China opposes U.S. move to pull ChinaTelecom license to operate in U. S.

[BLA + 1,666]

too bad

https://uk.mobile.reuters.com/video/watch/china-opposes-us-action-against-china-te-id711706964?chan=8gy4f0zc

FCC will vote this week 

Joe Biden sides with China.  Joe says Trump is xenophobic and China is a friend of the U.S. 

 

https://www.cnbc.com/2020/04/10/trump-administration-asks-fcc-to-ban-china-telecom-in-us.html 

 

 

Edited April 12, 2020 by BLA

[Marcin2 + 725]

43 minutes ago, BLA said:

Joe Biden sides with China.  Joe says Trump is xenophobic and China is a friend of the U.S.

I do not think that Biden is so stupid to ever say this (I mean not after 2010 or so).

But back to topic, I really think that such actions like with China Mobile are just short term chaotic moves, completely justified by election season and Trump doubling down on changing the narrative from COVID19 back to his China is a threat pet  topic.

But they are useless, just posturing. Important data are always secured by strong encryption.

I think there are 3 major blunders of US politics vs China:

1. Underestimation of Chinese capabilities and how fast they are improving.

2. Lack of Masterplan of nearly complete decoupling of United States from relations with China.

3. Going alone against China,without allies, mainly EU.

Point 2:

SInce May 2018 China is decoupling from the United States with full speed and full strength of the state.

Decoupling technologically, currently major Chinese weakness.

I think we have less than 10 years until China will be more or less ready and then RECIPROCATE and ban all US companies from manufacturing in China and ban access of US companies to ANY Chinese components or products. This will cripple US industry, also high--tech industry and cause supply shock in US.

And US appears to lack larger plan behind chaotic sanctions.

ZTE and later Huawei sanctions is something that NEVER could be undone in Chinese perception of the United States. Whatever US would do, China would not stop until becomes independent from US.

Edited April 11, 2020 by Marcin2
typo

[BLA + 1,666]

12 hours ago, Marcin2 said:

I do not think that Biden is so stupid to ever say this (I mean not after 2010 or so).

Biden said this in January of this year. Biden as VP made millions for his son, brothers, brother-in-law's and daughters husband

Everywhere he has gone ie Ukraine, China, Iraq etc, etc, he funnels deals to family.

He's not stupid he's crooked

LOCK HIM UP !

LOCK HIM UP !

LOCK HIM UP !

Trump Campaigns ad

Quote

 

1. Underestimation of Chinese capabilities and how fast they are improving.

Yes, but Trump is changing that. He is sounding the alarm. It's not easy

Quote

2. Lack of Masterplan of nearly complete decoupling of United States from relations with China.

Trump is working on it.  How can you have a masterplan to confront CCP when the Democratic Party and MSM take China's side.

Quote

3. Going alone against China,without allies, mainly EU.

EU has exploited U.S. Free Trade initiatives also.  Many of EU's economies are already beholden to China.  The CCP has advanced unencumbered.  CCP deep in Italy.  Germany's car sales in China were threatened if they did not go along with Chinese.

Quote

 

You are correct China will dump U.S.  and European companies like yesterday's newspaper once they get critical mass.

May be too late already. 

Edited April 12, 2020 by BLA

[surrept33 + 609]

Trump (and Bernie) torpedoed the TPP, which seems like it would have been the strongest way to gain leverage over China due to their exclusion and the inclusion of many of China's largest trading partners.

It would have also made it easier to substitute China as a trading partner both in imports and exports.

[Douglas Buckland + 6,308]

3 hours ago, Marcin2 said:

I do not think that Biden is so stupid to ever say this (I mean not after 2010 or so).

But back to topic, I really think that such actions like with China Mobile are just short term chaotic moves, completely justified by election season and Trump doubling down on changing the narrative from COVID19 back to his China is a threat pet  topic.

But they are useless, just posturing. Important data are always secured by strong encryption.

I think there are 3 major blunders of US politics vs China:

1. Underestimation of Chinese capabilities and how fast they are improving.

2. Lack of Masterplan of nearly complete decoupling of United States from relations with China.

3. Going alone against China,without allies, mainly EU.

Point 2:

SInce May 2018 China is decoupling from the United States with full speed and full strength of the state.

Decoupling technologically, currently major Chinese weakness.

I think we have less than 10 years until China will be more or less ready and then RECIPROCATE and ban all US companies from manufacturing in China and ban access of US companies to ANY Chinese components or products. This will cripple US industry, also high--tech industry and cause supply shock in US.

And US appears to lack larger plan behind chaotic sanctions.

ZTE and later Huawei sanctions is something that NEVER could be undone in Chinese perception of the United States. Whatever US would do, China would not stop until becomes independent from US.

Go for it!!!

[0R0 + 6,251]

20 hours ago, Marcin2 said:

I do not think that Biden is so stupid to ever say this (I mean not after 2010 or so).

But back to topic, I really think that such actions like with China Mobile are just short term chaotic moves, completely justified by election season and Trump doubling down on changing the narrative from COVID19 back to his China is a threat pet  topic.

But they are useless, just posturing. Important data are always secured by strong encryption.

I think there are 3 major blunders of US politics vs China:

1. Underestimation of Chinese capabilities and how fast they are improving.

2. Lack of Masterplan of nearly complete decoupling of United States from relations with China.

3. Going alone against China,without allies, mainly EU.

Point 2:

SInce May 2018 China is decoupling from the United States with full speed and full strength of the state.

Decoupling technologically, currently major Chinese weakness.

I think we have less than 10 years until China will be more or less ready and then RECIPROCATE and ban all US companies from manufacturing in China and ban access of US companies to ANY Chinese components or products. This will cripple US industry, also high--tech industry and cause supply shock in US.

And US appears to lack larger plan behind chaotic sanctions.

ZTE and later Huawei sanctions is something that NEVER could be undone in Chinese perception of the United States. Whatever US would do, China would not stop until becomes independent from US.

China has been bringing in ever worse people to export manufacturing as the entry level working demographic has shrunk and will continue shrinking to half its level in 2010. The country simply can not sustain its position in manufacturing going forward. US companies have been diversifying away from China for a long time. Tariffs and sanctions just accelerated the process. The process will accelerate and EU companies will be joining in force. 

There is a problem in diverting tech people in China to duplicate the supply chain going into high grade chips. These people are already occupied with high tech work for either foreign technology companies or domestic ones. They are paid 60% to 90% of their counterpart's incomes across the world. These are not the illiterate country bumpkins living in dorms at their factories.  You can't just throw gobs more of them at the problem for pennies on the Western dollar. It is not something China can actually afford to do without throwing the rest of its tech sector into disarray and creating another batch of megacities of empty offices and apartments that would result from bidding up these people to go into the new tech. 

 

The US is not a command and control economy. It does not do industrial planning by government.  The only tool to policy to direct US investment away from China is tariffs and quotas or bans. To an extent, regulatory relief will go a long way. 

I don't believe the EU countries are going to have an extended relationship with China. Particularly Germany, since German exports (50% of its economy) into China were dropping rapidly already before CV19, and as cars were the major portion, and China's car buying demographic is shrinking rapidly and will be half of what it was at its peak 3 years ago, there is no growth there. First cars are at saturation in China, it is a replacement market, like the West. Additionally, China has already been blocked by the German government from accessing robotics technology they were intending to steal the same way they did cellular backbone and transmission technology from Ericsson and Nokia. Germany is an export led economy, with China being over capitalized and its consumer demographic shrinking and already laden with debt, the two countries have a natural competitive position as export driven economies. There is no more future growth for their trade relationship. Similarly, Japan, Taiwan and Korea are in direct competition with China as overcapitalized economies with large export sectors and weak consumer demographics. ASEAN are similarly structured and can't rationally look to China as a trade partner, but only as a competitor. 

The only natural complement to China is also the natural complement of EU and ASEAN and to an extent, NAFTA, those are India and Africa S of  the Sahara. India is not going to be in the Chinese sphere. China has already made inroads into Africa in a big way, having purchased the ruling class. That does not mean that relationships are in any way friendly or commercial. And several countries are already aware that they have a purely vassal relationship with China and are looking to extricate themselves from it. Expect Chinese owned property to be nationalized in due course. 

 

I suggest you go and find the Chinese Ministry of Propaganda talking points on economics, trade and finance, and mark all sources that follow them as acting agents of the CCP, and thus liars, and make the conscious decision to drop them as sources of information. 

You will find that many key sources in European business journalism are actively recruited into the CCP cause. E.g. in the US is Bloomberg, which carries multiple page Chinese advertisements in its paper publications. Their China related stories must be filtered for Chinese Ministry of Propaganda content. 

[Marcin2 + 725]

Companies manufacture in China MAINLY because it is the best place to manufacture 90% of all industrial products.

There is no other place where you can have: unlimited pool of skilled industrial White and blue collar workers - over 110 million of them, unlimited supply of first class infrastructure if your industry needs it : want to produce electrolitic copper or aluminium or anything else and need another 50  GW of electricity or 50 million container capacity at port or 10,000 of high speed rail you can have it when you need it: the dictatorship will ensure you have it.

And the most important : everybody from any industry is just round the corner. You forgot about 1 million specific components: you do not need to try to secure contract at small US company and then  move it through Pacific: 4 months in total. If you can pay higher price you will get it in 2 weeks.

Look at masks output:

1 Feb 10 m/d

1 March 110 m/d

20 March 200 m/d

so were able to export 3.85 billion of them in March 2020.

No the major problem now is how to not be overreliant on China, nobody any longer can be competitive and not have factories in China.

About data: I know China can mismanage data, but most data you can easily corrborate with non Chinese sources. And  things like employment or infrastructure or output of major industrial products: you simply cannot lie about it.

Edited April 12, 2020 by Marcin2
Typo

[0R0 + 6,251]

On 4/12/2020 at 7:07 PM, Marcin2 said:

Companies manufacture in China MAINLY because it is the best place to manufacture 90% of all industrial products.

There is no other place where you can have: unlimited pool of skilled industrial White and blue collar workers - over 110 million of them, unlimited supply of first class infrastructure if your industry needs it : want to produce electrolitic copper or aluminium or anything else and need another 50  GW of electricity or 50 million container capacity at port or 10,000 of high speed rail you can have it when you need it: the dictatorship will ensure you have it.

And the most important : everybody from any industry is just round the corner. You forgot about 1 million specific components: you do not need to try to secure contract at small US company and then  move it through Pacific: 4 months in total. If you can pay higher price you will get it in 2 weeks.

Look at masks output:

1 Feb 10 m/d

1 March 110 m/d

20 March 200 m/d

so were able to export 3.85 billion of them in March 2020.

No the major problem now is how to not be overreliant on China, nobody any longer can be competitive and not have factories in China.

About data: I know China can mismanage data, but most data you can easily corrborate with non Chinese sources. And  things like employment or infrastructure or output of major industrial products: you simply cannot lie about it.

China has the economies of scale and proximity of industrial capacity for an ecosystem of fast cheap availability and turnarounds. It also has ample labor to staff  - all this NOW. It won't in the not too far future. For planners looking into the next decade, China is already over. 

Much of the scale is going to be lost as domestic consumption flattens and falls back and foreign demand for exports continues falling. Labor costs are already too high. domestic materials costs are high. Supply of migrant labor continues falling, and the outflow of capital continues.  Margins in China peaked on the eve of the financial crisis period. They had a reprieve in 2015 after the oil crash as it saved costs for industry and consumers. But it didn't change the fundamental fact that the China boomers were already heading for retirement, not new families. The cost savings were quickly met with labor cost rises as the Millennial peak crossed over the entry into work stage of life, fresh entry level labor supply turned over a second time. Private business in China was reporting 12% non-performing loans amid rising labor costs and export market competition as well as shrinking output prices vs. costs. Despite the crash of oil, and resumption of upstream production, that has not changed in the rise from shutdowns, output prices continue falling, while input costs remain elevated. Any respite from dirt cheap oil prices has been translated to output prices and then some, ending in further falls in margins. 

The economics are not in China's favor. Their future is not like its past. You keep trying to project the China of the past into its future. It is not correct. The trends in investment turn before the actual conditions do. Nothing is more obvious beforehand than demographics. The reversal of the China growth trend has been ongoing for a while. That is why China has had so many years of large scale stimulus programs. What they can do  now is not what they will be capable of later. The people are not retired - yet. But the boomers will all be retired by 2030. Then these vast rapid turnarounds will not be possible.  

https://www.markiteconomics.com/Public/Home/PressRelease/26d2e64100134c259a5553462889c8c1

The actual situation going forward is not about price competitiveness, it is about supply chain security. Operating outside of China is the primary need. The China excess capacity  will remain ever more excessive as the world ignores its existence and export orders don't come in. Where prices matter, Japan has already shown the way with a "not from China" subsidy to companies uprooting production out of China.

Peter Zeihan projects an enormous US reshoring of industry with vast political support to extricate the US from reliance on China exports. The China price will not be relevant. This CV19 was a Pearl Harbor moment. The US China relationship is over entirely. Watch what Foxcon do with their US plants that they were unable to staff before. That will tell more about the reality of reshoring than anything else. 

"China Free" is the new marketing pitch.  

Edited April 14, 2020 by 0R0

[surrept33 + 609]

On 4/12/2020 at 4:49 PM, 0R0 said:

There is no more future growth for their trade relationship. Similarly, Japan, Taiwan and Korea are in direct competition with China as overcapitalized economies with large export sectors and weak consumer demographics. ASEAN are similarly structured and can't rationally look to China as a trade partner, but only as a competitor. 

The only natural complement to China is also the natural complement of EU and ASEAN and to an extent, NAFTA, those are India and Africa S of  the Sahara. India is not going to be in the Chinese sphere.

I agree with most of the rest of your post, however, China + ASEAN + South Korea + Japan + Aus/NZ were on the verge of signing the RCEP trade accord right before the coronavirus epidemic hit. Those economies for the most part are already integrally tied arguably more so than "Chinamerica" is. India nearly joined the pact as well, and may still yet in the future depending on domestic politics.

There might be anti-China blowback in the Asia/Pacific after this that may delay the signing of RCEP, but China had a number of concessions re: trade liberalization that other trade partners will likely want to see still enacted.

 

RCEP (India withdrew late last year for now)

[Douglas Buckland + 6,308]

...and don’t forget, China has lots and lots of viruses, and the probability of more!

A great place to anchor your supply chain, as we recently found out.

Where’s the closest market where I can get a fresh anteater/bat burrito? I need a break from reverse engineering stuff.