EU(Merkel/Germany) ready to sign Trade Agreement with China

[Roch + 537]

At the same time Angela has demands for Joe Biden. (1) Joe declare the environment a National Emergency (2) Cooperate on "free trade" (3) Fight terrorism.  

Easy for Merkel to demand while she:

a.  Refuses to pay fair share of NATO costs . Signed Coalition of Willing to defeat ISIS, yet balked when asked to contribute.  

b. Wants U.S. to allow Germany automakers to export car parts and vehicles to U.S. , while maintaining protectionist stance in Germany. There really isn't such a thing as Free Trade.

c. Wants U.S. to pay $ Trillions and sacrifice lives in mideast to protect the flow of oil to the EU and their new trading partner China. She wants the U.S. to help stem the flow of immigrants from the Mideast . 

d. Wants the U.S. to spend Trillions on Green Technology development of which she can exploit.  Example "green hydrogen".  Seems great, however Trillions needs to be spent to (1) economically produce green hydrogen (as opposed to hydrogen produced from methane/natural gas) (2) scale hydrogen storage and pipeline distribution.  

Merkel Germany was in a serious recession in 2019.  Germany number one market for their auto industry is China. They depend on the Chinese Communist Party permission to continue their sales.  Germany scared to death of being banned from manufacturing Electric Vehicles. 

Looks like China has lured EU into their web.  The question is how long does their "friendly" investment partnership last.  

1.  Long enough to allow China to invest in Europe's infrastructure (ex. Ports) and businesses.

2.  Long enough to install Huawei 5G in Europe.  If don't think Huawei will be part of this deal you are wrong.

EU is making a deal with the devil. We all know how this Faustian deals always end up. 

Post signing per agreement EU will no longer be able to stop any Chinese investment in or acquisition of European companies or infrastructure.  Huawei is not mentioned in agreement but Huawei 5G will become part of the deal and implemented across China.  Individual EU countries will not have control over their Chinese investments.  All this so Germany can manufacture or sell Electric Vehicles in China. 

Biden is a push over and will certainly give Merkel everything she wants.  New Environment Secretary Kerry has probably already planned meeting with Angela.

Speaking of Kerry, do you think during Kerry's Senate Confirmation Hearing he will be asked about his stepson Chris's partnership with Hunter Biden in Rosemont Seneca Capital ? How about the $130 million Federally guaranteed loan the received in 2009 to buy assets acquired by the Fed during the 2008 Financial Crisis.  That loan where they funneled the millions in profits thru an offshore account in the Cayman Islands to evade taxes ?

Today's political environment is not LEFT vs RIGHT , but rather INSIDER vs OUTSIDER.  

https://www.breitbart.com/europe/2020/12/29/european-union-prepares-investment-pact-with-communist-china/ 

One difference between U.S. and Chinese trade policy is :

China makes other countries pay to access their consumers and businesses.

U.S. pretends Free Trade is a real workable policy.  U.S. proposes the World Trade Organization (WTO), abides by its rules and gets abused by Asia and Europe.

Biden Administration will give Merkel anything she demands. 

 

Edited January 5, 2021 by Roch

[Eyes Wide Open + 3,555]

21 minutes ago, Roch said:

At the same time Angela has demands for Joe Biden. (1) Joe declare the environment a National Emergency (2) Cooperate on "free trade" (3) Fight terrorism.  

Easy for Merkel to demand while she:

a.  Refuses to pay fair share of NATO costs . Signed Coalition of Willing to defeat ISIS, yet balked when asked to contribute.  

b. Wants U.S. to allow Germany automakers to export car parts and vehicles to U.S. , while maintaining protectionist stance in Germany.

c. Wants U.S. to pay

 

Merkel Germany was in a serious recession

 

Well 2010 was a new direction for Germany...

https://ourworld.unu.edu/en/germanys-great-green-transformation

https://www.nationalgeographic.com/magazine/2015/11/germany-renewable-energy-revolution/

2019 not so much, 

https://www.politico.eu/article/germany-climate-change-green-energy-shift-is-more-fizzle-than-sizzle/

https://www.newgeography.com/content/006381-germany-went-totally-green-too-quickly

It would seem Merkel's direction for German citizens is a bit skewed....and to think the world is awash in LNG....

Edited December 29, 2020 by Eyes Wide Open

[Tomasz + 1,608]

The problem of the USA is that both Europe and Russia do not see a strategic threat in China and the possible effects of economic cooperation with China are very satisfactory.

Never in history has China been an expanding country beyond mainland China.

The USA must therefore convince its allies that China is a great threat, which seems to me to be a very difficult task.

The difference in attitudes in NATO  towards Russia and China is precisely the cause of what Emanuel Macron called NATO's brain death.

In my opinion, everything leads to the fact that in the perspective of 2-3 decades, China will be the new world hegemon in place of the USA, and I personally do not mind it and, as a European, I fully support European-Chinese trade cooperation.

Because from what I can see, no one outside the US is going to fight with the new Chinese power and everyone wants to earn from this cooperation.

Only USA has a strategic dilemma because  China is slowly but systematically depriving USA of the role of a global hegemon.

But I personally have nothing against it and I see no reason to build a broad anti-Chinese coalition.

Edited December 29, 2020 by Tomasz

[Roch + 537]

On 12/29/2020 at 4:20 PM, Tomasz said:

The problem of the USA is that both Europe and Russia do not see a strategic threat in China and the possible effects of economic cooperation with China are very satisfactory.

Never in history has China been an expanding country beyond mainland China

The USA must therefore convince its allies that China is a great threat, which seems to me to be a very difficult task.

The difference in attitudes in NATO  towards Russia and China is precisely the cause of what Emanuel Macron called NATO's brain death.

In my opinion, everything leads to the fact that in the perspective of 2-3 decades, China will be the new world hegemon in place of the USA, and I personally do not mind it and, as a European, I fully support European-Chinese trade cooperation.

I beg to differ

Russia and EU realize China Hegemony is a threat BUT THEY HAVE NO GOOD CHOICE

Russia and EU need access to Chinese markets to survive.  Just as the OPEC oil states need China to survive. It's a "Hobson's Choice".

Russia sells large amounts of Oil , Coal , Natural Gas and Wheat to China. Basically Russia's only exports with the addition of Uranium and vodka. 

EU (aka Germany) sells cars and machinery to China.  China is the #1 market for German auto sales. Germany needs China. Whereas China does not need Germany.  Germany has no Oil, Natural Gas, Soybeans, Corn or Wheat.  

In reality China will use them until it's no longer necessary or beneficial.  What choice does Germany have.  Germany will be fumped in 5 to 10 years.

I disagree with your statement " In  my opinion, everything leads to the fact that in the perspective of 2-3 decades, China will be the new world hegemon in place of the USA,"

Chinese hegemony will happen in 5 to 10 years.

Edited January 5, 2021 by Roch

[Gerry Maddoux + 3,627]

^

"The United States is the most powerful country in history and will remain so until long after your grandchildren are gone."

----The Absent Superpower by Peter Zeihan, copyright 2016. 

What are you guys smoking? The whole world realizes that this virus came from Wuhan and that President Xi had a good month in which to warn the world. Xi used this virus to level the playing field. Countries felt emboldened with Mr. Trump throwing jabs at China, but suddenly they feel powerless again. China is overcrowded and food insecure, for starters. It is in love with electric cars but charges them using electricity from coal-fired power plants. China is a genius at stealing intellectual property yet they couldn't build out 5G without Taiwan Semiconductor, who is expanding into the United States, not China. The world is going to run on fossil fuels for the next several years and they're not going to be enough of it (coal will be outlawed; countries that belong to the Paris Accord will be boycotted if they use coal). Just because China looks to be ascending right now doesn't mean that will continue. China will never be the global hegemon. 

[Roch + 537]

On 12/29/2020 at 5:16 PM, Gerry Maddoux said:

^

"The United States is the most powerful country in history and will remain so until long after your grandchildren are gone."

----The Absent Superpower by Peter Zeihan, copyright 2016. 

What are you guys smoking? The whole world realizes that this virus came from Wuhan and that President Xi had a good month in which to warn the world. Xi used this virus to level the playing field. Countries felt emboldened with Mr. Trump throwing jabs at China, but suddenly they feel powerless again. China is overcrowded and food insecure, for starters. It is in love with electric cars but charges them using electricity from coal-fired power plants. China is a genius at stealing intellectual property yet they couldn't build out 5G without Taiwan Semiconductor, who is expanding into the United States, not China. The world is going to run on fossil fuels for the next several years and they're not going to be enough of it (coal will be outlawed; countries that belong to the Paris Accord will be boycotted if they use coal). Just because China looks to be ascending right now doesn't mean that will continue. China will never be the global hegemon. 

GM, you and ORO are the smartest posters at this site. (At least in my opinion for what it's worth). However, you both believe China will never supplant the U.S. as the Economic Super Power.  

I respectfully disagree.  

1. China spread the Wuhan virus around the world.  Have they been held accountable ?  Many countries are afraid to even question them. 

2. China charges it's electric cars with Coal Power Plants.  So what.  It's cheaper then natural gas. Doesn't need a pipeline. Is anyone holding them accountable for the pollution ? Nope. They're a "developing country" and have till 2035. China continues to build Coal plants. 

3. China is food insecure.  So what.  If U.S. charges to much for soybeans and wheat they will buy wheat from Russia and soybeans from Argentina or Brazil.  In Brazil they are in the process of burning half the Amazon down to produce more agriculture for China.

4. China is a genius at stealing intellectual property. Yes they are. They will continue to be.  Cheaper than developing yourself. I imagine the EU investment pact will include Europe buying Huawei 5G. Just watch and see. 

China can and does manufacture most everything they need.  Their Debt/GDP has not hurt them yet. The have large cash reserves. They're building a formidable military.  My guess is they will now crack down on Taiwan while Biden is in office.  They know Biden is a pushover and won't interfere.

They don't have large oil and gas reserves or enough other natural resources but have producing countries lined up to sell to them. Probably have unlimited inexpensive electricity with Fusion Nuclear in 15 years. By 2050 at the latest.

They don't have enough food production.

But they can buy that from those countries fighting each other to sell to them soybeans wheat and pork.  

Thomasz thought 2 to 3 decades before China hegemony.  With Biden Presidency, U.S. politicians that are easily bought or sleep with Chinese spies and U.S. Banks and Companies whores that Invest at will with the CCP , I give it 10 years at most till  China's hegemony.

Biden won't drop tariffs right away. He won't suck up to China immediately.  Because everyone will be watching.  But he eventually will. Give him a year. 

It's hard to imagine, but so was $40 bbl oil ten years ago. 

Edited January 5, 2021 by Roch

[RichieRich216 + 454]

What did you expect from a Nazi! Trace her family roots.

[Gerry Maddoux + 3,627]

1 hour ago, Roch said:

2. China charges it's electric cars with Coal Power Plants.  So what.  It's cheaper then natural gas. Doesn't need a pipeline. Is anyone holding them accountable for pollution ? Nope. There a developing country and have till 2035.

But right here resides such an incredible dichotomy that it simply boggles the mind. Here is a country sophisticated enough to believe in an electric car, ostensibly for purposes of reducing the amount of greenhouse gas in the troposphere, and yet they're using electricity manufactured at a utility plant powered by burning the lowest grade coal with a pollution index that's off the charts!

The world watches that sort of thing. It is incongruous with hegemony. 

In order to grab global hegemony (which, granted they aspire to), a country has to have three things: 1) a reserve currency, 2) a military mighty enough to challenge a group of nations, 3) compassion. China has none of these, and I don't see them getting them. They are certainly capable of establishing a digital yuan and if they affix that to gold at the value of the Bretton Woods standard, they would provide a tempting morsel to dangle before the world. They are capable of building out a capable military, but it has an awful long way to go. And communism and compassion don't belong together in the same sentence. 

Do I see them as a threat? Of course, one would have to be blind not to. Do I see them attaining global hegemony? No. They are food and energy insecure and treacherously overcrowded--the triad that breeds epidemics (which they won't always get by with). They are geopolitically located in an impossible spot. They don't create loyalty from neighboring countries. They are a dragon in name only.

The United States has become splintered this last year; China won this round. During 2021 I believe Mr. Biden will embarrass himself and the country, but the flag will be standing. There is a limit beyond which this country (U.S.) will no longer abide a corrupt Congress. At some point we'll actually have a president who can help us heal. The most important thing that is going on in America right now is chaos so awful that it makes us turn over the rocks and see what lurks beneath. The Communist Party of China will never do that; they will always try to pretend that a stinking little virus came straight from the horseshoe bat to humanity with no intermediate tinkering by the Wuhan Institute of Virology. Deception recapitulates weakness just as phylogeny recapitulates ontogeny. 

[Roch + 537]

On 12/29/2020 at 8:46 PM, Gerry Maddoux said:

But right here resides such an incredible dichotomy that it simply boggles the mind. Here is a country sophisticated enough to believe in an electric car, ostensibly for purposes of reducing the amount of greenhouse gas in the troposphere, and yet they're using electricity manufactured at a utility plant powered by burning the lowest grade coal with a pollution index that's off the charts!

The world watches that sort of thing. It is incongruous with hegemony. 

In order to grab global hegemony (which, granted they aspire to), a country has to have three things: 1) a reserve currency, 2) a military mighty enough to challenge a group of nations, 3) compassion. China has none of these, and I don't see them getting them. They are certainly capable of establishing a digital yuan and if they affix that to gold at the value of the Bretton Woods standard, they would provide a tempting morsel to dangle before the world. They are capable of building out a capable military, but it has an awful long way to go. And communism and compassion don't belong together in the same sentence. 

Do I see them as a threat? Of course, one would have to be blind not to. Do I see them attaining global hegemony? No. They are food and energy insecure and treacherously overcrowded--the triad that breeds epidemics (which they won't always get by with). They are geopolitically located in an impossible spot. They don't create loyalty from neighboring countries. They are a dragon in name only.

The United States has become splintered this last year; China won this round. During 2021 I believe Mr. Biden will embarrass himself and the country, but the flag will be standing. There is a limit beyond which this country (U.S.) will no longer abide a corrupt Congress. At some point we'll actually have a president who can help us heal. The most important thing that is going on in America right now is chaos so awful that it makes us turn over the rocks and see what lurks beneath. The Communist Party of China will never do that; they will always try to pretend that a stinking little virus came straight from the horseshoe bat to humanity with no intermediate tinkering by the Wuhan Institute of Virology. Deception recapitulates weakness just as phylogeny recapitulates ontogeny. 

I know China promoting electric cars charged by Coal Power Plants makes no sense.  But it shows what they really want.  Industrial supremacy.

I agree with the rest of your post.  I don't know that Joe will embarrass himself.  Not if Doctor Jill does not let him leave the Whitehouse alone. 

Hopefully, someone will come along that can unite the U.S.  The distance between political parties seems to great to overcome.  Hope I'm wrong.

Ann Coulter recently said, " The U.S. wants Trump's policies, they just don't want Trump".

Edited January 1, 2021 by Roch

[Tomasz + 1,608]

Quote

 

Both outgoing US President Donald Trump and incoming leader Joe Biden fail to understand that China is an economic superpower that is deeply integrated into the global economy, even amongst American allies.

On Monday night Biden made a premier speech setting out his foreign and national security policies. Although Western coverage of the address was overshadowed by controversies pertaining to Donald Trump refusing to cooperate on the transition, it was no surprise that he placed primary focus on China. 

The former vice president pledged that “As we compete with China and hold China’s government accountable for its abuses on trade, technology, human rights and other fronts, our position will be much stronger when we build coalitions of like-minded partners and allies,” thus pledging to continue Trump’s hardline policy against Beijing with less of an ‘America first twist’.

Except, such a thing is easier said than done, and obscures the reality: the Trump administration’s unilateralist policy did not detract from it seeking to enlist US allies against China, and to speak of it Biden is already starting on the back foot.

As 2020 draws to a close, Beijing has wrapped up the year with two highly significant agreements. Firstly, the Regional Comprehensive Economic Partnership (RCEP), a mammoth trade agreement spanning the Asia Pacific. Secondly, as reported this morning, it has successfully finalized a comprehensive investment treaty with the European Union – despite the new US administration’s open eagerness to build a “transatlantic alliance” against Beijing.

These two agreements are both massive blows to Washington’s effort to contain and isolate China. They reveal a failure by both Trump and Biden to understand that China is an economic superpower that is deeply integrated into the global economy, even amongst allies, and subsequently has more than enough leverage to hold its own against America – not least on physical trade whereby it dominates global exports and supply chains. 

The liberal mainstream media truly assumed that the only reason allied countries and, in particular, the European Union, did not sign up to comprehensive anti-China objectives was simply because of Trump’s off-putting and risk prone behavior, rather than accounting for legitimate interests these countries have. 

The mainstream media seem to advocate a belief that because Biden ticks the right ideological boxes, it will be easier for him to enlist allies against Beijing than it was for Trump. Commentariat circles have long advocated the view that Trump’s widespread unpopularity and ‘America First’ policy, despite his heavy handed approach on China, was more detrimental to Washington’s interests because the administration alienated allies. In line with this, it is assumed that this is the reason the EU did not go all in against Beijing, and that subsequently under a Biden administration which would be a more zealous proponent of transatlanticism, it will naturally follow its “true interests” in doing just that. Therefore, liberal outlets such as the BBC framed Biden’s victory as being “bad for China.” Why? Because apparently, he will succeed in getting other countries to follow.

But the narrative that countries sought out deeper economic ties with China simply “because of Trump’s repulsiveness” and unpredictability is ridiculous and makes the ideological assumption that a liberal American president who is “not awful” can always succeed in getting the world to do what he wants by kinder engagement. Do countries really pivot their long-term foreign policy strategies purely depending on the personality in the White House? Of course certain policies matter, yet on a broader assumption this misreads pretty much everything about how international relations work. The Obama administration for one had no such luck when it came to China. When Beijing established the Asian Infrastructure Investment Bank (AIIB) in 2015, Obama told allies not to join it, they did anyway.

Given this, the idea that certain countries will be “more inclined” to follow the US under Biden and otherwise don’t have their own real respective interests when it comes to China is misleading and simplistic. Like every other president, Biden will find he has to negotiate, compromise and might not always get everything he wants. Countries might see value for engagement with the US on some matters related to China, but not others. This makes building a “coalition against China” easier said than done because as a whole, Beijing remains a core of the global economy and an extremely important partner, of which confronting brings considerable downsides, and shared values do not automatically mean a certain country shares the same geopolitical perspective or is eye to eye.

In this case, even if the rhetoric is less heated and less offensive, talk of building blocs against China seeps into the same very binary Cold War rhetoric which Pompeo is preaching now, which hasn’t really got many takers. The EU’s approach to China, for one, is focused on delivering and securing European interests primarily. Through engaging with China, it now has better economic terms than what the US has. Whilst there is some overlap with the Biden administration’s view capacities, why would the EU completely devote itself to a US crusade which doesn’t serve its own interests? Why would you cut off your nose to spite your face?

Too many people are making the assumption that because Biden is a liberal, the conception of “American interests” doesn't matter anymore as his approach is “universal.” In reality, the incoming presidency doesn’t have all the cards because it is entering an environment where Beijing is already a major player and has doubled down on huge agreements which have effectively served to isolate the US. 

Beijing’s tacit ability to make compromises and concessions to consolidate its global economic position have outflanked Washington, and other countries aren’t going to flip to the American position any more than they did during Trump’s presidency. At best, Biden is playing catch up. Be it under Trump, Biden or whoever, US foreign policy is always overtly idealistic than realistic, and therefore the China challenge poses no straightforward answers or solutions.

 

Tom Fowdy is a British writer and analyst of politics and international relations with a primary focus on East Asia.

[Gerry Maddoux + 3,627]

^^^^^

The above merely restates Thucydides Trap. 

1) The tariffs were a horrible mistake; every economist told Mr. Trump that except for the one he chose to listen to: Peter Navarro. 

2) China has an extensive ghost financial enterprise, which at some point has to rise or fall on its own.

3) The world is very, very angry with China. Australia is so angry, and vocal, that China has boycotted Aussie wine and LNG. 

4) What exactly is it that China is going to do? They couldn't build an iPhone. They can't build a proper semiconductor. They can't build a terrific navy. They can't feed themselves. They have too many people living in too small a place. Their only intrinsic energy source is poor-grade coal. They have well over a million Eyghurs and others performing slave labor (for Apple?)--how long before the world turns against them because of human rights violations . . . or are you men so dismissive of the world's conscience as to believe this no longer matters?

I don't personally believe that China poses a Thucydides Trap, even though Graham Allison has been predicting it for most of his adult life. I believe that China needs the world and the world needs China. I would imagine that Xi will try to seal the deal on Hong Kong and Taiwan during this decade. I have no idea what the rest of the world will say. I'm not sure they can say much about HK, but Taiwan is a different sort of thing. Whatever, it's going to be interesting. If Trump had stayed in power, he would have tried isolationism to the extreme. As it stands now, I suspect Biden will try what worked ten years ago . . . with disastrous results. But Mr. Biden fails to understand that half the United States is furious, not at just the "results" of the election, but at a corrupt U.S. Congress that puts special interests and pork even inside a bill designed ostensibly to help the American people hardest hit by the Covid. And yes, most of the world thinks of this as the "China Virus," even though they don't say it in public. 

China is likely going to be isolated by their callous act of failure of notification posthaste that a virulent organism had escaped, and that it was capable of rapid person-to-person spread. Perhaps not for a while, but Xi thinks he got off scot-free, and he will push on the string. Eventually, however, the truth always outs, and when that happens, I predict that China--and Xi--will be ostracized by the world. Even with a hapless Joe Biden at the helm. 

[Roch + 537]

On 12/29/2020 at 10:26 PM, Tomasz said:

Tom Fowdy is a British writer and analyst of politics and international relations with a primary focus on East Asia.

You speak of a coalition with allies to confront China.  It's a bunch of crap.  EU , Asia, South America ,Africa are afraid to say a peep about China.

Look what China is doing to Australia. They dared to speak up and China is making an example of them .  China is going all out to destroy their economy.  

A coalition to confront China economically is a pipe dream. It's a diversion.  

Biden wants a coalition ?  CHINA OWNS THE BIDEN FAMILY.  What a joke.  

There was only one leader in the Free World with the balls to confront China. That person was Donald J. Trump.

During EU's final discussions on their Investment Pact with China they brought up concerns of China's (1) Crack down on Hong Kong, (2) internment of the Uighers and (3) use of slave labor for farming.  Merkel said China gave her assurances they would address these concerns.

LOL

Merkel the modern day Neville Chamberlain.  

Appeasement will come back to bite the EU.

Merkel thinks she can use the China deal as leverage against a weak President Biden and use Democrat hate for Trump to get what she wants from U.S.

Unfortunately she is right to think so.  

Biden can do a lot of damage to the U.S. working middleclass in four years.  

Edited January 1, 2021 by Roch

[0R0 + 6,251]

15 hours ago, Roch said:

2. China charges it's electric cars with Coal Power Plants.  So what.  It's cheaper then natural gas. Doesn't need a pipeline. Is anyone holding them accountable for the pollution ? Nope. They're a "developing country" and have till 2035.

Chinese coal is the most expensive coal to produce in cost per Btu. They can't produce enough now, but in competition with Aussie coal, which they no longer allow to import, it caused credit defaults among China coal companies, even SOEs.

Having forced their electric generators to use this nasty low energy coal, their plants designed for clean Aussie coal are overrun with excess ash and fouled boilers and rampant corrosion from high sulfur coal the plant was not designed to handle.

it is part of "great leap forward" version N+1. They are leaping into the economic abyss..

China's peak first time car buyer demographic was 5 years ago, and actual sales peaked 2017. It will shrink by 60% in 20 years. Already cooked into their demographics.

16 hours ago, Roch said:

China can and does manufacture most everything they need.  Their Debt/GDP has not hurt them yet. The have large cash reserves. They're building a formidable military.  My guess is they will now crack down on Taiwan while Biden is in office.  They know he won't interfere. 

Their Debt to GDP is understated, there is another 200% of GDP of shadow banking debt, that is >23% non performing, while 200% of GDP in SOE debt held by banks produces an 8% roll, meaning that it produces a loss of 15% of GDP that needs to be papered over by fresh debt or PBOC backstops to take it off the bank's books.

China does manufacture much of what they need, but at a higher cost than global competitors at any given quality level. Their labor advantage is now gone for most of the decade already. They have already resorted to ever increasing distortions in their GDP reports. Their economy is now overstated by 15% or more in GDP terms. The only reason that manufacturing is done in China is because it is subsidized for global strategic reasons and an increasing portion of the labor is slave labor that no other employer can bid away.

China has no experience in any aspect of actual warfare. If they couldn't make advances on the Indian border, it speaks badly as to their ability to do anything in a real confrontation with a navy or army with an actual history of battle. Such as all of the NATO armies. The Chinese are floating lots of short range boats that are designed for single use combat, they are built like bees. Their crew safety and survivability are secondary considerations, so while they are a threat, they are also very likely to be wiped out by an attack, making them ultimately a very attractive target for a surprise attack to take out the entire Chinese navy in one fell swoop.

China does not have cash reserves but for $1Trillion at the Fed, the rest of the "reserves" are not cash or liquid bonds but debts of the Belt and Road initiative's 3rd world countries. China's finances are a mirage of smoke and mirrors. Their young people are more indebted than even credit card happy Koreans, The actual Debt to GDP estimates are at 500%.

The current retail sector borrowing has reached a higher than 50% rejection rate this new years season due to compressed margins - normal levels are at or below 20% - China Beige Book reports y/y retail sales are still down 10%. Their domestic demand looks to be collapsing ahead of the demographic schedule that had it collapsing after a few year's plateau.

16 hours ago, Roch said:

3. China is food insecure.  So what.  If U.S. charges to much for soybeans and wheat they will buy wheat from Russia and soybeans from Argentina or Brazil.  In Brazil they are in the process of burning half the Amazon down to produce more agriculture. 

The Chinese blunders of (1) building up infrastructure and cities on top of their best arable soils (40%) down the river deltas have brought "black soils" into the lexicon of the politburo. (2) bad animal feed production leading to spread of bird and swine viruses that have wiped out the flocks and herds by 1/3 to 1/2 for 2 and 3 years running, taking the grain the animals ate with them. (3) agricultural productivity peaked in 2014, and output in 2016 despite the use of 8X the labor and 5X the chemical inputs relative to Western agriculture.

The Chinese production losses this year's flood season can not be filled in by any of the food exporting countries, not even all of them put together, and they can not pay for the food anyway, as their export revenues are not repatriated.

 

The EU is making a terrible mistake in continuing to tie their economy to China's sinking ship. Two net exporting blocks can not make a viable trading system. The entirety of the EU investment will be used by China to bail out their bumbling SOEs. In 3 years the investment will have disappeared into CCP insider's pockets while JV's go belly up.

[Roch + 537]

I agree with most of your Chinese stats . .  but I differ on the outcome.

A totalitarian CCP Government will continue to move them forward.  

As for "The EU is making a terrible mistake in continuing to tie their economy to China's sinking ship. Two net exporting blocks can not make a viable trading system. The entirety of the EU investment will be used by China to bail out their bumbling SOEs. In 3 years the investment will have disappeared into CCP insider's pockets while JV's go belly up."

 

Yes I agree.  But watch.  Merkel is using this to placate the Chinese in order to sell more cars, but more important use as leverage against Biden/Kerry to take advantage of U.S. largesse under the guise of Hate Trump/Love Your Ally Cooperation. Biden Administration will fall for this ploy.   (Kerry will be Environmental Secretary but is also a "shadow" Secretary of State.) The Environment is where the Big money will be made over next 4 years courtesy of the $Trillion to be spent by Biden administration. 

Germany is one more U.S. "Fair Weather" friend.

In my opinion the only true U.S. allies at this point are England, Poland, Israel, Australia.  Most others have strayed for now.  

Edited January 5, 2021 by Roch

[0R0 + 6,251]

The US defense intelligence community is already calling the Biden team a national security menace, not just a risk, they may not make it to Jan 6 as free men and women. They already cut off Biden's team from intel and defense briefings. Trump may still insist on going through the courts and legal system to overturn the election fraud. But the military may not care to wait and will act to stop Biden from inauguration.

The EU action is motivated by blackmail and bribery, as well as Chinese threats to cut Germany out of its markets if investment does not flow in such amounts that China is being paid on net for its imports. Corporate and labor interests are backing this because they are not threatened by the reality of it being a national and EU detriment as it does bail them out at everyone else's cost.

If the US military with or without Trump's support, remove Biden from the possibility of taking office, then the entire background of EU-China trade will have changed relative to expectations based on the current "picture". I would expect Germany to hold off till the US situation is really resolved.

[Gerry Maddoux + 3,627]

1 hour ago, Roch said:

I agree with most of your Chinese stats . .  but I differ on the outcome.

Roch, how can you agree with the numbers but doubt the outcome. 

Said simply, the Chinese financial infrastructure is built on sand--before they engineered a pandemic it was sinking fast. They are destroying their people by producing high-sulfur ash. Were it not for genetically-engineered food, the world would be in famine right now--especially the Chinese. They have some boats but they're flimsy and barely seaworthy; they do not have the sea in their bloodstream. 

And in your list of American allies, you left out perhaps the most influential one of all: INDIA. And as far as I know, Japan still gives us favored nation trading status. 

Lots of people have turned against China: they just haven't told you and me. Australia has been the most vocal. The Belt and Road countries are left holding the bag--they're not going to like that. The biggest threat the U.S. faces is that more and more Russia is climbing into bed with the Chinese Communist Party. The UK has been actively trying to figure out how to disengage from Huwai and their 5G. 

I don't want to keep arguing the point but a lot of Chinese posturing is a hall of mirrors. They are in tiptop shape as long as they have intellectual property to swipe and passive countries are eager to trade with them. Remember, the Spratley Islands were built quickly and they could be destroyed just as quickly. Taiwan desperately wants the protection of the United States. 

Oh well, you have a good mind; use it. 

[Marcin2 + 726]

The problem of China is not that they WANT hegemony, but that they HAVE TO be hegemon.

China has NO choice in this regard.

The only culprit of this situation is their huge population.

Please forget for a moment that China is a country of 1,410 million people.

What you see ? Just another East Asian country trailing the footsteps of Japan, South Korea or Taiwan.

Fast developing economy, currently at upper-middle income level of about 10-11,000 USD/per capita GDP.

And this economy , like Japanese or South Korean would develop fast until it will reach 60-80% of US GDP / per capita

in 25-30 years.

And now we multiply this situation by 1,410 million people, that is 4.2 times US population.

Innocent 60-80% of US per capita level, becomes suddenly HUGE GDP 2.52-3.36 times the United States.

Nobody questions the fact that the country with GDP 2.5 times or 3 times US GDP has to be world hegemon.

So as I said no matter what are Chinese plans or intentions they have no choice but become global hegemon.

 

[Marcin2 + 726]

Losing or achieving global hegemony is a very long process, even longer than human lifespan.

Last time when hegemony has switched from British Empire to United States of America the process actually started in 1870s.

In 1870s US GDP became higher than UK GDP. At about WW1 US GDP became higher than whole British Empire GDP.

But only after WW2 USA became crowned new global hegemon. (it could be much earlier without US isolationism).

The same is with China and US.

Chinese GDP in PPP terms is larger than US since about 2014.

In nominal terms there are various estimation , it would be about 2027-2032.

Chinese military would be on par with US military no earlier than 2040.

Juan would become reserve currency on par with dollar and euro also not earlier than 2030-2035.

So China would become fully fledged hegemon in 2040s-2050s, but the process is already underway since 1990 - the year of apex of American Empire.

[RichieRich$ + 65]

China’s communist party rule will self implode long before any of this takes place. They are currently at almost 300% of their GDP where as the United States of America is at 98% of our GDP. Once the billions of Chinese people that have no idea of what they’ve missed out on and could have been a part of in regards to better living, electronics, world travel, better housing, free market they will rise up and take the communist party down.

if anyone believes the communist party is not afraid of that happening just look what they’ve done to Hong Kong and broke that treaty because Hong Kong was pushing the limits past what the communist party was willing to except and they were afraid it would spread in the mainland China.

[Roch + 537]

On 12/30/2020 at 1:24 PM, Gerry Maddoux said:

Roch, how can you agree with the numbers but doubt the outcome. 

Said simply, the Chinese financial infrastructure is built on sand--before they engineered a pandemic it was sinking fast. They are destroying their people by producing high-sulfur ash. Were it not for genetically-engineered food, the world would be in famine right now--especially the Chinese. They have some boats but they're flimsy and barely seaworthy; they do not have the sea in their bloodstream. 

And in your list of American allies, you left out perhaps the most influential one of all: INDIA. And as far as I know, Japan still gives us favored nation trading status. 

Lots of people have turned against China: they just haven't told you and me. Australia has been the most vocal. The Belt and Road countries are left holding the bag--they're not going to like that. The biggest threat the U.S. faces is that more and more Russia is climbing into bed with the Chinese Communist Party. The UK has been actively trying to figure out how to disengage from Huwai and their 5G. 

I don't want to keep arguing the point but a lot of Chinese posturing is a hall of mirrors. They are in tiptop shape as long as they have intellectual property to swipe and passive countries are eager to trade with them. Remember, the Spratley Islands were built quickly and they could be destroyed just as quickly. Taiwan desperately wants the protection of the United States. 

Oh well, you have a good mind; use it. 

Yes, add India and Japan.  Maybe even South Korea.  

I disagree with the outcome because China is a totalitarian  government with about 90 million CCP Members, maybe another 200k to 250k middle class and another Billion+ lower class or peasants.  They have an iron grip on the people.  If you live in China and resist you disappear.  Do you think they care about pollution effect on their people over dominating every industry by 2030.  No. 

The change is not going to come from within China.  Last January on an unusually warm  Sunday I was out for a walk.  Chinese girl came up to me as I was enjoying a cigar sitting on a bench and started talking to me.  She was a Chinese exchange student and just came back from her visit home.  The long and short of it she was given a choice of two colleges she could attend in the U.S. both of them engineering/science based. She was on the 5th year of a five year plan , all three semesters (Fall, Spring and Summer).  She only gets to go home once a year. That's only because she has to renew her student visa.  She hadn't seen her father in five years because he is away working first in Angola and now in Laos.  She says she is an accomplished pianist , and talked about visiting Europe. She has no brothers or sisters because she was born during the "one child" days.   Asked what her father does in Laos and if he is a member of the People's Liberation Army or the Communist Party.  She answered he's a technician.  I asked again if he was a member of the Communist Party . She again answered he is a technician.  

Beyond that evasive answer she seemed very open and honest.  I asked where in China she was from . She named a City or Provence but I could not understand her. She added "in the south where we have the spicy food". At one point she coughed on me.  I actually got Covid 4 weeks later to the day.  But I think I picked it up at my gym.  

While the conversation was winding down she said, " you know we couldn't do this in China".  I didn't understand and asked her what do you mean. She responded,  "walk up to foreigner and talk. It's not allowed" 

Too me that says it all.  You and I have no idea what is is like living and growing up on the mainland China. The population complies or else

The only chance of encouraging positive change in China is by a coalition of nations standing up to China in unison.  Trump tried it but no takers.  Most of the world is dependent on exporting to China for economical survival.  China's recent treatment of Australia is a reminder of of the consequences of any country's resistance to China's plans.

Posters have given me numerous reasons, violations and despicable behavior carried out by the CCP. But it worked for them.  Never held accountable.  Never slowed them down.  

Did they pay a price for wishing Hong Kong resistance ? NOPE.  Did it stop EU/Merkel from posing Investment Pack with China ? NOPE.

Edited January 5, 2021 by Roch

[specinho + 475]

22 hours ago, Roch said:

U.S. pretends Free Trade is a real workable policy.  U.S. proposes the World Trade Organization (WTO), abides by its rules and gets abused by Asia and Europe.

 

Learnt in a class last month regarding the history of free trade policies....... Hope to bring it to discussion here:

- Americans prefer "market justice", society's benefits distributed through workplace rather than through government policy => This might have incurred more expenditure to the employers e.g. medicard or worker insurance, EPF, retirement fund etc

- 1980s, people started to question - why pay high price to Americans when the same good could be produced less expensively abroad and shipped back to US markets. The obstacle back then was tariff ( tax on imported goods) that could wipe out savings made there. Therefore, multinational companies pressured lawmakers to adopt free trade agreement => job losses to lower wage countries offset by saving to consumers of lower cost products. All economists agreed of free trade.........

Theoretically, it is a win-win condition........ ,no?? To the manufacturers and to the consumers............ But , what about the work force?? Manufacturing field employs the most number of work force per se. What would people do?? Is relocating outside of US the only option to bring up profit?

1. How about creating adequate insurance price e.g. $ 15 per month, that could both afforded by the workers and the employers without incurring too much costs?? There was a saying......... insurance is like paying throughout your lifetime for something that you might or might not use........ Not even saving insurance with investment link plans are worthy (hearsay stories might not be correct when applied to different group of people)............ Why should the general price be so expensive if the ratio of  paying back is closed to none or zero?? (Certain fields with dangerous work should be considered separately).

2. Retirement plan in the old days might have been adequately allocated to the performing work force of elder generation. Nowadays, massive intake of poor servitude into areas with this plan might have spoilt the initial kind intention........ especially by the governments worldwide. If we are more stringent on the criteria, may be the cost saving plan would be seen, that only 20 to 30% of work force qualified to be entitled............

3. return a percentage of profit to those who work hard for you is justifiable. Afterall, you treat them well, your company could last longer with highly maintained quality..... This old common sense might not be working any more in the modern world. Most companies, especially of developing and not so developed countries, treat employees badly, with minimal benefit granted....... Poor quality of work is produced by the majority and still accepted...... Companies runned at losses and nobody cares............... What are we doing??

4. Import cheap and high quality parts or raw materials to be assembled in the US has been a good idea of the old generation. However, what went wrong?? Why has the direction been changed to produce completed goods outside and shipped back?? Imagine the disappointment of a purchaser flying all the way to Korea from US to buy original-  made in Korea, but to find Samsung- made in China in Korea, after a long flight...........

 

14 hours ago, Gerry Maddoux said:

China is likely going to be isolated by their callous act of failure of notification posthaste that a virulent organism had escaped, ...........................  I predict that China--and Xi--will be ostracized by the world. Even with a hapless Joe Biden at the helm. 

So that India, Bangladesh, Pakistan et al can rise?? What are we doing?? Could this anti-China sentiment be stirred by the Hollywood movie "Crazy rich Chinese" produced by Singaporeans and Hong Kees?

Edited December 30, 2020 by specinho

[0R0 + 6,251]

18 minutes ago, Marcin2 said:

The problem of China is not that they WANT hegemony, but that they HAVE TO be hegemon.

China has NO choice in this regard.

The only culprit of this situation is their huge population.

Please forget for a moment that China is a country of 1,410 million people.

What you see ? Just another East Asian country trailing the footsteps of Japan, South Korea or Taiwan.

Fast developing economy, currently at upper-middle income level of about 10-11,000 USD/per capita GDP.

And this economy , like Japanese or South Korean would develop fast until it will reach 60-80% of US GDP / per capita

in 25-30 years.

And now we multiply this situation by 1,410 million people, that is 4.2 times US population.

Innocent 60-80% of US per capita level, becomes suddenly HUGE GDP 2.52-3.36 times the United States.

Nobody questions the fact that the country with GDP 2.5 times or 3 times US GDP has to be world hegemon.

So as I said no matter what are Chinese plans or intentions they have no choice but become global hegemon.

 

None of that can happen, we have passed "peak China"

The $10-11k figure is irrelevant because it reflects an averaging of Two Chinas. The one we are all familiar with is the industrial giant that is 350-370 mil 1st world middle/upper income that are educated, trained, skilled, and 92 mil of them are CCP, the rest are their relatives. They are 60-70% of US income levels.

The rest of China is 270 mil migrant labor (down from 360 mil) 40% of which are still unemployed, which are part of the 500 mil farm and agribiz rural people The rest are 340 mil children and well over 400 mil retirees. 75% of the children are rural.

Broad education in China has suffered from low priority in spending, education levels have only budged from 76% dropping out at middle school to 74%, and this year's estimates are again back up to 76% or worse as children destined to high school funded by migrant labor workers could not afford high school and dropped out.

The first world China has not expanded since 2017. The rural economy is growing now, after having been shunned for 2 decades by banking and provincial govt. Banks are now directed to fund anything farmers are trying to do to increase output. Provincial govt is directed to assist in mitigating aquifer damage, but central govt. decisions on banning cheap low sulfur Aussie coal imports have left the damage even worse than it was before.

The best estimates for China's GDP growth I found are

2018 0-1.6%

2019 -0.5% to 0%

2020 -4.6%

That figure is likely to be an overestimate for 2020 as ChinaBeigeBook shows 10% decline in retail transaction y/y for Nov. as it was all summer. All the "growth" contribution is from infrastructure and exports and support services. Retail business financing for the holding of stocks for sale during lunar new year has fallen from near 80% bank approval to less than 50% The upcoming holiday retail season is looking to be bleak and a large and visible dive off the cliff in retail sales.

Marcin, I would have discounted GaveCal's estimates by now. They trend with official data, which has been bogus for a decade in increasingly large departures from reality.

 

[0R0 + 6,251]

31 minutes ago, Marcin2 said:

Losing or achieving global hegemony is a very long process, even longer than human lifespan.

Last time when hegemony has switched from British Empire to United States of America the process actually started in 1870s.

In 1870s US GDP became higher than UK GDP. At about WW1 US GDP became higher than whole British Empire GDP.

But only after WW2 USA became crowned new global hegemon. (it could be much earlier without US isolationism).

The same is with China and US.

Chinese GDP in PPP terms is larger than US since about 2014.

In nominal terms there are various estimation , it would be about 2027-2032.

Chinese military would be on par with US military no earlier than 2040.

Juan would become reserve currency on par with dollar and euro also not earlier than 2030-2035.

So China would become fully fledged hegemon in 2040s-2050s, but the process is already underway since 1990 - the year of apex of American Empire.

These are irrelevant projections. You can't project from old performance when the demographics can't support the trajectory that led to that prior performance.

China has found the magic formula whereby their capital investment REDUCES per capita output. Michael Beckley's estimates are that 1/3 of China's output is "GDP holes" in China economist lingo. I.e.output that has no market value nor use. In the old days of Mao they would use shovels to dig holes and put posts in them, which would never be used for anything, not phone or electric wires, not fencing, just holes with sticks of various materials sticking out of them. Those would all count into GDP as industrial output for the sticks cement and shovels, and as services (construction) for the work. 50 years later, nothing has changed. Emperor Xi is just as obsessed with irrelevant numbers as his idiot predecessor was.

China is not on track to become a hegemon. It has reached close to its peak and may have passed it already. They have a short while longer before their skilled workforce retires and they can no longer build up their navy missiles and army at the pace they are currently operating. That is why they resorted to a decades long campaign of bribery and blackmail to capture the leaderships of Western countries into their Intel operations, and thieving of intellectual property. That is why they released CV19 on the world, and it is why they rigged the US election to install their puppets in the White House, governor's mansions, Judiciary, and in the Senate and House. 

 

[Roch + 537]

40 minutes ago, 0R0 said:

None of that can happen, we have passed "peak China"

 

ORO

You are a wealth of Chinese data and statistics.  If I may ask, in what profession do you apply this knowledge ?

(a) Academic ?

(b) Government ?

(c) Intelligence Agency ?

(d) Finance/Investments ?

(e) Personal intellectual curiosity ?

(f) None of the above ?

 

Edited December 30, 2020 by Roch

[Roch + 537]

19 minutes ago, 0R0 said:

 

 

Quote

That is why they resorted to a decades long campaign of bribery and blackmail to capture the leaderships of Western countries into their Intel operations, and thieving of intellectual property. That is why they released CV19 on the world, and it is why they rigged the US election to install their puppets in the White House, governor's mansions, Judiciary, and in the Senate and House. 

 

 

I agree with this part.

And by all counts they were very successful at it and in my opinion will continue to be successful.  

 

Edited December 30, 2020 by Roch