However, they refuse to listen to us.
Therefore, the Canadian and American businesses, citizens, employees etc (which is the entire American nation and the Canadian nation) are paying a heavy price for the completely avoidable silliness of US President Donald Trump.
China is not some small, irrelevant country with a few million citizens whom anyone can push around but it is the new superpower nation as America gives away the mantle to China on a global stage, hence, it needs to be treated with respect and not with disdain.
All the calamity being caused today in this world of trade wars and tariff tantrums was started by President Donald Trump, which everyone knows very well.
From the very first month (though not on the start of aluminum and steel tariffs, on which we were in agreement, because it helped America get insulated/defend itself from any leverage by foreign countries on itself), we were against these tariffs.
Now China is retaliating:
"China is the destination for about 40 per cent of Canada's canola exports, and the revocation of Richardson's permit hurts the entire value chain of industries involved in the market, the Canola Council of Canada said."
China is the only country on the planet that has the capacity and courage to sue the Canadian and US Govts.
It is unlikely that in the last 50 years any country has gathered that courage, it could even be a first in the history of America and that of Canada.
Last Sunday, on 3 Mar 2019, Huawei (defacto supported by the Chinese Govt) sued the Canadian Govt.
"Meng Wanzhou, the chief financial officer of Chinese technology company Huawei, is suing the Canadian government, its border agency and the national police force over her high-profile detention. Meng claims they detained, searched and interrogated her before telling her she was under arrest."
On Mar 4, 2019, news came out that Huawei of China is about to sue the US Govt next.
"The Chinese electronics giant Huawei is preparing to sue the United States government for barring federal agencies from using the company’s products, according to two people familiar with the matter."
Already in Jan 2019, data came out that Chinese investments into America have plunged 90% between 2016 and 2018.
"Not only are Chinese firms drastically scaling back investments, but they've embarked on a record-setting wave of sales of real estate, hospitality and entertainment businesses."
Back to Canada, on 4 March 2019, the 2 Canadians who were arrested in China, have been charged with spying and could easily spend the rest of their lives in a Chinese jail.
The universities in America are worried to their stomach that thousands of Chinese will not come to America to study any more.
Data is really ugly and it is hurting Americans where it hurts the most, their pockets!
This is just at 1 university out of hundreds of universities across USA.
Not only do universities attract talented students when so many thousands remain back in USA for work but also brings billions of dollars in revenues. All of this advantage that America has over so many other nations is shrinking rapidly, thanks to Trump's tariff tantrums that are meant to hurt the Chinese but are backfiring on American businesses, universities and farmers etc.
The talent pool in America was one of the biggest reasons why America had so many Top 500 corporations until 2 decades ago. This ranking has already slipped badly since it's peak in 2001.
Over the last few years, Canada, Singapore and in particular China are doing more medical research, more AI research and filing more patents which is going to hurt America forever.
The least that President Trump can do is not to accelerate the decline and destruction of America that is already happening at a natural pace.
The talent pool in America was one of the biggest reasons why America had so many Top 500 corporations until 2 decades ago. This ranking has already slipped badly since it's peak in 2001.
Over the last few years, Canada, Singapore and in particular China are doing more medical research, more AI research and filing more patents which is going to hurt America forever.
The least that President Trump can do is not to accelerate the decline and destruction of America that is already happening at a natural pace.
"As an example, he cited Michigan State University, which enrolled 486 fewer undergraduate students from China in the fall semester last year.
Based on the university's annual $40,000 international undergraduate tuition fee, 486 fewer students means a loss of nearly $20 million in revenue in the first year and $80 million in four years, Choudaha said."
6 Mar 2019: US colleges fret over fall in Chinese students
Then the Americans are worried on their CNBC TV Channel as to why Chinese are not investing, nor studying and not even looking at the almost bankrupt country's consumers.
Who will focus on US consumers if American President himself is busy "tarriffing" Chinese products and others, banning Chinese businesses and arresting their top most business leaders while bankrupting his own country's middle class?
You don't need to be a NASA scientist to figure out that China will retaliate and that too strongly.
Meanwhile, American companies are busy selling to Chinese consumers showing who is the stronger power here and is more open to welcoming other country's corporations because they (China) are busy strengthening their middle class.
5 Mar 2019: Why Alibaba Gave Up On U.S. Consumers
Some commentators are starting to believe that the Chinese stock markets and businesses will see a healthy rise this year as the Chinese Govt begins relaxing rules and add more money into the economy with tax cuts and other tools, a leverage that western nations don't have after the 2008 bailouts of their entire financial systems, car plants and insurance companies plus the damage caused to their business due to tariffs and quality of employment.
The entire US media and stock markets are falling apart because the data on US side is coming out so bad, thanks to Donald Trump. The main US indices have been hovering at the same level for over 2 weeks now.
We predicted it all this to occur last year but so many "pundits" and leading economists are expressing surprise, which is simply astonishing to us.
If we could figure it out last year, then how can it be difficult for Harvard types or bank research Chief Economists or Govt officials or leading think tanks, that the damage caused will be entirely on America and shall be the greatest?
"The U.S. trade gap in goods rose to an all-time high of $891.3 billion, reflecting record deficits with China, Mexico and Europe."
6 Mar 2019: Trade deficit soars to 10-year high in 2018, foiling Trump White House effort to rein it in
The biggest damage caused in the US economy has been to the US farming and agriculture sector. They were the biggest leaders across several products in the entire world but Trump has brought them down to a stage of bankruptcy.
We are happy that the ex Chairman of Morgan Stanley, Asia who has deep and solid insights into China has agreed with us though a few months later since July 2018, we believe.
"In the end, economic strength is relative. The US economy’s current strength appears fleeting. Its short-term resilience is already faltering and, in view of worrisome long-term fundamentals, may fade further. China is in the opposite position: today’s short-term weakness should run its course by midyear, against a backdrop of relatively solid longer-term fundamentals. This reality will come as a rude awakening to US negotiators, who are misreading China’s strength and the hollow benefits of a cosmetic trade deal."
24 Feb 2019: Misreading China’s Strength
Aside from dairy and soybean and various other farmers, data is also coming about American rice farmers getting hurt badly both in price and volumes.
What American officials don't understand in this fog of lies by the President of US is that Americans are the ones paying a heavy price from their pockets and someone has crunched the numbers now.
Last year, Americans paid an extra USD 3 BILLION PER MONTH to the US Govt, all thanks to Trump's tariffs.
Meanwhile, China silently continues to march onwards.
China's currency is on it's way to global super power status in the world of trade and central bank reserves and everything else.
"By the middle of 2015, almost 30 percent of China’s trade was being settled in renminbi. Hong Kong banks were holding some 1 trillion RMB worth of yuan-denominated deposits and there was life in the dim sum bond market, with issuance running close to the equivalent of US$10 billion per month."
"What all this means is that it might be possible one day for China to have its cake and eat it — in other words, for the renminbi to be a truly global currency and yet for Beijing to retain a discretionary approach to managing the capital account."
6 Mar 2019: Waiting for the global renminbi
For the Chinese, it's just a small hiccup on their way to bigger victories ahead.
China is a country that adds the GDP of entire India (or UK) every 3-4 years and has been successfully doing so for about 2 decades.
Slowdown for them means, adding an Indian (or UK) GDP every 4 years and a faster speed means adding it every 3 years!
Bring on the tariffs, Mr Tariff Man!
But, just release that CFO of Huawei, else the pressure on Canadian and American economies will keep worsening every passing day and even the Tariff Man (whose family and he himself may go to jail) won't be able to help the house of cards that is the Canadian and American economy standing with the support of trillions in unpayable debt.
A short few months ago flying from L.A to China I saw at least a dozen infants just weeks old flying back to China. When I see that come to a halt then I can see something is wrong. Why do Chinese people do this? Do they not think their Passport/Country is strong enough so they have their sons/daughters in America to get an American passport? Or when I see an American men/women travel to China to find a Chinese bride/husband because they want that Chinese visa. When I start seeing this something is wrong with America. I know all these things I have listed are just after your said decline has already happened. I wonder how many years this kind of thing will take. Shall we guess or predict when this will happen?
ReplyDeleteHello,
DeleteThanks for visiting and for your interesting comment.
There are many reasonings as answer to your question.
One is a dream world. Most people in this world who are doctors or lawyers or Govt officials or engineers or businessmen or any job etc anywhere in the world live inside a cocoon which is ok until it breaks.
This means that someone is very happy working for Lehman Brothers or a Portuguese Bank or a Sears like large retail chain or an Indian airline or a Chinese coal company or a South Korean shipping company or a Brazilian billionaire's company and then one fine day they wake up and they have ALL been fired. No one expects it but it becomes a rude awakening, same like moving to a "better" country today.
This applies to most folks in the third world countries all of whom have a dream since birth to move to a "better" country like G-7 countries or at least send their kids, like tech people from India or scientists and others from China or hispanics in America etc.
Their reasons may be different but their "dream" is to make money and settle down in a "better" country.
What this refers to, is that, people have a dream to go to America or UK or Singapore or Australia for years because a family or parent were influenced in a certain way and they don't follow the news over the last decade or so and dont care to know that France is burning or in Sweden one can raped instantly than ever in their history or in Morocco one may get beheaded if they are white or Americans. And that this impacts business declining and immigration being shut.
Because simply billions of people live in a a cocoon, they still dream and end up in America and have their kids there from any third world country however, because Chinese and Indians are the max educated and max with money today than ever before so you simply see that in the numbers.
Secondly, some Americans have been sending their kids to China to study because they know that thats the future. They could be children of businessmen or finance people etc who are aware that the 21st century belongs to China no matter what any one says.
Another point is that Chinese (and Indians) have large populations and at any point, someone for some reasons has the dream or wishes to run or is old or whatever may be the reason, and wishes to leave. Since the populations are so large hence even a small percentage results in very large volumes of people migrating to other "better" nations.
When will Americans go to China to get brides for visas is a difficult question to answer because not only Americans are becoming bankrupt and poorer but their global power is shrinking rapidly thanks to their bombing campaigns for 18 years now.
Did you know that Americans are advised not to travel to 30 countries including China as on date by their own Govt?
Americans cannot visit Afghanistan or Iraq or Pakistan etc else they be shot within seconds. Last month a terrorist attack happened n Kenya just because Americans had a business conference in that hotel at that time but fortunately it was not displayed at the hotel lobby entrance where exactly the conference was so "only" 4 Americans were killed by terrorists.
The hatred of Americans around the world knows no bounds. If it subsides perhaps they may go to China to get a visa but as of now, I would not bet on it.
2/2
DeleteIf you saw the youtube video above, on CNBC where they discuss why Chinese don't want to come to sell in America but American companies are literally dying to sell in China, that speaks volumes.
It shows that Chinese middle class whether at 300m or 600m is double or same as the ENTIRE US population and they spend like how Americans used to spend back in the 1980's and 1990's. And spending power is what makes this world go round. Chinese power is huge today and in the years ahead will surpass the entire world combined which probably even America did not achieve at it's peak.
Every era must come to an end just like the American era is now coming to an end in almost all spheres.
If America stops bombing and regime change in other countries, we might see them being welcomed in other countries a decade thereafter. But if they continue with selling military equipment like jets and missiles, bombing sovereign nations to generate demand and regime change like they are doing in Venezuela as on date, then even 50 years is too less for them to be welcomed anywhere.
An eye for an eye makes the entire world blind. If Americans learn this, they will know that the retaliation from all the other countries is yet to begin, China has just opened the door ajar and there could be massive backlash against against America over the next decade which is yet to begin.
So whether the trend of Americans looking for women or men in China in order to get their "powerful" or "better" visa/passport is a very tough one to answer exactly, as on date, and may not happen so easily.
Hope this helps and somehow answers your question/s.
Thank you and all the best,
Thanks for your answer, I can tell you from my families experience my brother married an ABC and her parents are from one from Hong Kong and the other from Mainland, they have hundreds of family members here now and I have not heard one of them wanting to go back to China. I have a cousin that married a Highly Educated and wealthy Chinese woman, but sadly are living in upstate New York and not in China. But most likely she is very Liberal and wanted to run away from China asap because my cousin is very very Liberal. Liberal enough to defriend me on facebook for some of my posts. So Until I meet people dying to live in China either America or even Chinese then my mind will change on this subject.
DeleteHi Manoj,
DeleteThank you again for your great insights and views on economies and investment. You are above and beyond!
Please share with me your insights on Chinese debt level and if there is any merit in (western media) hammering articles about how high this is?
Regards,
S.A.
Hi S.A.,
DeleteThank you very much for your appreciate comments. I am truly humbled. Glad you find the information useful.
Chinese debt level is very low on both per capita basis and an external debt level.
We need to understand several things here:
1. China has been growing for over 25 years and has not had a recession since then, it is growing slowly purely because they are moving up the value chain into service sector and higher value products. Same happened in America in 1970's and 1980's. America also used to grow at 12% pa too and now it's at a fake 1%. USA was manufacturing base until then and subsequently moved into higher value into banking and tourism etc. and thus grew slowly post 1980's.
Western pundits lie all day long because their jobs depend on this plus they have thrown capitalism out of the window and refuse ot apply logic and cultural understanding to economics.
External debt and per capita debt is more important than total debt. You may see here that China is ranked very lowly on external debt despite such high growth rates.
https://en.wikipedia.org/wiki/List_of_countries_by_external_debt
Internal debt is not as bad because it's owed domestically so will not cause a contagion unlike what we saw from sub prime crisis in USA that was external debt and caused banks in Iceland, Spain and Germany etc to shut down.
2. China has been moving away from manufacturing for more than 5 years into service sector. all this "slowdown" and debt is all pre planned.
This means they will have some issues due to this transition, factories will shut down, bad debt may rise and so much else.
Does this mean they are collapsing? Absolutely not.
2/2...
DeleteBut overall doing very well. They add a GDP equal to entire India every 3-4 years! Can you imagine that? No western analcyst will tell you this data as a comparison.
Until China has a bigger collapse than Lehman Brothers which was more than USD 600b, I will not be worried which is a few decades away, if at all.
This is a very interesting article and shows how tourism and consumer spending is occurring in China and how they are using it to strengthen China even further by spending domestically and not internationally.
Luxury industry's jitters as Chinese tourists stay home
https://www.thenational.ae/business/travel-and-tourism/luxury-industry-s-jitters-as-chinese-tourists-stay-home-1.834193
This is sending shock waves globally because Chinese have stopped buying goods abroad which is killing the entire world but the media and research refuse to mention this anywhere.
From HK to Singapore to Dubai to Italy to London and NY, all major cities globally are seeing closing stores, dropping real estate etc because the big spending Chinese consumer in millions is holding their purses back.
3. China is the only country in the world ever to have more than USD 3 trillion in reserves. This is more than the entire world combined. They can save 5 Lehman Bros just with their one hand.
4. When any person, company or country is growing, they simply need to borrow more. This allows them to rise even more. Just like a young man, who gets his first job or gets married, he needs to borrow to buy a car or a house and has high income so he spends more. Does that mean he is bankrupt? No way!
He is contributing more to the economy wherever he lives, provided he has a job. Exactly the same is the situation with China.
They have just started issuing USD bonds a decade ago which America has been issuing for decades and when they have this debt because they need to create a "debt yield curve" they are being tarnished that they have extra debt which they don't.
Main reason to have external debt for China is to manage foreign currency cash flows and make a debt curve to compare with other country's same curve for the sake of comparison. Rest everything is just noise.
5. Only when a country is growing rapidly we can see the impact on the wider population. China is a very peaceful and all inclusive growth economy taking care of their most poorest.
China has moved more than 800m people out of poverty and according to ILO standards, there will be no poor in China within the next few years.
You may read some interesting facts here:
China’s record in poverty reduction unparalleled in human history: British expert
http://www.xinhuanet.com/english/2018-04/23/c_129857170.htm
All this sums up that China is doing very fine and is on a very healthy trajectory with unparalleled growth while taking care of it's entire population and making the entire economy resilient to any negative media articles out there.
Western analycysts are advised to read Art of War by Sun-tzu written centuries ago and not the Art of Deal written by a bankrupt Trump. Art of War is a must read for everyone in China which is a kind of open secret and they follow it diligently.
In it Master Sun-tzu said centuries ago that never let the enemy know what you are thinking and that's exactly how entire China operates.
Hope this helps.
Thank you and best wishes,
Hi Manoj,
DeleteThank you very much for your well written reply with good arguments and facts!
I will read the art of war from Sun-Tzu have seen documentaries from him and many quotes, but reading the book will give more in depth knowledge.
If you ever have some spare time please read
1434: The Year a Magnificent Chinese Fleet Sailed to Italy and Ignited the Renaissance. Its a great historic book sharing a different light on history when China sent one of the largest fleet ever around the world.
Thank you again for sharing your valuable knowledge and time. It is highly appreciated and enriching!
Regards,
S.A.
Hi S.A,
DeleteThank you again for your comments and replying.
I recommend the Art of War by John Minford that I had picked it up in Shanghai on my travels to China.
It's a Penguin Classic and am pretty sure you can buy it online.
It's written by a foreigner who had immersed himself in Chinese history and culture. Hence, is much friendly and easier read and a must read.
In it, Master Sun Tzu is quoted: "Every battle is won before it is fought". He wrote this 2,000 years ago!
Poor Trump and his team of Cabinet filled with 75y-80y olds don't have a clue what they are dealing with! :)
Chinese have refined these thoughts over the centuries and newer Presidents, intellectuals, writers and advisers etc have said "the Skillful Strategist defeats the enemy without doing battle".
And one last one I like: which again has been refined by Chinese over the last several decades: "In war it is best to attack minds, not cities, psychological warfare is better than fighting with weapons".
Chinese claim that this last one is even superior to the writings of Master Sun and Master Wu.
Anyone who wants any opinion on China should not read Bloomberg or FT or any western bank research but these few books before they form any conclusions about China.
I have read a few books by various authors about China and once you have read those, you know you are against the Might of a Jedi or such a being that is simply undefeatable.
That's why I wonder why can't these so called smart CIA, NSA, Harvard educated intellectuals, Pentagon, Cabinet Ministers and their "expert" advisers etc, with all their collective body of resources cannot figure out what I am giving away on a blog for free!
Because they are losing big time and besides attacking China in writing, they simply have no other moves left at this point.
China is like a giant blue sky (like the air we breathe) that will just take over everyone, no matter who, what or where they are and whatever they do.
And the ones who do not align with China will simply perish or keep shrivelling and shrinking and write articles filled with wrong data and harping on a "collapse" of China that they been predicting since 1991! LOL
This book is mandatory reading across China for everyone but especially those in politics or military and Govt. And they believe in it and follow it more seriously than anything in this world on a collective basis.
I will certainly look for the book you mentioned.
I know that until 16th century India and China combined ruled the world in GDP, trade and everything else. However, the British and Europeans came and just with the power of the invention of the gun they changed the course of history by looting and destroying wherever they went and used to call themselves "rich", until now, however, China is trying to recoup it's lost glory just like it had until the 16th century.
Without guns, war and looting of China and India since the 16th century, UK and US would not be what they are today and gladly they are losing their clout, money and "strength" and giving it all to their nemesis, China, over which they have no choice but to keep writing more negative articles. lol
Thank you and best wishes,
Hi Manoj,
ReplyDeletePower is very addictive and with power you accumulate other things like wealth & influence.
Giving this up or worse seeing this demenish in front of your eyes is a painful process. Hence the USA will try their best to turn the odds against China.
The only funny part in this all is that the world would exactly benefit from a new world order, where less war (China doesn't wan't to attack all the time other countries unlike USA) will be a central part of societies. Or changing regimes in Africa, South America, Asia, Middle East and East-Europe with some puppet.
Thank you for all your time spend on sharing your knowledge with us!
Regards,
S.A.