Skip to main content

China: the world is changing…fast

 Did you know that flight to and from China only recovered to 50% of the pre pandemic, and more importantly flights between China and the US are at less than 10% of what they were prior to the pandemic.

What that means is the US executive who were in the past flying to China to either contract work or supervise operations are no longer doing so, the long term implication for China is catastrophic because the US is China’s #1 export market.  America is/was China single largest source of FDI.  

In the short term the impact is being felt right now, expanding capex by companies in their US operations and a precipitous drop in total FDI into China that translates into slower economic growth.

When will trend change?  Probably not for years to come.  The reason is that China is no longer financially attractive as a FDI destination, Americas and Vietnam (which is a small economy) are more attractive.  

CEO have not got to China for several years because of covid, the connection is broken; financially it no longer makes sense therefor to consider China.  To make it even worse Chinese leaders have been trampling all over the place and acting like a “bag of dicks” so politically China is seen negatively.  Finally, China’s energy infrastructure has been in poor shape for some time now.  

US business people have lost the interest or appetite and Ina’s political actions has made it even easier to look elsewhere.

Comments

Post a Comment

Popular posts from this blog

what people get wrong about tariffs

 The issue is simple. What percentage of the economy is dependent on tariff goods? The truth, is that the US economy is far more closed than people understand. People genuinely believe that all manufacturing has ceased to exist in the United States all given to China on the altar of woke policy the truth can be further from That statement. Only about 15% of US GDP is related to foreign trade. Of that amount, slightly more than half is from Canada in Mexico. And half of that is energy. What that means, is that about 7% of US GDP is tariff dependent. The proof in the pudding, is how little money tariff generates. People think that 30 or 50 billion is a lot it’s not in an economy that has $3 trillion. The impact on the US economy will be less visible but not absent. Inflation hasn’t occurred yet first because tests have hardly started to bite, but more importantly it’s such a small percent of the economy. Now certain things are critical. The rare earth metals from China were critical....
Post a Comment
Read more

The end of Tesla?

 it takes a special kind of idiot, to think that he can antagonize his entire customer base, and think that it will not impact his business. When Elon Musk went to work for Donald Trump, and created the doge department, he antagonized every liberal, and these people represent 90% of his client base.That’s not a brilliant move. Now Elon Musk is worth hundreds of billions of dollar, so he shouldn’t care a great deal, however, he needs to care because of several other issues. The cyber truck has been a disaster, most have had to be recalled because of defective glue, it’s not a truck, it’s not a car, it’s noisy, relatively uncomfortable, but great as a development platform. What Tesla has learned in making car manufacturing more seamless is truly amazing. The problem was that Elon Musk was so pissed with the Democrats, and with Joe Biden, in particular because of some slight, which were just plain stupid too. By the way, that he decided to support with hundreds of millions of dollar, ...
Post a Comment
Read more

Demographics

 I am preparing a kind of family tree for our children so that they know where they came from.  In my family I am the only survivor, although my brother and sister died recently they were both in their seventies (a story I told already).    It was a fun process, but it provided more than that.  First, I married relatively young I was 26 when I married and nearly 30 when our first child was born.   I was looking at my ancestors.  On my mother's side, she had 6 siblings, Four died before the age of 30, two in war, and two from illnesses.  Only she and a single sister survived.   The two boys had a child each but they died in WWII, and the other sister died as an infant.   what is interesting is that every one of my mother's siblings had children in their early 20s.   I know that my mom was hardly 20 when my brother was born.    What is remarkable is that among our friends, we are the only ones to have fou...
Post a Comment
Read more