I listened with a smile as I sat down with a young Chinese entrepreneur named Chen, he is a graduate in Mathematics from a top London university and he owns a factory employing 1,000+ people.
I ask so what is going on, and without hesitation, he suggested the Americans dropped the virus. Chen had a grin, and it’s plausible, but in my mind, I cannot see the benefits, except to try and hurt the Chinese reputation, sell them curing drugs, or destroy their global image?
I am not so sure they care and in fact I doubt the communist-capitalist government is not as concerned about their global reputation. The majority of Chinese do not have passports and only 150 million can travel abroad, and they do every chance they get – but not anymore.
Think of the devastation of the global economy when the Chinese stop traveling, it will be dramatic. In Japan, shops are empty and in Australia Casino’s and tourism is losing hundreds of millions this month.
Chinese are the ultimate poker players, no one can touch them, never underestimate any government’s covert operations, or what happens behind closed doors. Each power has its own conscience, strategy, and conduct, and the Chinese are top ranked.
The Chinese government seems significantly and sufficiently annoyed by Trump, and the economies of both the U.S. and China have slowed since the tit-for-tat tariffs began 18 months ago. China’s economic slowdown limited Xi’s options to retaliate against American threats and put some pressure on him to reach a deal. I am not quite sure all the Trump huff-n-puff does very much, but on the surface, it appears effective.
The USA has China pledging to buy an additional $12.5 billion in U.S. agricultural goods this year, so greater dependence on China once again. Is that a clever tactic or it a dirty band-aid?
Consider the Chinese government is in total control, and communist rule frustrated by Chinese travelers spending 250 Billion annually outside of China on travel, buying luxury goods and depriving the core of Chinese capital-communism.
The Chinese used a short reach in Hong Kong, a bloody mess, difficult to curtail and now under control. The communist government cracked down on Chinese gambling in Macau, it was annoying government officials and they put the brakes on and added currency restrictions, and moving monies abroad is more and more difficult. Yet at the same time, the Chinese entrepreneurs represent the greatest number of additions to the world billionaire list.
Never underestimate the global reach of the Chinese, they are very well educated, strategic and persistent. USA companies invested more than $300 billion in China compared with $140 billion Chinese companies have invested in the United States, so no mercy, and unlike China, the United States does not have a centrally planned economy. The Chinese send their kids abroad every chance they get and the Chinese have a very long reach.
Then comes Huwaei a strategic play by the US to stop the reach of the 5G network, and that hasn’t been resolved and still drags on. When the Chinese tech executive Meng Wanzhou was arrested by the Canadian authorities in the Vancouver airport while changing flights, she suddenly became one of the world’s most famous detainees. Her December arrest made at the United States’ request for her extradition on fraud charges, landed Ms. Meng in legal limbo and put Canada in the middle of a fight between two world powers that are both rivals and trading partners.
China and the US are engaged in a race for technological dominance and 5G has been cited as a key battleground for key military and security strategic use. China is expected to invest more than US$150 billion in 5G by 2025, according to Goldman Sachs. On the commercial side, hundreds of thousands of 5G base towers are set up across the country.
Chinese have the power and their reach will be globally owning a significant stake in rare earth minerals. Trump insisting on US businesses re-repatriate their resources, I am sure the Chinese after seeing how many billions of dollars are being spent outside of their country, the government officials inherited the very idea. In fact, long before Trump had the idea and it has accelerated since Trump’s stand on trade.
China and America are two superpowers of opposite sensibility: one is quick to use brawn and the other is patient and strategic and in a position to act without any accountability. Chinese officials had good reason to stop Chinese travel, but in fact, the world stopped it, not even the Chinese themselves.
Imagine the contempt Chinese people have by the racist views developing around the globe about Chinese travel. A clever strategy by the Chinese government to have the general population in line with their ideas and popularity. This kills skeptics who blamed the Chinese government for not acting quickly enough.
No one wants Chinese on their territory and people now see them as “infectious” further dividing the world’s racist views. But the Chinese are integral to our global success the same way global investors depend on the US stock exchange, we depend on Chinese manufacturing and their growing economy.
Surely the general population who travel find it very annoying to be blamed and isolated but at the same time. The Chinese government has a good reason to crack down hard, even use force, and develop hospitals to treat the poor elderly people most affected by the virus.
I ask how many will perish in the coming months, and of course not nearly enough to dent the population. This virus is no different than other flu viruses killing millions of people. This particular strain will probably carry-on until it has some significant levels of mortality amongst the elderly in and around the globe. After all, this is pneumonia which has a higher than normal fatality rate.
Then critically China’s aging population, aging rapidly, and one-third of the country’s population will be over 60 in the next 30 years, up from the current level of 340,000 million. The aging of China’s population represents a crisis because its arrival is imminent and inevitable because its ramifications are huge and long-lasting because its effects will be hard to reverse.
Yeah, the virus is dumped in a wet market, a good and easy RNA explanation, and it spreads to where first significantly and by whom: on the Japanese cruise, and by someone from Hong Kong.
The ship, which set sail January 20, and arrived February 3 in Yokohama carrying about 3,700 passengers and crew. A passenger who disembarked from the cruise in Hong Kong had contracted the virus, leading to the ship’s quarantine. Is that a coincidence passenger?
The Japanese are no friends of the Chinese and an easy target. The cruise ship Diamond Princess is the best breeding ground and catches global acclaim. At the same time, it is spreading and news focuses on the virality of the virus. Wuhan’s virology laboratory studying communicable diseases in the past 50 years: https://en.wikipedia.org/wiki/Wuhan_Institute_of_Virology. In February 2020, the New York Times reported that a team led by Shi Zhengli at the Institute were the first to identify, analyze and name the genetic sequence of the Novel coronavirus (2019-nCoV), and upload it to public databases for scientists around the world to understand, and publishing papers in Nature.
In February 2020, the Institute applied for a patent in China for the use of remdesivir, an experimental drug owned by Gilead Sciences, which the Institute found inhibited the virus invitro in a move which also raised concerns regarding international intellectual property rights. In a statement, the Institute said it would not exercise its new Chinese patent rights “if relevant foreign companies intend to contribute to the prevention and control of China’s epidemic”. A political glitch and an ethical decision to be made.
The world is getting infected and China is on lockdown and re-calibrating as they can under communist rules. In the US the large retailer can feel the pinch and the likes of Wallmart and others will be seen. Manufacturing slows down and American companies need to re-open in China or they will be slaughtered and who are these companies?
Well, let’s just say ultimately we are more dependant on Chinese manufacturers and eventually a shortage of goods prices will slowly rise, and factories will become busy. Actually the factories are opened and working yet the priority will be local clients and I guess the Chinese goods will become a more valued commodity as Chinese are tired of being taken for granted.
Here comes the significance of China’s oil consumption reported at 13,000,000 Barrel/Day in 2019, and they are the world’s largest net importer of oil only producing 4 million barrels per day. China’s excessive GDP growth adds a premium to the price of oil which increases over time, the effect of Chinese GDP growth on oil prices as a cause for the issue. The current prices of oil are savings of almost $300,000,000 per day and that is major!
For the first time, the Trump administration is imposing economic penalties on a Chinese company for importing Iranian oil, a decision certain to add to tensions between Washington and Beijing. China is the largest importer of Iranian oil. Yes, the fearest of them all is …..the oil, and the Americans are dominating supply.
China’s excessive growth adds a premium to the price of oil which increases over time. The results have policy implications in terms of the sustainability of the Chinese faster growth rate from the perspective of its negative externalities to the world.
World oil demand growth remains solid, although the pace of growth is slowing. China’s growth slows while India’s demand remains robust, and by 2024 India’s annual volume growth will equal China’s. Demand in the Rest of the world growth is dominated by petrochemical projects, mainly in the US, which benefits from cheaper feedstock as a consequence of the shale revolution.
The U.S. oil and gas industry celebrates two landmarks this year that few Americans would have ever expected. Crude oil production from U.S. oil fields has surpassed 10 million barrels a day – a number not seen since the 1970s, if ever. This year also marks the 10th anniversary of the shale revolution that started this spectacular rise in oil and gas production.
Today, the U.S. produces more oil per day than Saudi Arabia or Russia… and Texas alone produces more oil each day than several OPEC countries. Exports have been averaging about 1.7 million barrels a day so far this year, but in one week this summer, they set a record of 3 million barrels a day.
The U.S. is also now the No. 1 producer of natural gas in the world, surpassing longtime rival Russia. American production is about 78 billion cubic feet a day, with gas from fields in Pennsylvania being exported to Europe, and exports in the form of liquefied natural gas (LNG) from fields in South Texas to Japan and India. The newest LNG export terminal just began commercial operations on the Chesapeake Bay this summer. Another being built on the Georgia coast near Savannah will start commissioning soon.
And Liquefied natural gas (LNG) is natural gas that has been cooled to a liquid state, at about -160°C, for shipping and storage. The volume of natural gas in its liquid state is about 600 times smaller than its volume in its gaseous state. This process makes it possible to transport natural gas to places pipelines do not reach.
But never forget, oil is the root of many evils and cheaper oil can only be achieved by decimating the demand chain, and cheaper oil is what suits the Chinese industry. The rest is up to you to figure out…and the entire globe depends on tourism, and the Chinese represent the better part of global travel, and so figure it out and play it out for yourself.
Keep one thing in mind, the virus is re-balancing our economies and at the end of the day, there will be one winner. Consider the devastation to the world economies and watch out for imminent recession.