A Second China Shock, With Brad Setser

[@MRTY323]

It won't stop with green energy and transports. Next step is replacing GE, Siemans, Bayer, GSK...with Chinese brands.

[@YKLim-fb7jm]

the task of the Chinese govt was simply to create the environment so that the people can excel - whatever that maybe. As a result, a billion people came through poverty. Every Chinese who succeed is a Stoic - they have the mentality of a slave, who became a philosopher - they focus on what they need to do to get out of slavery . . .

[@bin.s.s.]

Good that you get this out of this long long discussion.

[@chriswong9158]

Deng Xiaoping famously said "It doesn't matter whether a cat is black or white, as long as it catches mice."

[@hyuxion]

To clarify, the present American reaction to China's ascent mirrors the British government's response to America's economic and technological growth from the late 1800s to the early 1900s. It's a striking case of history repeating itself.

[@datoolbox1]

LOL no it isn't. My comments keep getting deleted or flagged by Chinese bots so I will write again. Your analagy is wrong. The British Empire pushed Ricardian economics - free trade. Unlike Britain in it's heyday, present day America is turning to protectionism because China has cheated too much. China never intended to engage in actual free trade, it was a plan from the start to suck the Western world of jobs, tech, and anything nice.

[@scorburosugrosu6344]

accurate assessment ;)

[@professorwang]

Fairly balanced analysis, but highly flawed (accidentally, I believe) as a result of ignorance. Costs of living in China are so much lower than in the US that there is no lack of Chinese consumption. Chinese people buy and consume more consumer goods and services than Americans. It just costs SOOOOO much less that American economists cannot comprehend or analyze it correctly. For consumer goods, the costs in China are approximately 10% of the cost in the US. In other words, if China "only" spends 20% as much on consumer goods as the US does, they actually get twice as much in real goods. Americans might spend $1500 on an iphone. Chinese spend $150 each on 2 Xiaomi or Oppo. The functionality is identical. Chinese spend 20% but get twice the consumer good. Ditto for the "social safety net". China doesn't need a social safety net because the cost of medical care is about 2-5% of US medical care cost, and also because Chinese people take care of their parents. For example, An x-ray costs $15, setting a broken bone and putting it in a cast costs $50, and open chest surgery costs $2000 (all these costs without any insurance, and of course multiply by about 7.25 to get the CNY cost). In other words, there is no need for medicare or social security because everyone can afford these costs. Older Chinese have much less need of retirement homes or elderly care because the vast majority of elderly live with their children. Learn a bit about China, and your analysis will be better.

[@arminius6506]

First Shock : Chinese started exporting underwear, toys and calculators Second Shock : Chins have started exporting HITECH EVs, computers, chips, ships & passenger aircrafts

[@EM-dw2yv]

china grow is week? it grew 5.7 % last year.

[@arminius6506]

US had the strong growth of 2% 💪

[@shiulai5804]

5.3%

[@hauchyi]

That number has already been refuted by many top Chinese economists. What economy will grow at 5.3% with an “official” youth unemployment rate at 18-ish%?

[@resnica3557]

10:05 - " ... and that rebate was limited to Chinese made cars with Chinese made batteries .... " That is a blatant lie!!! The rebate applies to any EV sold in China, including also Tesla's EVs (The US and Americans love to tout about its being American Brand and American pride).

[@slomo4672]

Calm down 😅 Tesla cars made in Shanghai factory fit into your quoted statement.

[@gstlb]

Please don’t confuse lies with misinformation. The latter is a mistake or misunderstanding, the former is a deliberate statement of untruth. Unless you know for sure, you shouldn’t call someone a liar.

[@resnica3557]

@@gstlb , This is the Channel by Council on Foreign Relations, not some cocomaniac one hosted by someone born yesterday. The host and the guest stated the matter as if it were truth, while it was contrary to the fact and reality on the ground, without any evidence to substantiate their assertion. It is either gross negligence or simply malign intent, and that is a lie. Misinformation is discrepancy due to benign and unintentional error. Insinuation with intended and calculated blurry is not much different from any blatant lie.

[@NaijaOracle]

I was genuinely shocked to hear him say that as well.

[@soowo5942]

Made in the united states Tesla cars enjoy the same treatment. ​@@slomo4672

[@kckoay6211]

The inconvenient truth is - the U.S. is enjoying a massive advantage over the rest of the world. That is largely made possible because the world at large (and China) still honour the dollar as the principal reserve currency, even after the collapse of Bretton Woods and the de-pegging of the dollar from gold. The certitude of dollar as the reserve currency enables the U.S. to print money, via issuance of debts, to finance its insatiable appetite for consumption; and to augment the exploit and hegemony of capital. So, it was by choice that the U.S. thinks that a whole new economy can be built around consumption, which lead to the so-called “post industrial economy”. And why not? When effectively to the U.S., the cost of capital and labour of other producing countries is no more than the cost of printing of the greenbacks. It looks like the bad decision is coming home to roost. Why the complain now?

[@datoolbox1]

Classic deflection. Well done wumao

[@shiulai5804]

Good discussion. I may add that the decline in the Chinese real estate sector is actually a result of deliberate policy decision. The policy was an attempt to correct the over dependency on investment in the past. They did extreme quantitive easy to save their(and our) economies after the 2008 GFC. They are still dealing with the negative effect of that move. That is why they don't want to repeat the same mistake

[@liamtan1837]

As if US and EU don't subsidise their industries .

[@imtryinghere1]

If they did, how were 2 million American manufacturing jobs lost in 20 years?

[@zhinan888]

You guys should go to China and take a train trip. The trains are often quite full.

[@PahatRout]

When you have a FREE Printing press, you don't need anything! How long will the world willing to be suckers?

[@xdgao3015]

full of biased opinions, sad, with this attitude you wont find out why China succeed.

[@qake2021]

👌👌👏👏👏👍👍

[@gstlb]

Be more specific. Which opinions? Show me someone with an unbiased opinion and I’ll show you a god.

[@patbyrneme007]

America's protectionist response to China's challenge will lead it to become a technological and economic backwater. Meanwhile the rise of the BRICS will end the dominance of the dollar and the US will have to start paying its debts with a greatly devalued currency or much higher interest rates.

[@etbuch4873]

Not really. The US has been keeping on printing green backs for decades -- the one and only factual case of "overcapacity" via its incessant "quantitative easing" for decades, thereby the US device the mechanism to "inflate away" all the debts it owes to any other countries.

[@adamiskandar5107]

@@etbuch4873 If the US could do that without any problems, why not just do it and see the results!

[@gstlb]

Can you please tell me which stocks to buy? I mean since you apparently know the future so well 😂

[@shiulai5804]

The real estate slow down is being resolved, albeit slowly. It would NOT lead to systemic crisis. The ecposure of the Chinese big banks to real estate loans are in the low single digit percentage.

[@ericyeo805]

One man poison is another man foods. So, you need to talk to more experts on such topics to weigh the plausibility. Also, one cannot have the cake and eat it too.

[@superwalker90]

It is just like any competition, if you are boxing and you are not skilled enough to beat the opponent then you cannot start kicking to win the competition, in the same way China is superior in manufacturing and also China produce affordable products for every class of the society, if you are capable enough then beat them in competition not by starting kicking or twisting their arms.

[@jackreacher8858]

For China the people view govt. as second papa . For Americans they view govt as lizard people I kid you not LOL

[@Jackkalpakian]

Not only this, but attempts to regain US traction in manufacturing are bound to fail.

[@johnwhoo6194]

talking exactly like politicians, full of BS.

[@alextube2551]

get ready, China strong

[@dryeoh2023]

Hahahaha!!!! Go stay in China for one year and do an honest and truthful research!!!

[@qake2021]

👌👏👏👏👍👍

[@gstlb]

You didn’t really say anything, did you? If you have a specific point, please make it.

[@zhinan888]

💯

[@KaiZ-l4u]

To say that Chinese government does not encourage consumption is just total nonsense. In fact it is the opposite. The Chinese government has consistently adjust their policies to encourage consumption in China. In many sectors it has been highly successful. Anyone who visit China these days will be amazed by the level of consumption in goods and services. Yes, Chinese households have higher saving rates than American ones, but this is more of a culture difference. Not surprisingly, Chinese American households have one of the highest saving rates in the US. Living within your means is a highly regarded virtue in the Chinese culture.

[@blafonovision4342]

The USA really needs to remove MFN status from the PRC, and leave the WTO.

[@babublue69]

mfn if removed usa inflation will skyrocket ...so better to keep it..

[@jean-philippeleblanc2660]

u.s needs to devalue it's overprice dollar to be price competitive and stop bleeding out manufacturing , you will gain nothing as long as u.s companies can't export anything due to cost and lack of effort, companies are de incentivise from being fit by constant bail out and protectionism. going hardcore protectionism will just mean end of america. protectionism has been proven to not work across history. ain't going to work this time either. devalue dollar , remove protectionism (ya let china sell ev in u.s so big 3 either wake up or get replaced by actual fit companies. ) ain't going to be pretty for awhile , but the more you keep going in the current trajectory worst it's going to be long term.

[@adamiskandar5107]

...and problem solved?

[@arminius6506]

Leaving WTO is the best thing, it would definitely save the Ford and you'd be deriving your mustang in 2060s. It would save America & the world 🌎

[@blafonovision4342]

@@arminius6506 I don’t think there’s any saving the world. Most of the world is going to be toast in the coming years. The PRC may be the crispiest of them all.

[@calvinang1]

States subsidies, lower tax incentives as well as the creation of designated FTZ are prevalent in economies across the world in order to grow industries. And in doing so, it brings about cost efficiencies to be able to compete globally and also create job opportunities for its own. Providing discount subsidies within the upstream spectrum of any industries ie discounts to electric vehicles has no leverage towards industrial manufacturing. The US is the victim of its own industrial demise when it chooses not to incentivese its own downstream activities. Allow professionals to decide industrial policies as academiens are not entrepreneurs

[@Western_Decline]

this host is clearly biased and asking questions he already knows the answer to

[@DorJinTan]

jokers

[@Walawala459]

It is US own doing. Selfishness, discrimination, greed, lead to these outcome.

[@khtan585]

BS bias

[@EM-dw2yv]

china grow is week? it grew 5.7 % last year.