4 ms·

China's leadership seem fairly intent recently on destroying the areas where China's economy was picking up. Tech companies, software developers, and now anythi

by jemmyw 3y ago

China's leadership seem fairly intent recently on destroying the areas where China's economy was picking up. Tech companies, software developers, and now anything innovative that would benefit from external investment to get off the ground.

grey-area 3y ago
They’re trying to cover up a massive crash, in real estate especially. They’re also preparing for war over Taiwan amidst tightening US sanctions. Long term for the country it is terrible strategy, unfortunately short term for the dictator and his cronies it is profitable.
- kyleyeats 3y ago
  The China and the US are both doing this in some kind of twisted PR standoff. The only way anything the US is doing makes any sense is through this lens.
  - grey-area 3y ago
    This is not just PR, it's real and the current trade war is likely to lead to real war in the next few years.
- roenxi 3y ago
  If they are trying to cover up a crash, it'll be a typical example of why centralised control fails so hard at economics. A crash isn't like a storm or something where a new force appears; it is a recognition that past decisions were not as effective as people at the time thought. Trying to fight a crash just keeps people doing destructive work for longer instead of moving on and finding some other activity.
  - grey-area 3y ago
    Yes I agree, but in a dictatorship the interests of the country and the interests of those at the top are not aligned. Another example of this recently - imprisoning your top entrepreneurs is a great way to ensure that your tech industry completely dies, but only over a long time frame as nobody comes up to replace the current companies (they all leave if they can). In the short term it offers great opportunities to enrich the leadership at the expense of all that wealth generated in previous decades, and at the expense of course of the country's future wealth. So long term a disastrous decision for the country, short term it pays out for the current leaders if their cover up domestically is sufficiently thorough and there are other events to distract the populace (e.g. expansion through war).
    - graemep 3y ago
      > in a dictatorship the interests of the country and the interests of those at the top are not aligned. I wish that was a problem only in dictatorships. > long term a disastrous decision for the country, short term it pays out for the current leaders if their cover up Dictators will remain in charge long term. To that extent their interests are better aligned with those of the country. I decision that will be bad in the medium term can be quite good for the ruling party in a democracy if they lose the next election and can persuade the electorate to blame whoever is in charge at the time.
      - RandomLensman 3y ago
        No, not how dictatorships work. They usually work by keeping the supporting 2nd layer below the dictor happy and under control, which has nothing to do with country as such. Coincidentally, things could align, but they often don't.
        natmaka 3y ago
        Isn't Chinese history the elephant in the room here? IMHO most Chinese citizens remember that whenever they fight each other (civil war...) disasters happen, and therefore the most important mission of the government is to squash any growing quarrel. Everything else is ancillary.
        RandomLensman 3y ago
        No, why would it? A mix of local ineptitude and revisionist history isn't really saying anything about the counterfactual. Why is China not as rich as the West if it has had the better governance for a long time?
        secondcoming 3y ago
        > Why is China not as rich as the West I find this hard to believe
- powerapple 3y ago
  there are people thinking government should leave economy alone, there are people thinking central banks should use financial tools to control inflation and other things. China is not covering up, it is trying to control a crash.
  - grey-area 3y ago
    The lack of any reliable data specifically is a cover up, that is what the article is about.
mytailorisrich 3y ago
China does not need external (as in 'foreign') investment. They have huge amounts of cash. The strategy seems more about decoupling and independence from foreign interference and potential sanctions. Likewise, when foreign investors leave it is also because they've seen what was done to Russia and thus don't want to repeat that with China, which would be massively more costly. Edit with data: In 2022 Chinese households accumulated $1tn in savings, just over that year (this is something typical in China because of lack of safety net and lack of investments avenues, hence also why everyone wants to buy property to invest their cash): https://www.crugroup.com/knowledge-and-insights/spotlights-blogs/2023/how-china-s-households-unleash-savings-is-key-to-recovery/ https://www.crugroup.com/knowledge-and-insights/spotlights-b... China also has $3.2tn in foreign cash reserves: https://en.wikipedia.org/wiki/Foreign-exchange_reserves_of_China https://en.wikipedia.org/wiki/Foreign-exchange_reserves_of_C... They also use that cash as a tool of foreign policy with loans to foreign countries in excess of $240bn: https://www.reuters.com/markets/china-spent-240-bln-bailing-out-belt-road-countries-study-2023-03-27/ https://www.reuters.com/markets/china-spent-240-bln-bailing-...
- throwaway2990 3y ago
  [flagged]
- berserk1010 3y ago
  They do? Probably should tell the average citizens in China who are having trouble withdrawing cash out then https://www.youtube.com/watch?v=s9odXNPldCI https://www.youtube.com/watch?v=s9odXNPldCI. I think some banks were kind enough to tell their customers to withdraw in a few months. Other banks just zeroed out their customer's bank account.
  - deleted 3y ago
    [deleted]
- vbezhenar 3y ago
  Potential? China is under heavy sanctions right now. They need to surrender or to fight. For now they chose the latter.
peoplefromibiza 3y ago
FWIW between Blue Orca Capital LLC and China I would choose China all the time. They are simply trying to short China to profit, like they did before so many times. This is not even news: in "Regulation of platform market access by the United States and China: Neo-mercantilism in digital services" published in 2022 you can read Since 2009, both countries have progressively restricted access to each other's domestic information services markets. In both cases, the primary stated rationale involved national security claims rather than trade policy concerns It's happening both ways.
- paganel 3y ago
  [flagged]
gdc8 3y ago
For who is that innovation? Tech companies are examples of runaway mindlessness. Their scale has lost purpose long ago. They are over valued and over rated from a social cost stand point. Their capabilities don't translate to real world reduction in health costs, education costs, housing costs, energy costs, defense costs etc. They infact increase those cost for everyone with time. It's pseudo innovation from con men or the clueless. Natural that govts are reacting and overreacting. Good times are over world over. Jurassic Park is out of control.
- dsab 3y ago
  Interesting opinion, could you please elaborate how tech companies increases cost of housing?
  - justinclift 3y ago
    You've heard of San Francisco yeah? ;)
    - inglor_cz 3y ago
      On the other hand, a widespread capability of WfH, which wouldn't be possible without tech, or at least not in contemporary volume, is likely putting a downward pressure on housing in attractive areas. If a well-earning programmer settles somewhere in a rural place, it means a) more money spent in a small community, b) one fewer affluent person seeking housing in an urban hotspot. I would guess that the aggregated effect worldwide is an order of magnitude higher than whatever passes in Portland and SF.
      - justinclift 3y ago
        > ... likely putting a downward pressure on housing in attractive areas. The theory is good. Unfortunately, that downward pressure doesn't seem to be having any effect for cities in many western nations. Pretty close to runaway house pricing these days. :(
russli1993 3y ago
not really. Chinese government was regulating specific behaviors of companies, all are legit concerns, not against the companies themselves. Example: companies fighting each other using monopolistic tactics that doesn't bring benefit for anyone (Tencent music locking exclusive rights, Taobao forcing sellers for exclusivity, Taobao can only use Alipay). Online lending coupled with financial instruments (Alipay giving out loans to anyone without credit checks and using asset-backed security scheme to massively increase amount they can lend out (ABS is cause of US 08 financial crisis, controlling this in 2020 might have avoided a systematic crash this year due to housing problems). All other activities are fine, and specific areas basically are real tech are very much supported, eg, semi, semi equipment, chip design, EDA, etc. Chinese gov are saying instead of thousands of smartest phds trying to figure out how to play financial games, get them to build the lithography machine, cuz the latter creates real economic value.
nirui 3y ago
That's what I always say. Contrary to popular belief, the current ruling party of China poses a much bigger threat to China than any external factor such as the US, Taiwan or India would ever achieve. There is an meme online titled "When China made a decision", followed by a picture of the Prime Minister of Singapore laughing (see link 0 for sample), hinting the fact that due to many mistakes made under Xi's administration, companies/economic entities (including Chinese founded ones) are moving away from China to Singapore, often citing social control and economic reasons. [0]: https://www.reddit.com/r/real_China_irl/comments/162oc8g/%E6%9D%8E%E6%98%BE%E9%BE%99%E6%B2%BB%E5%B0%8F%E5%9B%BD%E8%8B%A5%E5%A5%B3%E4%B8%8A%E4%BD%8D/ https://www.reddit.com/r/real_China_irl/comments/162oc8g/%E6... However, I don't really think that's all Xi's fault. There are so many things you just simply don't know if you're a child of nepotism. The party highleaders created their own social class, and as result, they and their offspring became disconnected from the reality more and more generation by generation. Most of them has so little experience of real people and so many experience of nepotism, it is already a miracle if they can still maintain a healthy mental condition, let alone the capabilities needed to do things right. The same kind of disconnection can also explain why the highleaders believed that the Wolf Warrior Tactic was a smart move: they simply don't understand how politics work, so the most primitive solution became the most obvious to them.
- ethbr1 3y ago
  I thought of this as why authoritarian regimes are so so bad at propaganda -- they have no experience in interacting with a normal, sometimes adversarial media landscape. At home, they say the sky is red, everyone says "Yes" or gets a visit from the secret police. So they do the same thing elsewhere, and there's criticism, memes, humor, apologism, etc... all the features of a more open information space with diverse opinions. But they have little basis for how to interact with that, because they didn't need any of the nuanced soft power skills at home. And so you get Russia endlessly repeating 'Everything is proceeding as planned in the special military operation' and China saying the Philippines "deliberately stirred up trouble" by navigating and claiming Philippine UNCLOS-EEZ waters in the Spratlys.
  - 0dayz 3y ago

by jemmyw 3y ago

grey-area 3y ago

They’re trying to cover up a massive crash, in real estate especially. They’re also preparing for war over Taiwan amidst tightening US sanctions. Long term for the country it is terrible strategy, unfortunately short term for the dictator and his cronies it is profitable.

kyleyeats 3y ago
The China and the US are both doing this in some kind of twisted PR standoff. The only way anything the US is doing makes any sense is through this lens.
- grey-area 3y ago
  This is not just PR, it's real and the current trade war is likely to lead to real war in the next few years.
roenxi 3y ago
If they are trying to cover up a crash, it'll be a typical example of why centralised control fails so hard at economics. A crash isn't like a storm or something where a new force appears; it is a recognition that past decisions were not as effective as people at the time thought. Trying to fight a crash just keeps people doing destructive work for longer instead of moving on and finding some other activity.
- grey-area 3y ago
  Yes I agree, but in a dictatorship the interests of the country and the interests of those at the top are not aligned. Another example of this recently - imprisoning your top entrepreneurs is a great way to ensure that your tech industry completely dies, but only over a long time frame as nobody comes up to replace the current companies (they all leave if they can). In the short term it offers great opportunities to enrich the leadership at the expense of all that wealth generated in previous decades, and at the expense of course of the country's future wealth. So long term a disastrous decision for the country, short term it pays out for the current leaders if their cover up domestically is sufficiently thorough and there are other events to distract the populace (e.g. expansion through war).
  - graemep 3y ago
    > in a dictatorship the interests of the country and the interests of those at the top are not aligned. I wish that was a problem only in dictatorships. > long term a disastrous decision for the country, short term it pays out for the current leaders if their cover up Dictators will remain in charge long term. To that extent their interests are better aligned with those of the country. I decision that will be bad in the medium term can be quite good for the ruling party in a democracy if they lose the next election and can persuade the electorate to blame whoever is in charge at the time.
    - RandomLensman 3y ago
      No, not how dictatorships work. They usually work by keeping the supporting 2nd layer below the dictor happy and under control, which has nothing to do with country as such. Coincidentally, things could align, but they often don't.
      - natmaka 3y ago
        Isn't Chinese history the elephant in the room here? IMHO most Chinese citizens remember that whenever they fight each other (civil war...) disasters happen, and therefore the most important mission of the government is to squash any growing quarrel. Everything else is ancillary.
        RandomLensman 3y ago
        No, why would it? A mix of local ineptitude and revisionist history isn't really saying anything about the counterfactual. Why is China not as rich as the West if it has had the better governance for a long time?
        secondcoming 3y ago
        > Why is China not as rich as the West I find this hard to believe
powerapple 3y ago
there are people thinking government should leave economy alone, there are people thinking central banks should use financial tools to control inflation and other things. China is not covering up, it is trying to control a crash.
- grey-area 3y ago
  The lack of any reliable data specifically is a cover up, that is what the article is about.

mytailorisrich 3y ago

China does not need external (as in 'foreign') investment. They have huge amounts of cash. The strategy seems more about decoupling and independence from foreign interference and potential sanctions. Likewise, when foreign investors leave it is also because they've seen what was done to Russia and thus don't want to repeat that with China, which would be massively more costly. Edit with data: In 2022 Chinese households accumulated $1tn in savings, just over that year (this is something typical in China because of lack of safety net and lack of investments avenues, hence also why everyone wants to buy property to invest their cash): https://www.crugroup.com/knowledge-and-insights/spotlights-blogs/2023/how-china-s-households-unleash-savings-is-key-to-recovery/ https://www.crugroup.com/knowledge-and-insights/spotlights-b... China also has $3.2tn in foreign cash reserves: https://en.wikipedia.org/wiki/Foreign-exchange_reserves_of_China https://en.wikipedia.org/wiki/Foreign-exchange_reserves_of_C... They also use that cash as a tool of foreign policy with loans to foreign countries in excess of $240bn: https://www.reuters.com/markets/china-spent-240-bln-bailing-out-belt-road-countries-study-2023-03-27/ https://www.reuters.com/markets/china-spent-240-bln-bailing-...

throwaway2990 3y ago
[flagged]
berserk1010 3y ago
They do? Probably should tell the average citizens in China who are having trouble withdrawing cash out then https://www.youtube.com/watch?v=s9odXNPldCI https://www.youtube.com/watch?v=s9odXNPldCI. I think some banks were kind enough to tell their customers to withdraw in a few months. Other banks just zeroed out their customer's bank account.
- deleted 3y ago
  [deleted]
vbezhenar 3y ago
Potential? China is under heavy sanctions right now. They need to surrender or to fight. For now they chose the latter.

peoplefromibiza 3y ago

FWIW between Blue Orca Capital LLC and China I would choose China all the time. They are simply trying to short China to profit, like they did before so many times. This is not even news: in "Regulation of platform market access by the United States and China: Neo-mercantilism in digital services" published in 2022 you can read Since 2009, both countries have progressively restricted access to each other's domestic information services markets. In both cases, the primary stated rationale involved national security claims rather than trade policy concerns It's happening both ways.

paganel 3y ago
[flagged]

gdc8 3y ago

For who is that innovation? Tech companies are examples of runaway mindlessness. Their scale has lost purpose long ago. They are over valued and over rated from a social cost stand point. Their capabilities don't translate to real world reduction in health costs, education costs, housing costs, energy costs, defense costs etc. They infact increase those cost for everyone with time. It's pseudo innovation from con men or the clueless. Natural that govts are reacting and overreacting. Good times are over world over. Jurassic Park is out of control.

dsab 3y ago
Interesting opinion, could you please elaborate how tech companies increases cost of housing?
- justinclift 3y ago
  You've heard of San Francisco yeah? ;)
  - inglor_cz 3y ago
    On the other hand, a widespread capability of WfH, which wouldn't be possible without tech, or at least not in contemporary volume, is likely putting a downward pressure on housing in attractive areas. If a well-earning programmer settles somewhere in a rural place, it means a) more money spent in a small community, b) one fewer affluent person seeking housing in an urban hotspot. I would guess that the aggregated effect worldwide is an order of magnitude higher than whatever passes in Portland and SF.
    - justinclift 3y ago
      > ... likely putting a downward pressure on housing in attractive areas. The theory is good. Unfortunately, that downward pressure doesn't seem to be having any effect for cities in many western nations. Pretty close to runaway house pricing these days. :(

russli1993 3y ago

not really. Chinese government was regulating specific behaviors of companies, all are legit concerns, not against the companies themselves. Example: companies fighting each other using monopolistic tactics that doesn't bring benefit for anyone (Tencent music locking exclusive rights, Taobao forcing sellers for exclusivity, Taobao can only use Alipay). Online lending coupled with financial instruments (Alipay giving out loans to anyone without credit checks and using asset-backed security scheme to massively increase amount they can lend out (ABS is cause of US 08 financial crisis, controlling this in 2020 might have avoided a systematic crash this year due to housing problems). All other activities are fine, and specific areas basically are real tech are very much supported, eg, semi, semi equipment, chip design, EDA, etc. Chinese gov are saying instead of thousands of smartest phds trying to figure out how to play financial games, get them to build the lithography machine, cuz the latter creates real economic value.

nirui 3y ago

That's what I always say. Contrary to popular belief, the current ruling party of China poses a much bigger threat to China than any external factor such as the US, Taiwan or India would ever achieve. There is an meme online titled "When China made a decision", followed by a picture of the Prime Minister of Singapore laughing (see link 0 for sample), hinting the fact that due to many mistakes made under Xi's administration, companies/economic entities (including Chinese founded ones) are moving away from China to Singapore, often citing social control and economic reasons. [0]: https://www.reddit.com/r/real_China_irl/comments/162oc8g/%E6%9D%8E%E6%98%BE%E9%BE%99%E6%B2%BB%E5%B0%8F%E5%9B%BD%E8%8B%A5%E5%A5%B3%E4%B8%8A%E4%BD%8D/ https://www.reddit.com/r/real_China_irl/comments/162oc8g/%E6... However, I don't really think that's all Xi's fault. There are so many things you just simply don't know if you're a child of nepotism. The party highleaders created their own social class, and as result, they and their offspring became disconnected from the reality more and more generation by generation. Most of them has so little experience of real people and so many experience of nepotism, it is already a miracle if they can still maintain a healthy mental condition, let alone the capabilities needed to do things right. The same kind of disconnection can also explain why the highleaders believed that the Wolf Warrior Tactic was a smart move: they simply don't understand how politics work, so the most primitive solution became the most obvious to them.

ethbr1 3y ago
I thought of this as why authoritarian regimes are so so bad at propaganda -- they have no experience in interacting with a normal, sometimes adversarial media landscape. At home, they say the sky is red, everyone says "Yes" or gets a visit from the secret police. So they do the same thing elsewhere, and there's criticism, memes, humor, apologism, etc... all the features of a more open information space with diverse opinions. But they have little basis for how to interact with that, because they didn't need any of the nuanced soft power skills at home. And so you get Russia endlessly repeating 'Everything is proceeding as planned in the special military operation' and China saying the Philippines "deliberately stirred up trouble" by navigating and claiming Philippine UNCLOS-EEZ waters in the Spratlys.
- 0dayz 3y ago