The rise of China - global stocks in the PP

[Kevin K.]

Good editorial in the NYT today:

https://www.nytimes.com/2025/05/19/opin ... =url-share

It's pretty one-sided but if you have NYT access there's a much longer piece by Ezra Klein in which he interviews China expert Thomas Friedman about his extensive travels in China of late. IMHO the bottom line is China is taking full advantage of us having idiots in charge for the next 3.5+ years - not that these trends weren't already firmly in place under Biden.

I think focusing myopically on the China-U.S. duel misses the larger point that everything the current administration is doing makes other countries stronger and incentivizes them to reduce their dependence on both the dollar and business with us. Not planning any radical moves but surely the default stock allocation in the PP and other portfolios - any U.S.-based investor's portfolio - should be VT, not VTI.

[boglerdude]

DNC & CCP BFF. This guy I follow on FB has started promoting CCP, I think they're scared. https://facebook.com/philngai

CCP owns the businesses, tariffs come out their margins. But everything is propaganda, and tariffs are case-by-case, so who knows.

"Japan and South Korea are already providing the template today. China is now in a race against time to do what they did: get rich before they get old. I guess maybe up to roughly a third of China, the wealthy eastern coastal cities, can hope accomplish this to a similar level that Japan and South Korea managed, but what will happen to the other 2/3rds+ is anyone's guess"

edit1:

[dualstow]

I just cannot stand Tom Friedman (or Ezra Klein). Remember when Friedman was pushing this wonderful company called Enron? I think it was in ‘The Lexus and the Olive Tree’. Admittedly, an enjoyable book. But he never even added a note or revised it after Enron went down.

[yankees60]

I just cannot stand Tom Friedman (or Ezra Klein). Remember when Friedman was pushing this wonderful company called Enron? I think it was in ‘The Lexus and the Olive Tree’. Admittedly, an enjoyable book. But he never even added a note or revised it after Enron went down.

He also confidently predicted much in his 2005 World Is Flat book which is yet to happen.

[Xan]

It's tough to make predictions, especially about the future.

[Kevin K.]

A great new book that's nominally about Apple but really about a broader reshaping of the supply chain and China using Apple's almost unimaginably vast investment in China to their own advantage has come out.

Here's a guest article link to the NYT review:

https://www.nytimes.com/2025/05/15/book ... =url-share

Better yet, here's Jon Stewart's interview with the author:

https://youtu.be/NAj9zB4vaZc?si=BkhRpr5u2jA2YIpF

Ignore the implications at your peril.

[dualstow]

A great new book that's nominally about Apple but really about a broader reshaping of the supply chain and China using Apple's almost unimaginably vast investment in China to their own advantage has come out.
…

Yeah, I don’t understand how Apple is supposed to move manufacturing to the States in a few short years. It’s too idealistic. They already tried to move some operations to India and quickly learned that only the Chinese have the skills.
The mind boggles.

[Smith1776]

No doubt that China is a rising power in the world, and may very well overtake the US as the top dog.

One important thing to note of course is that geopolitical and economic dominance doesn't necessarily translate to superior investment returns. It may even translate to subpar performance.

Even the esteemed Burton Malkiel seemed to get swept up in the China story with his book, From Wall Street to the Great Wall: How Investors Can Profit from China's Booming Economy. It turned out to be pretty much the worst time to publish such a book as US stocks went on to deliver insane returns.

[seajay]

A great new book that's nominally about Apple but really about a broader reshaping of the supply chain and China using Apple's almost unimaginably vast investment in China to their own advantage has come out.
…

Yeah, I don’t understand how Apple is supposed to move manufacturing to the States in a few short years. It’s too idealistic. They already tried to move some operations to India and quickly learned that only the Chinese have the skills.
The mind boggles.

As the US closes for business then the likes of Apple will retain presence in both, establish a manufacturing base within the to US to solely serve Americans, maintain its existing Asian presence for selling elsewhere. Businesses hate chopping and changing however, they want stability/certainty. So like others treating Trump for the child like mannerism he exhibits and pacification/pleasing he desires, so they just adjust to that whilst making adult decisions/choices in reflection of what Trump says/does today might be flipped around tomorrow.

I wouldn't be surprised if Apple suggested they were intending to spend billions on a US based manufacture factory, but later revised that considerably down due to technical-difficulties, to the extent of ending up with a US based factory that basically just put component parts together and stamped the product with a Made in America sticker.

[dualstow]

That sounds right.

In the 80’s I made a concerted effort to buy American where I could.
When we’re talking about iPads, I’d go out of my way to get the one made in China so it doesn’t fall apart on me.
(Just bought one this week).

[Smith1776]

Has anyone here made a trip to China in recent years? Apparently Ray Dalio was less struck by the economic data coming out of China and more by what he actually saw in person (work ethic, drive, manufacturing robustness, etc.).

[Kevin K.]

Has anyone here made a trip to China in recent years? Apparently Ray Dalio was less struck by the economic data coming out of China and more by what he actually saw in person (work ethic, drive, manufacturing robustness, etc.).

Take a look at this great interview with Thomas Friedman about his recent trip to China (and of course many others over the years):

https://www.nytimes.com/2025/04/15/opin ... =url-share

The story about being driven around in an electric car and surfing the internet alone makes it worth the read. They are so far ahead in so many ways and everything the U.S. is doing right now plays into their hands. Scary.

[dualstow]

Has anyone here made a trip to China in recent years? Apparently Ray Dalio was less struck by the economic data coming out of China and more by what he actually saw in person (work ethic, drive, manufacturing robustness, etc.).

I haven’t been for a while. My wife was there earlier this year.