Read this article if you’re interested in long-term trends beyond the headlines. So I avoid topics like Covid and stocks, and focus on China and geopolitics. I present one perspective of many. I’m not trying to be exhaustive or precise, but instead to list themes for you to explore.
Main point: 2020 is the year when China decisively overtook the US. China is similar to the US in the 1920s, and is effectively a superpower now.
- Buy Chinese stocks.
- Buy IT stocks.
- Consider “knowledge economy” work as a career. That is, work that requires specialized training. Especially consider programming.
- Ensure that your online engagement makes you happier. Ensure you’re consciously developing authentic friendship.
- Don’t live in an echo bubble. Seek out other perspectives.
- Learn more about the China.
China Overtakes the US
While the US relies on printing money and deficits, China’s command economy requires little encouragement. The US playbook of infinite deficits and do-nothing governance looks like the last days of the Roman Empire.
- China leads in diverse areas like EVs, technology standards, artificial intelligence, quantum communication, space missions, universities.
- China’s GDP is predicted to surpass the US in 5 years (2026).
- China invests 2.23% of GDP into research vs. US’ 0.62%.
- China’s population of 1.3B is a far bigger single market than the US or the EU.
- China’s high-speed rail project is a bigger, better version of the US Interstate system.
- China is building military bases in the South China sea, build deepwater ports in allied nations, infrastructure in Africa and more.
- EU signed a trade deal with China without US involvement. The deal splits the EU and US. The EU needs Chinese markets and investment and China knows this.
- China controls the renewable energy supply chain, from rare earths metals to manufacturing at scale. China has already won.
- China has tighter control over its companies than the US for national goals. Ex: China Molybdenum bought the Kisanfu copper-cobalt mine in Congo to mine rare earth metals for batteries. Meanwhile the US govt struggles with perception problems at US tech companies.
- National psyche: China is more open to change than the US. The US has “cultural NIMBYism“. USians are less receptive to bold ideas around cities, technology, transportation, and housing.
- Yuan: The Chinese yuan is appreciating against the dollar. The yuan is slowly joining the world’s reserve currencies. The US will grow poorer if the dollar’s status as the world’s reserve currency is threatened.
New Axes in Geopolitics
- Israel gains recognition with the UAE and Saudi Arabia. For the Arabs, money and trade triumphed over religion.
- India-US-Japan- Australia alliance strengthens to counter China. For the same reason, Vietnam and India relations are improving.
- India-China tensions over summer led India to realize it must realign against China. India responded by banning Chinese companies. Anti-China sentiment in India is growing.
- Turkey becomes a regional power and comes in conflict with Russia: Turkish support enabled Azerbaijan to win against Armenia. Propping Libyan rebels. Propping Syrian rebels. In its regional role, Turkey is in conflict with Russia as Russia has interests in both Armenia and Syria.
- Renewable energy prices crash and uptake increases. Countries are adopting ambitious carbon targets.
- Information technology: Tech companies continue building integrated ecosystems across the world, whether MercadoLibre in Brazil, Rapi in Colombia, Jio in India, Go & Gojek in Indonesia, Yandex in Russia, WeChat in China, Apple in the US and so on.
- Semiconductors: TSMC is a Taiwanese company that’s he only company in the world that can produce advanced semiconductor chips. As a result, TSMC is a Taiwan’s bargaining chip. China is racing to manufacture such chips.
- China and the US in AI: China’s tech industry has inherent advantages over the US because US companies face public opposition and privacy regulation, whereas China cultivates these industries.
Meanwhile, the world adapts to technology companies:
- In France, the French newspapers reached a deal with Google. Meanwhile, the media industry in Australia is talking to Google.
- US and EU are continue their investigations into technology companies.
- China reined in Alibaba and Jack Ma.
- India regulates Amazon and Walmart
Looking across the world, the story is one of convergence. Social media quickly crosses borders, whether its #MeToo spreading from LA to the world, or TikTok from China to the world.
- Ultrarich: People who own shell companies, have family trusts, use tax havens, benefit from political connections.
- Money begets money: If you have the capital to own stocks, you make even more money. Those who lack capital are left out.
- Knowledge economy: Gap between knowledge economy workers and others continue to increase. For example, in IT, the best programmers have decades of training in elite companies and command salaries that are multiples of the average programmer. Each increase in training increases the knowledge gap between these programmers and others.
- Global haves and have-nots: The signifiers of class boundaries converge across the world.
Online expression continues to evolve
- Internet gets better and better at matching people’s niche interests.
- Social media lets misinformation bubbles spread faster, such as QAnon.
- Apps that empower self-expression win quickly, like TikTok, Snapchat, Instagram.
- Limits are placed on expression. Ex: Parler is banned by all tech companies. For an internet that promised to be open and democratic with a free flow of information, this action acknowledges that “open” and “democratic” are platitudes that need refinement for the real world.
Friendship & Family
- What does friendship and family look like in information society? Korea’s “Hojonk” and “Sibal Biyong“, Japan’s loneliness, China’s little emperors, epidemic of loneliness in USA
- As connection online increases, it’s unclear how that translates to meaningful connection. Social media use is linked to suicides, excessive internet use is linked to depression, “Internet Addiction” is a recognized disorder.
- Birthrates drop across the world. What is the future o fthe family?
Polarization between Cities and Country