Chinese scientists made breakthrough at the No.404 Factory of China National Nuclear Corp in the Gobi desert in remote Gansu province, enabling the re-use of spent uranium and increasing the efficiency of nuclear fuel by 60 folds. China’s existing supply of uranium throughout China was estimated to last for 70 years. With this technology, China now forecasts the supply lasting 3,000 years.
This breakthrough obviously makes nuclear power a much more practical option, because the waste resulting from use is now dramatically reduced. Read more…
Here is Warren Buffett talking to CNN Money about two months ago. I feel his basic message to the American people is right. I think he tried to stay away from the politics and offer a fairly optimistic view of the China-U.S. relationship. Quite a bit of ground covered in that short segment, actually. If one of my American friends ask me, I will provide basically the same nutshell. (There might be an obligatory 30 second commercial before Buffet appears.)
Russian President Vladimir Putin and Chinese Premier Wen Jiabao has just jointly announced in St. Petersburg to no longer use the U.S. dollar in their two country’s bilateral trade. China Daily reported the news, headlining, “China, Russia quit dollar.” This is a reaction to the yet another round of printing by the Fed ($600 billion in fact).
“Quantitative easing” are new fancy words the U.S. government use to describe printing money out of thin air. (Would you be surprised if the U.S. media do not refer to this as “currency manipulation”?) At the recent G20 Summit, world leaders were upset at the U.S. for being so irresponsible as the USD is the reserve currency for the world. If Russia and China successfully execute on this arrangement in the coming years, I think other countries could follow suit.
In my prior post, “The 2010 USCC Annual Report is ‘truthless, prejudicial’,” I ranted about the 2010 USCC Annual Report and reiterated Chinese Foreign Ministry call that the report was “truthless” and “prejudicial.” Some of you expressed privately that I should address the report seriously, especially, as this is an “official” position taken by a branch of the U.S. government.
Some of you also responded, since the U.S. is not interested in addressing the systemic problems locally and rather blame foreigners (China especially in this report), then let the U.S. march forward with her madness. In the long run, it will only result in America’s decline. Let it be, so the argument goes.
After giving it some thought, I think China and the rest of the world have a vested interest in America seeing our world for what it is, not to be cloaked in lies and prejudices. Read more…
Recently, the U.S.-China Economic and Security Review Commission (USCC) released their “2010 Annual Report” (complete in PDF) to the U.S. Congress, criticizing China over many issues. The USCC’s purpose is as follows:
To monitor, investigate, and submit to congress an annual report on the national security implications of the bilateral trade and economic relationship between the United States and the People’s Republic of China, and to provide recommendations, where appropriate, to Congress for legislative and administrative action. Public Law 109-108 directs the Commission to focus its work and study on the following eight areas: proliferation practices, economic transfers, energy, U.S. capital markets, regional economic and security impacts, U.S.-China bilateral programs, WTO compliance, and the implications of restrictions on speech and access to information in the People’s Republic of China.
the Economist recently interviewed Michael Spence (Professor of Economics, Stern School of Business, New York University, and Senior Fellow, the Hoover Institution, Stanford University), and I thought his comments about China, the U.S., and the growth dynamics between the developing countries and the developed countries were rather interesting.
He talks about economics without the politics. It’s almost “weird” to find this type of discussion in America nowadays. He said that China is laying the ground work for transitioning into a more advanced economy over the next decade. He also said that the developing countries will maintain their growth even if the developed countries continue to limp along; the developing economies are no longer as dependent on the developed countries as was a decade ago. Elsewhere, I’ve read him articulating the U.S. has been consuming more than it produces for about a decade now and the U.S. will have to settle into a lower consumption “norm” when it re-emerges. Read more…
Six months ago, I wrote about the “COMAC C919, Challenging the Boeing and Airbus Duopoly.” The aircraft was scheduled for production release in 2016. And looks like the plan is proceeding well. The company has reported 100 of the planes having been pre-ordered by various airlines. So, here we are, six years before release, the C919 has already started making dents in this lucrative industry.
You may follow the above link to see who the suppliers are (for various subsystems of this aircraft) as well as other pertinent information about the market the C919 competes in. The C919 leverages COMAC’s experience from the ARJ21 which is expected to enter service this year.
Today, I am writing this post from Japan. I had a chance to speak with a Japanese colleague about the general financial crisis in the developed world, particularly as relates to Japan and the U.S.. In this post I simply would like to share that conversation.
It started out with him telling me the Japanese government is trying to take austerity measures to address the country’s budget deficit. This meant cutting back on government expenses. Europe is similarily embarking on such measures. Read more…
Kauai is one of the most beautiful places on planet earth. I have just returned from a one week vacation on the island with my family. The vacation has given me a chance to step away from blogging and put a pause on every day life. You might begin to wonder how this post is going to relate to China. While on Kauai, a number of thoughts did occur to me. Before getting into that, I’d first like to share with you the wonders of this incredible place.
(You may click on any images on this post for an enlarged view.)
Above is a traveler meditating to sunset at Poipu Beach at the southern coast of Kauai. It is easy to imagine why such landscape or seascape draw all sorts of inspiration; romance, artistry, and, apparently spirituality. By the way, the woman in the picture is really beautiful. A thought to interrupt her to get a portraiture did cross my mind, but I decided otherwise. Read more…
So here goes the news again: Public Enemy Number One in China, Liu Xiao Bo, has been awarded the Nobel Prize! Not sure where that infamous title of Liu came from. But this latest Nobel prize must be giving people in the U.S. quite a laugh.
The award of a Nobel to Liu is certainly controversial. Allegedly, the Nobel committee itself was internally divided. But given Liu’s high profile conviction last year, this decision is not totally unexpected. I originally did not plan to write about Liu. However, given the renewed and widespread interest of Liu’s Nobel, I have decided to wade in with my thoughts. Here is a translation of what a typical report in the West is like. Read more…
Despite the moral posturing and smearing campaign against China in the Western media on the currency valuation issue, the essence of the current rebalancing of our world economic system is a fight between the rich and the poor (and between the rich themselves).
The U.S. really doesn’t have this currency valuation issue all that together. Here, NYT reports “Currency Rift With China Exposes Shifting Clout” where Jame D. Wolfensohn, a former president of the World Bank, on what this boils down to: Read more…
The 8th Asia-Europe Meeting (ASEM), a bi-annual event (the previous was in Beijing in 2008), just took place on October 4th and 5th in Brussels, Belgium. It was a big deal. Asia and Europe represent 60% of humanity and 60% of global trade. I like how ASEM state their mission. Below is part of it: Read more…
Fareed Zakaria of CNN’s GPS recently interviewed Chinese Premier Wen Jiabao. It’s a great interview, and I am glad to learn that CNN agreed to not make commentary on what Premier Wen said. In exchange, CNN was given permission to ask whatever they wanted. Zakaria acknowledged “it was one of the most open and frank discussion he has ever seen with a Chinese leader.”
Here is the interview from tudou.com:
(Looks like I linked mistakenly to the 2008 interview on Tudou.com in my original post. Tudou still has the 2010 interview in fragments. Here is the correct interview video from CNN.com in its entirety.)
Many Americans think the politics of East Asia is dominated by China on one side and U.S.-Japan on the other. While that may be true on the surface, the dynamics are actually very complicated, and in fact makes that dichotomy false. The pillar of the Japan-U.S. alliance was born out of the Cold War in fear of the former Soviet Union, which no longer exists today in case you haven’t noticed. In contrast, the threat today is a loose combination of whatever is posed by North Korea, China, and Russia. For the on-going of American occupation of Japan, I think it is a much harder sell today.
We see cracks in the pillar recently – former Prime Minister Yukio Hatoyama made the policy pronouncement when taking office to focus on this idea of an East Asian Community. He won partly on the issue of wanting the U.S. to relocate the military base in Okinawa. Japan is now occupied for over 60 years. This situation is unprecedented in history. How long should the U.S. be occupying Japan? Another 10, 100, or 1000 years? Japan is already paying for the U.S. military presence, so it is only a matter of time before the Japanese wanting to spend that money too on her own military. Read more…
The U.S. Congress is running scared. With a mid-term election coming up and a populace that is unhappy about the economy, they have resorted to be mad about something, and that something appears to be China – specifically China’s valuation of the Yuan (RMB). The argument goes:
China is keeping the yuan artificially low. In keeping the Yuan low, China is stealing job from America, preventing America from undergoing a quick economic recovery. China is artificially manipulating its currency to gain an unfair trade advantage against America. America must wake up and do something. China doesn’t listen to reason. If the U.S. must go into a trade war with China, so be it.
Let’s take a look at the engine under the hood of such reasoning. Read more…
It’s Labor Day in the U.S.! There has been a lot of sensationalism in the West regarding rising labor costs in China (i.e. Foxconn, Honda, etc.). Just to keep things in perspective, we are talking about instances of factory workers making something like $100 a month to making $150 a month in the richer coastal cities. While it is a whopping 50% jump, that $50/month is easily absorbed by other factors as explained by an economist and Beijing University Professor Fan Gang. He is also Director of China’s National Economic Research Institute, Secretary-General of the China Reform Foundation, and a former member of the Monetary Policy Committee of the People’s Bank of China.
I have read too many “dumbed down” and sensationalized articles in the West about the labor cost issue in China. Here is an intelligent (and I also dare say “boring”, as in Daniel Schorr’s “boring”) view from China (appeared in China Daily as, “Is low-wage China disappearing?“): Read more…
I thought this was a very accurate characterization by Orville Schell via an op-ed on China Daily of the “dysfunctional” investment relationship between China and the U.S. at the moment. My interpretation? On one hand, China welcomes investment with open arms; think Intel, GM, Caterpillar, and even Google investing in China. That creates tons of jobs in China. American politicians calls that “exporting jobs” to China. Now China wants to “export jobs” to the U.S. through investing, and the American politicians call this a national security issue! (Yes, if Chinese companies invest in the U.S., it would also mean they will derive revenue from the U.S.. That is the same thing already being done by U.S. multinationals like Intel, GM, etc. in China. That’s globalization.) The 50 Congressional Representatives Schell referred to? They are xenophobic, protectionist, and stupid. Read more…
In this Op-Ed in China Daily, “FTA pushes ASEAN ties,” an associate professor at the School of International Studies of Nanjing University had these interesting statistics about the trade volume between China and ASEAN countries:
A much-anticipated free trade area (FTA) between China and the regional bloc was formally launched in early 2010, which, with a $4.5 trillion trade volume, ranks as the world’s third largest trade zone. The bilateral trade value in the first half of this year reached $136.5 billion, an increase of 55 percent year on year, and the figure for the full year is expected to total $250 billion.
The latest buzz is the expected overtaking of Japan by China as the world’s number two economy some time in 2010. I’ll ignore the more polarizing perspectives from the likes of CNN and the NYT. Here are some decent takes on this “news”: Bloomberg, BBC (video), and Japan Today).
As reported in Xinhua News, I think the most important aspect of this story is really the per capita of $3,600.00 in China vs. the $39,000.00 in Japan. The ratio of real wealth is 1 to 10, and China’s population is actually 10 times bigger than Japan’s. If the world has humanity, it should hope for continued stable development and that China’s per capita GDP catches up to Japan’s $39,000.00. In the article below, Xinhua writers explain why China is not that excited about surpassing Japan as world’s number 2 economy: Read more…
(If you follow Huawei, you will know that it is one of the most innovative companies in China, and it has made substantial inroads around the world for its reliable and cost-effective telecom equipment. Actually, if you talk to some Cisco engineers about Huawei, they will tell you Huawei is incredibly innovative. Huawei may even be more active in international bodies defining standards – yes – even more so than Cisco!)
Abrams writes about the recent Huawei failed attempts at acquiring 3Com, 2Wire, and Motorola’s wireless equipment unit, despite offering $100 million more than the competition. He argues this was “blatantly protectionist.” I couldn’t agree more. The only disagreement I have with his article is his characterizing this blatant protectionist act on the U.S.’s part as “Zen.” It is American insecurity and xenophobia; pure and simple. Everyone in China recognize it as such.
In my opinion, this was really a blessing in disguise for Huawei. Read more…
According to a report by the International Energy Agency, China has surpassed the U.S. to become the number 1 consumer of energy. The Wall Street Journal has this report, a copy of which is included:
China has passed the U.S. to become the world’s biggest energy consumer, according to new data from the International Energy Agency, a milestone that reflects both China’s decades-long burst of economic growth and its rapidly expanding clout as an industrial giant.
China’s ascent marks “a new age in the history of energy,” IEA chief economist Fatih Birol said in an interview. The country’s surging appetite has transformed global energy markets and propped up prices of oil and coal in recent years, and its continued growth stands to have long-term implications for U.S. energy security. Read more…
Intel has just announced its Q2 2010 earnings. It is the best quarter in the company’s 42 year history. Some of you might say, “what?!” With the financial crisis in Europe and the U.S., how can this be possible? Here is a direct link to their Q2 2010 report.
You will see in the report Intel’s revenue is derived 57% from “Asia-Pacific” excluding Japan. With Japan’s 11%, the whole of Asia accounts for nearly 70% of Intel’s revenue! China’s roaring economy is likely contributing a significant portion towards this record earnings. It is a little wonder that Intel is building a new fab in China (300mm fab in the northern Dalian using state of the art 90nm technology). Toyota too builds auto plants in the U.S., and for the same reasons: it would be too politically insensitive to not given how much Toyota derives its revenue from the U.S.. Read more…
Zhang Monan is economics researcher with China’s State Information Center and frequently appears on China Daily with her “big picture” takes on the global financial system. She is worthwhile following if you wish to understand how China sees the jostling of control between the now currently dominant developed countries and the emerging developing countries for a fairer share of wealth. In her 2010-07-05 article, “Towards new financial order,” she summarizes the inevitable competition (or “cooperatition” if you will) from developing countries in reshaping our worlds financial institutions. Below are snippets from her article: Read more…
Song Dynasty (AD 960-1127) Calligraphy by Ming Dizhu
China Daily has just reported a “Chinese calligraphy work sold for record $57.1M” at the Poly 2010 Spring Auction on June 4, 2010. This record price puts Ming Dizhu’s work within the same league as van Gogh and Picasso in terms of how much was fetched from an auction (“Portrait of Dr. Gachet,” $139million, inflation adjusted, van Gogh; “Nude, Green Leaves and Bust”, $106million, inflation adjusted, Picasso).
According to a Boston Consulting Group report in late 2009, the number of millionaires in China has reached around 450,000 by the end of 2009. Given the fact that China’s GDP has grown 8% to 10% annually for the last three decades, two phenomenons have occurred:
a. Demand for Chinese art has increased because Chinese citizens have become wealthier.
b. Supply for Chinese art (contemporary) has increased because more Chinese are freed from subsistence to pursue art.
In turn, the international art market expects Chinese art to become even more valuable for the above two reasons. Foreign collectors – private individuals and museums alike collect Chinese art. Collectors also exhibit because further popularizing the pieces enhances the art’s value. (Here is a collection of works by some popular contemporary Chinese artist in Beijing – Art Scene Beijing.) Read more…
We have completely lost to the old man who is seeking to change the world using his prayers and smile, and have given up critical thinking in front of him. If we look carefully at the history of Tibet under the rule of the Dalai Lama, we will find that Tibet was still a society of serfdom back then. Tibet's serfdom was not abolished until the middle of the 1950s. If we see only the Dalai Lama's smile, it will mean that we care only about the symbolic meaning of the Tibet issue instead of Tibet itself. (German Chancellor Helmut Schmidt
Zhang Monan is economics researcher with China’s State Information Center and frequently appears on 
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