Chinese Economics Thread
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So China is going to popularize an OS without Gmail, Uber, Facebook, WhatsApp, etc. and a ton of other U.S. apps that the world population is already addicted to? Its too late bro, the patient is hooked on opium and can't get off. If China tries to release a new OS it would have to somehow get people to abandon all their old apps that they've been using since they were kids. That's unlikely.
And the code is not owned by anyone in practice, it is only "IP" which you void if you reveal yourself to be a CIA agent, cuz why should China recognize IP claims made by a literal hostile foreign government?
China can just go nuclear and seize the assets of any company complying with US sanctions that have also not been ratified by Chinese lawmakers. These companies proved to be extensions of American government, and they're therefore illegal US state assets.
As long as China is earning major money from the west, China is reluctant to take such steps. But if it came down to an asset seizing war, who do you think invested more in the other? China into America or vice versa?
What does it matter if some company wants to use Google or whatever and US tries to forbid it. China can say, use our platform or get marked as an US state actor and forfeit everything you own. Those who live by (American) dictatorship deserve to die by (Chinese) dictatorship.
The way to do it is not to release a new OS with new apps, but to eliminate the need for those apps in the first place.
China Mobile is adding 5G SMS, which can replace Facebook, WhatsApp etc for example, so brining app functionality to the phone natively can work.
When Huawei release their sanction proof device, I expect many app functions to be just native.
That is precisely why the US government is so scared of Tiktok. The more killer apps China has the more they can leverage to make people move to their own OS in the future.
China's GDP is 12 trillion USD for first 9 months of this year at current USD/CNY rates. Unless Yuan radically strengthens, full year GDP on track towards 16 trillion USD (lower than 17 trillion last year).
US projected GDP for this year is 25 trillion. China still has a long way to go. Poor demographics and continuing Zero Covid isn't helping.
why current rates? why not year average rate or year beginning rate? because you know it is intellectually dishonest to use a period of temporary high interest rates and USD appreciation to compare GDP, yet here we are doing it to score points.
btw, seems like EU has utterly collapsed compared to the US so the overall west-China power balance has improved.
Q4 tends to be higher than previous quarters so a linear extrapolation is not valid. This is similar to companies having much higher Q4 revenue/profits.
China's 2021 GDP was 114T yuan so it most certainly won't be 116T this year as you're projecting. Probably going to be around 123T like IMF is projecting.
In any case it is useless to worry about the increasing gap in GDP between US and China because US nominal GDP is currently propped up by two factors: strong dollar and inflation. The strong dollar is temporary and will be reversed when the interest rates go down. Inflation is going to seriously hurt the US economy for years / decades to come. Just to put things in perspective: the US nominal GDP usually grows about $0.5-0.7T on a good year. But in the past two years it has increased by $4T. Did the US suddenly double its economic growth post-Covid? No, it's just inflation. Things are getting more expensive which translates to a higher nominal GDP. This will further erode US competitiveness down the line and the US is going to experience little growth in the future.
Full opening of the economy should start right now. Most covid measures should be abolished and local mRNA vaccines should be administered. The economy is being held back by some unscientific claims.
Maybe an unpopular opinion, but I agree Americans should have skin in the game with TikTok. Just like if an American company wants to succeed in the Chinese market, they have to at least invest in China. The equivalent thing in America is to sell a minority stake to American investors and hire some American software engineers in silicon valley, who are going to be your greatest ally to avoid regulation. Right now, the US will be protectionist and support failed companies like Facebook to protect them from the threat of TikTok. If TikTok was owned 25% by American investors and another 25% listed on the stock exchange, this might be quite different.
It's also a mistake to have Douyin for China and TikTok for the world. TikTok US for Americans and TikTok world should be separate. The policy of making a separate app just for Chinese people blunts China's soft power in the world and enhances the reach of American influencers on TikTok. Better to isolate the Americans in their own little app ecosystem and make something separate for the world.
As has been said already, Q4 GDP is traditionally much larger than the previous quarters. You also have to use the average exchange rate for each quarter. So Q1 and Q2 are going to be calculated at a quite strong RMB, Q3 is kind of weak and Q4 remains to be seen. If the RMB keeps going down, sure, nominal GDP may decline. But I don't think anyone expects the dollar to remain this strong next year. I don't think it makes that much sense to compare with the US when the USD is such a volatile currency. It's better to calculate the share of world GDP