Chinese Economics Thread
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Nah. They will keep quiet after every L and invent the next cope. Like say large language models, medicine, psychology, etc. They thought aerospace was impossible for China to catch up, and imposed export control. It was supposedly 'pinnacle of human inventions' just like chips. The result was China kicked their ass in space tech. This type of story has been repeating for a long time. Chip race is not the first one and will not be the last.
Lethe
Captain
mmmhmm. Australia is like Russia minus industry. That Australia ostensibly has greater "economic complexity" than Russia raises real questions about exactly what is being assessed by this measure and why we should care about it.
It is a nice place to live, though.
Right. In 2013, prior to Russia's annexation of Crimea, the IMF was projecting Russia's 2015 GDP to be USD $2.38tn at then-current exchange rates. In 2015, post-annexation, post-western response, the IMF was projecting Russia's 2015 GDP to be USD $1.18tn, again at then-current exchange rates. Russia's projected GDP in USD literally halved in less than two years. Whatever the debates about the real underlying state of Russia's economy, and the undoubtedly real effects of the sanctions regime that was imposed, Russia clearly did not materially implode over the course of those two years as those numbers would suggest. Rather, what we witnessed was a sudden, dramatic change in currency exchange rates that was clearly divorced from the underlying economic realities that such ratios ostensibly describe. That should probably invite us to be more skeptical of the utility of GDP figures expressed in USD more generally.
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Australia indeed has lower complexity though (more negative, positive is more complex) so the index is consistent.mmmhmm. Australia is like Russia minus industry. That Australia ostensibly has greater "economic complexity" than Russia raises real questions about exactly what is being assessed by this measure and why we should care about it.
It is a nice place to live, though.
Right. In 2013, prior to Russia's annexation of Crimea, the IMF was projecting Russia's 2015 GDP to be USD $2.38tn at then-current exchange rates. In 2015, post-annexation, post-western response, the IMF was projecting Russia's 2015 GDP to be USD $1.18tn, again at then-current exchange rates, literally half of the projection some two years earlier. Whatever the debates about the real underlying characteristics of the Russian economy, and the undoubtedly real effects of the sanctions regime that was imposed, Russia clearly did not materially implode over the course of those 24 months in any real sense. What we witnessed was a sudden, dramatic change in currency exchange ratios that was clearly divorced from the underlying economic realities that such ratios ostensibly describe.
Lethe
Captain
Right. Never mind then.
I do find it amusing that one of the consistent American attack lines against Russia is that it is "a gas station masquerading as a country" (as Senator John McCain put the argument in its most memorable form). Obviously that line of attack was never open to Australian figures seeking to attack Russia, so instead we had a Prime Minister who semi-coherently to personally Vladimir Putin. Straya!
It is not the technology but the hype around semiconductors that makes this technology different to others. The hype about how important it is, the hype about how difficult it is.
If the western barrier to chip technology is overcome, western analysts will be shaken to their cores. They will harbor serious doubts if any barrier can stop the rise of the east.
Space race is pretty darn hype if hou ask me. ChatGPT is also hype. Chip is not even that hype.
No it hasn't.
The recently reported negative FDI was for 2023Q3. 18 months ago, and lower than the at the time, so the rate differential was actually the other way around 18 months ago.
China also has that requires regulatory approval for foreign-invested enterprises (FIE) moving money out of China. The approval process takes 2~3 months AFTER the FIE satisfies requirements such as having a low debt-to-equity ratio. In other words, FIEs need to first pay down their liabilities to achieve a low enough debt-to-equity ratio before they can even apply for approval for moving money out of China. This means that there will be a significant delay after the rise in US yields before FIEs can move money out of China.
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Very few that hype semiconductors like that has even seen a wafer tool. And to them, software might as well be black magic. The only reason they don't block software is because it's hard to stop.
Semiconductor is hard... but 99% not complex. It's a relatively straightforward application of materials science, chemistry and physics for the fab portion to get started. 3-10 person research teams at universities can make low yield chips with old or R&D equipment. They can even build many of their own tools (not lithography though).
What makes the fab and equipment portion hard but not complex, is all the little factors you have to consider particularly pertaining to purity, arranging/optimizing everything to maximize production, and lithography.
But lithography is just used in semiconductor manufacturing. It is ultimately an electromechanical device, not a semiconductor one. So how well you make a lithography machine doesn't depend on your fabs or chip design but on your ability to design and source components for a complex electromechanical device. And that heavily biases the countries with long industrial experience in the 19th and early 20th centuries.
Like I said before, Coorstek for instance makes ceramic parts for semiconductor tools, and why are they Coorstek? Because they got spun off from the bottle business of Coors Beer.
Complex is software and chip design. It's not straightforward and is conceptually hard to understand, even at a superficial level.