Finding Opportunity in a Rapidly Declining China
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get more and more horrible business news coming out of China. You know, we talked about Evergrande coming back a little bit, but it’s not really coming back. The real estate, we’ve gone over that again and again and again here on the podcast and the radio show. But, you know, you’re also getting right now stories in regards to venture capital money that has gone into that country and they can’t get it out. Since since Alibaba.
went public in 2014, early stage investing has flowed into China, but with nothing to show for it. Only four US dollar denominated venture capital funds established between 2015 and 2020 have at least returned all the money that they put in. That’s not even getting any sort of return. Why is this important? Why do I keep talking about this here on the program? Why is this important to you, to I? Again, another story here.
American business confidence in China slumps to lowest in decades. It’s important because again, the powers that be and again, the overall, the overarching theme on many business networks, the conventional wisdom out there is that we are going to war with China. We’re going to have to go to war with China, they’re going to invade Taiwan, we got to up the ante, you get a lot of hawks out there talking about all of the issues.
All of the issues that we’ve had with China, they’ve been around for some time. Business was booming for a period and no one really wanted to pay attention to it. Everybody kind of glossed over the entire situation where China would censor American films. We talked about forced technology transfers, all of these things. Well, guess what? Guess what? The inevitable happened.
exactly what we told you was going to happen. We told you the Chinese economy was one big fat fugazi. It wasn’t going to bounce back from COVID like that they were telling you. And I can go on and on and on. This is an opportunity, okay? This is an opportunity if we can get some halfway intelligent diplomats working with this country. There’s no need to be going to war. There is a much better solution when it comes to trying to work with this country at this point.
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I know, I know, I’m gonna hear communist China and this and dictators and that. Okay. Would you rather butt heads, would you rather, would you rather send our young men and women to go fight inevitably over there, or would you rather talk this thing through. Believe it or not. Believe it or not, with as weak as our economy is with the problems that we have at this point in time, we are in a position of strength.
Everybody is pulling out of China. Everybody. I mean, you’re talking Europe, no more, you know, Belt Road Initiative. All of these things are not going their way. Now, again, is this a good time to engage and maybe try to push them in a certain direction? And I’m not even saying that it’s going to work. But the effort needs to be made. But one of the things that we have to do is you can’t
play this out in a public forum. The goal shouldn’t be to try to embarrass them there. Again, you gotta understand the psyche, the type of culture that you’re dealing with over there. You work behind the scenes to solve this problem. Again, and I think if it’s handled the right way, you know what, you might not have a situation where China says, you know what, we’re gonna force.
forcibly take Taiwan. Yeah, I mean, they, you know, could it go in the opposite direction? Do you have to trust and verify? Do you have to pay attention to their military and the activities that they have in the South China Sea? Absolutely. Absolutely, but their economy right now is in disarray. And I want to point to something where I believe we screwed up royally. We screwed up royally.
when the Soviet Union broke up in regards to Russia. And listen, I get obviously, first and foremost, our biggest concern was to make sure that there was no proliferation of nuclear weapons, which were in states that were now independent outside of the former Soviet Union and Russia at that point in time. But again, we allowed that to get out of control.
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Boris Yeltsin, I know, remember him yucking it up with Bill Clinton. We allowed for the oligarchs to take over. So basically, you had a lot of the same people, Vladimir Putin, KGB agent. You allowed the powers that be, the people that were in power that were well up the food chain, the Communist Party, take over a myriad of different industries there. And look where we’re at.
Again, I think that we should have done more to engage at that point in time than we did. And again, I think we’re paying for some of those mistakes right now. China is in decline. Is in decline. And, you know, it’s again, you look at their long history. They’ve been through this in the past. But now, like I said, they’re in decline, but they’re also, again, a major player on the world stage.
when it comes to manufacturing. I know it’s not as big as it used to be. I know people are decoupling, de-risking, whatever you want to call it, but they’re still an important part. And they’re also a, still have a formidable military. You’d be a real wonderful time for somebody to step in. Watchdog on wallstreet.com.
