Now we gotta talk China and I think it's really useful to look at what China's priorities are, especially what they are telling their country their priorities are because I'll tell you there is a lot of fear and uncertainty and doubt right now about the relationship of potentially China providing lethal weapons to Russia while at the same time the United States is providing weapons to Ukraine suggesting this real Uh is essentially World War We're seeing, we know that China is trying to expand their nuclear stockpile at the same time as you've got Russian saber Radley There's a lot of pain around a potential idea of China invading Taiwan China just had a Chinese person Chinese dude steal Advanced chip manufacturing uh schematics and Manufacturing plans from the Dutch company asml to Pro to provide Advanced chip making capabilities to China potentially for three and two nanometer chips uh, which the United States has banned China from being able to buy that equipment so China's threatening to make their own while at the same time, China's like we're gonna face out using the big four Auditors because Fu America like things feel really like tense and scary right now. but I think it's really useful to look at what Xi Jinping actually provided as a speech to Chinese because it's somewhat useful to look at the translation of this because I believe that what is happening in public policy is giant saber rattling and what Xi Jinping is actually saying to his to his country is really the primary goal. and I think when you listen to the speech because you might think like oh well, what if it's just brainwashing or manipulation? That's fair, you know I got some tinfoil too. Okay, but I actually think what he's saying here is very important.

uh, and very realistic. So let's take a look at this. So the first priority that Azizian Ping has is investing in expanding domestic demand. In other words, they are providing stimulus to businesses and infrastructure to make sure they can do whatever they can to actually continue to grow.

Keep in mind China's population just shrunk. So then that's the first time their population has shrunk uh and are really leading to this idea that uh oh, we don't want to turn into Japan where all of a sudden we don't have GDP growth anymore and we just basically stagnate. We want to make sure we're really supporting growth uh. lending standards for for Chinese housing have been relaxed.

The three red line policy has been relaxed which led to a massive burst in the housing bubble of China home prices down somewhere between 30 to as much as 45 in certain areas. China Going as far as looking at unsafe high-rises that were built in in ghost towns and starting to demolish them. so in other words that housing can be rebuilt appropriately and in a safer standard to where it's needed with the support of government stimulus. And so they say here, look, they, it's their words First give priority to the recovery and expansion of consumption.

China's new Industrialization Informationization that's a fancy word. Urbanization and agricultural modernization have been further promoted and consumption has increasingly become the basic Force to drive economic growth. Xi Jinping is literally opening up his speech by saying consumption will drive our economic growth. That's true in America folks.

but guess where it's not true China it's not true in China Because what? Oh wait ah, the consumer only makes up about 32 percent of the Chinese economy. Real estate makes up most of it. Uh oh, but what did you just screw up? Oops, The real estate market and Once Bitten Twice Shy I think Chinese are saving a lot more money than people expect and yeah higher in Brands like Hilton and Lvmh are pretty dang excited. uh at the reopening and they're seeing a nice juicy rebound which is fantastic, but it's going to take a while.

file for every Chinese consumer to actually eat it into such levels of consumption that you could support the levels of GDP growth that you previously had. The Chinese government realizes this and I think because they realize that they've really got to boost the consumer much like America did. You're going to be in a situation of uh oh, wait a second. we might not grow like we used to.

and if we don't grow like we used to uh oh uh because we're too busy saber rattling and threatening War then we're going to lose a lot of clout. uh in the International Community And we could actually negatively affect the future of our growth even more because if China is not growing, why would you want to invest in China If you're say Apple or Tesla or other companies, where are you going to go and set you go to India Mexico Taiwan right? That's not what China wants. So China is making it very clear consumption is a function of income. Therefore, it's necessary to increase the income of individuals.

as their income goes up and they have more access to Consumer Credit they'll be able to spend more money. Uh, so really China is trying to do what America has been able to do for the last 50 plus years, which really is is increased income for individuals. That's the goal number one. As much as China waves the saber of of pain, uh, it's very, very clear they want to invest and so that's why they're accelerating their 14.

Five-Year Plan whatever. But part of that Five-Year Plan they say it's necessary. This is very interesting to liberalize Market access for private investment and encourage more private. Capital Growth in the construction of major national projects.

Uh, you know, really making up for shortcomings. But look at this. China's actually waking up to the idea of damn. Maybe capitalism is the way to do it.

Maybe we've been supporting growth for too long with government projects, but now we've built and the people didn't come because crap. our population declined and damn, we had the stupid policy called the one Child policy not to be confused with the one China policy. the one child policy which doesn't exist anymore, but absolutely led to birth rate declines. And guess where the rich people are going, they're leaving.

The rich people are going to different areas like Singapore they're taking their money out of China and in part because China has not accepted capitalism. Uh, and and it looks like here via this speech, they're actually trying to increasingly open up to the idea of private investment as a factor of growth. They also want this economic cycle to be smooth. Well, you can't have a smooth economic cycle if you invade Taiwan So if you're an investor who's like no, no man, China's gonna invade Taiwan Come on no.

The China's goal is for Russia not to suck to Russia Russia to end the war in Ukraine because the more Russia spends on Ukraine the lower the Russian GDP uh goes unless Russia can actually have their country invest with China and instead they're focused on working with Iran on Bill building suicide Kamikaze drones when that money could be going into I don't know. building a Russian EV which probably suck anyway, but at least it'd be something better than building bombs that are just getting sent over to Ukraine. It's stupid. China doesn't really benefit that much from that.

That's of course. China is thinking about. hey, maybe now we can start providing some lethal weapons to you and in the meantime we'll buy your cheap gas. But come on, you don't want to destroy your biggest trading partner.

One of your biggest trading partners. What else do we have? Effective implementation of two? Unwavering. All right. Basically here for some time there have been some incorrect or even wrong comments in society about whether we will still engage in a socialist market economy and therefore adhere to unwavering.

We have a clear attitude and to be unambiguous. We will always adhere to the direction of a socialist market economy. That's what they argue. They say that and they talk about three-year reform of state-owned Enterprises and how great this has been.

However, look what they're saying. At the same time, they're talking out of both sides of their mouth because they realize socialism isn't the sole answer. Optimize the development of the environment of private Enterprises and promote the development of private. Enterprises The private economy plays an important role in the economic and social development.

Employment, fiscal, taxation, scientific and technological innovation. They realize they're falling behind. They're falling behind on creativity because when they state run everything. What's your point? What's the point of being creative and innovating? You're going to get paid the same anyway.

It doesn't matter, and the government's going to take all the profits. Well, then you don't innovate. and then you, You don't get more tax revenue, Then then you're not actually building GDP So they're talking out of both sides of their mouth, realizing, look at this. We should improve the Fair competition system, oppose local protection and administrative monopolies, and open up more space for private.

Enterprise This is actually a fantastic speech because it shows you there's like a waking up happening in China Oh crap, our population's declining. Oh no, our GDP is starting to suffer. It is necessary to strengthen the communication and exchanges with foreign businesses to provide the greatest conveniences for the foreign businessman to come to. China Yeah, because so far they've been leaving, uh, effectively, prevent and resolve major and economic.

Financial Risk All you're going to do if you go to war with Taiwan is make that even worse, right? So again, this speech is like a phenomenal speech that should give you a lot of enthusiasm that China has massive goals of streamlining what's happening in the world, eliminating war, and focusing on transitioning to a smoother economy and one that can grow again. Look at it. I Mean how many times do they use the word smooth in this? Be remarkable. Eliminate the disadvantages of high-yield dad High Leverage High turnover development model over the year, and promote the real estate industry to the development of a new model.

A smooth transition, you know. I Just want to do a quick command F on the word smooth in the speech. Oh, they actually only mentioned it twice, but it seems like they're They're saying the same thing in many different ways, right? Third, prevent and resolve the debt risks of local governments. This is because local governments that have put so much money into local real estate bonds have been getting reamed.

so they're really talking about. hey, we got to solve the debt crisis. We got to smooth out the fact that the real estate market has absolutely gotten crushed, but we want to focus on more private markets more private. Enterprise How can we put together socialism and capitalism? How can we combine those things? And how can we mitigate further risks while actually encouraging people to invest in China and innovate in China.

Well, you don't do that by going to war. You do that by ending the war, encouraging the ending of the war with Russia which there's a reason one of the chop a top Diplomat from China is in Russia right now in Moscow and potentially is going to unveil their sort of master plan for peace in Ukraine Uh, on the one-year anniversary which is this Friday February 24th. So it'll be interesting. but if if you're seeing headlines about like China and or you know, saber rattling and all this, in my opinion, it is the complete opposite of the core of what China is actually trying to do.

They're not trying to encourage more. Warfare Uh, you know this whole weather balloon stuff and and the chip stuff and a lot of this is saber rattling and and political uh jargon and nonsense in my opinion. But long term? Uh I I think China's goals are very, very clear. They're realizing their economy is suffering and the goal is to encourage capitalism because that's how you create Innovation.

So I think big U-turn from China that provides a much more realistic view of what the Chinese future should look like. We shall see, We shall see. Uh, it's gonna be very interesting. Uh, We've literally been following Japan's footsteps.

Well, we'll see. That's another idea too is that you end up going into like stagflation. There's no growth from anywhere, right? Uh, so it'll be fascinating. But but look, uh, the the relationship between China and Russia is strengthening.

Obviously, the China's economy uh, or Russia's economy is substantially smaller than the trading partners that the United States has with with the West uh, substantially larger economies than Russia. But anything you look at uh shows China's very, very clear Alliance uh with Russia and how they would benefit from not seeing Russia fall into an even smaller uh uh uh economy and they would benefit strongly from a a much a more resilient Russia uh, from an economic point of view, not necessarily military. So so it's it's things like that that when people ask me like oh, do you think China's going to invade Taiwan do you think China is actually going to make the war in Ukraine Wars No. I don't think so.

Here's why: I don't think so. That doesn't mean I'm gonna be right I don't know what they're ultimately doing. Who knows. Maybe this is all just propaganda and bullcrap and they're gonna do none of this.

That's possible too. Uh oh, look at this. China's foreign Ministry China is willing to work with Russia to deepen political trust, extend pramatic cooperation, and play constructive roles for both. uh, promoting peace and World development.

This is literally just out. This was literally just tweeted here first squat five minutes ago China appreciates Russia's willingness to resolve Ukraine crisis through negotiation sounds great. Uh. China will maintain objective and impartial stance on Ukraine crisis though.

but they'll play a constructive role in the settlement of the Ukraine crisis. China will play. uh. let's see: China will maintain objective Impressions That's okay.

That's reiterating the same thing. China Uh, that's about trying to appreciate the willingness. That's fine. We read that.

Okay, yeah, I mean that's that's basically. uh, you know it sounds like, uh, what we're talking about. Uh, pretty well.