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China Readies ‘Largest-Ever’ State Semi Program With 500 Billion AI Plan
When it comes to industrial policy, no one does it quite like the Chinese.
That's not a compliment
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Ironically, I was reading Bloomberg’s piece on China Vanke’s apparently quickly-approaching debt demise and reflecting on the pattern we’ve seen in China over some decades as they cycle through industry after industry, passing each through stages of “strategic declaration”, supporting it, becoming dependent on it, blowing it to unsustainable scale, attempting to export it, knee-capping it, arresting bankers and executives for it, containing it, and finally managing it into oblivion. The fact that it happens in a command economy isn’t really surprising; it’s the sheer number of repetitions that always gets me when I think about it.
At the bottom of the China Vanke article is a link to the next article: “China Prepares as Much as $70 Billion in Chip Sector Initiatives”. And so it begins…
Impartially, the Chinese investment of $70 billion USD is substantially larger than the funding allocated under the CHIPS Act. To illustrate this briefly: the differentiation in labor costs demonstrates the significant margin China possesses for investing in human capital, which is further supported by the large number of STEM major graduates the country produces.
Two really good points.
Another industry starting down the the involution path. Hasn’t worked yet, maybe this time…
Fear is a great motivator until the adrenaline surge wears off, then it’s crash time. Donald, are you listening or are you just like every other global dictator.
He routinely copies their mistakes. After all the US’ grand plan was a copy of that of a foreign dictator Trump admires.
China…….and always up to no good …That about nails it.