What Investors Are Missing About China There's been a lot of talk about China lately, from protest, to pork shortages, to trade wars. There's a lot of factors at play. So what's actually important, how do you make sense of it and what are the potential outcomes in a conflict between the US and China? We're going to talk about all that and more on this week's episode of Real Visions The One Thing. What's going on investors? AK here. Recently, Real Vision has featured a lot of different views on China. We've had experts come in and discuss the different geopolitical, economic, and technological aspects of this conflict. Now, they're all focused on different factors. But the common theme between them is that they're all very skeptical and they approach it from an unconventional viewpoint, which is refreshing in a world where most investors are hugging the indices and following the consensus. These alternative views can help identify money-making opportunity. Now, even though the media just covers Trump's tweets in the terrorists, the trade wars actually have more to do than just with trade. Our experts agree that not everything is being reported, but they disagree on what's actually important and what the actual issues are. Chris Balding sat down with Real Vision to talk about his experience living in China and how things change while he was there. It really began to feel China's change in 2012. When I first arrived in 2006 and 2009, in relative terms, China's seems looking back now almost open in freewheeling. Things really began to change in 2012 when she was there and I think those changes really began to accelerate in let's say 2014-15. So Balding is saying that China's than a much different situation now compared to even five or 10 years ago. So what are the changes that make them mainstream narrative wrong? Well, everyone's heard about China devaluing their currency, but Balding points to something else on the macro level that's the true cause for the changes he seeing in China. I think that is probably one of the biggest things that is missed in everything that's being discussed about China is, she is almost, in my estimation, singularly focused on not just the collapse of China, but the accompanying numerology that is there right now. One of the ones is, and I might be wrong on the name of the plan, but I believe it was the Soviet Union was on its 13th five-year plan and China is in the middle or near the end of its 13th five-year plan right now, and the Soviet Union did not see a 14th. She is singularly focused on not just having a 14th, but on making sure that she does not replicate what she sees as the errors of the Soviet Union that led to its demise, specifically opening and liberalization. By trying to avoid the problems of the soviet union, G is leading China into unknown waters. Meanwhile, Marco Paddock argues that not only is the mainstream misunderstanding China in its motives, but they're underestimating the capabilities of a fully mobilized China too. Here's Marko explaining why the US might be vulnerable on his purchase of global hegemony. I would agree with that. I would agree with that just because, size of your military is irrelevant today. The other problem that the US has is that the US has over the last 30 years really focused on beating the crap out of very weak countries. So take the aircraft carrier. Aircraft carrier is a beautiful piece of technology if you're going to bomb Serbia. But if you go into fight China, which you've just done, is you put all your eggs in one beautiful basket that costs about $20 billion and it can be shredded into linguine by hyper-sonic cruise missiles which China has and which is developed. Now, he's not saying that the US is going to go to war with China. He says a China not only challenges us economically, but militarily as well. Okay. So if we're not going to war with China, then what does this mean and what do they want. Here's Marco's answers. For global hegemony may be out of reach for China and I think it will be. So there might be this moment of the next decade, where China has managed to get regional hegemony and goes for broke, goes for global, and that's where they will potentially fail. But I think we're one step removed from that and I think they're currently focused and regional hegemony, and that's why it does make sense to delay the confrontation with us. So Marko things that China will try to establish a regional hegemony and in some ways they're already a good portion of the way to achieving that. But what are the consequences of a regionalized China and more skirmishes? Marco explains that if it leads to a military confrontation, technology will be the factor that decides the outcome. Ian Bremmer joined us to explain how technology will determine the fate of our next conflict. Well, certainly, people are moving and ideas are moving and capital is moving around the world faster and faster. But the most important point is the most advanced part of our economy, which is technology, chips, 5G, heart big data, the Cloud, and there we actually see globalization literally falling apart. We see two completely different competitive systems. One being driven by the Chinese, the other largely being driven by the Americans, and they don't interact. Everyone's complaining right now in China that the Americans are trying to get widow Huawei, which is their major Technology Company driving 5G. But if you're Amazon or Google, which are functionally American monopolies in their space, they don't have access in the world's largest intranet market, China. That's not globalization. That's not the world wide web. That's a splinter net and it's completely different from what advocates of globalization and the free market we're hoping was going to happen in the 21st century. He sees a world where technology actually pushes us further apart. If China can establish a regional hegemony, it would make sense that each country would dominate their respective technological spheres of influence. Between all of the things that our experts said, there is no clear outcome of the conflict between China and the US. But luckily for us, Mike Greene puts it all into perspective for us quite nicely. Unfortunately, I see these dynamics playing out very similarly. One of the alternate takes. So there' s, I would argue, three primary narratives. One is China's the future, this is the Joe Biden articulation, which is difficult to square with many of the facts on the ground, but certainly remains, I would argue, the consensus view. The second one is that China's not the future, but it's going to manage it similarly to Japan. That it's going to have a step-down in growth, that it's going to age, and therefore have deflationary pressures and probably an appreciation of the one as they seek our financial power and global power in terms of the financial sphere as compared to the manufacturing or outright growth. Then the third one is the China collapse model right. Maybe all these things like a full-blown war, the collapse of the CCP won't happen anytime soon. But the risk is are out there. So whether you agree with our experts or not, you got to think about the potential impact on your portfolio. If you want to help tracking those risks and identify new ones that may pop up, subscribe to Real Vision. I'll talk to you next week. Let's play a game. I'm going to read out three sentences. You need to guess what they have in common. All right. Here we go. Sentence number one. 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