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Glenn Profile picture
Glenn
@GlennLuk
Co-founder/Director @HealthCareInc | Previously @Catalyte_io | VC/PE @Investcorp Technology Partners — Tech | Economic Development | Investing | Greater China
14 subscribers
Mar 1 • 5 tweets • 2 min read
What’s more likely?

The company that pushes out its methods onto open source is lying about its compute needs

Or research analyst guessed wrong on the number of chips they inputed into an excel table Six consecutive days of open source code releases validate the OoM efficiency and cost improvements …
Feb 28 • 12 tweets • 2 min read
When outside pundits opine that China’s savings rate is “too high”, people should realize they are effectively complaining that China is building too many houses and too much infrastructure for its own people.

Why do they care so much how China chooses how to develop itself? Savings ~= Investment (gross capital formation, GCF)

Housing and public infrastructure account for 50-60% of total GCF and accounted for more than 100% of the growth of GCF since the GFC.

(it’s only been the last 4 years — since 3RL — where housing has declined) Image
Feb 27 • 26 tweets • 6 min read
Was having a DM conversation on "breakthrough invention" with Noah.

I had not originally counted "the drone" as a Chinese invention but ultimately it depends on how you define "invention":

Don't need to be 1st, but need to be early & achieve commercial success. The conversation delved into the deeper topic of incremental improvements vs. true "breakthrough innovation" and where China fit on the curve.

@ruima discusses the topic of incremental innovation here:

Feb 26 • 19 tweets • 7 min read
1. It is Argentine shortfin squid (illex argentinus) season. We know these boats are looking for shrimp from the lights (squid are attracted to the lights).

2. Argentine shortfin squid habitat includes deepwater (i.e. outside EEZs).

3. Spain and Italy are the largest importers of squid. The U.S. is also a squid importer.

4. Deepwater fishing is hard work, dangerous and requires a certain boat specification.

5. China has leading share of both (i) these boats, (ii) and work crews willing to take on this hard and dangerous work.

6. Chinese work crews and/or work crews working on Chinese ships capture most of the world's shortfin squid to satisfy demand from the net importers.

7. People from squid-importing countries suggest
sinking these boats and killing these work crews. 1. It is Argentine shortfin squid season

2. Argentine shortfin squid aggregate on the seafloor to depths of 800 meters https://www.seafoodnews.com/Story/1292255/Illex-Squid-Fishing-Season-to-Open-Early-in-January-2025
https://en.wikipedia.org/wiki/Illex_argentinus
Feb 25 • 12 tweets • 3 min read
The challenge with re-industrialization is reality that the U.S. will need to re-learn how to walk before it can run again.

Competitive mfg is incremental and cumulative; leapfrogging is rare.

People sometimes think China leapfrogged. No, it had to learn step-by-step. Take my favorite topic HSR as an example.

China did not leapfrog into HSR.

1st it learned how to build slow trains + basic tracks. Then it learned building bridges and tunnels. Then it learned how to speed them up. Finally, it started building HSR.

Feb 23 • 20 tweets • 5 min read
It's really quite simple:

We can trust Brad's alternative estimates when he can he can definitely point out evidence where trillions of dollars of hidden capital outflows have accumulated in global asset markets, thus far undetected. This is the undisputed implication of claiming SAFE has been understating its official CA surplus by $500-600 billion per year since 2021.

I raised this in October ...

Feb 19 • 18 tweets • 5 min read
Remember all the people who said China wouldn’t be able to make the shift away from the real estate-driven economy? This transition was possible in part because of the continuously underrated migrant “floating” population.
Feb 14 • 16 tweets • 3 min read
There's of course a certain level of irony with rumors of 50/50 JV with TSMC being considered with "tech transfer" when juxtaposed next to complaints about China's mandated use of 50/50 JVs and tech transfer, e.g. in the automobile sector in the 90s and 2000s. Instead of correctly viewing it dispassionately as a rather effective structure to transfer tacit knowledge in a "learn by doing" activity like manufacturing, the 50/50 JV structure itself was demonized and associated with allegations of IP theft and unfair trade practices.
Feb 7 • 20 tweets • 5 min read
Rising U.S. goods trade deficit is (in part) a mirror of the rising power and profitability of U.S. MNCs that generate large profits offshore that are accumulated in tax havens.

You can see this by walking through the balance of payments. Everyone knows that the U.S. goods deficit has been growing.

The CSIS (Pettis/Setser) explanation is that this reflects imbalances in the global economy, e.g. China “overcapacity”.

The problem as I have been saying is that the goods trade is only a subset of trade.
Jan 31 • 32 tweets • 8 min read
This key chart from @SemiAnalysis_ appears to have been the key source for claims of "50,000 Hoppers" and more detailed disclosure on their CapEx buildup analysis ("$1.3B").

But the table has errors/inconsistencies. More significantly, key assumptions don't pass sanity checks. https://semianalysis.com/2025/01/31/deepseek-debates/ 1⃣ First thing you might notice is that it says 60,000 in the Total column.

But the A100s aren't "Hoppers". So the 50,000 is just the last three columns.

Ok, so far so good. Image
Jan 29 • 22 tweets • 5 min read
One focus area for DeepSeek was going "lower level" with PTX.

Here's a nice explainer on CUDA/PTX 👇.

While this is an admittedly arcane/technical subject, it actually provides critical insights into:

1⃣ the development cost question
2⃣ export controls
3⃣ future trajectories First some quick background: PTX is a low-level coding language analogous to Assembly.

This is "deep" software engineering: you are now talking in the native language of the machines, with the thinnest of abstraction layers.

I discussed more here, too:

Jan 28 • 32 tweets • 8 min read
If people freaked out about DeepSeek wait until they hear about how it is scaling inference. “Third of the cost” is

1) Likely conservative, and

2) Didn’t require EUV
Jan 25 • 9 tweets • 3 min read
Three reasons why this is the wrong take:

1⃣ Continent-sized economies follow different economic laws (specialization vs. self-sufficiency)

2⃣ Optimal sector allocation

3⃣ China's STEM workforce is young 1⃣ Continent-sized economies follow different economic laws (specialization vs. self-sufficiency)

Larger economies can be more self-sufficient (pursue higher levels of autarky) without losing the benefits of specialization.

Jan 25 • 14 tweets • 5 min read
This is a key point about EVs. Many think it is about the electrification.

It is really more about the tech (the "I"): software-defined UX + tech component integration.

Keep in mind this comes from CATL's Co-Chairman, whose batteries are tied to the electrification aspect. A prime example of this is how PHEVs/EREVs are the fastest-growing segment in China right now.

They are built on the same modern platforms as BEVs, where the ICE is simply another integrated component to extend range beyond battery-only.

Jan 25 • 13 tweets • 4 min read
This debate with Pettis on Germany is interesting because you see many of the same flawed arguments when Pettis talks about China in the same light. Yalcin points out that Pettis focuses just on the goods trade surplus while ignoring the intangibles trade in services and tech/IP, where the U.S. runs huge surpluses.

This makes surpluses in “surplus countries” look much bigger than they truly are.
Jan 24 • 15 tweets • 3 min read
Despite all the hoopla over Deepseek, this whole story speaks more to China's broader AI ecosystem and accumulated human capital than a single company. While this has brought well-deserved accolades to High-Flyer / Deepseek + will make it a magnet for elite AI talent, I suspect what will be more impactful in the LT are the new creative use cases that can take advantage of usage costs reduced by more than an OoM.
Jan 23 • 20 tweets • 4 min read
I like to try to understand all sides so let's do "devil's advocate" analysis on this "Moonshot" or "New Manhattan Project".

This means really trying to understand the rationale of its sponsors. The above-framing/marketing is instructive on the overall vision and mission statement of the project.

This is about achieving AGI first on the premise that whomever achieves it wins the second Cold War (just as the atomic bomb / nuclear weapons framed the first one).

And achieving AGI first is itself premised on the importance of scaling total compute resources, which is both a chips and energy infrastructure question.
Jan 22 • 30 tweets • 6 min read
Keep in mind chips & servers are short-lived assets that depreciate quickly; there’s a reason accountants calculate useful lives in the 3-5 year range.

(This is fundamentally different from long-lived assets like rail & power infrastructure w/ 50+ year useful lives) Because of this, the unit economics of such investment demand a much faster return on capital.

The weighted average cost of capital will be much higher — you can’t use a ton of LT debt to finance “compute”. It will have to be mostly equity.
Jan 20 • 5 tweets • 2 min read
This is so dumb because I think it misses the underlying point here about TikTok. It is about control, not economic ownership.

China wants control. So does the U.S.

Not clear what Trump actually wants here with a JV, as Bytedance is already >60% owned by foreign investors. Image If Beijing wants to be a smart ass, it will push for a new bill that limits foreign ownership in domestic media properties to 20% and force the sale of ~40% foreign ownership in Bytedance.

Remember Alipay?

Perhaps it will even do this by offering to exchange that Bytedance stake for the 50% “joint venture” ownership stake in TikTok. That would be rich with irony.
Jan 18 • 14 tweets • 4 min read
You can see some major Dunning-Kruger effect with some TikTok refugees who have gone onto Chinese social media and made "first contact" with a large mass of Chinese netizens in a native Chinese environment. They don't seem to appreciate that what they are seeing is a self-selected and filtered slice of China.

XHS started as a social media app that catered to relatively well-to-do younger urban women.

It has expanded more widely since but its monetization model (e-commerce) evolved out of this core group, which selects a certain type of "lifestyle" content and user base.
Jan 17 • 26 tweets • 7 min read
One shouldn't think of China as a normal-sized country, but a continent.

18th/19th century concepts of the benefits of economic specialization were formulated in an era where most economic activity took place locally (butchers, smiths, merchants etc). It was also before computers, robots, software - which can increasingly substitute human labor, the key production factor.

And it was also before the era of renewables, where in the 21st century any country can be energy self-sufficient with widely available solar.