1/ In the Auto Race, who is Number 1? 2/ In 2023, which nation made the most automobiles? Which nation’s citizens bought the most number of cars?

1/ Why is TSMC’s attempt to build a semiconductor factory in Arizona falling further and further behind? “TSMC’s debacle in the American desert” from Rest of the World offers clues:

restofworld.org/2024/tsmc-ariz… 2/ Since its announcement in 2022, the landmark Arizona plant has been delayed twice and is currently set to open in 2025, more than a year behind schedule.

Inconvenient Facts about the Chinese Economy. The Peterson Institute’s Nick Lardy’s recent in Foreign Affairs, “China Is Still Rising,” offers a number of inconvenient facts that remind us to follow the numbers instead of the narratives.

foreignaffairs.com/united-states/…

Having returned from a whirlwind tour of 9 intense days of meetings in Beijing, reflecting on my discussion with Xi Jinping: While Xi’s primary objective in meeting with US business leaders (I was included as a ‘representative of the academic and strategic community’) was to emphasize that China is “open for business,” he was also interested in engaging about the broader geopolitical relationship.

1/ The US vs China—who is growing faster than whom? 2/ Because that question has been answered by people using different metrics, it’s understandable that there has been some confusion. In real terms, the consensus supported by the World Bank and IMF agrees that China grew twice as fast as the US: 5.2% versus 2.5%.

1/ China Facts: Who has the most competitive automobile market in the world? Who has the most competitive market for EVs in the world? 2/ The answer is China and China. China sold 30 million autos domestically last year. In contrast, the US sold only half as many—15.5 million. China also overtook Japan to become the world’s largest auto exporter.

As @WSJ and other outlets sound the alarm that China’s 7.2% increase in military spending is “another hefty increase” in its decades-long military buildup, it is important to examine the facts. China’s 7.2% increase is nominal. If China hits its real GDP target of 5% and CPI target of 3%, its military spending as a percent of GDP will shrink in 2024.

Last week, I was interviewed by @NYMag about the dangers of demonizing China. As politically profitable as demonizing China now is, it leads individuals to overestimate China’s strengths and to underestimate its vulnerabilities. nymag.com/intelligencer/… As people awake to the fact that China really is emerging in many arenas as a serious rival to the US and—in some instances—has already displaced the US as the predominant power, they are understandably alarmed.

1/ In his FT article last week, @EdwardGLuce identifies another example of what I term the “Trump Put”—how the realization that Trump could indeed re-take office in a year’s time is causing governments and institutions to alter their behavior today.
rb.gy/gtbzor 2/ Ed notes that Wall Street executives are changing their tune on Trump, as their fiduciary duty ensures they are “paid to hedge bets.” When asked about JP Morgan's prospects under a Biden or Trump presidency, CEO Jamie Dimon said: “My company will survive and thrive in both.”

At Davos, after a small-group discussion with National Security Advisor Jake Sullivan, an Israeli who was at the meeting caught me to say he’d been rereading my book: Essence of Decision. As he put it: the essence of the challenge Biden and his team face in dealing with the Israeli government is that differences within Bibi’s government are at least as big as differences between the US and Israel governments.

China Hype. In the current political environment, politicians and commentators alike are competing to demonstrate who can make the most extreme charges against China. While as I’ve written, I believe it is essential to recognize that China is and will be the fiercest rival a ruling power has ever faced, I am also convinced that the current demonization of China confuses more than it clarifies.