1/ With China beefing up its gold reserves and largely opting out of the market for foreign holdings of US Treasuries - which is already causing liquidity problems - it’s useful to get a sense of what the Chinese are saying about this internally. 🧵 2/ Here we turn to the latest issue of the China Institute of Contemporary International Relations’ journal. CICIR is an important government-affiliated think tank that has been around since 1965. So borderline official doctrine coming from this shop.

1/ Now that we have the results let’s take a look at the Shy Trump Effect and how it performed. Remember: when applying the Shy Trump Effect to the polls all we are doing is standard statistical practice. Why can’t @NateSilver538 and @FiveThirtyEight figure it out? 🤷‍♂️ 2/ Some of the swing states haven’t been called but we have some idea of spread. In what follows I will use ‘Trump’s Lead Over Harris’ as the measure. Just as in the original Shy Trump Effect prediction thread.

1/ The US election is here. If you analyze the polls properly you'll see that @realDonaldTrump is ahead of @KamalaHarris by anywhere between 2.4% and 6.9% in the swing states. The reason the media won't tell you this is because they don't understand the Shy Trump Effect. 🇺🇸🧵 2/ The polls show consistent bias against @realDonaldTrump. This is not due to cheating but due to quirks in the polling. More later. For now, let us just look at polls versus outcomes. Here are the November polls in 2020 versus the actual results. They were way off.

1/ Despite not becoming Tory leader @RobertJenrick tried to raise serious economic issues in the recent contest. Britain appears locked into 5 year old culture war issues even as its economy looks on the brink of collapse. Britain needs a serious debate on this ASAP. 🧵 2/ @RobertJenrick recognised that one key issue is energy. He advocated switching from green investments into nuclear, specifically small modular reactors (SMR). Britain needs a new energy policy ASAP but it seems highly unlikely the country can develop its own SMRs.

1/ We have been treated to 48 hours of hot garbage on what happened at the BRICS summit around alternative financing relationships. In this thread we will go through the garbage and look at what actually happened. 2/ Start with the silliest first. Some people were circulating a picture of an actual BRICS banknote, as if the BRICS would adopt a single currency like the euro. This would be like the G7 adopting a single currency. Nonsensical.

1/ What Britain is witnessing is the beginning of Dark Blairism. This is the final stage in the collapse of the country. 🇬🇧🪦🧵 2/ The first iteration of Blairism was a happy-go-lucky affair. Blair and co were Marxists of a variety, but happy Marxists who rejected state socialism and embraced cultural radicalism - a new, freer society where different groups would live in harmony.

1/ In a new study undertaken in partnership with @hiia_budapest I compare the relative geoeconomic strength of NATO and the BRICS+. We do not think a war between these is likely, but a war between members might turn these into autarkic trading blocs. 2/ Our first major finding is that the economies of the two groupings are now roughly the same size, with BRICS+ being slightly larger. This is an enormous development. Policymakers seem to imagine that we live around the year 2000 in this regard. They’re dead wrong.

1/ Here is a thread on why recent record sales by the Chinese of US Treasuries might be one of the first signs of a major fiscal crisis in the US. There is a lot of confusion about how this would work so let's go through it step by step. 2/ What matters here is not overall US government debt but rather the balance of payments. If a country runs a trade deficit this must be offset by financial inflows on the financial account to maintain equilibrium.

1/ A new paper is out with the @hiia_budapest. In it we explore reindustrialisation. With governments across the world waking up to the catastrophe caused by a decline in manufacturing we want to explore what reindustrialisation might entail and what might constrain it. 2/ Do not believe those who tell you deindustrailisation is driven by technology. A portion of it is, but most of it is a redistribution of manufacturing capacity from the Western countries to the emerging BRICS+ bloc - especially China.

1/ Ever since the pandemic the Western world has started to talk about ‘derisking’ and ‘decoupling’ which are both euphemisms for increased protectionism in the West, especially vis-a-vis China. A study I worked on with @hiia_budapest shows that this has not been thought through. 2/ Through globalisation the world has become highly interconnected. It used to be that China relied heavily on imports but now the EU is more reliant and the US is as reliant.

1/ In conjunction with the @hiia_budapest I will be working on a comprehensive series of economic studies on the emergence of the multipolar world in the 2020s. In the first othis series, we explore the Origins of Economic Multipolarity. Highlights in this 🧵. 2/ China overtook the US and the EU as the largest economy in 2017, but little attention was paid to this because of a flood of fake economic metrics (details in report).

1/ In our new paper demographer Paul Morland and I argue that Western countries facing low and falling birth rates are confronted with a trilemma. They can only pursue two of three possibilities: economic dynamism, ethnic continuity, and egoism. @arc_forum 2/ Countries like the United Kingdom can barely reproduce itself. Deaths in the country are close to outstripping births. Extremely high immigration rates are needed to keep the economy rolling.

1/ Iran are making big threats against the US. Some may be inclined to dismiss this. After all, isn’t Iran a third rate power and a hermit kingdom? A sort of Middle Eastern North Korea? Maybe not. 🇮🇷🇺🇸🇮🇱

https://twitter.com/clashreport/status/1717511229260939276

2/ Iran has a huge missile stockpile. These include around 3,000 ballistic missiles that can strike anywhere in the Middle East.

1/ I’ve spoken to numerous people this week, including some with experience in Middle East politics, who realise that the region is about to destabilise again. But they also think this is just part of the cycle, every ten years it falls apart there. But this time IS different. 🧵 2/ There is no doubt that the Middle East is a powder keg. It always has been. Many of its borders were drawn only a century ago, in line with Western interest. It remains true that the region is a powder keg, it does NOT remain true that it is still a “playground of empires”.

1/ From what I understand, word in DC is that the upcoming Battle of Gaza is going to be modelled on the Second Battle of Fallujah in the Iraq War. How the battle progresses and whether the IDF gets pinned down is basically contingent on whether this is an accurate assessment. 🧵 2/ There is, however, a potentially better analogue: the Siege of Mariupol in the Russia-Ukraine war. Let’s consider both.

1/ Here’s a hypothesis that I haven’t seen much discussed: maybe the economic growth that we are currently seeing in the United States is simply fake; that is, made up of make work to keep the economy ticking over before the election. 🇺🇸🧵 2/ I barely need to highlight how many leading indicators are screaming ‘recession’ in the US. Let’s just look at PMIs. Manufacturing PMI is at 47.6, worse than the beginning of the 2008 recession.

1/ Yesterday I published an article in @unherd arguing that the situation leading up to the French riots is being driven by high food prices and low consumption. I presented INSEE data showing a 17% drawdown in food consumption, totally unprecedented in recent history. Chart 👇 2/ I wouldn’t usually comment on the response to one of my articles - negative comments really don’t bother me. But the response to this was fascinating: person after person expressed disbelief in the numbers, said I hadn’t sourced them, and surmised that I made them up.

1/ There seems to be a bit of confusion being spread regarding the BoE 0.5% rate hike yesterday and how it will impact the coming recession. Apparently it is now mainstream to say that there will be a recession in the next 12 months. That’s a new development in and of itself. 2/ But the latest debate is whether this recession would not have happened without more rate hikes. In all likelihood it would, but this is really besides the point.

1/ The UK could be in a bit of trouble here. Labour are clearly dipping into the American liberal left playbook for basically all their policies. But where policies may be viable in the US, they may be harmful and even dangerous in the UK. 2/ First off, to be clear, I’m not shilling for carried interest. Looked at in terms of ‘fairness’ its debatable whether it should be taxed as capital gains. From an economic point-of-view, the carried interest debate isn’t even interesting. Except maybe in the case of the UK…

1/ Labour plan on allowing councils to force landholders to sell land at rates that don’t take into account potential improvements. Labour’s plan buys into the mythology that the problem is too little supply and so will fail like all the other failed plans. 🧵 2/ Other countries in Europe already to do this - and they have the same high house prices as the UK. For example, in the Netherlands they have this system and yet housing is still top of the list in elections.

1/ A 🧵on the @SecYellen speech which, while promising, seems to be a bit myopic both on the relative economic position of the US and on the relative isolation the US is experiencing in their China policies. 2/ The section that caught the headlines highlighted that the US did not want to decouple from China, calling such a prospect “disastrous”.