China Overcapacity? Naiveté or Old Lady Wisdom -- China Watchers Part 3
Open Systems vs Closed Systems vs Dual Circulation
The recent visit by Janet Yellen to China sparks viewpoints on who really has the leverage and who is navigating the ship. This recent dialogue comes off the back of hallowed attempts to “right the ship,” for US-China relations. The insanity of the messages seems obvious for the the business leaders, naïve for the politicians/policy makers, and genius for the advisors.
The answer, however, has to come from within the borders. Gone are the days of squeezed money flows and the mighty deterrence of supply/demand. The days of new business models and innovation leadership are here. The only question remaining is the time it takes to make these business models and innovations real.
Each side speaks what they want, falling on deaf ears. Each side thinks they are smarter than the other as they fall back to their bed with different dreams of dominance. Human psychology at its finest as the “whack-a-mole” continues.
US Messages
Stop producing, you are making us look bad….
Stop making things, we cannot compete….
Let’s talk more about it….we love to hear ourselves
China Messages
Yes, we produce lots of stuff….thank you for noticing…
We will look into the capacity and adjust our output to further press your inefficient systems….thank you for providing the pain points so we can be more competitive…
We are more than happy to keep talking about stuff……talking costs us nothing
Maybe this was the reality of the discussion….
“Businesses hold the keys to the future of the US-China relationship. Businesses led the charge decades ago, they will be the tip of the spear at reshaping the relationship. New alliances, new partnerships, new technologies, and new business models. All of these will reshape the relationship between the two largest economies. Each watcher has their own view. Each watcher has their own prediction.”
Laowai
Types of China Watchers Part 2 — Published Dec 3 2023
TJ
