Glenn Luk has worked as an investment banker, private equity investor, and startup founder. He has closely analyzed aspects of the Chinese economy, including its GDP and high speed rail system.
Steve and Glenn discuss:
(00:00) - Introduction
(01:21) - Glenn Luk's Background: HK, Taiwan, China
(07:59) - Evolution of Chinese Companies and Economy
(14:58) - From Banking to Private Equity and Venture Capital
(23:08) - Founding a Healthcare Startup and Entrepreneurial Ventures
(26:35) - China's Development and Economic Policies
(41:17) - Comparing US and China's Economies and Cultures
(47:12) - Demographics and Consumer Behavior in China
(49:09) - China's Economy: Beyond GDP
(56:34) - High Speed Rail: huge success, or white elephant?
Russell Clark is a hedge fund investor who has lived and worked in both Japan and China. He writes the widely followed Substack Capital Flows and Asset Markets: https://www.russell-clark.com/
Steve and Russell discuss:
0:00 Introduction
0:52 Russell's background and experiences in Japan
13:25 Hong Kong and finance
31:53 China property bubble
48:54 Dollar status as global reserve currency
56:09 Japan and China economies from a long run perspective
1:05:07 Inflation, US economy, and macro observations
Raymond McGovern is a former Central Intelligence Agency (CIA) analyst, serving from 1963 to 1990.
His CIA career began under President John F. Kennedy and lasted through the presidency of George H. W. Bush. McGovern advised Henry Kissinger during the Richard Nixon administration, and during the Ronald Reagan administration he chaired National Intelligence Estimates and prepared the President's Daily Brief.
He received the Intelligence Commendation Medal at his retirement but returned it in 2006 to protest the CIA's involvement in torture.
Steve and Ray discuss:
0:00 Introduction
01:25 Ray McGovern's assessment of the JFK assassination
26:10 Hunter Biden's laptop
30:50 Ukraine and the U.S. intelligence services' role in the deep state
55:20 Strategic implications of the Ukraine war for the U.S.
I've been listening to Hidden Forces with Demetri Kofinas for years now. He's an excellent interviewer with interests in finance, geopolitics, technology and more.
In Episode 351 of Hidden Forces, Demetri Kofinas speaks with Stephen Hsu, a Professor of Theoretical Physics and Computational Mathematics, Science, and Engineering at Michigan State University. Stephen is also the co-founder of multiple companies, including Genomic Prediction, which provides preimplantation genetic screening services for human embryos, and SuperFocus.ai, which builds large language models for narrow enterprise use cases.
This is a conversation about some of the most important advancements and trends in genomic science and artificial intelligence, including the social and ethical dilemmas arising from implementing these technologies at scale. Stephen and I discuss the competitive landscapes in both industries, how America’s geostrategic competition with China is driving tradeoffs between innovation and safety, the risks and opportunities that these revolutionary technologies pose, and how the world’s largest companies, economies, and military powers can work together to reap the benefits of this revolution while averting some of their most disastrous potential consequences.
Louis-Vincent Gave of Gavekal discusses China's economic growth, its focus on education, and the global implications of its economic and political policies.
The study concludes that air launched BGV/MaRVs could attack ships from well over 1000km. Land or ship based launch would allow even greater range.
There is currently no defense against such weapons.
Russia and PRC both have systems of this type.
Defense requires interceptor missile speeds significantly greater than that of MaRV/BGV in terminal phase.
This is under ideal conditions where sensors function perfectly - it is just kinematics.
Bharat Karnad is an Emeritus Professor in National Security Studies at the Center for Policy Research in Delhi. He was a member of India's first National Security Advisory Board and has authored several books on nuclear weapons and Indian security.
Robert Trumbull Crowley, former Deputy Director of Clandestine Operations for the CIA. Recorded conversations (Conversations With The Crow) near the end of his life:
".. their head expert was fully capable of building a bomb and we knew what he was up to. He was warned several times but what an arrogant prick that one was. Told our people to fuck off and then made it clear that no one would stop him and India from getting nuclear parity"
Yasheng Huang is the Epoch Foundation Professor of Global Economics and Management at the MIT Sloan School of Management. His new book is The Rise and Fall of the EAST: How Exams, Autocracy, Stability, and Technology Brought China Success, and Why They Might Lead to Its Decline.
Steve and Yasheng discuss:
0:00 Introduction
1:11 From Beijing to Harvard in the 1980s
15:29 Civil service exams and Huang's new book, "The Rise and Fall of the EAST"
37:14 Two goals: Developing human capital and indoctrination
48:33 Impact of the exam system
57:04 China's innovation peak and decline
1:12:23 Collaboration and relationship with the West
1:21:31 How will the U.S.-China relationship evolve?
David Paul Goldman is an American economic strategist and author, best known for his series of online essays in the Asia Times under the pseudonym Spengler with the first column published January 1, 2000.
Steve and David discuss:
0:00 Introduction
2:22 David’s background in music, finance, and Asia
16:55 Looking back at the financial crisis
23:04 Rise of the Chinese economy
29:44 How Huawei’s strength is tied to China’s economic power
36:49 Competition in the global electric vehicles market
38:06 Why David thinks European countries like Germany will become closer with China
45:29 U.S. manufacturing is falling behind
52:08 Potential for war and ongoing U.S.-China competition
Dominic Cummings is a major historical figure in UK politics. He helped save the Pound Sterling, led the Vote Leave campaign, Got Brexit Done, and guided the Tories to a landslide general election victory. His time in No. 10 Downing Street as Boris Johnson's Chief Advisor was one of the most interesting and impactful periods in modern UK political history. Dom and Steve discuss all of this and more in this 2-hour episode.
0:00 Early Life: Oxford, Russia, entering politics
16:49 Keeping the UK out of the Euro
19:41 How Dominic and Steve became acquainted: blogs, 2008 financial crisis, meeting at Google
27:37 Vote Leave, the science of polling
43:46 Cambridge Analytica conspiracy; History is impossible
48:41 Dominic on Benedict Cumberbatch’s portrayal of him and the movie “Brexit: The Uncivil War”
54:05 On joining British Prime Minister Boris Johnson’s office: an ultimatum
1:06:31 The pandemic
1:21:28 The Deep State, talent pipeline for public service
Jeffrey D. Sachs is a world-renowned economics professor, bestselling author, innovative educator, and global leader in sustainable development. Professor Sachs serves as the Director of the Center for Sustainable Development at Columbia University and is a University Professor, Columbia's highest academic rank.
Steve and Jeffrey discuss:
0:00 Jeffrey Sachs’ experience on the Lancet Commission for COVID-19
13:41 Potential for bioweapons research
19:06 Why a lab leak is plausible
32:38 Possible defenses for COVID coverup
43:56 Government secrecy and other areas of concern
48:08 Reflections on Nord Stream sabotage
Resources:
The Lancet Commission on lessons for the future from the COVID-19
pandemic, Sachs et al., Sept. 14 2022
Why the Chair of the Lancet’s COVID-19 Commission Thinks The US
Government Is Preventing a Real Investigation Into the Pandemic,
Current Affairs, Aug 3 2022
Sachs led a 2 year study of COVID-19 organized for the Lancet. One of the task forces was focused on COVID-19 origins. Sachs feels that members of this task force were engaged in a deliberate cover up which tried to push the natural origin hypothesis from the beginning. His conclusion is that a lab origin hypothesis is still viable, and indeed more likely than the natural origin hypothesis.
The US is treaty bound to only do "defensive" bioweapons research and development, but this includes the creation and study of dangerous viral strains -- e.g., so that vaccine efficacy and related technologies can be studied. As far as I can tell the US spends ~$10 billion per annum on biodefense research, much of it funneled through NIAID (NIH institute for infectious diseases). Many of the researchers involved in "gain of function" genetic engineering are funded via NIAID and have been for decades. Sachs claims that the genetic engineering research to add a human-specific cleavage site to a coronavirus was actually performed, although the specific 2017 DEFUSE research plan (uncovered in 2021 investigation) was not funded.
The state of Michigan required all public HS seniors to take the SAT last year (~91k out of ~107k total seniors in the state). This generated an unusually representative score sample. Full report.
I'm aware of this stuff because my kids attend a public HS here.
To the uninformed, the results are shocking in a number of ways. Look specifically at the top band with scores in the 1400-1600 range. These are kids who have a chance at elite university admission, based on academic merit. For calibration, the University of Michigan median SAT score is above 1400, and at top Ivies it is around 1500.
Some remarks:
1. In the top band there are many more males than females.
2. The Asian kids are hitting the ceiling on this test.
3. There are very few students from under-represented groups who score in the top band.
4. By looking at the math score distribution (see full report) one can estimate how many students in each group are well-prepared enough to complete a rigorous STEM major -- e.g., pass calculus-based physics.
Previously I have estimated that PRC is outproducing the US in top STEM talent by a factor as large as 10x. In a decade or two the size of their highly skilled STEM workforce (e.g., top engineers, AI researchers, biotech scientists, ...) could be 10x as large as that of the US and comparable to the rest of the world, ex-China.
This is easy to understand: their base population is about 4x larger and their K12 performance on international tests like PISA is similar to what is found in the table above for the Asian category. The fraction of PRC kids who perform in the top band is probably at least several times larger than the overall US fraction. (Asian vs White in the table above is about 6x, or 7x on the math portion.) Also, the fraction of college students who major in STEM is much larger in PRC than in the US.
Professor Goldstein recently retired after 20 years of service on the faculty of the U.S. Naval War College (NWC). During his career at NWC, he founded the China Maritime Studies Institute (CMSI) and has been awarded the Superior Civilian Service Medal for this achievement. He has written or edited seven books on Chinese strategy and is at work on a book-length project that examines the nature of China-Russia relations in the 21st century. He has a longstanding interest in great power politics, military competition, and security in the pacific region.
Goldstein is Director of Asia Engagement at the Washington think-tank Defense Priorities, which advocates for realism and restraint in U.S.defense policy, and also a visiting professor at the Watson Institute for International and Public Affairs at Brown University.
He earned a PhD at Princeton, an MA from Johns Hopkins SAIS, and an AB from Harvard. He is fluent in both Chinese and Russian.
Steve and Lyle discuss:
00:00 Early life and background
18:03 Goldstein’s dissertation on China’s nuclear strategy
37:35 Pushback on “Meeting China Halfway”
41:24 Could the U.S. have prevented war in Ukraine?
46:05 How territorial conflicts are influencing China’s relationship with Russia
1:00:16 Analyzing war games with U.S., China, and Taiwan
I've been asked to write something about PRC military buildup and a potential Taiwan (TW) conflict.
1. My perspective and bona fides: My father was a KMT officer, my mother's father was a KMT general and that side of the family is related to Chiang Kai Shek by marriage. I have relatives both in PRC and TW. My wife is a graduate of National Taiwan University. I should be biased in favor of TW and against CPC but I am a realist and rationalist so I call things as I see them.
2. PRC military technology has reached parity with the US and, overall, surpassed Russia. PLARF (dedicated rocket forces) may be decisive in a conflict in the pacific. They may have achieved A2AD and can make it very costly for the US navy to operate anywhere near TW.
3. Specifically, long range missile attack on surface ships, using initial targeting via satellites and drones, and final targeting from sensors on the missile itself, is probably a mature technology now and difficult to defeat with countermeasures / missile defense.
4. US estimates of PRC nuclear weapons stockpile have barely changed in 30y and are likely highly unreliable. Based on production capabilities alone they may already have ~1000 warheads (if not now, in a few years), and the ability to target the entire US. PRC is building up its arsenal to ensure that the US understands that they have a reliable MAD capability.
5. PRC can easily blockade TW if desired, and (at cost of significant escalation) can probably also blockade Japan and S. Korea as well. All of these countries import ~90% of energy and ~50% of food calories, so a protracted blockade would have serious impact.
6. I don’t believe PRC has near term plans to invade TW, but they have to maintain the capability to deter any change in the status quo. Both sides prefer the status quo but accidents can happen.
7. Thanks to stupid US strategy re: Ukraine, PRC can rely on Russian energy in the future and will become much more resistant to naval blockade (e.g., of oil supplies transiting the Malacca Strait). In other words, dumb US neocons solved PRC’s energy security problem for them.
No one talks about this because US strategy has been brain dead for a long time. No one even talks, in the immediate aftermath, about the trillions of dollars and millions of lives wasted over 20y in the Iraq/Afghanistan tragedies. Cui bono?
8. PRC spends a smaller fraction of GDP on defense than the US, but because they have mastered the entire military technology stack cost estimates should be PPP adjusted. After PPP adjustment the PRC economy is substantially larger than the US economy. This, plus the fact that their manufacturing capacity (e.g., ship building) is far beyond that of the US, means that their overall capability to produce war materiel (i.e., to engage in a rapid buildup on, e.g., a 5y timescale) has easily surpassed ours. Anyone following their recent naval or air power or missile or satellite build up can see that this is the case.
I'll be discussing some of these topics with Lyle Goldstein (US Naval War College, Watson China Initiative at Brown University; BA Harvard, PhD Princeton) in a future podcast.
See also this documentary produced by the US Army University Press. Queued to start at discussion of missile technology and nuclear weapons.
Tsinghua University (dad's alma mater) seems to be the only academic institution in the world keeping up with big corp labs like OpenAI, Google Brain / DeepMind, Baidu, etc. in large AI models.
Wordcels (e.g., in policy or geostrategy) have mystical ideas re: at-scale AI research, mistakenly linking progress to lone geniuses / democracy / open society..
They don't realize it's an engineering problem that requires *very* capable teams, but well within PRC capability 🤔
RUSI report: semiconductor content of Russian weapons. Snapshot below from conclusions.
Miltech almost never uses leading edge (e.g., 7nm) chips. Much older e.g. 200nm process sufficient. RUS can source from PRC or use sanction evasion networks...https://t.co/ol5cpTPA0lpic.twitter.com/bdL4SqEn4f
I quote "expert" reports like this because wordcels / midwits can't reason from first principles.
Right-tail obvious inferences which go against conventional wisdom ("sanctions will crush RUS economy and war machine!" "UKR will win!") need to be "sourced" from "real experts" 🤔
On midwits and wordcels: g factor depends on M,V,S. If only V is high while M,S are mediocre, implies total g is ony in midwit range even if V (ability to make vacuous but impressive sounding BS arguments) is exceptional.
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