Well, this was quite unexpected. Doing my weekly watch of Rabbit Hole Recap and lo and behold @Marty Bent and @ODELL start talking about yours truly. Marty, very much looking forward to our conversation later today. As mentioned, there’s not a single topic that is off the table. Matt, my thanks for the points made. To their conversation, it is very understandable for many/most to view my Notes here as some sort of universal acceptance or approval of the China model. My actual aim is to provide insight into how China is operating on the global stage with the aim of destabilizing the American-led “rules-based international order”. There’s been a brilliance in the approach. That’s not meant as admiration, rather a stark warning. I’ve found that there is just too much Beltway Consensus cope with zero focus on addressing the issue head on. I am a red-blooded American who, through a series of life events, just so happens to have lived in China for 30 years. In that time, I’ve watched the emboldened optimism of the American way of life, my lived experience growing up in New England, become a shell of what I once knew. Wars, corruption, power never held to account ….. I watched on as the America I once knew descended into “rules for thee and not for me”. A vacuum was created, and power abhors a vacuum. China saw the opportunity. My objective is to present the Strum und Drang landscape as it is. China isn’t winning, America is losing. All energy must be directed towards a return of an America of true freedom and individual agency and self-determination. An unshackling from the chains of fear. Present to the world the option of two starkly different governance models, and there’d be no competition. America wins!

China Morning Missive There’s a rather famous quote which I expect will begin making the zeitgeist rounds in the not-to-distant future. Fantastic to see it here in this article. "Who rules the Heartland commands the World-Island." Attributed to historian Halford Mackinder in 1904, the concept stated that whichever power controlled the landmass from Russia to China, and all part in-between, would rule the world. The reason for bringing this up is to highlight the recently launched China-to-Iran rail line. Not only does this allow for faster transit, but the rail line also removes the all potential threats of maritime chock points. Strongly recommend reading through this article below. It hits on so many pertinent points.

The Daily Star

How a train to Tehran is rewriting the world’s map

The China-Iran corridor, bypassing western sea lanes, had become a steel reality.

China Morning Missive. This will be a quick one. Just wanted to post a Note to provide a perfect comparison of where fiscal spending is allocated in China versus the United States. There’s been a plethora of commentary over the past several weeks regarding China building yet another massive dam. What will be the world’s largest hydropower facility. Three times the size of the Three Gorges Dam. The estimated cost for the mega-project is USD167bn. The final cost, once completed, will probably be closer to USD200bn based on overrun estimates for the Three Gorges construction. The expected time to complete construction is 10 years. Now let’s compare this to the American program for nextgen SSN(X) submarines. The Navy just announced higher cost estimates for a single unit, the USS District of Columbia, to USD16.1bn. The program is projected to build 12 nextgen subs for a grand total of USD192bn. Roughly the same total costs as the Chinese mega-dam. I need to add that none of these submarines are included in the current AUKUS program. These are all submarines slotted for the American Navy and will be purchased by the American government. This is but a single example of what has transpired over the past two decades. China has invested in infrastructure writ large. American has “invested” in weapon systems. Both countries have debt loads which are unwieldly. One of these, however, is getting a return on that debt load. This dynamic needs to change and needs to change sooner rather than later.

Bloomberg.com

Next-Gen US Missile Submarine Sees A $1.7 Billion Cost Hike

The Navy raised the estimated price tag for the first of its next-generation nuclear-missile submarines by $1.7 billion, another black eye for a pr...

This is making the rounds on Chinese social media. There is a pretty strong meme culture here in China and across a host of issues.

China Morning Missive The military parade is currently in progress and here is how Xi Jinping decided to enter the event. Again, pictures such as these will achieve, in my opinion, a singular outcome from the Washington. Unadulterated aggression. I’d also add that we’ve not even arrived at the point in the event where all of China’s latest technology is put on display. But what is it, exactly, that the American – or even European – leadership can do at this point other than lash out. Long duration bond yields are blowing out across the entire G7 and gold is smashing through one all-time-high after another. Not only is the West completely and totally boxed in fiscally, but investors now look to have called it a day and are voting with their asset allocation decisions. Personally, I am an aggressive optimist. There is so much that can be achieved through collaborative efforts. Nevertheless, if you go after the King you best not miss. That is sort of the point in history we all now find ourselves. No great

Fantastic and random Tuesday lunch with the wife. #perfection

China Morning Missive True to form, here we have Trump doubling down on India. It is beginning to look as though the decision to place 50% tariffs on India was a gross miscalculation. Not just as it pertains to bilateral ties, but in how the move has reverberated throughout the Global South. There’s genuine resolve coming out of the two day SCO meeting here in China. It is now expected that a virtual meeting of all BRICS members is to be convened on the coming week. Who needs whom more? That looks to be the question now being asked. Is access to the American market worth the demands made? Is it possible for the Global South nations to build its own unified market? Don’t get me wrong. There remains a host of issues yet to be addressed among the largest of the Global South partners. China, India and Russia are - at this juncture - aligned solely under the premise of “the enemy of my enemy”. By itself, that isn’t enough to hold over time. The whole “you’re either with us or against us” mentality must be ripped up from the roots. What is needed is a return to an American way that was truly open and individualistic. Complete on these core principals and you win. It isn’t overly complicated. Trump calls India-U.S. trade relationship 'a totally one sided disaster' after Modi visits China

CNBC

Trump calls India-U.S. trade relationship 'a totally one sided disaster' after Modi visits China

This comes against the backdrop of the U.S. imposing 50% tariffs on the country, including secondary duties of 25% last month for purchasing Russia...

I need to vlog more from Shanghai. Great engagement. What do you all want to see first hand?

Vlogging from Shanghai. @HODL Is this still a “thing” here on Nostr?

Seeing if this works.

China Morning Missive Here is a picture that is the outcome of recent American foreign policy, primarily the Trump trade policy. A picture, as well, that will send the entirety of the Beltway consensus to lose its collective mind. If you are unaware, there is a large annual meeting taking place in China called the Shanghai Cooperation Organization (SCO). The group was established over 20 years ago and is meant to coordinate geopolitical agendas throughout what was termed by Halford Mackinder “The World Island”, or basically all of Eurasia. Essentially, it is the precursor to the “Global South”. What we have today, literally today, is a meeting on the sidelines between Xi, Putin and Modi with the later making his first trip to China in over seven years. China and India have had real issues over both trade and national borders. Now there has been a thaw. A total of 26 different nations will be in attendance as well. The point of all the commentary here is a demonstration that China planned accordingly and did so over multiple decades. There was a tremendous degree of luck involved too. America made a host of geopolitical missteps over the past two-plus decades allowing for China to gain ground. And now we have the Trump trade agenda so blatantly alienating India that there is now the real risk of a rapprochement with China. From a geopolitical perspective, this could easily go down as the single largest mistake made by Team Trump. While India is probably seeking to play both ends against the middle here and work to have Washington ease off the applied 50% tariffs, I just don’t see Trump – the man – willing to capitulate. He hates the TACO moniker and with that will be less than willing to negotiate. Now we wait for Wednesday and the even bigger Chinese military parade. I’ll get to that later in the week. Expect to see the headlines though. Washington is going to lose its mind once again.

China Morning Missive So, the proverbial penny has dropped for Sam Altman. After months of publicly ignoring the very issue that was staring the man straight in the face, he has decided to come out and state – openly – that China is a competitive threat in the AI space. What I found even more surprising is that the decision by OpenAI to release an open weight model last week – which was universally panned by the LLM community – was the outcome of the aggressive Chinese open-source drive throughout this year. The fact remains. Altman is boxed in, as are all of the American AI models. You can either go for a platform which prioritizes profitability or a platform which seeks to achieve scale. You can’t do both. There is also the issue of applicability. A host of Chinese industries have deployed DeepSeek for the expressed purpose of enhancing productivity. It has been a slower process throughout America. And all of this has transpired in the span of less than one year. Altman is correct to be concerned. I’ve not even highlighted the issue of hundreds of billions of CAPX being thrown at the AI complex in America. There’s a saying that money can’t buy taste. I’d add that money, too, can’t buy – or build – a competitive moat. Not anymore and especially not in our digital world.

CNBC

OpenAI's Altman warns the U.S. is underestimating China's next-gen AI threat

Despite escalating U.S. export controls on semiconductors, Altman is unconvinced that the policy is keeping up with technical reality.

Finally back LIVE on Bloomberg HK. Great hosts. They ask the right questions and are open to topics which US business media outlets only dance around.

China Evening Missive First there was Modi calling Lula yesterday. Now we have Xi and Putin getting on the phone. Personally, I have doubts that Trump and Putin are actually going to meet up as is being reported.

South China Morning Post

Xi and Putin discuss Ukraine war ahead of expected US-Russia summit

Russian leader briefs Chinese president on Moscow’s communication with Washington as Donald Trump’s deadline for ceasefire looms.

China Morning Missive Going with another quote this morning. The old reliable Macbeth, “it is a tale told by an idiot full of sound and fury signifying nothing.” Thing is, while there is certainly found and fury, this time is does signify (inadvertently) something. Enormous fissures in the American led rules based international order. As I was saying just the other day. Recent moves made by the Trump team have ultimately played directly into the hands of the Chinese. While it may be the aim for Trump to take direct aim at the leaders of the BRICS organization, doing so – at this point in time – will be utterly fruitless. Much as is discussed on this platform, the only product America produces is currency, US dollars. A commodity that we all know is being debased at an ever-increasing rate. Countries such as China and Brazil produce actual commodities or critical end products all of which are in demand across the United States. The thinking in Washington is that, somehow, the American market is so valuable that it can be used to weaponizing trade to achieve non-economic geopolitical ends. The reality is now becoming quite clear. The Global South has seen this movie numerous times before. Only America’s “allies” have demonstrated a willing to bend the knee and capitulate. Those countries deemed “adversaries” have found a voice and are announcing to the world that they are unwilling to submit. You should all expect to see more of these sorts of moves in the coming weeks, and – quite frankly – throughout the course of the Trump presidency.

Bloomberg.com

Modi Speaks With Lula, Plans Xi Meeting as Ties With US Sour

Modi plans first China trip in 7 years and will call Brazil’s Lula amid rising US tariffs.