I think the tone will be security overgrowth.
That's been the consistent tone.
I think there's so much uncertainty going on on the
other side of the bilateral relationship right now that it's
really hard to formulate a strong view on, on what
things might look like in 6 or 12 months.
And, and Xi Jinping himself is dealing with this uncertainty
in trying to set a strategic course for China when
we don't really know what the strategic approach in the
US is going to look like.
I, I know people tend to say Biden and Trump
have similar policies.
I, I don't really buy that.
I, I, you know, we'll see what President Trump brings
should he return to office.
There's a tremendous amount of uncertainty there.
His new vice presidential nominee, JD Vance, is aggressively hawkish
on China.
Some of the candidates for the Treasury Secretary job are
aggressively hawkish on China.
Some, like a Jamie Dimon, maybe not so much.
So, you know, should Trump get reelected, we'll get a
lot of information when he makes that Treasury pick.
We're not entirely sure who the Democratic candidate is or
what the policies would look like should the other side
win.
So there's just a ton of uncertainty that China is
dealing with.
And again, I think the focus from from XI's perspective
will be simply to make China as robust as possible
to whatever might come at it in terms of the
bilateral relationship, tariffs from Europe or other moves that anyone
might make to the couple of China.
Brian, Speaking of uncertainty, something that Chinese people are talking
a lot about right now.
And I don't know if you're a basketball fan, I
can't quite see whether you are one based on your
shelf behind you there.
But garbage time.
This seems to be a catch phrase that a lot
of Chinese people are talking about right now.
And the propaganda machine is trying very hard to rebut
at the moment.
But what it's insinuating is highlighting the pessimism in the
economy right now.
How are you watching that?
Well, yeah, the Chinese economy is on the the wrong
side of a blowout loss, but it's only the second
quarter, so there's going to be a lot of garbage
time.
Some quick numbers for you.
The the property sales are half of what they were
on a flow basis relative to 2021.
But property under construction is a function of five years
of cumulative property sales because it takes a long time
to get these things started, finished, and if they ever
get completed, actually deliver them.
So sales are down by half.
Construction activity as officially measured is only 15% off the
highs.
That too is going to fall to half of what
it was over the next three or four years.
So you've really only started to see the beginning of
the loss in economic activity and momentum coming from the
property sector.
Its going to get a lot worse in the next
couple of years.
And that's quite a contrarian view because what we were
hearing was that property has hit rock bottom, the damage
to the property sector has hit rock bottom and that
is bottomed out and things may not recover swiftly from
here, but would labor around these levels from a sales
perspective, you're still down double digit rates, but that is
decelerating.
So sales years ago we're falling 25%, now they're falling
15%.
I I think that sales could level out in the
next year or so.
The problem is that pipeline of sales is still making
its way through the construction activity.
The sales that they had in 20/20/21 and 22 that
were very strong.
So as those units assuming they ever get completed, if
they can finance the completion of those units, there's no
new sales to replace that.
So the level of activity is going to in terms
of actual shovels being put in the ground on a
day-to-day basis is going to continue to decline for two
or three years quite steeply from here.