<table cellpadding="0" cellspacing="0" width="100%" style="background-color:#f6f6f6; text-align: center; overflow:hidden"><tbody><tr><td style="max-width:600px"><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; background:#fff"><tbody><tr><td style="padding:3.5%; text-align:left;"><img width="110px" src="https://assets.website-files.com/5c864c33af62620dca1373ac/5d86577f82aa6e55afacb4ea_cd%20long-fit.png" alt="CHINADebate"></td></tr><tr><td style="padding:3.5%; text-align:center;"><a style="border-bottom:none; text-decoration:none;" href="https://www.chinadebate.com/china-macro-reporter/archive" target="_blank"><img style="width:70px; border-radius:3%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);" src="https://assets.website-files.com/5a3e922cf6b9a40001bc2d6b/5e3dbbf161e6c357b022bea5_China%20Macro%20Reporter%20.png" alt="China_Macro_Reporter"></a></td></tr><tr><td style="text-align:center; font-size: 27px; font-family: gorditamedium, sans-serif; color:#001544; font-weight:bold; letter-spacing: -0.5px; line-height: 1;">China Macro Reporter</td></tr><tr><td style="text-align:center; line-height:1.5; padding-bottom:35px; padding-top:10px; font-size: 13px; color:#001544; font-family:'gordita', sans-serif;">By Malcolm Riddell<span style="margin:0 6px">·</span>Feb 29, 2020</td></tr><tr><td style="text-align:center; line-height:1.5; display:block; max-width:480px; margin:0 auto; padding:7px 0; font-size: 1.175em; font-family: Georgia, serif; color:#c80000; font-weight:normal; letter-spacing: -0.5px; border-bottom:2px solid #c80000;">Opening Statement</td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td style="padding:3.5% 0 3.5% 3.5%"><table cellspacing="0" cellpadding="0" width="100%"><tbody><tr><td width="50px" style="display:block;"><a href="http://sco.lt/8x5C7s?track_p_id=7hfT1Psd66tIq6_XxdAldv5" target="_blank" title="SourceLogo"><img height="50px" width="auto" alt="SourceLogo" src="https://img.scoop.it/A3V_9S99DmaIh9kNYyVqGEi__cjguAuwrRM5-qsdIhQ=" style="display:block; overflow:hidden; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19); width:auto;"></a></td><td width="100%" style="padding-left:5%;"><a href="http://sco.lt/8x5C7s?track_p_id=066tIq6_fNAMRj3vaBhGCR6" style="color:#001544; font-size:1.3em; font-weight:bold; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.5; text-decoration: none; border-bottom:none;" target="_blank">In the end, it's all about supply chains</a></td></tr></tbody></table></td></tr><tr><td style="height:0px; font-size:0">&nbsp;</td></tr><tr><td style="padding:0 3.5%; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h1 style="display: inline-block;font-size: 1.35em;margin-top: 0em;margin-bottom: 0em;margin-left: 0;margin-right: 0;line-height: 1.35em;font-weight: normal;font-family: gorditamedium, sans-serif;color: #001544;letter-spacing: -0.1px;"><strong style="font-weight: bold">Greetings!</strong></h1><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Three quotes </strong>from today's picks sum up what may be the enduring impact of the coronavirus:</p><ol style="margin-top: 0px;margin-bottom: 0px;"><li style="margin-top: 0.5em;margin-bottom: 0em;">&nbsp;<strong style="font-weight: bold">‘Tariffs gummed up&nbsp;</strong><a href="https://www.barrons.com/articles/whether-or-not-there-is-a-u-s-china-deal-the-global-trade-system-is-changing-51552692446?mod=article_inline"><strong style="font-weight: bold">global trade routes</strong></a>&nbsp;over the past two years. The coronavirus has now frozen them.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Deglobalization</strong> is driven by the discomfiting realization that the entire system now has a single point of failure—China.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;">&nbsp;<strong style="font-weight: bold">'Deglobalization </strong>is accelerating.’</li></ol><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">During my 40+ working years,</strong> I've watched as globalization has occurred - and did my small part in accelerating it.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">With populist movements,</strong> tariffs, and now a disease, I am watching as it changes into something new.&nbsp;</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">The question </strong>is how will it change?</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Still too early to tell, </strong>but I can tell you what I will be focusing on:</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">Supply chains.</strong></li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">We love ‘Letters to the Editor,’</strong> so send me your thoughts on anything here or anything about China.</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">And please forward</strong> the China Macro Reporter to your friends and colleagues.</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Best,</strong></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Malcolm</strong></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td style="height:10px; font-size:0; border-bottom:10px solid #fff;">&nbsp;                </td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%"><tbody><tr><td style="height:20px; font-size:0; background-color:#f6f6f6;">&nbsp;                </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto;"><tbody><tr><td style="text-align:center; display:block; padding:5px; background-color:#c80000; font-size: 1.375em; font-family: gorditamedium, sans-serif; color:#ffffff; font-weight:bold; letter-spacing: 0px; line-height:1.25em;">1. CORONAVIRUS' IMPACT ON CHINA'S ECONOMY</td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; background-color:#001544; line-height:1"><tbody><tr><td style="width:25px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><p style="display: block;height: 13px;background-color: #c80000;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td><td style="display:block; padding:5px 5px 5px 12px; text-align:left; font-size: 1.275em; font-family: Georgia, serif; font-style: italic; color:#ffffff; font-weight:bold; letter-spacing: 0px; line-height:1.5em;">PMIs Weakest Ever</td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%" style="background-color:#f6f6f6; text-align: center;"><tbody><tr><td style="max-width:600px"><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td><img width="100%" src="https://img.scoop.it/QB9E6Ghrb3hlm65imkjuNDl72eJkfbmt4t8yenImKBXdhNIf0Yl8YfRAVzhohB7e"></td></tr></tbody></table></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td style="padding:3.5% 0 3.5% 3.5%"><table cellspacing="0" cellpadding="0" width="100%"><tbody><tr><td width="50px" style="display:block;"><a href="http://sco.lt/9KrNJo?track_p_id=4EgEK6GK9ja_hxFAHRXI%40Uu" target="_blank" title="SourceLogo"><img height="50px" width="auto" alt="SourceLogo" src="https://img.scoop.it/Q7K3LvBpUHwYzkoXdXm2WUi__cjguAuwrRM5-qsdIhQ=" style="display:block; overflow:hidden; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19); width:auto;"></a></td><td width="100%" style="padding-left:5%;"><a href="http://sco.lt/9KrNJo?track_p_id=06GK9ja_Dhr%40Fi2My26pbcJ" style="color:#001544; font-size:1.3em; font-weight:bold; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.5; text-decoration: none; border-bottom:none;" target="_blank">Coronavirus Latest: China Factory Activity Weakest on Record&nbsp;</a></td></tr></tbody></table></td></tr><tr><td style="height:0px; font-size:0">&nbsp;</td></tr><tr><td style="padding:0 3.5%; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.3em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Bloomberg</strong></h3><h2 style="text-align: center;display: block;font-size: 1.15em;margin-top: 1em;margin-bottom: 1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.5em;background-color: #f6f6f6;"><strong style="font-weight: bold">“There’s scant chance for a V-shaped rebound -- the authorities are using targeted aids more than stimulus to stabilize the economy and that will lead to a gradual bounce.”</strong>&nbsp;</h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘China’s PMI</strong> - manufacturing purchasing managers’ index - plunged to 35.7 in February from 50 the previous month, according to&nbsp;<a href="http://www.stats.gov.cn/tjsj/zxfb/202002/t20200229_1729136.html" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">data</a>&nbsp;released by the National Bureau of Statistics on Saturday, much lower than the median estimate of economists.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Even if companies</strong> have restarted that doesn’t mean that they are back at full capacity, or that the logistics systems in China are working normally.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The non-manufacturing gauge</strong> also fell to its lowest ever, 29.6.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The services sector</strong> has taken a hard blow as most businesses rely on human interaction, which is constrained by tight control of people’s mobility within and across cities.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">“The sharp drop in China’s manufacturing PMI</strong> in February reinforces our view that the normalization in economic activity will be delayed,” as can be seen in&nbsp;<a href="https://www.bloomberg.com/news/articles/2020-02-18/how-fast-can-china-s-economy-bounce-back-from-virus-lockdown" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">high-frequency data</a>, said Xing Zhaopeng, an economist at Australia &amp; New Zealand Banking Group.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“There’s scant chance for a V-shaped rebound</strong> -- the authorities are using targeted aids more than stimulus to stabilize the economy and that will lead to a gradual bounce.”</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">“Most people</strong> were comparing the impact of the coronavirus with that of SARS,” said Larry Hu, head of China economic research at Macquarie Securities.'</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“But I think</strong> it is on par with that of the financial crisis in 2008.”</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td style="height:10px; font-size:0; border-bottom:10px solid #fff;">&nbsp;                </td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%"><tbody><tr><td style="height:20px; font-size:0; background-color:#f6f6f6;">&nbsp;                </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; background-color:#001544; line-height:1"><tbody><tr><td style="width:25px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><p style="display: block;height: 13px;background-color: #c80000;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td><td style="display:block; padding:5px 5px 5px 12px; text-align:left; font-size: 1.275em; font-family: Georgia, serif; font-style: italic; color:#ffffff; font-weight:bold; letter-spacing: 0px; line-height:1.5em;">Economic Impact Worse Than Reported</td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td style="padding:3.5% 0 3.5% 3.5%"><table cellspacing="0" cellpadding="0" width="100%"><tbody><tr><td width="50px" style="display:block;"><a href="http://sco.lt/559kQq?track_p_id=eKLrL2%40BJ3Exk1p5UHXyA_f" target="_blank" title="SourceLogo"><img height="50px" width="auto" alt="SourceLogo" src="https://img.scoop.it/BmWeP5MftE-hc_D4mxoQeEi__cjguAuwrRM5-qsdIhQ=" style="display:block; overflow:hidden; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19); width:auto;"></a></td><td width="100%" style="padding-left:5%;"><a href="http://sco.lt/559kQq?track_p_id=bgcInC3XEjrm5UHXyA_QtB5" style="color:#001544; font-size:1.3em; font-weight:bold; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.5; text-decoration: none; border-bottom:none;" target="_blank">Coronavirus Is Hitting China’s Economy Harder Than Expected&nbsp;</a></td></tr></tbody></table></td></tr><tr><td style="height:0px; font-size:0">&nbsp;</td></tr><tr><td style="padding:0 3.5%; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.3em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Barron’s</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.3em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Shehzad H. Qazi</strong> | China Beige Book&nbsp;</h3><h2 style="text-align: center;display: block;font-size: 1.15em;margin-top: 1em;margin-bottom: 1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.5em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘China’s economy is getting hit much harder by the coronavirus outbreak than markets currently recognize. And Wall Street appears to be the last one to know it.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">The following is from the </strong><a href="https://www.chinabeigebook.com/" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">China Beige Book</strong></a> – and for that reason, pay special attention.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">Unlike economic estimates</strong> based on reported Chinese data, the China Beige Book surveys Chinese businesses directly – and has for nine years.</li></ul><p style="text-align: center;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">_________________________________</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><br></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘China’s economy</strong> is getting hit much harder by the coronavirus outbreak than markets currently recognize.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘And Wall Street</strong> appears to be the last one to know it.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Markets have had trouble determining</strong> the actual economic damage caused by the virus.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Investment banks</strong>—by their own admission lacking access to reliable figures on the spread of the virus—<a href="https://www.bloomberg.com/news/articles/2020-02-04/economists-cut-china-s-growth-forecast-on-coronavirus-impact?mod=article_inline" rel="nofollow">trimmed their forecasts</a> for China’s first-quarter GDP.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But in the midst of a nationwide lockdown</strong> and in the absence of independent business-performance data, projections ranging from 2.5% to 6% growth not only appeared divorced from reality, they also bred market complacency.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Now, economic data</strong> privately collected by China Beige Book shows that the state of Chinese businesses is significantly worse than investors have assumed for weeks.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Most of the economy</strong> has remained under a virtual lockdown.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Our first-quarter flash survey,</strong> which has tracked over 1,400 firms in February, shows that 31% of companies have remained closed since the extended Lunar New Year holiday.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Among many of the businesses</strong> that have reopened, employees either continue to telecommute (29%) or are waiting to resume work from their job sites (7%).’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘In other words,</strong> only a third of businesses have fully reopened.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘While figures on firm closures</strong> have improved in very recent days, business performance is in the doldrums.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘For the first time in nine years,</strong> every headline metric tracked by the private survey has turned negative.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Companies say</strong> their revenues, profits, orders, and production are all in freefall.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Sales have declined</strong> by over 10% at nearly two in five businesses.</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The result:</strong> Every major sector of the economy is currently in contraction territory.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘And these early data from the China Beige Book survey</strong> show an economy struggling to restart, with the epidemic having caused unmistakable weakness across Chinese companies in every major sector.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘This makes a first-quarter GDP contraction</strong> highly likely, though it may never be acknowledged in official data.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The most frightening aspect of this crisis</strong> is not the short-term economic damage it is causing, but the potential long-lasting disruption to supply chains.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Chinese auto manufacturers and chemical plants</strong> have reported more closures than other sectors.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘While there are fewer idle IT factories</strong> by comparison, here too workers have not returned to a majority of firms.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Crucially,</strong> shipping and logistics companies have also reported higher closure rates than the national average.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The ripple effects</strong> of this severe disruption will be felt through the global auto parts, electronics, and pharmaceutical supply chains for months to come.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td style="height:10px; font-size:0; border-bottom:10px solid #fff;">&nbsp;                </td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%"><tbody><tr><td style="height:20px; font-size:0; background-color:#f6f6f6;">&nbsp;                </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto;"><tbody><tr><td style="text-align:center; display:block; padding:5px; background-color:#c80000; font-size: 1.375em; font-family: gorditamedium, sans-serif; color:#ffffff; font-weight:bold; letter-spacing: 0px; line-height:1.25em;">2. IMPACT ON FOREIGN BUSINESSES</td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; background-color:#001544; line-height:1"><tbody><tr><td style="width:25px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><p style="display: block;height: 13px;background-color: #c80000;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td><td style="display:block; padding:5px 5px 5px 12px; text-align:left; font-size: 1.275em; font-family: Georgia, serif; font-style: italic; color:#ffffff; font-weight:bold; letter-spacing: 0px; line-height:1.5em;">Impact on Foreign Business in China</td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%" style="background-color:#f6f6f6; text-align: center;"><tbody><tr><td style="max-width:600px"><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td><img width="100%" src="https://img.scoop.it/W5nHmVSJO7oyoCqFtt9PGTl72eJkfbmt4t8yenImKBXdhNIf0Yl8YfRAVzhohB7e"></td></tr></tbody></table></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td style="padding:3.5% 0 3.5% 3.5%"><table cellspacing="0" cellpadding="0" width="100%"><tbody><tr><td width="50px" style="display:block;"><a href="http://sco.lt/8Owvjc?track_p_id=eTevXNpu4Dzs1Mu8tgJ5i_d" target="_blank" title="SourceLogo"><img height="50px" width="auto" alt="SourceLogo" src="https://img.scoop.it/UhpUPMCJFye7fkL4IvWfEki__cjguAuwrRM5-qsdIhQ=" style="display:block; overflow:hidden; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19); width:auto;"></a></td><td width="100%" style="padding-left:5%;"><a href="http://sco.lt/8Owvjc?track_p_id=4u1rX8tgJ5i_IaC4b6JbUSi" style="color:#001544; font-size:1.3em; font-weight:bold; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.5; text-decoration: none; border-bottom:none;" target="_blank">COVID19: The Impact on European Business in China</a></td></tr></tbody></table></td></tr><tr><td style="height:0px; font-size:0">&nbsp;</td></tr><tr><td style="padding:0 3.5%; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.3em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">European Union Chamber of Commerce in China</strong></h3><h2 style="text-align: center;display: block;font-size: 1.15em;margin-top: 1em;margin-bottom: 1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.5em;background-color: #f6f6f6;"><strong style="font-weight: bold">“The patchwork of conflicting rules that emerged from the fight against COVID-19 has produced hundreds of fiefdoms, making it next to impossible to move goods or people across China.”</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Between 18th and 21st February 2020,</strong> a total of 577 member companies of the European Union Chamber of Commerce in China and the German Chamber of Commerce in China participated in a flash survey on the impact of the novel coronavirus outbreak on European business in China.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">This survey</strong> makes vivid the challenges to foreign businesses in China from the coronavirus.</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Impacts are widely spread</strong> across different aspects of a company’s operations.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘’Supply chains</strong> are bearing the worst disruptions, with 54% seeing demand slide, 46% facing erratic supplies and 46% struggling with logistics nightmares.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Challenges stemming from the movement of people</strong> are also dragging down efforts across the board to resume operations, as 46% report staff shortages and 30% are struggling with HR compliance burdens like requirements to stockpile masks and other products aimed at the prevention and control of virus transmission.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">“The patchwork of conflicting rules</strong> that emerged from the fight against COVID-19 has produced hundreds of fiefdoms, making it next to impossible to move goods or people across China,” said Jörg Wuttke, president of the European Union Chamber of Commerce in China.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“While virus containment</strong> is the most important task, standardising measures across larger jurisdictions should also be prioritised to get the real economy back on its feet.”</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The current ecosystem</strong> is one in which even if a company can open its doors again, it may not have the supplies, demand, logistics or talent necessary to get business moving.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘This has driven down business sentiment,</strong> with 44% experiencing uncertainty and being unable to confidently make business and investment decisions.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Revenue projections</strong> are widely impacted for the worse: a quarter anticipate a revenue decrease of more than 20% in the first half of the year; another quarter expect a drop of 10–20%; and a fifth project a dip of less than 10%. The remaining quarter believes that it is too early to accurately forecast the impact.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘A significant proportion of respondents</strong> in business services, consumer goods and services, and electronics industries forecast the worst revenue drops, reflecting a considerable decrease in demand for both business-to-business services and business-to-consumer goods and services.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Between the US-China trade war and the COVID-19 outbreak,</strong> many European companies have put diversification at the top of their agendas, as they fear they have become over-reliant on China.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘This should be a wake-up call for China</strong> to decisively broaden its reform and opening-up agenda, to increase the allure of its market.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Bold and early steps</strong> can help to anchor business sentiment from drifting further, but there needs to be a steady procession of concrete actions to prevent confidence from diminishing further.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“The COVID-19 outbreak</strong> will have taught many companies a lesson on market predictability, and could cause some to now move away from a single source to diversify in China or the wider region,” said Jörg Wuttke, president of the European Union Chamber of Commerce in China.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“However, China tends to flourish in challenging times</strong> – it opened its market in 1978 and 1992, and signed up to the WTO in the midst of the Asian financial crisis. We hope that China will take the opportunity presented by the current situation to again embrace foreign investment and engagement, and get the economy back on track.”</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td style="height:10px; font-size:0; border-bottom:10px solid #fff;">&nbsp;                </td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%"><tbody><tr><td style="height:20px; font-size:0; background-color:#f6f6f6;">&nbsp;                </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto;"><tbody><tr><td style="text-align:center; display:block; padding:5px; background-color:#c80000; font-size: 1.375em; font-family: gorditamedium, sans-serif; color:#ffffff; font-weight:bold; letter-spacing: 0px; line-height:1.25em;">3. IMPACT ON SUPPLY CHAINS</td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; background-color:#001544; line-height:1"><tbody><tr><td style="width:25px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><p style="display: block;height: 13px;background-color: #c80000;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td><td style="display:block; padding:5px 5px 5px 12px; text-align:left; font-size: 1.275em; font-family: Georgia, serif; font-style: italic; color:#ffffff; font-weight:bold; letter-spacing: 0px; line-height:1.5em;">Industries Hit By Disrupted Supply Chains</td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td style="padding:3.5% 0 3.5% 3.5%"><table cellspacing="0" cellpadding="0" width="100%"><tbody><tr><td width="50px" style="display:block;"><a href="http://sco.lt/5PfGa0?track_p_id=1e4wZPDy_wwlWQVs2PoBIqz" target="_blank" title="SourceLogo"><img height="50px" width="auto" alt="SourceLogo" src="https://img.scoop.it/BmWeP5MftE-hc_D4mxoQeEi__cjguAuwrRM5-qsdIhQ=" style="display:block; overflow:hidden; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19); width:auto;"></a></td><td width="100%" style="padding-left:5%;"><a href="http://sco.lt/5PfGa0?track_p_id=04wZPDy_omXgG3RHR1XgGXV" style="color:#001544; font-size:1.3em; font-weight:bold; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.5; text-decoration: none; border-bottom:none;" target="_blank">Coronavirus Is Disrupting Supply Chains. These Industries Are Most Vulnerable.</a></td></tr></tbody></table></td></tr><tr><td style="height:0px; font-size:0">&nbsp;</td></tr><tr><td style="padding:0 3.5%; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.3em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Barron's</strong></h3><h2 style="text-align: center;display: block;font-size: 1.15em;margin-top: 1em;margin-bottom: 1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.5em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘The coronavirus has severely disrupted nearly every link in the global supply chain, from raw materials to&nbsp;components&nbsp;to finished goods,</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Tariffs gummed up&nbsp;</strong><a href="https://www.barrons.com/articles/whether-or-not-there-is-a-u-s-china-deal-the-global-trade-system-is-changing-51552692446?mod=article_inline" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">global trade routes</strong></a>&nbsp;over the past two years.'</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The coronavirus</strong> has now frozen them.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘This has the potential</strong> to cause an economic shock unlike those that led to recessions in the recent past:’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘the oil spike in 1991</strong> that hit consumer wallets or the credit crunch in 2008 that seized up lending markets.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The coronavirus</strong> has severely disrupted nearly every link in the global supply chain, from raw materials to&nbsp;<a href="https://www.barrons.com/articles/coronavirus-could-bring-tech-supply-chains-to-a-halt-51581125237?mod=article_inline" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">components</a>&nbsp;to finished goods, which could lead to curtailed production, product shortages, and financial stress across a range of industries.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘How manufacturing delays</strong> ripple through the economy isn’t so straightforward, however.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘That is particularly true</strong> now that the virus has spread to other major manufacturing hubs&nbsp;<a href="https://www.barrons.com/articles/stocks-italy-south-korea-revenue-exposure-coronavirus-51582667395?mod=article_inline" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">such as South Korea,</a>&nbsp;and Japan, and is starting to move through Europe.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘China, South Korea, and Japan</strong> together account for more than a quarter of U.S. imports—and more than half of American imports of computer and electronics products.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘More than a dozen companies</strong> in myriad industries—from technology to toothpaste, agriculture, and toys — have told investors that the coronavirus is disrupting their supply chains.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Some have said</strong> they are expecting an impact on earnings, but few have quantified that.’&nbsp;</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Tech companies, apparel makers, and industrial-equipment manufacturers</strong> are likely to be hurt most, given that they are most reliant on inputs from China and Southeast Asia.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘A prolonged delay</strong> in parts procurement not only would threaten corporate earnings, but could imperil companies’ ability to make debt payments.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Apparel and footwear companies</strong> are in particular trouble, says analyst John Kernan, an analyst at Cowen.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘They source about 30% of their goods</strong> from China, and other countries in the chain often get raw materials from there.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“The supply chain</strong> emanates out of Southeast Asia, and China in particular,” Kernan says.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“It’s not just the factories.</strong> A lot of the materials that go to Bangladesh and Vietnam and other areas emanate from China. It’s a mess.”</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘So far, retailers’ shelves</strong> aren’t going empty, but that might not be far off, he warns. “Eventually, you’ll have a slowdown in goods coming into the country.”</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Tech is threatened,</strong> too, and it’s not only big companies such as Apple and Microsoft.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Tech equipment maker&nbsp;</strong><a href="https://www.barrons.com/quote/JBL" rel="nofollow"><strong style="font-weight: bold">Jabil</strong></a><strong style="font-weight: bold"> (JBL),</strong> an important cog in the supply chain for companies including&nbsp;<a href="https://www.barrons.com/quote/AMZN" rel="nofollow">com</a>&nbsp;(AMZN), withdrew its financial guidance Tuesday and said that impacted factories were running at just 65% to 70% of capacity.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Consumers,</strong> who account for 70% of U.S. economic activity, might not see the impact of supply-chain disruptions immediately.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Instead,</strong> inventory shortages would start to show up in company sales.'</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Oil companies are reeling,</strong> too, because China is the world’s largest petroleum importer.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Crude has fallen</strong> more than 20% since the start of the year.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The auto industry</strong> is relatively insulated from supply disruption.'</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Several companies</strong> have built regional factories to serve local markets.’&nbsp;</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Potential disruptions</strong> could be worse had companies not been paying more attention to their supply chains due to the U.S.-China trade spat.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Multinationals</strong> have been working on diversifying them for the past three years as U.S. tariffs ramped up.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">“At least compared to prior periods</strong> of supply-chain disruption, companies seem to be better prepared in terms of their inventory levels,” says Wells Fargo economist Sarah House.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“That suggests</strong> that there’s a little bit more time for this to get sorted out and for shipping and production to resume before we start to see it in the data.”</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td style="height:10px; font-size:0; border-bottom:10px solid #fff;">&nbsp;                </td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%"><tbody><tr><td style="height:20px; font-size:0; background-color:#f6f6f6;">&nbsp;                </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; background-color:#001544; line-height:1"><tbody><tr><td style="width:25px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><p style="display: block;height: 13px;background-color: #c80000;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td><td style="display:block; padding:5px 5px 5px 12px; text-align:left; font-size: 1.275em; font-family: Georgia, serif; font-style: italic; color:#ffffff; font-weight:bold; letter-spacing: 0px; line-height:1.5em;">Still Lots of Inventory</td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td style="padding:3.5% 0 3.5% 3.5%"><table cellspacing="0" cellpadding="0" width="100%"><tbody><tr><td width="50px" style="display:block;"><a href="http://sco.lt/719ffc?track_p_id=efTHE1ACEppGXcU5VXuuM_n" target="_blank" title="SourceLogo"><img height="50px" width="auto" alt="SourceLogo" src="https://img.scoop.it/LVEdRSpgxX4CbqTrlPycNEi__cjguAuwrRM5-qsdIhQ=" style="display:block; overflow:hidden; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19); width:auto;"></a></td><td width="100%" style="padding-left:5%;"><a href="http://sco.lt/719ffc?track_p_id=05VXuuM_3raMNas2rN6UMok" style="color:#001544; font-size:1.3em; font-weight:bold; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.5; text-decoration: none; border-bottom:none;" target="_blank">Inventory Shortages Coming End of March</a></td></tr></tbody></table></td></tr><tr><td style="height:0px; font-size:0">&nbsp;</td></tr><tr><td style="padding:0 3.5%; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.3em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">CNBC</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.3em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;">&nbsp;<strong style="font-weight: bold">Yossi Sheffi</strong> | director, MIT Center for Transportation and Logistics</h3><h2 style="text-align: center;display: block;font-size: 1.15em;margin-top: 1em;margin-bottom: 1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.5em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘Sometime toward the end of March, I expect to start seeing shortages.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Q: ‘A lot of people</strong> have been discussing is the complexity of modern supply chains. ‘Do manufacturing companies not have a lot of spare inventory because of ‘Just-in-Time’ manufacturing?’</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">YOSSI SHEFFI: ‘The complexity</strong> of the supply chain is not the problem.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Just-in-Time’ manufacturing</strong> is overly hyped - there's a lot of inventory.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Chinese factories</strong> have closed now for six weeks or so, right? We still don't have any shortages in the marketplace. It will come, it will come.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘There's a lot of inventory</strong> in the channels. For example, there are a lot of ships on the sea that have a lot of inventory on them.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But sometime toward</strong> the end of March, I expect to start seeing shortages.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td style="height:10px; font-size:0; border-bottom:10px solid #fff;">&nbsp;                </td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%"><tbody><tr><td style="height:20px; font-size:0; background-color:#f6f6f6;">&nbsp;                </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; background-color:#001544; line-height:1"><tbody><tr><td style="width:25px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><p style="display: block;height: 13px;background-color: #c80000;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td><td style="display:block; padding:5px 5px 5px 12px; text-align:left; font-size: 1.275em; font-family: Georgia, serif; font-style: italic; color:#ffffff; font-weight:bold; letter-spacing: 0px; line-height:1.5em;">Reverse Bullwhip Means No 'V-Shaped' Recovery</td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td style="padding:3.5% 0 3.5% 3.5%"><table cellspacing="0" cellpadding="0" width="100%"><tbody><tr><td width="50px" style="display:block;"><a href="http://sco.lt/6Adsbg?track_p_id=4yzt17U73So_CHHPgRgbFbP" target="_blank" title="SourceLogo"><img height="50px" width="auto" alt="SourceLogo" src="https://img.scoop.it/LVEdRSpgxX4CbqTrlPycNEi__cjguAuwrRM5-qsdIhQ=" style="display:block; overflow:hidden; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19); width:auto;"></a></td><td width="100%" style="padding-left:5%;"><a href="http://sco.lt/6Adsbg?track_p_id=3diQ7U73So_UbL6NEFA2tY3" style="color:#001544; font-size:1.3em; font-weight:bold; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.5; text-decoration: none; border-bottom:none;" target="_blank">Virus-Related Supply Chain Disruptions to Get Much Worse</a></td></tr></tbody></table></td></tr><tr><td style="height:0px; font-size:0">&nbsp;</td></tr><tr><td style="padding:0 3.5%; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.3em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">CNBC</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.3em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Yossi Sheffi</strong> | director, MIT Center for Transportation and Logistics</h3><h2 style="text-align: center;display: block;font-size: 1.15em;margin-top: 1em;margin-bottom: 1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.5em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘It's not going to be a V-shaped recovery.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">YOSSI SHEFFI: ‘Let me explain what we call</strong> the “bullwhip” in the supply chain.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">Assume a retailer</strong> forecasts X% less demand is coming. So it cuts its orders to the wholesaler by 2X%.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘When the wholesaler sees this,</strong> it cuts its orders to the manufacturer by 4X%.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘For this reason,</strong> the most vulnerable companies are the small suppliers at the upstream or the supply chain.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘And the Chinese government</strong> totally understands this.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘It is now asking</strong> all the state banks to loan money to and are cutting taxes for small suppliers up to the end of the supply chain.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Q: ‘We don't know</strong> if we'll get that V-shaped or U-shaped recovery. But what happens then when that demand picks up? How quickly does that whole system turnaround?’</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">SHEFFI: </strong>‘Very slowly. Because you have the “bullwhip” in the opposite direction.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Many suppliers</strong> will be out of business.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The remaining suppliers</strong> have lower capacity. They cannot supply all the orders now. And this leads to the “bullwhip” in the opposite direction.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘So what do companies do?</strong> Place “phantom orders.”’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘They know suppliers</strong> are constrained and that they can get only a percentage of what they order. So they order a lot more than they need.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Now these “phantom orders”</strong> start hitting the suppliers’ customers and their customers and their customers - nobody can get enough.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘So it's not going</strong> to be a V-shaped recovery.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘We didn't have a V-shaped recovery</strong> after 2008 because of this same phenomenon.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td style="height:10px; font-size:0; border-bottom:10px solid #fff;">&nbsp;                </td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%"><tbody><tr><td style="height:20px; font-size:0; background-color:#f6f6f6;">&nbsp;                </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto;"><tbody><tr><td style="text-align:center; display:block; padding:5px; background-color:#c80000; font-size: 1.375em; font-family: gorditamedium, sans-serif; color:#ffffff; font-weight:bold; letter-spacing: 0px; line-height:1.25em;">4. DE-GLOBALIZATION</td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; background-color:#001544; line-height:1"><tbody><tr><td style="width:25px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><p style="display: block;height: 13px;background-color: #c80000;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td><td style="display:block; padding:5px 5px 5px 12px; text-align:left; font-size: 1.275em; font-family: Georgia, serif; font-style: italic; color:#ffffff; font-weight:bold; letter-spacing: 0px; line-height:1.5em;">Why Deglobalization is Accelerating</td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%" style="background-color:#f6f6f6; text-align: center;"><tbody><tr><td style="max-width:600px"><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td><img width="100%" src="https://img.scoop.it/J2cxH5PpC8xO6plq-D0JhDl72eJkfbmt4t8yenImKBXdhNIf0Yl8YfRAVzhohB7e"></td></tr></tbody></table></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td style="padding:3.5% 0 3.5% 3.5%"><table cellspacing="0" cellpadding="0" width="100%"><tbody><tr><td width="50px" style="display:block;"><a href="http://sco.lt/6XDGUq?track_p_id=bWqmIWwD3yVJ9EgciU_VQWQ" target="_blank" title="SourceLogo"><img height="50px" width="auto" alt="SourceLogo" src="https://img.scoop.it/Q7K3LvBpUHwYzkoXdXm2WUi__cjguAuwrRM5-qsdIhQ=" style="display:block; overflow:hidden; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19); width:auto;"></a></td><td width="100%" style="padding-left:5%;"><a href="http://sco.lt/6XDGUq?track_p_id=1G9EgciU_ofPKTSffUh62%40p" style="color:#001544; font-size:1.3em; font-weight:bold; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.5; text-decoration: none; border-bottom:none;" target="_blank">Why Deglobalization is Accelerating</a></td></tr></tbody></table></td></tr><tr><td style="height:0px; font-size:0">&nbsp;</td></tr><tr><td style="padding:0 3.5%; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.3em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Bloomberg</strong></h3><h2 style="text-align: center;display: block;font-size: 1.15em;margin-top: 1em;margin-bottom: 1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.5em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘Deglobalization is driven by the discomfiting realization that the entire system now has a single point of failure—China.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Businesses are reassessing</strong> China’s role in global supply chains, and by the time this virus burns out,&nbsp;many of them will have started planning to relocate at least some of their production elsewhere.’&nbsp;</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'</strong><a href="https://www.bloomberg.com/news/articles/2020-02-28/goldman-sachs-economists-now-see-global-contraction-fed-cuts?srnd=economics-vp" rel="nofollow"><strong style="font-weight: bold">Deglobalization </strong>is accelerating</a>.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">&nbsp;‘Globalization</strong> was all about price and manufacturing efficiency, regardless of place, and its mutual dependencies were supposed to guarantee its stability.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The U.S. and Chinese economies</strong> were bound together by the supply chains on which they both relied.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But it turns out</strong> that place matters a great deal—for individual businesses, for entire industries and&nbsp;for the global economy.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The epidemic</strong> that began in Wuhan has blocked key arteries of international trade.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Now the&nbsp;</strong><a href="https://www.bloomberg.com/news/articles/2020-02-28/china-s-amassing-a-commodity-mountain-that-risks-crushing-prices?srnd=premium-asia" rel="nofollow"><strong style="font-weight: bold">global economy is</strong></a> having a seizure.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The coronavirus </strong>calls into question these premises that underpin globalization itself.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Deglobalization </strong>is driven by the discomfiting realization that the entire system now has a single point of failure—China.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Chinese President Xi Jinping</strong> is conducting the equivalent of industrial triage, desperately trying to restart factories most critical to global supply chains. But as Mikko Huotari, the director of the German think tank MERICS argues, this isn’t so much comforting as a sign of the&nbsp;<a href="https://www.merics.org/en/china-flash/china-will-be-different-country-after-coronavirus-crisis" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">scale of the problem</a>.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“China’s reputation</strong> for reliability is in tatters, and momentum for supply-chain diversification inside and outside the country is growing.”</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“China will be a different country</strong> after the coronavirus crisis.”</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td style="height:10px; font-size:0; border-bottom:10px solid #fff;">&nbsp;                </td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%"><tbody><tr><td style="height:20px; font-size:0; background-color:#f6f6f6;">&nbsp;                </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; background-color:#001544; line-height:1"><tbody><tr><td style="width:25px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><p style="display: block;height: 13px;background-color: #c80000;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td><td style="display:block; padding:5px 5px 5px 12px; text-align:left; font-size: 1.275em; font-family: Georgia, serif; font-style: italic; color:#ffffff; font-weight:bold; letter-spacing: 0px; line-height:1.5em;">Decoupling is Hard to Do</td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td style="padding:3.5% 0 3.5% 3.5%"><table cellspacing="0" cellpadding="0" width="100%"><tbody><tr><td width="50px" style="display:block;"><a href="http://sco.lt/8ljVyK?track_p_id=06wXzKg_4VrLQpuUreQ2mxS" target="_blank" title="SourceLogo"><img height="50px" width="auto" alt="SourceLogo" src="https://img.scoop.it/_WMiBTDcNqqcPnQt-JHFGUi__cjguAuwrRM5-qsdIhQ=" style="display:block; overflow:hidden; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19); width:auto;"></a></td><td width="100%" style="padding-left:5%;"><a href="http://sco.lt/8ljVyK?track_p_id=5n1hSl6wXzKg_nc%40cVvTX3P" style="color:#001544; font-size:1.3em; font-weight:bold; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.5; text-decoration: none; border-bottom:none;" target="_blank">Covid-19 is teaching hard lessons about China-only supply chains </a></td></tr></tbody></table></td></tr><tr><td style="height:0px; font-size:0">&nbsp;</td></tr><tr><td style="padding:0 3.5%; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.3em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">The Economist</strong></h3><h2 style="text-align: center;display: block;font-size: 1.15em;margin-top: 1em;margin-bottom: 1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.5em;background-color: #f6f6f6;"><strong style="font-weight: bold">“The globalisation of putting everything where production is the most efficient, that is over.”</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Chinese leaders</strong> insist that they are well on the way to conquering the coronavirus, allowing them to reopen “leading enterprises and key links with important influence” in global supply chains.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘A victory over the novel coronavirus</strong> will once again demonstrate “the notable advantages of leadership by the Communist Party of China”, President Xi Jinping told 170,000 officials by video-conference on February 23rd.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But even if all those boasts</strong> come true, foreign governments and business bosses will not quickly forget a frightening lesson: <ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘for some vital products</strong>, they depend on one country.’</li></ul></li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘There is much speculation</strong> about whether covid-19 will accelerate trends in America and other Western countries to decouple from China.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Benjamin Shobert,</strong> a health-care strategist at Microsoft, noted that mutual dependency was once seen as a reason to believe that Sino-American relations were stable and safe.’<ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But in an age of rising distrust,</strong> if those same calculated dependencies were to become a source of fear, then “much of what has supported the modern era of globalisation is no longer valid.”</li></ul></li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Joerg Wuttke,</strong> the president of the European Union Chamber of Commerce in China, says China’s dominance in sectors like pharmaceuticals and pesticides is a topic of concern when he visits officials in Berlin, Brussels and elsewhere.’<ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘He does not expect firms</strong> to leave China altogether, because it drives global growth in so many sectors.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But Mr Wuttke</strong> expects the epidemic to intensify European discussions about industrial policy.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“The globalisation</strong> of putting everything where production is the most efficient, that is over.”</li></ul></li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘James McGregor</strong>, a China veteran who heads the Chinese operations of&nbsp;apco, an American consultancy, watched businesses putting ever more eggs in the China basket for a decade.'<ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Hit by rising labour costs,</strong> trade tensions and now the virus, companies have concluded that they need to diversify—though many are struggling to find countries with China’s infrastructure and adaptable labour force.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Against that,</strong> some firms that are in China to sell to China are expanding production there, in part to avoid the uncertainty of tariffs.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The most capable high-tech companies</strong> see China as “the market of the future” for such promising industries as autonomous vehicles, robotics and the internet of things. They may be rewarded for their faith.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“We are going to see</strong> the Chinese government be extraordinarily nice to companies once this virus is over,” suggests Mr McGregor.’</li></ul></li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td style="height:10px; font-size:0; border-bottom:10px solid #fff;">&nbsp;</td></tr></tbody></table></div><div></div></td></tr></tbody></table>

<table cellpadding="0" cellspacing="0" width="100%" style="background-color:#f6f6f6; text-align: center; overflow:hidden"><tbody><tr><td style="max-width:600px"><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; background:#fff"><tbody><tr><td style="padding:3.5%; text-align:left;"><img width="110px" src="https://assets.website-files.com/5c864c33af62620dca1373ac/5d86577f82aa6e55afacb4ea_cd%20long-fit.png" alt="CHINADebate"></td></tr><tr><td style="padding:3.5%; text-align:center;"><a style="border-bottom: none;text-decoration: none;color: #001544;" href="https://www.chinadebate.com/china-macro-reporter/archive" target="_blank"><img style="width:70px; border-radius:3%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);" src="https://assets.website-files.com/5a3e922cf6b9a40001bc2d6b/5e3dbbf161e6c357b022bea5_China%20Macro%20Reporter%20.png" alt="China_Macro_Reporter"></a></td></tr><tr><td style="text-align:center; line-height:1"><span style="font-size: 27px; font-family: gorditamedium, sans-serif; color:#001544; font-weight:bold; letter-spacing: -0.5px; line-height: 1;">China Macro Reporter</span></td></tr><tr><td style="text-align:center; line-height:1.5; padding-bottom:35px; padding-top:10px"><span style="font-size: 13px; color:#001544; font-family:'gordita', sans-serif;">By Malcolm Riddell<span style="margin:0 6px">·</span>Feb 26, 2020</span></td></tr><tr><td style="text-align:center; line-height:1"><span style="display:block; max-width:480px; margin:0 auto; padding:7px 0; font-size: 1.175em; font-family: Georgia, serif; color:#c80000; font-weight:normal; letter-spacing: -0.5px; line-height:1.5em; border-bottom:2px solid #c80000;">Opening Statement</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td style="padding:3.5% 0 3.5% 3.5%"><table cellspacing="0" cellpadding="0" width="100%"><tbody><tr><td width="50px" style="display:block; padding-top:5%;"><a href="http://sco.lt/6lSolc?track_p_id=dhh5WSjqDcADXA66tIq6_5i" target="_blank" title="SourceLogo" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><img height="50px" width="auto" alt="SourceLogo" src="https://img.scoop.it/A3V_9S99DmaIh9kNYyVqGEi__cjguAuwrRM5-qsdIhQ=" style="display:block; overflow:hidden; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19); width:auto;"></a></td><td width="100%" style="padding-left:5%;"><a href="http://sco.lt/6lSolc?track_p_id=cI1YWlVasjYoN66tIq6_43u" style="color:#001544; font-size:1.3em; font-weight:bold; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.5; text-decoration: none; border-bottom:none;" target="_blank">To Know That You Don't Know</a></td></tr></tbody></table></td></tr><tr><td style="height:0px; font-size:0">&nbsp;</td></tr><tr><td style="padding:0 3.5%; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h1 style="display: inline-block;font-size: 1.35em;margin-top: 0em;margin-bottom: 0em;margin-left: 0;margin-right: 0;line-height: 1.35em;font-weight: normal;font-family: gorditamedium, sans-serif;color: #001544;letter-spacing: -0.1px;"><strong style="font-weight: bold">Greetings!</strong></h1><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">I’ve never bought</strong> a share of stock.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">I have no feel</strong> at all of why markets move.</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">But even though I don't have the feel,</strong> during the U.S.-China trade talks, markets still surprised me. That surprise was summed up in Linette Lopez’s <a href="https://www.businessinsider.my/trump-trade-war-tariffs-china-fools-wall-street-stock-market-2019-10" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">‘<strong style="font-weight: bold">Wall Street keeps embarrassing itself every time Trump talks about China’</strong></a><strong style="font-weight: bold">:</strong></p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Every time President Donald Trump</strong> says he has a trade deal with China the stock market rallies.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘And then</strong> it turns out the deal is vapor.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Stop it, Wall Street</strong> – you’re embarrassing yourself.</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Then, after the news about the Coronavirus</strong>, I expected some turbulence in the markets – with some optimists buying and some pessimists selling - until investors coalesced around a narrative that defined the risk posed.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">Instead U.S. equity markets</strong> just kept going up.</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">Until</strong> they didn’t.</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">Now as I write,</strong> the Dow is down 123 points after a couple of days of big drops.</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Through both</strong> the trade talks and Coronavirus epidemic, a quote from Confucius’ <em style="font-style: italic">Analects</em> kept coming to mind:</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The Master said,</strong> "Yu, shall I teach you what knowledge is?”</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“When you know a thing,</strong> to hold that you know it; and when you do not know a thing, to allow that you do not know it; this is knowledge."</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">From what I can tell,</strong> we are still in the ‘do not know’ phase of the Coronavirus crisis but are surrounded by those who tell us they do know.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">Last week,</strong> investors were confident that the Coronavirus outbreak would be contained and short-lived, so U.S. markets went up.</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">This week</strong>, with not much changing, investors weren’t so confident, so markets went down.</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Similarly, the President</strong> tells us that everything in the U.S. is under control.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">And, ‘CDC officials</strong> warn Americans of "significant disruption" coming because of the virus.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Uncertainty</strong> is scary.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">But having decisions </strong>&nbsp;– whether about investments or public health – made by people who don’t know what they don’t know is terrifying.</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><br></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">We love ‘Letters to the Editor,’</strong> so send me your thoughts on anything here or anything about China.</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">And please forward</strong> the China Macro Reporter to your friends and colleagues.</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Best,</strong></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Malcolm</strong></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><br></p><h2 style="text-align: center;display: block;font-size: 1.15em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.5em;background-color: #f6f6f6;"><strong style="font-weight: bold">NOTE:&nbsp;</strong></h2><h2 style="text-align: center;display: block;font-size: 1.15em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.5em;background-color: #f6f6f6;"><strong style="font-weight: bold">To read the main articles, please click on the title.</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td style="height:10px; font-size:0; border-bottom:10px solid #fff;">&nbsp;                </td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%"><tbody><tr><td style="height:20px; font-size:0; background-color:#f6f6f6;">&nbsp;                </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto;"><tbody><tr><td style="text-align:center; line-height:1; display:block; padding:3px; background-color:#c80000; font-size: 1.375em; font-family: gorditamedium, sans-serif; color:#ffffff; font-weight:bold; letter-spacing: 0px; line-height:1.5em;">MILESTONE</td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td style="padding:3.5% 0 3.5% 3.5%"><table cellspacing="0" cellpadding="0" width="100%"><tbody><tr><td width="50px" style="display:block; padding-top:5%;"><a href="http://sco.lt/73d95k?track_p_id=7J6ChPjA5ifww2_rtm3urLI" target="_blank" title="SourceLogo" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><img height="50px" width="auto" alt="SourceLogo" src="https://img.scoop.it/kRJH85jYYKnePwZNnV2tdki__cjguAuwrRM5-qsdIhQ=" style="display:block; overflow:hidden; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19); width:auto;"></a></td><td width="100%" style="padding-left:5%;"><a href="http://sco.lt/73d95k?track_p_id=ath33eNlCkE5ifww2_V3Sdr" style="color:#001544; font-size:1.3em; font-weight:bold; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.5; text-decoration: none; border-bottom:none;" target="_blank">Congratulations to John Holden!</a></td></tr></tbody></table></td></tr><tr><td style="height:0px; font-size:0">&nbsp;</td></tr><tr><td style="padding:0 3.5%; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;">Center for Strategic &amp; International Studies</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><br></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Congratulations to John Holden</strong> on his confirmation as a senior associate with the <a href="https://www.csis.org/programs/chinese-business-and-economics?utm_source=CSIS+All&amp;utm_campaign=64928ba7b3-EMAIL_CAMPAIGN_2020_01_28_03_14_COPY_01&amp;utm_medium=email&amp;utm_term=0_f326fc46b6-64928ba7b3-222079057" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">Trustee Chair in Chinese Business and Economics </a>at the Center for Strategic and International Studies.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">John</strong> is an old friend and a supporter of CHINADebate since its founding.</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘John has over four decades </strong>of experience in the private sector and the nonprofit community building bridges between the United States and China.'</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘He is currently</strong> senior director and head of the China practice for McLarty Associates.'</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘He has managed</strong> the China business for leading U.S. firms, including Cargill and Hill &amp; Knowlton.'</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘He has served</strong> with distinction as chairman of the American Chamber of Commerce in China, president of the National Committee on U.S.-China Relations, founding associate dean of the Yenching Academy of Peking University, and president and CEO of the US-China Strong Foundation.'</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td style="height:10px; font-size:0; border-bottom:10px solid #fff;">&nbsp;                </td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%"><tbody><tr><td style="height:20px; font-size:0; background-color:#f6f6f6;">&nbsp;                </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto;"><tbody><tr><td style="text-align:center; line-height:1; display:block; padding:3px; background-color:#c80000; font-size: 1.375em; font-family: gorditamedium, sans-serif; color:#ffffff; font-weight:bold; letter-spacing: 0px; line-height:1.5em;">1. CORONAVIRUS' IMPACT ON MARKETS</td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%" style="background-color:#f6f6f6; text-align: center;"><tbody><tr><td style="max-width:600px"><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td><img width="100%" src="https://img.scoop.it/HBrRiO4WARpLe07puuLFSjl72eJkfbmt4t8yenImKBXdhNIf0Yl8YfRAVzhohB7e"></td></tr></tbody></table></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td style="padding:3.5% 0 3.5% 3.5%"><table cellspacing="0" cellpadding="0" width="100%"><tbody><tr><td width="50px" style="display:block; padding-top:5%;"><a href="http://sco.lt/7LnTPs?track_p_id=43svJ6aH3qo_GXidMQ3H6aX" target="_blank" title="SourceLogo" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><img height="50px" width="auto" alt="SourceLogo" src="https://img.scoop.it/Q7K3LvBpUHwYzkoXdXm2WUi__cjguAuwrRM5-qsdIhQ=" style="display:block; overflow:hidden; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19); width:auto;"></a></td><td width="100%" style="padding-left:5%;"><a href="http://sco.lt/7LnTPs?track_p_id=2Bj6aH3qo_ePYFZCZywyxJS" style="color:#001544; font-size:1.3em; font-weight:bold; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.5; text-decoration: none; border-bottom:none;" target="_blank">A V-shaped or L-shaped Recovery?</a></td></tr></tbody></table></td></tr><tr><td style="height:0px; font-size:0">&nbsp;</td></tr><tr><td style="padding:0 3.5%; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Bloomberg</strong></h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><h2 style="text-align: center;display: block;font-size: 1.15em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.5em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘Market players are&nbsp;scrambling&nbsp;to figure out whether there will be a V-shaped recovery or a more L-shaped recovery.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The coronavirus-fueled</strong> sell-off in stocks, commodities and more has ripped to shreds any notion of a global “everything rally.”’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The cumulative loss</strong> for the year across more than 20 major asset classes tracked by Bloomberg stood at 37% on Tuesday night.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Their cumulative return</strong> in 2019 was 273%.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘On Wednesday morning stocks</strong> in particular appeared to be making fresh efforts to stabilize.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Futures for the benchmark U.S. gauges fluctuated,</strong> while the Stoxx Europe 600 Index clawed back well over half of its earlier losses.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Market players</strong> are&nbsp;scrambling&nbsp;to figure out whether:’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘the virus will be contained</strong> and a V-shaped recovery will ensue, or'</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘if the impact will be lengthy</strong> leading to more L-shaped economic performance.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td style="height:10px; font-size:0; border-bottom:10px solid #fff;">&nbsp;                </td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%"><tbody><tr><td style="height:20px; font-size:0; background-color:#f6f6f6;">&nbsp;                </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td style="padding:3.5% 0 3.5% 3.5%"><table cellspacing="0" cellpadding="0" width="100%"><tbody><tr><td width="50px" style="display:block; padding-top:5%;"><a href="http://sco.lt/7dxnk0?track_p_id=8WhBlkg2U611mBS_zbvIBAI" target="_blank" title="SourceLogo" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><img height="50px" width="auto" alt="SourceLogo" src="https://img.scoop.it/3QKIJ28TXRxlm_PNLipujEi__cjguAuwrRM5-qsdIhQ=" style="display:block; overflow:hidden; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19); width:auto;"></a></td><td width="100%" style="padding-left:5%;"><a href="http://sco.lt/7dxnk0?track_p_id=0611mBS_eW2A%40XqsZd6FqDE" style="color:#001544; font-size:1.3em; font-weight:bold; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.5; text-decoration: none; border-bottom:none;" target="_blank">Wall Street Gets Worried About the Coronavirus</a></td></tr></tbody></table></td></tr><tr><td style="height:0px; font-size:0">&nbsp;</td></tr><tr><td style="padding:0 3.5%; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">New York Times</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Ruchir Sharma</strong> | chief global strategist at Morgan Stanley Investment Management&nbsp;</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">&nbsp;</strong></p><h2 style="text-align: center;display: block;font-size: 1.15em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.5em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘The big surprise was not that global markets fell sharply this week on fears of the coronavirus. But that it took so long for them to wake up to the threat.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">&nbsp;</strong></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The big surprise</strong> was not that global markets fell sharply this week on fears of the coronavirus.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But that it took so long</strong> for them to wake up to the threat.'</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Before Monday,</strong> Wall Street was full of instant experts in epidemiology.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘They&nbsp;</strong><a href="https://www.cnbc.com/2020/02/05/stock-market-today-live.html" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">predicted</strong></a><strong style="font-weight: bold"></strong>— on the basis of widely circulated charts showing the number of new cases had peaked in China — that “it’s over.”’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘By noon Monday</strong> that all changed.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Amid reports</strong> that the coronavirus has now spread well beyond China and that Beijing may lower its guard and ease its quarantines, the American market suffered its&nbsp;<a href="https://www.cnn.com/2020/02/23/business/stock-futures-coronavirus/index.html" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">worst day in two years and</a> ended down by nearly 5 percent from its peak last week.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘That drop is now right in line</strong> with the average at this stage of the eight postwar contagions, which go back to the Asian flu of 1957.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Markets are worried</strong> — but as the doctors would say, within normal limits.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The economic impact</strong> will vary from nation to nation, depending on how much stimulus a country can afford.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Already Beijing </strong>has been cutting interest rates and encouraging banks to increase lending.’<ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Chinese investors</strong> are confident the authorities will do whatever it takes to keep the economy moving.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘That is one reason,</strong> despite the fact that China is ground zero of the epidemic, markets have held up better there than in other developing countries.’</li></ul></li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The same is true of the United States,</strong> where investors still seem to trust the Federal Reserve to keep growth alive, come what may.’<ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The American stock market</strong> has also fallen less than the global average.’</li></ul></li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The hardest hit countries</strong> will be those with less wherewithal or inclination to spend more money.’</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td style="height:10px; font-size:0; border-bottom:10px solid #fff;">&nbsp;                </td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%"><tbody><tr><td style="height:20px; font-size:0; background-color:#f6f6f6;">&nbsp;                </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td style="padding:3.5% 0 3.5% 3.5%"><table cellspacing="0" cellpadding="0" width="100%"><tbody><tr><td width="50px" style="display:block; padding-top:5%;"><a href="http://sco.lt/7w8848?track_p_id=44eEQ5eRI6A_dsCxgVOb6Oo" target="_blank" title="SourceLogo" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><img height="50px" width="auto" alt="SourceLogo" src="https://img.scoop.it/zxbyrGBKPhFFZLzMYqfYnUi__cjguAuwrRM5-qsdIhQ=" style="display:block; overflow:hidden; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19); width:auto;"></a></td><td width="100%" style="padding-left:5%;"><a href="http://sco.lt/7w8848?track_p_id=3IE%405eRI6A_RaAX5QZBC5Dl" style="color:#001544; font-size:1.3em; font-weight:bold; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.5; text-decoration: none; border-bottom:none;" target="_blank">'The Worst is Yet to Come'</a></td></tr></tbody></table></td></tr><tr><td style="height:0px; font-size:0">&nbsp;</td></tr><tr><td style="padding:0 3.5%; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Financial Times</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Nouriel Roubini</strong>&nbsp;</h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;">Stern School of Business, NYU and Rosa &amp; Roubini Associates</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><h2 style="text-align: center;display: block;font-size: 1.15em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.5em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘The idea of a V-shaped recovery is nonsensical.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Investors are deluding themselves</strong> about how severe the coronavirus outbreak will be.'</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Despite this week’s big sell-off in equity markets, </strong>the worst is yet to come.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Until this week,</strong> the market reaction to the virus had been mild — after a dip in late January, US and global equities rallied to new highs. This complacency was based on a number of flawed assumptions.’</p><ol style="margin-top: 0px;margin-bottom: 0px;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘First, that the epidemic</strong> would be limited mostly to China, rather than becoming a global pandemic.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Second, that it would be contained</strong> and peak before the end of the first quarter, thus limiting the economic damage to China and the global economy.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Third, that the growth path</strong> would be V-shaped, with a strong rebound in the second quarter and beyond.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Fourth, that policymakers</strong> — both monetary and fiscal — would take strong early actions to support economies and markets, if things were to weaken significantly.’</li></ol><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘It is becoming clear</strong> that this is a global pandemic rather than a China-focused epidemic.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘And we do not know</strong> yet how many other countries in Asia and other parts of the world will experience a severe outbreak — most likely many more.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The view that the economic impact</strong> will peak before the end of the first quarter now looks very shaky.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The damage to China is severe,</strong> and global supply chains are being seriously disrupted, at a time when China accounts for about 20 per cent of global gross domestic product, not the tiny 4 per cent it had at the time of Sars in 2003.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Add to that an economic shock</strong> to big economies like Japan, South Korea and Italy.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘When the disease spreads</strong> to other developed and emerging markets, this damage will increase.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Global business confidence</strong> will soften, too.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The idea of a V-shaped recovery</strong> is nonsensical.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Suppose that the best Goldilocks scenario</strong> does occur: the shock to China hits only the first quarter and the contagion is mostly contained to the country.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘If its output shrinks</strong> just 2 per cent in the first quarter, that is an annualised contraction of 8 per cent.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘A V-shaped rebound</strong> would therefore require the same annualised growth, which exceeds the 6 per cent that China managed before the virus.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Assuming that China</strong> will rebound at this rate in the final three quarters of the year — which would imply growth in 2020 of 4 per cent — is heroically optimistic.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘It is more likely that a V-shape</strong> shows growth returning to a pre-virus annualised level of 6 per cent from the second quarter onwards.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘In this case,</strong> China’s calendar-year growth would be 2.5 per cent.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Compare both the rosy and more realistic scenarios</strong> with current market expectations, which have revised growth estimates for China from 6 per cent to 5.5 per cent, and you can see how investors are still delusional.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘An annual growth rate</strong> in the range of 2.5-4 per cent would also be a major shock to global growth and to other economies.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The expectation</strong> that policymakers will rapidly come to the rescue is also misguided.’’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Fiscal policy</strong> will react very slowly, or not at all, given political and other constraints.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Central banks</strong> are running out of bullets: how much more negative can the European Central Bank, Bank of Japan and others go on interest rates?’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The US Federal Reserve</strong> has only 1.5 percentage points of headroom left.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘It will probably react</strong> in the second quarter by cutting rates, leading to short-term market relief.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘But this coronavirus outbreak</strong> is mostly a negative supply shock that reduces growth and increases costs and inflation, with some side-effects for aggregate demand.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Monetary policy</strong> cannot resolve this.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘So expect a temporary positive market reaction</strong> when central banks signal an accommodative response to the global pandemic.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But this reaction will fizzle out</strong> when the virus becomes more severe and the economic impact spreads globally.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The coronavirus outbreak</strong> is likely to be only one of many negative shocks that will hit the global economy this year.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Others include the risk of a war</strong> between US and Iran causing a spike in oil prices; political chaos in the US as foreign rivals interfere in the upcoming election; and an escalation in tensions between US and China.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Take all of this together,</strong> and the risk of a global recession is rising.’</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td style="height:10px; font-size:0; border-bottom:10px solid #fff;">&nbsp;                </td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%"><tbody><tr><td style="height:20px; font-size:0; background-color:#f6f6f6;">&nbsp;                </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto;"><tbody><tr><td style="text-align:center; line-height:1; display:block; padding:3px; background-color:#c80000; font-size: 1.375em; font-family: gorditamedium, sans-serif; color:#ffffff; font-weight:bold; letter-spacing: 0px; line-height:1.5em;">2. IMPACT ON CHINA'S ECONOMY</td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%" style="background-color:#f6f6f6; text-align: center;"><tbody><tr><td style="max-width:600px"><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td><img width="100%" src="https://img.scoop.it/dYYc1vBslevWXRfpFSOk3Dl72eJkfbmt4t8yenImKBXdhNIf0Yl8YfRAVzhohB7e"></td></tr></tbody></table></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td style="padding:3.5% 0 3.5% 3.5%"><table cellspacing="0" cellpadding="0" width="100%"><tbody><tr><td width="50px" style="display:block; padding-top:5%;"><a href="http://sco.lt/8EISOG?track_p_id=8CtU3xZP54xc3qg_O3DPVC5" target="_blank" title="SourceLogo" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><img height="50px" width="auto" alt="SourceLogo" src="https://img.scoop.it/_WMiBTDcNqqcPnQt-JHFGUi__cjguAuwrRM5-qsdIhQ=" style="display:block; overflow:hidden; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19); width:auto;"></a></td><td width="100%" style="padding-left:5%;"><a href="http://sco.lt/8EISOG?track_p_id=1j4xc3qg_MM4Wo2YaPZDcGJ" style="color:#001544; font-size:1.3em; font-weight:bold; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.5; text-decoration: none; border-bottom:none;" target="_blank">As its covid-19 epidemic slows, China tries to get back to work&nbsp;</a></td></tr></tbody></table></td></tr><tr><td style="height:0px; font-size:0">&nbsp;</td></tr><tr><td style="padding:0 3.5%; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">The Economist</strong></h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><h2 style="text-align: center;display: block;font-size: 1.15em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.5em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘Just as China tries to get its businesses on track, it now faces the prospect of much weaker global demand and the danger that the epidemic, controlled within its borders, re-enters from abroad.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Since the outbreak of the coronavirus,</strong> economists and investors have tried to grasp the basics of epidemiology, analysing such matters as the potential incubation period of the disease and the dangers of asymptomatic transmission.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Recently,</strong> they have turned their attention back to more familiar terrain, tracking the state of the economy.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘To gauge whether production</strong> is resuming, they examine an array of daily figures, including coal consumption, traffic congestion and property sales.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘All have started to rise</strong> (see chart). But all remain far below the levels indicative of a healthy economy.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘One gauge</strong> has been far more upbeat—unrealistically so.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘China’s stockmarket</strong> fell by more than 10% after the coronavirus spread in late January but has since made up all of that ground.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘It even held on</strong> to its gains in recent days when global markets fell sharply because of concerns about the rise in coronavirus infections in Iran, Italy and South Korea.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The bullishness in China</strong> partly stems from the belief that the government could soon unleash a big stimulus to boost growth.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘So far, however,</strong> it has only offered targeted support: state-owned banks are extending loans, the finance ministry is cutting taxes on a temporary basis and landlords, guided by the government, are trimming rents.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Yet China has unquestionably shifted its focus,</strong> as underlined on February 23rd when President Xi Jinping spoke via teleconference to cadres around the country, as many as 170,000 watching him.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘In areas</strong> where the virus is no longer a big danger, it is time for companies to resume operations, he said, adding that China still wants to meet its economic targets this year.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘His words,</strong> taken literally, suggest that the government wants growth of at least 5.5% in 2020, a rate that would be hard to achieve if large-scale production outages dragged on into March.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘All going well,</strong> the base case of many analysts is that China’s businesses will be back to full capacity, more or less, by the end of March.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Economists at big banks</strong> think this resumption could allow first-quarter growth to reach about 4%, year-on-year.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘That would be the weakest</strong> since quarterly records began in 1992, but anything above zero will inevitably raise questions about whether the statistics bureau has toyed with the numbers.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The balance of risks</strong> is also changing as the virus hits other countries.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Just as China</strong> tries to get its businesses on track, it now faces the prospect of much weaker global demand and the danger that the epidemic, controlled within its borders, re-enters from abroad.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td style="height:10px; font-size:0; border-bottom:10px solid #fff;">&nbsp;                </td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%"><tbody><tr><td style="height:20px; font-size:0; background-color:#f6f6f6;">&nbsp;                </td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%" style="background-color:#f6f6f6; text-align: center;"><tbody><tr><td style="max-width:600px"><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td><img width="100%" src="https://img.scoop.it/6oVBfRlRHIDlQjsSFpVrAjl72eJkfbmt4t8yenImKBXdhNIf0Yl8YfRAVzhohB7e"></td></tr></tbody></table></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td style="padding:3.5% 0 3.5% 3.5%"><table cellspacing="0" cellpadding="0" width="100%"><tbody><tr><td width="50px" style="display:block; padding-top:5%;"><a href="http://sco.lt/8WSmiO?track_p_id=4KUXH7H8UUY_IODysrl2u2i" target="_blank" title="SourceLogo" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><img height="50px" width="auto" alt="SourceLogo" src="https://img.scoop.it/LVEdRSpgxX4CbqTrlPycNEi__cjguAuwrRM5-qsdIhQ=" style="display:block; overflow:hidden; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19); width:auto;"></a></td><td width="100%" style="padding-left:5%;"><a href="http://sco.lt/8WSmiO?track_p_id=07H8UUY_Y3%40RhYcY1ei1qca" style="color:#001544; font-size:1.3em; font-weight:bold; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.5; text-decoration: none; border-bottom:none;" target="_blank">'An enormous percentage of the economy right now is just not working.'</a></td></tr></tbody></table></td></tr><tr><td style="height:0px; font-size:0">&nbsp;</td></tr><tr><td style="padding:0 3.5%; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">CNBC</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Leland Miller </strong>| China Beige Book</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">&nbsp;</strong></p><h2 style="text-align: center;display: block;font-size: 1.15em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.5em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘An enormous percentage of the economy right now is just not working.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">&nbsp;</strong></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Q: ‘Leland, there's a big question</strong> about what the first-quarter impact is of the Coronavirus.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘You've collected some non-official data.</strong> Can you give us a sense of what it shows?’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">LELAND MILLER: ‘It's a lot worse</strong> than what most of the consensus has been up until very, very recently.’</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The question</strong> is how much are people back to work? But it's not just about going back to work.'</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘A percentage of the firms,</strong> maybe 30% of firms are closed altogether.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Another, say, 30% of firms</strong> are either working remotely or their CEOs aren't showing up even though their workers are, or they're technically open for business - but they're not really doing anything.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘So an enormous percentage</strong> of the economy right now is just not working - that's not good for growth.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Q: ‘There was a story on Bloomberg</strong> saying that millions of small- to medium- size companies will run out of cash in the next 30 days if they don't get some sort of reprieve from banks. Do you expect these companies to actually default, or go out of business, or do you think the government will likely step in?’</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">MILLER: ‘The government's</strong> going to step in.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘There will be bankruptcies,</strong> there will be firms that do not survive this.'</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But this is a case study</strong> on all the advantages of a centralized system.'</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The Party controls</strong> all the counterparties in the economy.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘You have state banks</strong> loaning to state enterprises; you have state banks loaning to small- and medium-size enterprises.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The government</strong> can just tell them to lend.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘China has the ability</strong> to just continue to get the process going.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The government never</strong> has to freeze up liquidity in the same way that a commercial financial system would work.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘So if it's the policy choice</strong> is to keep these small firms afloat, then the firms will be kept afloat.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td style="height:10px; font-size:0; border-bottom:10px solid #fff;">&nbsp;                </td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%"><tbody><tr><td style="height:20px; font-size:0; background-color:#f6f6f6;">&nbsp;                </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto;"><tbody><tr><td style="text-align:center; line-height:1; display:block; padding:3px; background-color:#c80000; font-size: 1.375em; font-family: gorditamedium, sans-serif; color:#ffffff; font-weight:bold; letter-spacing: 0px; line-height:1.5em;">3. IMPACT ON THE GLOBAL ECONOMY</td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td style="padding:3.5% 0 3.5% 3.5%"><table cellspacing="0" cellpadding="0" width="100%"><tbody><tr><td width="50px" style="display:block; padding-top:5%;"><a href="http://sco.lt/8od72W?track_p_id=05GNmpC_x1yLbD5DZmbScMa" target="_blank" title="SourceLogo" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><img height="50px" width="auto" alt="SourceLogo" src="https://img.scoop.it/F5oOqbo1JBgSwB670WGJUki__cjguAuwrRM5-qsdIhQ=" style="display:block; overflow:hidden; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19); width:auto;"></a></td><td width="100%" style="padding-left:5%;"><a href="http://sco.lt/8od72W?track_p_id=1m5GNmpC_4qvyUtnnkWuaUL" style="color:#001544; font-size:1.3em; font-weight:bold; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.5; text-decoration: none; border-bottom:none;" target="_blank">‘The COVID-19 outbreak has hit at a time great economic vulnerability.'</a></td></tr></tbody></table></td></tr><tr><td style="height:0px; font-size:0">&nbsp;</td></tr><tr><td style="padding:0 3.5%; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Project Syndicate</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Stephan Roach</strong> | Yale University</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;&nbsp;</p><h2 style="text-align: center;display: block;font-size: 1.15em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.5em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘The COVID-19 outbreak has hit at a time great economic vulnerability. With other major economies already struggling, the risk of outright global recession in the first half of 2020 seems like a distinct possibility.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">&nbsp;</strong></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The outbreak of COVID-19</strong> came at a particularly&nbsp;<a href="https://www.project-syndicate.org/commentary/global-growth-losing-its-trade-cushion-by-stephen-s-roach-2020-01" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">vulnerable point in the global business cycle</a>.'&nbsp;</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'World output expanded</strong> by just&nbsp;<a href="https://www.imf.org/en/Publications/WEO/Issues/2020/01/20/weo-update-january2020" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">2.9% in 2019</a>&nbsp;– the slowest pace since the 2008-09 global financial crisis.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘That is just 0.4 percentage points</strong> above the 2.5% threshold typically associated with global recession.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Moreover, vulnerability increased</strong> in most major economies over the course of last year, making prospects for early 2020 all the more uncertain.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘In Japan,</strong> the world’s fourth-largest economy,&nbsp;<a href="https://www.esri.cao.go.jp/en/sna/sokuhou/sokuhou_top.html" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">growth contracted</a> at a 6.3% annual rate in the fourth quarter – much sharper than expected following another consumption-tax hike.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Industrial output fell sharply</strong> in December in both&nbsp;<a href="https://www.destatis.de/EN/Press/2020/02/PE20_038_421.html;jsessionid=B9B45311C654D956B65D84A19D441D0A.internet742" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">Germany</a> (-3.5%) and&nbsp;<a href="https://www.insee.fr/en/statistiques/4305988" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">France</a>&nbsp;(-2.6%), the world’s fifth- and tenth-largest economies respectively.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The United States,</strong> the world’s second-largest economy, appeared&nbsp;<a href="https://www.bea.gov/data/gdp/gross-domestic-product" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">relatively resilient</a> by comparison, but 2.1% real (inflation-adjusted) GDP growth in the fourth quarter of 2019 hardly qualifies as a boom.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘And in&nbsp;</strong><a href="http://data.stats.gov.cn/english/easyquery.htm?cn=B01" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">China</strong></a><strong style="font-weight: bold"></strong>– now the world’s largest economy in purchasing-power-parity terms – growth slowed to a 27-year low of 6% in the last quarter of 2019.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘In other words,</strong> there was no margin for an accident at the beginning of this year.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Yet there has been a big accident:</strong> China’s COVID-19 shock.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The world economy was weak,</strong> and getting weaker, when COVID-19 struck.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The V-shaped recovery trajectory</strong> of a SARS-like episode will thus be much tougher to replicate – especially with monetary and fiscal authorities in the US, Japan, and Europe having such little ammunition at their disposal.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td style="height:10px; font-size:0; border-bottom:10px solid #fff;">&nbsp;                </td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%"><tbody><tr><td style="height:20px; font-size:0; background-color:#f6f6f6;">&nbsp;                </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td style="padding:3.5% 0 3.5% 3.5%"><table cellspacing="0" cellpadding="0" width="100%"><tbody><tr><td width="50px" style="display:block; padding-top:5%;"><a href="http://sco.lt/96nRMe?track_p_id=1X8MmFNW_zsiHtRhPxE5lp6" target="_blank" title="SourceLogo" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><img height="50px" width="auto" alt="SourceLogo" src="https://img.scoop.it/F5oOqbo1JBgSwB670WGJUki__cjguAuwrRM5-qsdIhQ=" style="display:block; overflow:hidden; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19); width:auto;"></a></td><td width="100%" style="padding-left:5%;"><a href="http://sco.lt/96nRMe?track_p_id=4o%40cT8MmFNW_GahnK4PLgEX" style="color:#001544; font-size:1.3em; font-weight:bold; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.5; text-decoration: none; border-bottom:none;" target="_blank">Will the Coronavirus Trigger a Global Recession? </a></td></tr></tbody></table></td></tr><tr><td style="height:0px; font-size:0">&nbsp;</td></tr><tr><td style="padding:0 3.5%; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Project Syndicate</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Jeffrey Frankel</strong> | Harvard</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><h2 style="text-align: center;display: block;font-size: 1.15em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.5em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘So far, US investors seem unconcerned about these risks.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘While global recessions</strong> are exceedingly difficult to&nbsp;<a href="https://onlinelibrary.wiley.com/doi/full/10.1111/infi.12130" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">forecast</a>, the odds of one – particularly one characterized by less than 2.5% growth, a threshold set by the IMF – now seem to have risen dramatically.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘(Unlike advanced-economy growth</strong>, global growth rarely falls below zero, because developing countries have higher average trend growth.)’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘At the start of this year,</strong> things seemed to be looking up for the global economy.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘True, growth had&nbsp;</strong><a href="https://www.imf.org/en/Publications/WEO/Issues/2020/01/20/weo-update-january2020" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">slowed&nbsp;</strong></a>a bit in 2019: from 2.9% to 2.3% in the United States, and from 3.6% to 2.9% globally.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Still, there had been no recession,</strong> and as recently as January, the International Monetary Fund&nbsp;<a href="https://www.imf.org/en/Publications/WEO/Issues/2020/01/20/weo-update-january2020" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">projected&nbsp;</a>a global growth rebound in 2020.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The new coronavirus,</strong> COVID-19, has changed all of that.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The COVID-19 outbreak</strong> has disrupted China’s economic activity – owing partly to the unprecedented quarantining of huge subsets of the population – there is reason to expect a sharp slowdown this year.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘During the recent meeting</strong> of G20 finance ministers, the IMF&nbsp;<a href="https://asia.nikkei.com/Spotlight/Coronavirus/IMF-downgrades-China-GDP-growth-outlook-to-5.6" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">downgraded&nbsp;</a>its growth forecast for China to 5.6% for 2020 – its lowest level since 1990.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Moreover, because China</strong> is a global supply-chain hub, disruptions there undermine output elsewhere.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Commodity exporters</strong> – including Australia, and most of Africa, Latin America, and the Middle East – are likely to be affected the most, as China tends to be their largest customer.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘But all</strong> of China’s major trading partners are vulnerable.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘European manufacturing </strong>could also suffer considerably.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Europe is more dependent on trade</strong> than, say, the United States, and is linked even more extensively to China through a web of supply chains.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘While Germany</strong> narrowly escaped recession last year, it might not be so lucky this year, especially if it fails to undertake&nbsp;<a href="https://www.project-syndicate.org/commentary/germany-austerity-time-for-fiscal-expansion-by-jeffrey-frankel-2019-09" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">some fiscal expansion</a>.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘As for the United Kingdom,</strong> Brexit may finally have the long-feared economic consequences.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘All of this could happen</strong> even if COVID-19 does not become a full-blown pandemic. In fact, while the virus is proliferating in some countries, such as&nbsp;<a href="https://www.bbc.com/news/world-asia-51603251?ns_campaign=bbcnews&amp;ns_mchannel=social&amp;ns_source=facebook&amp;ocid=socialflow_facebook&amp;fbclid=IwAR1J-iN4lKBAhzYoLRnrFyHPKzNmBDaDEhnuRdoZdh9QgnX9-2WJJ4MBqOQ" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">South Korea</a>, a high infection rate is not a prerequisite for economic hardship.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The specter of contagious disease</strong> tends to have a disproportionate impact on economic activity, because healthy people avoid traveling, shopping, and even going to work.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘So far, US investors</strong> seem unconcerned about these risks.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But they may be</strong> taking too much comfort from the US Federal Reserve’s three interest-rate cuts last year.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Should the US economy falter,</strong> there is nowhere near enough room for the Fed to cut interest rates by 500 basis points, as it has in past recessions.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td style="height:10px; font-size:0; border-bottom:10px solid #fff;">&nbsp;                </td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%"><tbody><tr><td style="height:20px; font-size:0; background-color:#f6f6f6;">&nbsp;                </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td style="padding:3.5% 0 3.5% 3.5%"><table cellspacing="0" cellpadding="0" width="100%"><tbody><tr><td width="50px" style="display:block; padding-top:5%;"><a href="http://sco.lt/4jQv0y?track_p_id=3uMz91RprK_UnHGrrUiP2Zx" target="_blank" title="SourceLogo" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><img height="50px" width="auto" alt="SourceLogo" src="https://img.scoop.it/K9fKxwrt-0GqvuYSovNp30i__cjguAuwrRM5-qsdIhQ=" style="display:block; overflow:hidden; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19); width:auto;"></a></td><td width="100%" style="padding-left:5%;"><a href="http://sco.lt/4jQv0y?track_p_id=8Q2p2zQra91RprK_HI3Z2ZP" style="color:#001544; font-size:1.3em; font-weight:bold; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.5; text-decoration: none; border-bottom:none;" target="_blank">The Fed's Limited Impact</a></td></tr></tbody></table></td></tr><tr><td style="height:0px; font-size:0">&nbsp;</td></tr><tr><td style="padding:0 3.5%; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Wall Street Journal</strong></h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><br></p><h2 style="text-align: center;display: block;font-size: 1.15em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.5em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘During both the 2001 and 2007-08 crises, the Fed cut by around five percentage points. At present, it can at most cut them by 1.75 points before hitting zero.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><br></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘If the virus infected a billion people,</strong> as the swine flu did in 2009 and 2010, 20 million could die, said Peter Berezin, chief global strategist at BCA Research.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“Demand for most items</strong> other than necessities would seize up.”</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The resulting recession</strong> would be as deep as 2008-09, though recovery would be much faster, he predicted.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The Federal Reserve</strong> could respond by cutting interest rates, but the effect would be limited.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Rate cuts boost demand</strong> for goods and services, but the problem now is whether workers and firms can supply them.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘After the Sept. 11, 2001,</strong> terrorist attacks, economic activity plunged from coast-to-coast amid a grounding of commercial flights and fear of more attacks.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The Fed cut interest rates,</strong> but the absence of follow-on attacks did the most to restore confidence.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Similarly,</strong> the Fed cut interest rates after Lehman Brothers failed in 2008, but it took a federal bailout to end the panic.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Another problem</strong> is that in both 2001 and 2007-08, the Fed cut by around five percentage points.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘At present,</strong> it can at most cut them by 1.75 points before hitting zero.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Finally, how other policy makers</strong> respond is a wild card.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The U.S. and its allies</strong> cooperated in 2001 to defeat al Qaeda and in 2008 to contain the financial crisis.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Today, that spirit of cooperation</strong> has been strained by trade wars and a greater willingness by the U.S. to act alone.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td style="height:10px; font-size:0; border-bottom:10px solid #fff;">&nbsp;                </td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%"><tbody><tr><td style="height:20px; font-size:0; background-color:#f6f6f6;">&nbsp;                </td></tr></tbody></table></div></td></tr></tbody></table>

<table cellpadding="0" cellspacing="0" width="100%" style="background-color:#f6f6f6; text-align: center;"><tbody><tr><td style="max-width:600px"><div><table cellpadding="0" cellspacing="0" width="100%" style="background-color:#f6f6f6; text-align: center;"><tbody><tr><td style="max-width:600px"><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; background:#fff"><tbody><tr><td style="padding:3.5%; text-align:left;"><img width="110px" src="https://assets.website-files.com/5c864c33af62620dca1373ac/5d86577f82aa6e55afacb4ea_cd%20long-fit.png" alt="CHINADebate"></td></tr><tr><td style="padding:3.5%; text-align:center;"><a style="border-bottom: none;text-decoration: none;color: #001544;" href="https://www.chinadebate.com/china-macro-reporter/archive" target="_blank"><img style="width:70px; border-radius:3%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);" src="https://assets.website-files.com/5a3e922cf6b9a40001bc2d6b/5e3dbbf161e6c357b022bea5_China%20Macro%20Reporter%20.png" alt="China_Macro_Reporter"></a></td></tr><tr><td style="text-align:center; line-height:1"><span style="font-size: 27px; font-family: gorditamedium, sans-serif; color:#001544; font-weight:bold; letter-spacing: -0.5px; line-height: 1;">China Macro Reporter</span></td></tr><tr><td style="text-align:center; line-height:1.5; padding-bottom:35px; padding-top:10px"><span style="font-size: 13px; color:#001544; font-family:'gordita', sans-serif;">By Malcolm Riddell<span style="margin:0 6px">·</span>Feb 22, 2020</span></td></tr><tr><td style="text-align:center; line-height:1"><span style="display:block; max-width:480px; margin:0 auto; padding:7px 0; font-size: 1.175em; font-family: Georgia, serif; color:#c80000; font-weight:normal; letter-spacing: -0.5px; line-height:1.5em; border-bottom:2px solid #c80000;">Opening Statement</span></td></tr></tbody></table></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td style="padding:3.5% 0 3.5% 3.5%"><table cellspacing="0" cellpadding="0" width="100%" style="padding:3.5%;"><tbody><tr><td width="50px" style="display:block; padding-top:5%;"><a href="http://sco.lt/7gYCW0?track_p_id=2y298XvVG_XRmHt%40qdOCknA" target="_blank" title="SourceLogo" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><img height="50px" width="auto" alt="SourceLogo" src="https://img.scoop.it/A34-JXbCfNBw6jMh3VQmQEi__cjguAuwrRM5-qsdIhQ=" style="display:block; overflow:hidden; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19); width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/7gYCW0?track_p_id=7zFIbZNw98XvVG_ijXX3BAf" style="color:#001544; font-size:1.35em; font-weight:bold; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; text-decoration: none; border-bottom:none;" target="_blank">Only so much to say</a></td></tr></tbody></table></td></tr><tr><td style="height:0px; font-size:0">&nbsp;</td></tr><tr><td style="padding:0 3.5%; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h1 style="display: inline-block;font-size: 1.35em;margin-top: 0em;margin-bottom: 0em;margin-left: 0;margin-right: 0;line-height: 1.35em;font-weight: normal;font-family: gorditamedium, sans-serif;color: #001544;letter-spacing: -0.1px;"><strong style="font-weight: bold">Greetings!</strong></h1><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">The Coronavirus </strong>is rightly sucking all the air out of the China reporting and analytical space.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">But because</strong> so little is known, the stuff coming out either strains to present a new angle (reporters do have to fill columns) or presents just plain-old speculation.</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Reminds</strong> of the U.S.-China trade war.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">May the Coronavirus crisis</strong> end with just such a whimper.</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">That said, </strong>even though we can't assess the global impact on lives or economies, we are learning - in passing - a great deal about China's political system, China's role global supply chains, just how robust the Chinese Communist Party really is, not to mention international economics and politics.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">This is important</strong> because after the effects of the trade war and the Coronavirus work themselves through the Chinese and international systems, those systems will have changed - in some cases dramatically.</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">&nbsp;And the best way</strong> to understand those changes is to watch - and analyze - as they happen in real-time.</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">We love ‘Letters to the Editor,’</strong> so send me your thoughts on anything here or anything about China.</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">And please forward</strong> the China Macro Reporter to your friends and colleagues.</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Best,</strong></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Malcolm</strong></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><br></p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">NOTE:&nbsp;</strong></h2><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">To read the main articles, please click on the title.</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td style="height:10px; font-size:0; border-bottom:10px solid #fff;">&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;</td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%"><tbody><tr><td style="height:20px; font-size:0; background-color: #f6f6f6;">&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;</td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto;"><tbody><tr><td style="text-align:center; line-height:1"><span style="display:block; padding:5px; background-color:#c80000; font-size: 1.375em; font-family: gorditamedium, sans-serif; color:#ffffff; font-weight:bold; letter-spacing: 0px; line-height:1.5em;">Coronavirus</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; background-color:#001544; line-height:1"><tbody><tr><td style="width:40px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><p style="display: block;height: 13px;background-color: #c80000;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td><td style="text-align:left;"><span style="display:block; padding:5px 5px 5px 30px; font-size: 1.275em; font-family: Georgia, serif; font-style: italic; color:#ffffff; font-weight:bold; letter-spacing: 0px; line-height:1.5em;">A Sobering Thought</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td style="padding:3.5% 0 3.5% 3.5%"><table cellspacing="0" cellpadding="0" width="100%" style="padding:3.5%;"><tbody><tr><td width="50px" style="display:block; padding-top:5%;"><a href="http://sco.lt/7Ips0W?track_p_id=eQ53AZWsoxqoTic81nL3u_3" target="_blank" title="SourceLogo" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><img height="50px" width="auto" alt="SourceLogo" src="https://img.scoop.it/3QKIJ28TXRxlm_PNLipujEi__cjguAuwrRM5-qsdIhQ=" style="display:block; overflow:hidden; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19); width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/7Ips0W?track_p_id=cTpjzwYkSUIbE81nL3u_MGP" style="color:#001544; font-size:1.35em; font-weight:bold; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; text-decoration: none; border-bottom:none;" target="_blank">Examining the Coronavirus Outbreak: China, Markets, and Global Health Governance</a></td></tr></tbody></table></td></tr><tr><td style="height:0px; font-size:0">&nbsp;</td></tr><tr><td style="padding:0 3.5%; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: left;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Council on Foreign Relations</strong></h3><h3 style="text-align: left;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Thomas R. Frieden&nbsp;</strong></h3><h3 style="text-align: left;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><em style="font-style: italic">CEO, Resolve to Save Lives&nbsp;</em></h3><h3 style="text-align: left;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><em style="font-style: italic">Former Director, Centers for Disease Control and Prevention</em></h3><h3 style="text-align: left;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><br></h3><h2 style="display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘Is the Coronavirus going to be controllable, like SARS? Or is it going to be like flu or the common cold, that circulates regionally, or in countries, for months, or years, or indefinitely?'&nbsp;</strong></h2><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">'We really</strong><strong style="font-weight: bold">don’t know.'</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><br></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">The Council on Foreign Relations</strong> held a meeting with a panel of experts looking at the coronavirus and its impact on public health and economies.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">The following</strong> is a short exerpt from the transcript – all of which is worth reading.</li></ul><p style="text-align: center;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">___________________________________</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">FRIEDEN: ‘The major question </strong>right now is:’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Is this going to be controllable,</strong> like SARS, which as far as we know is gone—has not infected anyone in the last fourteen years.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Or is it going to be like flu</strong> or the common cold, that circulates regionally, or in countries, for months, or years, or indefinitely?’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘And we really</strong> don’t know.’&nbsp;</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td style="height:10px; font-size:0; border-bottom:10px solid #fff;">&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;</td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%"><tbody><tr><td style="height:20px; font-size:0; background-color: #f6f6f6;">&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;</td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; background-color:#001544; line-height:1"><tbody><tr><td style="width:40px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><p style="display: block;height: 13px;background-color: #c80000;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td><td style="text-align:left;"><span style="display:block; padding:5px 5px 5px 30px; font-size: 1.275em; font-family: Georgia, serif; font-style: italic; color:#ffffff; font-weight:bold; letter-spacing: 0px; line-height:1.5em;">Hit from Air Travel Slowdown</span></td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%" style="background-color:#f6f6f6; text-align: center;"><tbody><tr><td style="max-width:600px"><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td><img width="100%" src="https://listly-temp.s3.amazonaws.com/519670_13000%20Missing%20Flights-The%20Global%20Consequences%20of%20the%20Coronavirus-NYT.gif"></td></tr></tbody></table></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td style="padding:3.5% 0 3.5% 3.5%"><table cellspacing="0" cellpadding="0" width="100%" style="padding:3.5%;"><tbody><tr><td width="50px" style="display:block; padding-top:5%;"><a href="http://sco.lt/8tPu4W?track_p_id=ero5w4QXpI3rbVk7Hu618_p" target="_blank" title="SourceLogo" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><img height="50px" width="auto" alt="SourceLogo" src="https://img.scoop.it/3QKIJ28TXRxlm_PNLipujEi__cjguAuwrRM5-qsdIhQ=" style="display:block; overflow:hidden; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19); width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/8tPu4W?track_p_id=5PL2WM7Hu618_CPH%40fnzkl1" style="color:#001544; font-size:1.35em; font-weight:bold; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; text-decoration: none; border-bottom:none;" target="_blank">13,000 Missing Flights: The Global Consequences of the Coronavirus&nbsp;</a></td></tr></tbody></table></td></tr><tr><td style="height:0px; font-size:0">&nbsp;</td></tr><tr><td style="padding:0 3.5%; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">New York Times</strong></h3><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><br></h3><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘Within just three weeks — from Jan. 23 to Feb. 13 — the number of daily departures and arrivals for domestic and international flights dropped to just 2,004, from 15,072- over 13,000 flights a day, lost to a crisis.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">&nbsp;</strong></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">In the </strong><a href="https://www.chinadebate.com/china-macro-reporter/archive#nl5" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">February 15 edition</strong></a> of the China Macro Reporter, Yossi Sheffi of MIT noted that:</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'Most freight</strong> - 52% of the ton-kilometers - fly in the belly of passenger planes, “belly cargo.”’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'With the passenger air travel bans,</strong> we have lost most of that “belly cargo” capacity.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'UPS and FedEx</strong> have also cut capacity going into China.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'Why is this important?</strong> Consider, for example, 'Apple gets its parts for iPhones from 43 countries that go to China where Foxconn assembles the phones in China.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'Now those parts</strong> aren’t going into China, and iPhones are not getting made.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Now The New York Times</strong> has created three powerful moving graphics that show just how severe the slowdown in air travel is in China.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">One is above.</strong> Check out the other two <a href="https://www.nytimes.com/interactive/2020/02/21/business/coronavirus-airline-travel.html?searchResultPosition=133" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">here</a>.</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">But the impact</strong> of that lost capacity goes beyond supply chain disruption.</p><p style="text-align: center;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">______________________</p><p style="text-align: center;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The disappearance</strong> of tens of thousands of flights from China’s skies in recent weeks points to how the coronavirus has hobbled a nation.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The flight suspensions</strong> started to mount late last month as countries and airlines sharply limited service in response to the accelerating spread of the virus.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Within just three weeks</strong> — from Jan. 23 to Feb. 13 — the number of daily departures and arrivals for domestic and international flights dropped to just 2,004, from 15,072- over 13,000 flights a day, lost to a crisis.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘If the coronavirus crisis</strong> is anything like the SARS outbreak in the early 2000s, it could eliminate $29 billion in global airline revenue this year, resulting in a small industry contraction.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The vast majority of the losses</strong> would be concentrated among airlines in the Asia-Pacific region.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The SARS outbreak wiped out</strong> about $6 billion in annual revenue for airlines in that part of the world and it took nine months for international passenger traffic to recover.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But the coronavirus</strong> has so far proved more lethal, more widespread and more damaging to flight traffic in China, which today plays a far bigger role in global travel than it did two decades ago.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td style="height:10px; font-size:0; border-bottom:10px solid #fff;">&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;</td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%"><tbody><tr><td style="height:20px; font-size:0; background-color: #f6f6f6;">&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;</td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; background-color:#001544; line-height:1"><tbody><tr><td style="width:40px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><p style="display: block;height: 13px;background-color: #c80000;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td><td style="text-align:left;"><span style="display:block; padding:5px 5px 5px 30px; font-size: 1.275em; font-family: Georgia, serif; font-style: italic; color:#ffffff; font-weight:bold; letter-spacing: 0px; line-height:1.5em;">The View from D.C.</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td style="padding:3.5% 0 3.5% 3.5%"><table cellspacing="0" cellpadding="0" width="100%" style="padding:3.5%;"><tbody><tr><td width="50px" style="display:block; padding-top:5%;"><a href="http://sco.lt/6kHCvA?track_p_id=93WRCPz1YD6TD30Q_wse4dm" target="_blank" title="SourceLogo" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><img height="50px" width="auto" alt="SourceLogo" src="https://img.scoop.it/3QKIJ28TXRxlm_PNLipujEi__cjguAuwrRM5-qsdIhQ=" style="display:block; overflow:hidden; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19); width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/6kHCvA?track_p_id=csd5ZcdQMbkat6TD30Q_wAX" style="color:#001544; font-size:1.35em; font-weight:bold; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; text-decoration: none; border-bottom:none;" target="_blank">Coronavirus Worsens U.S.-China Ties and Bolsters Hawks in Washington&nbsp;</a></td></tr></tbody></table></td></tr><tr><td style="height:0px; font-size:0">&nbsp;</td></tr><tr><td style="padding:0 3.5%; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">New York Times</strong></h3><h3 style="text-align: left;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><br></h3><h2 style="display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘But if the hard-liners were hoping for a united, anti-China message coming from Washington, that goal has been undermined by their own leader.’</strong>&nbsp;</h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘From the start,</strong> the Trump administration has been divided between:’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘A pro-trade faction</strong> that favors strong business relations with China and’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘A national security faction</strong> that promotes the idea of “decoupling” the two economies.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The Trump administration’s most hawkish officials</strong> have seized on the coronavirus epidemic to bolster their arguments that the United States needs to make a more fundamental break with China.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'The China hawks</strong> say privately that they see the virus&nbsp;<a href="https://www.nytimes.com/2020/02/15/world/asia/xi-china-coronavirus.html" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">weakening the party’s legitimacy&nbsp;</a>and further separating the two countries.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘But if the hard-liners</strong> were hoping for a united, anti-China message coming from Washington, that goal has been undermined by their own leader.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘President Trump</strong> has publicly commended President Xi Jinping’s handling of the crisis and even called for greater commercial ties, including the&nbsp;<a href="https://www.nytimes.com/2020/02/18/us/politics/trump-contradicts-advisers-china-technology.html" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">sale of jet engines to China</a>.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“Look,’’ Mr. Trump</strong> said on Tuesday, “I know this: President Xi loves the people of China, he loves his country, and he’s doing a very good job with a very, very tough situation.”</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Whether it is because</strong> of the assertiveness of the hard-liners, the ambiguities fueled by the competing messages or Beijing’s policies, the&nbsp;<a href="https://www.nytimes.com/2020/01/22/business/economy/trade-economy.html" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">relationship between the United States and China</a>&nbsp;has become so strained and unpredictable that even the need for a united effort to address a global health crisis has not overcome the suspicions that have increasingly taken root on both sides.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“The level of trust</strong> in the relationship is now cratering,” said Jude Blanchette, the Freeman Chair in China Studies at the Center for Strategic and International Studies in Washington.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“Issues like global pandemics</strong> and other issues that fundamentally impact the security of both countries,” he said, “are going to be very difficult to work through given the levels of distrust and disharmony on both sides.”</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td style="height:10px; font-size:0; border-bottom:10px solid #fff;">&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;</td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%"><tbody><tr><td style="height:20px; font-size:0; background-color: #f6f6f6;">&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;</td></tr></tbody></table></div><div></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; background-color:#001544; line-height:1"><tbody><tr><td style="width:40px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><p style="display: block;height: 13px;background-color: #c80000;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td><td style="text-align:left;"><span style="display:block; padding:5px 5px 5px 30px; font-size: 1.275em; font-family: Georgia, serif; font-style: italic; color:#ffffff; font-weight:bold; letter-spacing: 0px; line-height:1.5em;">Recovery Depends on Demand</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td style="padding:3.5% 0 3.5% 3.5%"><table cellspacing="0" cellpadding="0" width="100%" style="padding:3.5%;"><tbody><tr><td width="50px" style="display:block; padding-top:5%;"><a href="http://sco.lt/7tjiuu?track_p_id=4dsqU7NChSg_a6Gb154lNf6" target="_blank" title="SourceLogo" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><img height="50px" width="auto" alt="SourceLogo" src="https://img.scoop.it/4q8YTRvoY7LYzXxssuZgBUi__cjguAuwrRM5-qsdIhQ=" style="display:block; overflow:hidden; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19); width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/7tjiuu?track_p_id=ajwtkWx3Ud%407NChSg_LHGMt" style="color:#001544; font-size:1.35em; font-weight:bold; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; text-decoration: none; border-bottom:none;" target="_blank">Slack Demand Not Supply Dampening Recovery</a></td></tr></tbody></table></td></tr><tr><td style="height:0px; font-size:0">&nbsp;</td></tr><tr><td style="padding:0 3.5%; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">MacroPolo</strong></h3><h3 style="text-align: left;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Houze Song</strong> | MacroPolo</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">'Lack of demand rather than supply constraints is holding up a swift recovery.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The main obstacle</strong> to returning to business as usual has less to do with the current constraint on production and more to do with consumer sentiment and the mass psychology of uncertainty.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘In short,</strong> lack of demand rather than supply constraints is holding up a swift recovery.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘And if demand recovery</strong> leads the way, then supply will easily follow.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The current production bottlenecks</strong> could evaporate fairly quickly.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Chinese firms</strong> still have to go through extensive administrative review to resume production, and many are still awaiting their approvals.'</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘As of February 14,</strong> only about&nbsp;<a href="http://economy.caixin.com/2020-02-17/101516612.html" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">half of&nbsp;</a>the large firms reportedly obtained approvals to restart production.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘While this will certainly</strong> have an impact on production, a closer examination of sectoral capacity utilization suggests that these supply constraints are not the main culprit of suboptimal production.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Rather,</strong> it appears that below potential demand is playing a bigger role in determining the pace of the return to normalcy.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'When demand becomes robust again,</strong> firms should be able to ramp up production even with the restrictions in place.'</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td style="height:10px; font-size:0; border-bottom:10px solid #fff;">&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;</td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%"><tbody><tr><td style="height:20px; font-size:0; background-color: #f6f6f6;">&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;</td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; background-color:#001544; line-height:1"><tbody><tr><td style="width:40px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><p style="display: block;height: 13px;background-color: #c80000;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td><td style="text-align:left;"><span style="display:block; padding:5px 5px 5px 30px; font-size: 1.275em; font-family: Georgia, serif; font-style: italic; color:#ffffff; font-weight:bold; letter-spacing: 0px; line-height:1.5em;">The PBOC Acts</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff; style="><tbody><tr><td style="padding:3.5% 0 3.5% 3.5%"><table cellspacing="0" cellpadding="0" width="100%" style="padding-top:3.5%; padding-left:3.5%"><tbody><tr><td width="50px" style="display:block;"><a href="http://sco.lt/5HRZIW?track_p_id=5c1aW6650kAQ_bqN3xbnnHj" target="_blank" title="SourceLogo" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><img height="50px" width="auto" alt="SourceLogo" src="https://img.scoop.it/zxbyrGBKPhFFZLzMYqfYnUi__cjguAuwrRM5-qsdIhQ=" style="display:block; overflow:hidden; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19); width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/5HRZIW?track_p_id=eqwkQuWcvydt%40nb650kAQ_u" style="color:#001544; font-size:1.35em; font-weight:bold; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; text-decoration: none; border-bottom:none;" target="_blank">What the People’s Bank of China&nbsp;has Done to Stimulate the Economy</a></td></tr></tbody></table></td></tr><tr><td style="height:0px; font-size:0">&nbsp;</td></tr><tr><td style="padding:0 3.5%; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Financial Times</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Chen Yulu </strong>| deputy governor of the People’s Bank of China</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">&nbsp;</strong></p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘The most likely economic recovery scenario is a V-shaped curve: a decline in economic activities followed by a rapid recovery, with the total economic impact relatively contained.</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">&nbsp;</strong></p><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">The writer, Chen Yulu,</strong> is the deputy governor of the People’s Bank of China</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The sound fundamentals</strong> of China’s economy in the medium and long term remain unchanged.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘These underpinnings</strong> of high-quality growth will not reverse due to the epidemic.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Equipped with a rich policy toolkit,</strong> China is capable of coping with various uncertainties.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The PBoC</strong> has strengthened countercyclical adjustments of monetary policy through open market operations.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘This has ensured</strong> reasonable and adequate levels of liquidity and helped to boost market confidence.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The PBoC,</strong> with other financial regulators, rolled out 30 policy measures to support enterprises heavily affected by the epidemic, in particular small and micro ones, private enterprises and the manufacturing sector.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The central bank</strong> also provided Rmb300bn in special central bank lending to large banks and selected local banks in Hubei and other severely-hit provinces.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘It provides credit support</strong> at preferential interest rates to manufacturers of essential medical supplies and daily necessities.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘These policies</strong> have proved significantly effective.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Many SMEs</strong> seriously affected by the epidemic were given access to new bank loans.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Preferential loans</strong> to a rapidly-identified list of eligible enterprises are receiving fast-track approval.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Financial regulators</strong> have also ensured the stable functioning of markets by ensuring the uninterrupted operation of financial infrastructure.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘As the postponed</strong> consumption and investment activities resume, the economy is expected to experience a compensatory recovery.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The Chinese economy</strong> is expected to recover rapidly as it is supported by a restart of factories and inventory replenishment.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The most likely scenario</strong> is a V-shaped curve, which means a decline in economic activities followed by a rapid recovery, with the total economic impact relatively contained.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td style="height:10px; font-size:0; border-bottom:10px solid #fff;">&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;</td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%"><tbody><tr><td style="height:20px; font-size:0; background-color: #f6f6f6;">&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;</td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; background-color:#001544; line-height:1"><tbody><tr><td style="width:40px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><p style="display: block;height: 13px;background-color: #c80000;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td><td style="text-align:left;"><span style="display:block; padding:5px 5px 5px 30px; font-size: 1.275em; font-family: Georgia, serif; font-style: italic; color:#ffffff; font-weight:bold; letter-spacing: 0px; line-height:1.5em;">Why the PBOC Stimulus May Not Work</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td style="padding:3.5% 0 3.5% 3.5%"><table cellspacing="0" cellpadding="0" width="100%" style="padding:3.5%;"><tbody><tr><td width="50px" style="display:block; padding-top:5%;"><a href="http://sco.lt/875hB2?track_p_id=6oQZlRc4uaYYg_OhZvMidtY" target="_blank" title="SourceLogo" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><img height="50px" width="auto" alt="SourceLogo" src="https://img.scoop.it/LVEdRSpgxX4CbqTrlPycNEi__cjguAuwrRM5-qsdIhQ=" style="display:block; overflow:hidden; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19); width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/875hB2?track_p_id=djuXAY6RMYlZK24uaYYg_iS" style="color:#001544; font-size:1.35em; font-weight:bold; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; text-decoration: none; border-bottom:none;" target="_blank">China Stimulus Won't Be Very Effective</a></td></tr></tbody></table></td></tr><tr><td style="height:0px; font-size:0">&nbsp;</td></tr><tr><td style="padding:0 3.5%; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">CNBC</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Eswar Prasad</strong> | Cornell &amp; Brookings</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">&nbsp;</strong></p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘The smaller firms that are the much more dynamic ones but also much riskier of course, are the ones that end up suffering a lot more.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">&nbsp;&nbsp;</strong></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Q: ‘We're going to see</strong> major stimulus expected out of all of the effected countries. Are you skeptical that it will be particularly effective in China?'</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">PRASAD: ‘Some of the structural problems</strong> that already exist in China are going to mean that the stimulus isn't going to be very effective and could create risks.'</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The companies</strong> that are going to be likely hurting because they don't have much of a financial cushion are the small enterprises, especially in the service sector.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘In the private sector</strong> more broadly, these are the companies that are very important for employment growth and productivity growth in China.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The problem</strong> is that the formal banking system, which is largely state-owned, is not very good at funneling credit to these enterprises.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Much of the credit</strong> in the economy in China still goes to the large State-Owned Enterprises, which are going to be fine.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The smaller firms</strong> that are the much more dynamic ones but also much riskier of course, are the ones that end up suffering a lot more.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Because of this,</strong> if the People's Bank of China continues to inject liquidity that ends up mostly in SOEs, you might well end up with a situation where you still have a lot of investment that is not very productive because the productive private companies are starved of credit.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘You could end up with</strong> very little stimulus in terms of actual growth, productivity, and employment.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘And more financial risks</strong> in the future in an economy where there are already lots of significant bad loan problems in the banking system.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td style="height:10px; font-size:0; border-bottom:10px solid #fff;">&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;</td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%"><tbody><tr><td style="height:20px; font-size:0; background-color: #f6f6f6;">&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;</td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto;"><tbody><tr><td style="text-align:center; line-height:1"><span style="display:block; padding:5px; background-color:#c80000; font-size: 1.375em; font-family: gorditamedium, sans-serif; color:#ffffff; font-weight:bold; letter-spacing: 0px; line-height:1.5em;">The CCP &amp; Black Swans</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; background-color:#001544; line-height:1"><tbody><tr><td style="width:40px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><p style="display: block;height: 13px;background-color: #c80000;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td><td style="text-align:left;"><span style="display:block; padding:5px 5px 5px 30px; font-size: 1.275em; font-family: Georgia, serif; font-style: italic; color:#ffffff; font-weight:bold; letter-spacing: 0px; line-height:1.5em;">'China is a communist country'</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td style="padding:3.5% 0 3.5% 3.5%"><table cellspacing="0" cellpadding="0" width="100%" style="padding:3.5%;"><tbody><tr><td width="50px" style="display:block; padding-top:5%;"><a href="http://sco.lt/8nb7uC?track_p_id=afkbHLlktUh9A0JGY_A1UAd" target="_blank" title="SourceLogo" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><img height="50px" width="auto" alt="SourceLogo" src="https://img.scoop.it/tky1IOAtRdFmYOMRuP0Q7Ei__cjguAuwrRM5-qsdIhQ=" style="display:block; overflow:hidden; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19); width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/8nb7uC?track_p_id=513PEj9A0JGY_QSH6jMPI6f" style="color:#001544; font-size:1.35em; font-weight:bold; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; text-decoration: none; border-bottom:none;" target="_blank">Contradictions in China's Communist Party</a></td></tr></tbody></table></td></tr><tr><td style="height:0px; font-size:0">&nbsp;</td></tr><tr><td style="padding:0 3.5%; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">GLOBALBRIEF</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><br></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Bilahari Kausikan</strong> | former permanent secretary of the Ministry of Foreign Affairs of Singapore</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘In the long sweep of Chinese history, the times of maximum danger for ruling dynasties were those periods of internal uncertainty that coincided with periods of external uncertainty. We may be in such a time.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘China’s strengths and weaknesses</strong> both stem from a fact so obvious that it is too often ignored or downplayed: China is a communist country.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Perhaps no longer</strong> in the classical ideological sense – although Xi Jinping has stressed the need for Party discipline and his version of ideological orthodoxy – but certainly in the structure of the Chinese polity.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘China is a Leninist state</strong> led by a vanguard party that insists on absolute control over every aspect of state and society.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Control is the primary value</strong> to which all other considerations are subordinate. If exceptions are made, they are tactical and temporary.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Control gives a Leninist state</strong> the capability to take fundamental decisions and pursue them over the long term with minimal discussion except within the top echelon of the Party.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘It would have been well-nigh impossible</strong> in any other kind of polity to take and sustain the drastic policy shifts that led China to where it now stands.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The central dilemma</strong> facing China can be simply stated: The political logic of a Leninist state contradicts economic logic, setting up a cycle that it is difficult to break.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The essence</strong> of a Leninist state is the Party’s insistence on control.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The market,</strong> by definition, means less control.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Continually replenishing resources</strong> over the long period needed to deal with rising expectations requires sustained growth, particularly in the context of a rapidly ageing population.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Sustaining growth</strong> requires a new model based on greater economic efficiency.'</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘This, in turn,</strong> requires a new balance between Party control and economic efficiency.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Thus far, Xi Jinping</strong> has not found the will to take the risks needed to break this cycle by decisive action of the sort Deng Xiaoping took more than 40 years ago.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Economic policy</strong> since the 18thCCP Congress has largely been a series of partial measures and improvisations – often brilliant improvisations, but nonetheless still improvisations rather than what is needed to decisively address the fundamental issues. Xi’s priority is clearly on control.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘China will not fail.’</strong></p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The CCP</strong> is an extremely adaptive organization and inherits the experience of more than a century of political, economic and social experimentation.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'But the dilemmas and trade-offs</strong> now confronting China are more numerous, complex and daunting than those of earlier periods of reform.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘In the long sweep of Chinese history,</strong> the times of maximum danger for ruling dynasties were those periods of internal uncertainty that coincided with periods of external uncertainty.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'We may be</strong> in such a time.'</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td style="height:10px; font-size:0; border-bottom:10px solid #fff;">&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;</td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%"><tbody><tr><td style="height:20px; font-size:0; background-color: #f6f6f6;">&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;</td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; background-color:#001544; line-height:1"><tbody><tr><td style="width:40px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><p style="display: block;height: 13px;background-color: #c80000;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td><td style="text-align:left;"><span style="display:block; padding:5px 5px 5px 30px; font-size: 1.275em; font-family: Georgia, serif; font-style: italic; color:#ffffff; font-weight:bold; letter-spacing: 0px; line-height:1.5em;">Three Black Swans</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td style="padding:3.5% 0 3.5% 3.5%"><table cellspacing="0" cellpadding="0" width="100%"><tbody><tr><td width="50px" style="display:block; padding-top:5%;"><a href="http://sco.lt/6mhcfo?track_p_id=08Jm7Kg_leLjJ%405zUqRd4dI" target="_blank" title="SourceLogo" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><img height="50px" width="auto" alt="SourceLogo" src="https://img.scoop.it/tky1IOAtRdFmYOMRuP0Q7Ei__cjguAuwrRM5-qsdIhQ=" style="display:block; overflow:hidden; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19); width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/6mhcfo?track_p_id=1N8Jm7Kg_qhlaub56jpV%402E" style="color:#001544; font-size:1.35em; font-weight:bold; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; text-decoration: none; border-bottom:none;" target="_blank">China and the Breeding of Black Swans</a></td></tr></tbody></table></td></tr><tr><td style="height:0px; font-size:0">&nbsp;</td></tr><tr><td style="padding:0 3.5%; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">GLOBALBRIEF</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><br></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Bilahari Kausikan</strong> | former permanent secretary of the Ministry of Foreign Affairs of Singapore</h3><h3 style="display: block;font-size: 0.85em;margin-top:0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><br></h3><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘Xi seems to have reintroduced something akin to a neo-Maoist single point of failure into the Chinese system, whereby a single mistake can have widespread and perhaps catastrophic results.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Party rule and Xi’s position</strong> are not at immediate jeopardy.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘However,</strong> the CCP is approaching an inflection point, and some fundamental decisions cannot continue be postponed indefinitely.'</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Inflection points</strong> are breeding grounds for black swans.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Some</strong> have already hatched.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">1. ‘Xi Jinping himself </strong>is something of a black swan.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'He is a ‘princeling’</strong> and the CCP is his patrimony.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'When the Party elders</strong> selected him as new leader, they may have assumed that his was a safe pair of hands that could be trusted to clean up corruption, without shaking up the system too much. How wrong they were!’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'The concentration of power</strong> around Xi seems to have reintroduced something akin to a neo-Maoist single point of failure into the Chinese system, whereby a single mistake can have widespread and perhaps catastrophic results.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">2. 'The trade war</strong> is a second black swan.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘China seems</strong> to have underestimated Trump and was clearly caught on the back-foot by the change of attitude in the US.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Hubris is not a Western monopoly.</strong> Hubris led Beijing to fundamentally misread the direction of American foreign policy, exaggerate China’s strengths, down-play China’s vulnerabilities, and brush aside growing international concerns with certain aspects of Chinese behaviour.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘After the 2008-2009 global financial crisis,</strong> China seemed to have begun to believe its own propaganda about its inevitable rise and America’s (and the West’s) inevitable and absolute decline; Beijing may have over-generalized from the Obama administration’s lack of stomach for confrontation after Obama’s disastrous handling of crises over Scarborough Shoal in the South China Sea and the use of chemical weapons in Syria.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">3. 'Hong Kong</strong> is a third black swan.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘In itself, Hong Kong</strong> is not all that serious a matter to Beijing; its fate was settled in 1997 and it will eventually become just another Chinese city.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But Beijing clearly misread the situation,</strong> and Hong Kong encompasses complex issues of Chinese identity that have bedevilled China since the late 19th’ Identity issues could have serious implications for China’s relationships with overseas Chinese communities in Southeast Asia, Taiwan and beyond.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Xi has claimed</strong> the support of “all Chinese” for his version of the ‘China Dream’.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘This broad civilizational claim</strong> of privilege and authority creates the potential for trouble in Southeast Asia that could make Hong Kong seem only small beer.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘In the case of Taiwan,</strong> it has already been politically counterproductive and is potentially very dangerous. In the worst case, it could even lead to war with the US.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td style="height:10px; font-size:0; border-bottom:10px solid #fff;">&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;</td></tr></tbody></table></div></td></tr></tbody></table>

<table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; background:#f6f6f6;"><tbody><tr><td><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; background:#fff"><tbody><tr><td style="padding:3.5%; text-align:left;"><img width="110px" src="https://assets.website-files.com/5c864c33af62620dca1373ac/5d86577f82aa6e55afacb4ea_cd%20long-fit.png" alt="CHINADebate"></td></tr><tr><td style="padding:3.5%; text-align:center;"><a style="border-bottom: none;text-decoration: none;color: #001544;" href="https://www.chinadebate.com/china-macro-reporter/archive" target="_blank"><img style="width:70px; border-radius:3%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);" src="https://assets.website-files.com/5a3e922cf6b9a40001bc2d6b/5e3dbbf161e6c357b022bea5_China%20Macro%20Reporter%20.png" alt="China_Macro_Reporter"></a></td></tr><tr><td style="text-align:center; line-height:1"><span style="font-size: 27px; font-family: gorditamedium, sans-serif; color:#001544; font-weight:bold; letter-spacing: -0.5px; line-height: 1;">China Macro Reporter</span></td></tr><tr><td style="text-align:center; line-height:1.5; padding-bottom:35px; padding-top:10px"><span style="font-size: 13px; color:#001544; font-family:'gordita', sans-serif;">By Malcolm Riddell<span style="margin:0 6px">·</span>Feb 19, 2020</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:5px; border-left:0px solid #c80000; text-align:center; font-size: 1.375em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;">Opening Statement</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/8apR2G?track_p_id=1Z98XvVG_YWOjWI1I1WHAuy" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/A34-JXbCfNBw6jMh3VQmQEi__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/8apR2G?track_p_id=avLFyNlf2GU98XvVG_GcBwC" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">'When Fury Overcomes Fear'</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h1 style="display: inline-block;font-size: 1.35em;margin-top: 0em;margin-bottom: 0em;margin-left: 0;margin-right: 0;line-height: 1.35em;font-weight: normal;font-family: gorditamedium, sans-serif;color: #001544;letter-spacing: -0.1px;"><strong style="font-weight: bold">Greetings!</strong></h1><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">When I first read</strong> Xu Zhangran's essay <strong style="font-weight: bold">'Viral Alarm: When Fury Overcomes Fear,' </strong>criticizing Xi and his regime, I had thought to devote an entire issue to it. Instead I just introduce it today.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">The essay</strong> has now gotten traction in the western press. &nbsp;</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">But don't read the commentaries, </strong>read this extraordinary - and certainly courageous - &nbsp;polemic.</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">This is not the first essay</strong> that Xu, a professor of constitutional law at Tsinghua University (one of China's top two universities), has written taking the Party and the government to task. He has written several.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">For his efforts,</strong> he was demoted by the university and barred from teaching, writing, and publishing.</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">After publishing&nbsp;this essay </strong>- the ban notwithstanding - he wrote, “This may well even be the last piece I write.”’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">&nbsp;'Viral Alarm: When Fury Overcomes Fear'</strong> is such scorchy that that may well be true.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">Let me know</strong> what you think.</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><br></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">We love ‘Letters to the Editor,’</strong> so send me your thoughts on anything here or anything about China.</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">And please forward</strong> the China Macro Reporter to your friends and colleagues.</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Best,</strong></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Malcolm</strong></p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">NOTE:&nbsp;</strong></h2><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">To read the main articles, please click on the title.</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;                </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; text-align:left;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:5px; border-left:0px solid #c80000; text-align:center; font-size: 1.375em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;">'Viral Alarm: When Fury Overcomes Fear'</span></td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%" style="background-color:#f6f6f6; text-align: center;"><tbody><tr><td style="max-width:600px"><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td><img width="100%" src="https://i1.wp.com/chinachange.org/wp-content/uploads/2018/08/xu-zhangrun.jpg?fit=567%2C567&amp;ssl=1"></td></tr></tbody></table></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">Part One</span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/5X4aa8?track_p_id=eZsgaiknZtmdDkY8hDS0M_3" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/J3T8LU4ds3f9K0lWTONO6Ui__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/5X4aa8?track_p_id=1I8hDS0M_KBjQpcNvWuZD4l" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">'Viral Alarm: When Fury Overcomes Fear'</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">ChinaFile</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Xu Zhangrun </strong>| Tsinghua University</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><br></p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">&nbsp;“The bureaucratic and governance system of China we see now is one that values the mediocre, the dilatory and the timid.”</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><br></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">MUST READ. </strong><a href="https://www.chinafile.com/reporting-opinion/viewpoint/viral-alarm-when-fury-overcomes-fear" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">‘Viral Alarm: When Fury Overcomes Fear’</strong></a> by Xu Zhangrun, a law professor at Tsinghua University (one of China’s top two universities), criticizes Xi Jinping and the structures he has created in the most extraordinary and direct way I have seen.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">Far too much</strong> for me to summarize here. I had considered devoting an entire issue to the essay</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">But really</strong> you should the entire essay yourself. [<a href="https://www.chinafile.com/reporting-opinion/viewpoint/viral-alarm-when-fury-overcomes-fear" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">English here</a> /[<a href="https://matters.news/@Zhizhu_2019/%E8%BD%89%E8%BC%89-%E8%A8%B1%E7%AB%A0%E6%BD%A4-%E6%84%A4%E6%80%92%E7%9A%84%E4%BA%BA%E6%B0%91%E5%B7%B2%E4%B8%8D%E5%86%8D%E6%81%90%E6%83%A7-zdpuAtQTLkEf6MGa17RjcBdJFHFZAdRTfHPUgDBkCVkTUSg3o" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">original Chinese here</a>]</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Here</strong> is one quote:</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“Unfortunately,</strong> as a result of the endless political purges of recent years [carried out in the name of an “anti-corruption campaign”] and along with the revival of “Red Culture,” the people in the system who have now been promoted are in-house Party hacks who slavishly obey orders.”</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“As a result,</strong> both the professional commitment and the expertise previously valued within China’s technocracy, along with the ambition people previously had to seek promotion on the basis of their actual achievements, have been gradually undermined and, without any great hue and cry, they have now all but disappeared.”</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“The One Who Must Be Obeyed</strong> [Xi] who talks about the importance of transmitting “red genes” through the reliable Party body politic, the man with the ultimate decision-making power and sign-off authority, has created an environment in which the system as a whole has fallen into desuetude.”</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“What remains</strong> is a widespread sense of hopelessness.”</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“The bureaucratic and governance system</strong> of China we see now is one that values the mediocre, the dilatory and the timid.”</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><a href="https://www.chinafile.com/reporting-opinion/viewpoint/viral-alarm-when-fury-overcomes-fear" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">ChinaFile.</strong></a><strong style="font-weight: bold"> ‘In July 2018,</strong> the Tsinghua University professor Xu Zhangrun published&nbsp;an&nbsp;<a href="http://chinaheritage.net/journal/imminent-fears-immediate-hopes-a-beijing-jeremiad/" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">unsparing critique</a>&nbsp;of the Chinese Communist Party and its&nbsp;<a href="https://www.economist.com/china/2016/04/02/chairman-of-everything" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">Chairman of Everything</a>, Xi Jinping.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Xu warned of the dangers of one-man rule,</strong> a sycophantic bureaucracy, putting politics ahead of professionalism and the myriad other problems that the system would encounter if it rejected further reforms.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘That philippic</strong> was one of a cycle of works that Xu wrote during a year in which he alerted his readers to pressing issues related to China’s momentous struggle with modernity, the state of the nation under Xi Jinping and the mixed prospects for its future.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Although he was demoted by Tsinghua University</strong> in March 2019 and banned from teaching, writing and publishing, Xu has remained defiant.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘His latest polemical work—“When&nbsp;Fury Overcomes Fear</strong>”— appeared&nbsp;<a href="https://matters.news/@Zhizhu_2019/%E8%BD%89%E8%BC%89-%E8%A8%B1%E7%AB%A0%E6%BD%A4-%E6%84%A4%E6%80%92%E7%9A%84%E4%BA%BA%E6%B0%91%E5%B7%B2%E4%B8%8D%E5%86%8D%E6%81%90%E6%83%A7-zdpuAtQTLkEf6MGa17RjcBdJFHFZAdRTfHPUgDBkCVkTUSg3o" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">online</a> on February 4, 2020 as the coronavirus epidemic swept China and infections overseas sparked concern around the world.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><a href="https://www.theguardian.com/world/2020/feb/15/xi-critic-professor-this-may-be-last-piece-i-write-words-ring-true" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">The Guardian.</strong></a><strong style="font-weight: bold">&nbsp;'The Chinese professor Xu Zhangrun,</strong> who published a rare public critique of President&nbsp;<a href="https://www.theguardian.com/world/xi-jinping" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">Xi Jinping</a>&nbsp;over China’s coronavirus crisis, was placed under house arrest for days, barred from social media and is now cut off from the internet.'</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;                </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">Part Two</span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/4xNo1Y?track_p_id=4a4EU696sYQ_FGtYzJEdlId" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/tHKL9S3HBmldAy7-9GOMlUi__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/4xNo1Y?track_p_id=8PyJWUd3D696sYQ_PfOZYjH" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">"They can’t keep all 1.4 billion mouths in China shut.”</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">The New Yorker &amp; The New York Times</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Evan Osnos </strong>| The New Yorker</h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Nick Kristof&nbsp;</strong>| The New York Times</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">“The coronavirus epidemic has revealed the rotten core of Chinese governance."</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><a href="https://www.newyorker.com/news/daily-comment/chinas-iron-house-struggling-over-silence-in-the-coronavirus-epidemic" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">The New Yorker/Evan Osnos.</strong></a><strong style="font-weight: bold"> ‘Last week,</strong> the epidemic inspired a manifesto from Xu Zhangrun, a law professor at Tsinghua University, who has emerged as the most prominent intellectual critic of Xi Jinping.'</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Since Xi suspended term limits,</strong> the professor, who is a scholar of Chinese constitutional law, has circulated a series of searing critiques of one-man rule and the campaign to eliminate challenges to the Communist Party.'</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘On February 4th,</strong> he&nbsp;<a href="https://matters.news/@Zhizhu_2019/%E8%BD%89%E8%BC%89-%E8%A8%B1%E7%AB%A0%E6%BD%A4-%E6%84%A4%E6%80%92%E7%9A%84%E4%BA%BA%E6%B0%91%E5%B7%B2%E4%B8%8D%E5%86%8D%E6%81%90%E6%83%A7-zdpuAtQTLkEf6MGa17RjcBdJFHFZAdRTfHPUgDBkCVkTUSg3o" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">published online</a> “Viral Alarm,” an essay that faults Xi and the Party for initially suppressing the discovery of the virus and punishing truthtellers, a campaign of official silence that “served to embolden deception at every level of government.”’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘He wrote,</strong> “No matter how complex, nuanced, and sophisticated one’s analysis, the reality is stark.”’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“A polity</strong> that is blatantly incapable of treating its own people properly can hardly be expected to treat the rest of the world well.”</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘How can a nation</strong> that doggedly refuses to become a modern political civilization really expect to be part of a meaningful community?”’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">'In his essay on the virus,</strong> Xu called on the government to live up to Article 35 of the Chinese constitution, which guarantees “freedom of speech, of the press, of assembly, of association, of procession, and of demonstration.”’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But Xu</strong> has no illusion that any change is coming soon.'</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘For his writing,</strong> he has already paid a heavy price:’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Last March,</strong> Tsinghua University demoted him and banned him from teaching and publishing.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘He continues to write,</strong> though, and his work has circulated widely among Chinese intellectuals and abroad.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Because his latest essay</strong> assails Chinese leaders at a vulnerable moment, he expected that it might incur a harsher punishment—that, as he wrote, “this may well even be the last piece I write.”’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Still,</strong> he ended with a call to his countrymen “who have no way of fleeing this land.”’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘He wrote,</strong> “I call on them: rage against this injustice; let your lives burn with a flame of decency; break through the stultifying darkness and welcome the dawn.”’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The essay extends a theme</strong> of social criticism that has coursed through modern China, from Lu Xun to the writings of Liu Xiaobo, a Nobel laureate, who died in 2017 while serving an eleven-year prison sentence for subversion.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Geremie R. Barmé,</strong> an independent historian in New Zealand, who&nbsp;<a href="http://www.chinafile.com/reporting-opinion/viewpoint/viral-alarm-when-fury-overcomes-fear" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">translated Xu’s essays</a>, told me, “Writers like Lu Xun and Xu Zhangrun, and like Xiaobo as well as so many others, repeatedly warn against the authoritarian practice summed up by the term 鉗口,&nbsp;<em style="font-style: italic">qian kou</em>, an ancient expression meaning ‘to clamp mouths shut.’”</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“Although their views</strong> and political aspirations differed, they have a shared contempt for, and warn against, the millennia-old autocratic tradition.”</li></ul><p style="text-align: center;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;___________________________________</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><a href="https://www.nytimes.com/2020/02/15/opinion/sunday/china-coronavirus.html" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">NYT/Nick Kristof.</a><strong style="font-weight: bold">“The coronavirus epidemic </strong>has revealed the rotten core of Chinese governance,” a law professor in Beijing,&nbsp;<a href="http://chinaheritage.net/xu-zhangrun-%e8%a8%b1%e7%ab%a0%e6%bd%a4/" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">Xu Zhangrun</a>, wrote this month in&nbsp;<a href="http://www.chinafile.com/reporting-opinion/viewpoint/viral-alarm-when-fury-overcomes-fear" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">an online essay</a>&nbsp;that was immediately banned.'</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“The level of popular fury is volcanic,</strong> and a people thus enraged may, in the end, also cast aside their fear.”</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">'Xu certainly cast aside his own fear,</strong> predicting that he would face new punishments but adding, “I cannot remain silent.”</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">'He called on his fellow Chinese citizens</strong> to demand free speech and free elections and urged:’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“Rage against injustice;</strong> let your lives burn with a flame of decency; break through stultifying darkness and welcome the dawn.”</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">'Xu’s essay</strong> is reverberating around China through surreptitious copies.'</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'“Faced with this virus,</strong> the Leader has flailed about,” Xu wrote.'&nbsp;</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“Although everyone</strong> looks to The One for the nod of approval, The One himself is clueless.”</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">“Regardless of how good</strong> they are at controlling the internet,” Xu added, “they can’t keep all 1.4 billion mouths in China shut.”</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;                </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; text-align:left;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:5px; border-left:0px solid #c80000; text-align:center; font-size: 1.375em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;">economy</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">Recovery in Waves</span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/93kFiS?track_p_id=b6KkaxMCpYpm5BZn4Q_Ugl%40" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/hqcb7kJYiDYn7Mrr5RTueEi__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/9Lua2a?track_p_id=4dwpu5BZn4Q_Dv3wFYuWjhx" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">China's Response to the Economic Slowdown</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">McKinsey&nbsp;</strong></h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘China is attempting to resume economic activity in waves.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><br></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Thanks to my old friend&nbsp;</strong><a href="https://www.pamirlaw.com/team-member/nicholas-v-chen/" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">Nick Chen</strong></a><strong style="font-weight: bold"></strong>of Pamir Law Group in Taiwan for alerting me this succinct but comprehensive McKinsey report - great charts.</p><p style="text-align: center;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">____________________________</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘China is attempting</strong> to resume economic activity in waves, as migrant workers (&gt;15M in Shanghai and Beijing alone) return from the Lunar New Year holiday.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The first priority</strong> is infrastructure, basic supplies (food, water, electricity, gas, communications, transport, government), and medical supplies.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The government</strong> is allowing factory restarts if companies can ensure a safe working environment and adherence to stringent processes, including checking employee travel and exposure history.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘This will likely lead</strong> to a restart of manufacturing activity but it may take weeks. Other than Hubei (where there are 518 laboratory-confirmed cases per million inhabitants), all of China’s other provinces have fewer than 20 laboratory-confirmed cases per million.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘China appears</strong> to be betting that this relatively contained number will not worsen dramatically with a controlled restart of its factories.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘In addition to evaluating a restart</strong>, some manufacturers are temporarily moving their manufacturing, but most companies are focused on a smooth restart versus supply alternatives.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Some manufacturers</strong> are shifting temporarily to Southeast Asia (e.g., Philippines) to account for a shortfall in their production.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But there is a limited ability </strong>to do this due to lower Southeast Asian factory capacity and high degree of component customization, which makes the Chinese supply base sticky.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;                </td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%" style="background-color:#f6f6f6; text-align: center;"><tbody><tr><td style="max-width:600px"><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td><img width="100%" src="https://assets.website-files.com/5c864c33af62620dca1373ac/5e5713a5e8c5307d87d0c8d8_Potential%20evolution%20of%20the%20macroeconomic%20situation.png"></td></tr></tbody></table></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; text-align:left;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:5px; border-left:0px solid #c80000; text-align:center; font-size: 1.375em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;"> even more tariffs</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">Tariffs for Currency Manipulation</span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/5WqtKi?track_p_id=2qe6rXNSY_rxs1ThO2hUj2X" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/F5oOqbo1JBgSwB670WGJUki__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/5WqtKi?track_p_id=06rXNSY_JBD42zPHyrNi3Se" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">Trump’s “Currency Manipulation” Tariffs</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Project Syndicate</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Anne O. Krueger |</strong> School of Advanced International Studies</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘The Department of Commerce this month&nbsp;issued&nbsp;a rule that allows for additional levies on imports from countries deemed to be currency manipulators.’&nbsp;</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><br></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">'President Donald Trump's administration</strong> has devised yet another tool - additional tariffs on imports from countries deemed to be currency manipulators - with which to tilt the playing field against foreign competitors.’</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Many politicians</strong> over the years have argued that China and other developing and emerging economies “manipulate their currency” to gain a competitive edge.'</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘To account for such concerns,</strong> the United States has a law mandating that the Department of the Treasury prepare a biannual report for Congress specifying whether any currencies are being “manipulated.”’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘If the Treasury does so specify,</strong> the administration is then expected to carry on “talks” with the accused country.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Even then,</strong> the law mandates no penalties.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘But the Trump administration</strong> has discovered a new tool with which to bludgeon foreign competitors.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The Department of Commerce</strong> this month&nbsp;<a href="https://www.reuters.com/article/us-usa-trade-currency/u-s-finalizes-rule-to-slap-duties-on-countries-that-undervalue-currencies-idUSKBN1ZY08V" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">issued a</a> rule that allows for additional levies on imports from countries deemed to be currency manipulators, with the percentage increase in the tariff (in addition to the statutory tariff and the anti-dumping or countervailing duty margin) being equal to the estimated percentage by which the currency is deemed undervalued.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Worse, under the new rule,</strong> there is&nbsp;<a href="https://www.wsj.com/articles/new-rule-lets-u-s-companies-fight-currency-manipulation-11580831245" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">no legal process that</a> the department must follow when determining whether “manipulation” has occurred.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Accordingly, an American company</strong> that believes it is losing sales to a foreign company may now appeal to the Commerce Department (and the International Trade Administration) for special treatment.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Even if a (profitable) German exporter</strong> charges the same prices for the goods it sells domestically as it does for the goods it sells in the US, an American firm can demand additional levies by citing “currency manipulation.”’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘And if no US firm acts,</strong> the Commerce Department can simply initiate such appeals on its own.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘More broadly,</strong> the Trump administration’s currency politics will be felt everywhere.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Trump has complained</strong> that both Argentina and Brazil are manipulating their currencies, even though those countries’ exchange-rate depreciation is obviously a response to high inflation.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The International Monetary Fund</strong> and others have recommended that both pursue devaluation in order to restore macroeconomic balance.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Meanwhile,</strong> Trump continues to call on the US Federal Reserve to lower interest rates and ease its monetary policy so that the dollar will depreciate.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Apparently,</strong> the US is free to manipulate its currency – just so long as no one else does.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;                </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">Tariffs on Products Hurt by Tariffs</span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/8wTcki?track_p_id=85UjiINUJ68XxLK_FuW2jVA" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/TiISon2f36FD5_ms-2WONki__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/8wTcki?track_p_id=eGZKaSBeqDWY4gM68XxLK_d" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">Part 1: Cascading Protection: Tariffs on Products Hurt by Earlier Tariffs</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Peterson Institute for International Economics (PIIE)</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Chad Bown</strong> | PIIE</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">&nbsp;</strong></p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘Economists refer to a second round of tariffs on products hurt by earlier duties as "cascading protection."’&nbsp;</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">&nbsp;</strong></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘President Donald Trump's</strong> brazen move in late January to&nbsp;<a href="https://www.whitehouse.gov/presidential-actions/proclamation-adjusting-imports-derivative-aluminum-articles-derivative-steel-articles-united-states/" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">extend</a>&nbsp;his previously imposed "national security" tariffs on steel and aluminum to cover even more products was greeted with a collective yawn by many weary of his unending trade wars. But this latest action was significant:’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘For the first time,</strong> Trump was explicitly imposing new tariffs to help an industry suffering because of his previous tariffs.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'Economists refer</strong> to a second round of tariffs on products hurt by earlier duties as "cascading protection."'&nbsp;</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘On January 24, 2020,</strong> Trump delivered some of those tariffs for a handful of high-content steel products, including steel nails and car bumpers.’&nbsp;</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Trump’s motivation</strong> for his tariffs was that imports of these sorts of high-content steel products had increased.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But the increase in imports</strong> was due at least in part to American consumers of nails and bumpers switching to foreign suppliers to avoid paying for the American versions of products that Trump's tariffs had made more costly.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">&nbsp;‘That Trump's metal tariffs</strong> would hurt so many American companies making steel-derivative products was expected. Lydia Cox and Kadee Russ&nbsp;<a href="https://econofact.org/will-steel-tariffs-put-u-s-jobs-at-risk" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">estimated</a>&nbsp;80 Americans work in the steel-using industry for every one employed in steel production.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The cascade of additional protection</strong> was also not surprising, given economic&nbsp;<a href="https://voxeu.org/article/costs-cascading-trade-protection" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">research&nbsp;</a>that input duties trigger knock-on tariffs on products that use those inputs.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The policy concern</strong> is separate evidence of the arrival of what economists feared.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Trump's protection</strong> on inputs begets more protection on outputs.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;                </td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%" style="background-color:#f6f6f6; text-align: center;"><tbody><tr><td style="max-width:600px"><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td><img width="100%" src="https://www.piie.com/sites/default/files/styles/slimmed_natural/public/bown_2020-01-31_fig1.png?itok=wBkX-2gJ"></td></tr></tbody></table></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">Tariffs for Dumping</span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/5wxzIe?track_p_id=5mFuTb92E2gA_YFhXKfrofj" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/TiISon2f36FD5_ms-2WONki__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/5wxzIe?track_p_id=dDdNRCWdB5R3RW92E2gA_BT" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">Part 2: Cascading Protection: Anti-Dumping Tariffs</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Peterson Institute for International Economics (PIIE)</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Chad Bown</strong> | PIIE</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘Companies making these products can get protection under a different US trade law called antidumping.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘In less than two years</strong> since Trump's steel and aluminum tariffs first went into effect, American manufactures of metal file cabinets, propane cylinders, wheels, wind towers, and loads of other products have all faced higher input costs and demanded new protection (figure 2).’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘More than a dozen of these products</strong> with a high content of steel and aluminum—covering&nbsp;<em style="font-style: italic">ten times&nbsp;</em>the amount of trade affected by Trump's latest tariffs—have triggered cascading protection since Trump's original tariffs went into effect in March 2018.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Companies</strong> making these products can get protection under a different US trade law called antidumping.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘By the end of 2019,</strong> an additional $5 billion of US imports of steel and aluminum "derivative" products faced antidumping duties.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Potential antidumping duties</strong> on these additional $5 billion of imports of steel and aluminum derivative products are just the beginning.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Trump's tariffs</strong> on $360 billion of imports from China also disproportionately targeted parts, components, and other inputs that American companies and workers require to remain competitive with firms in Europe, Japan, Canada, and elsewhere.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Despite Trump's phase one deal </strong>with China, all of those tariffs&nbsp;<a href="https://www.piie.com/blogs/trade-and-investment-policy-watch/phase-one-china-deal-steep-tariffs-are-new-normal" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">remain</a>.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Expect more cascading protection </strong>– both "national security" &nbsp;and anti-dumping tariffs - to arise on "derivatives" of those imported inputs from China as well.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;                </td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%" style="background-color:#f6f6f6; text-align: center;"><tbody><tr><td style="max-width:600px"><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td><img width="100%" src="https://www.piie.com/sites/default/files/styles/slimmed_natural/public/bown_2020-01-31_fig2.png?itok=-GI6RYAd"></td></tr></tbody></table></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"></td></tr></tbody></table></div></td></tr></tbody></table>

<table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; background:#fff"><tbody><tr><td style="padding:3.5%; text-align:left;"><img width="110px" src="https://assets.website-files.com/5c864c33af62620dca1373ac/5d86577f82aa6e55afacb4ea_cd%20long-fit.png" alt="CHINADebate"></td></tr><tr><td style="padding:3.5%; text-align:center;"><a style="border-bottom: none;text-decoration: none;color: #001544;" href="https://www.chinadebate.com/china-macro-reporter/archive" target="_blank"><img style="width:70px; border-radius:3%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);" src="https://assets.website-files.com/5a3e922cf6b9a40001bc2d6b/5e3dbbf161e6c357b022bea5_China%20Macro%20Reporter%20.png" alt="China_Macro_Reporter"></a></td></tr><tr><td style="text-align:center; line-height:1"><span style="font-size: 27px; font-family: gorditamedium, sans-serif; color:#001544; font-weight:bold; letter-spacing: -0.5px; line-height: 1;">China Macro Reporter</span></td></tr><tr><td style="text-align:center; line-height:1.5; padding-bottom:35px; padding-top:10px"><span style="font-size: 13px; color:#001544; font-family:'gordita', sans-serif;">By Malcolm Riddell<span style="margin:0 6px">·</span>Feb 15, 2020</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:5px; border-left:0px solid #c80000; text-align:center; font-size: 1.375em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;">Opening Statement</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/8yLjea?track_p_id=631LCvo98XvVG_32dJJippA" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/A34-JXbCfNBw6jMh3VQmQEi__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/8yLjea?track_p_id=2xD98XvVG_aFlvFj%402oujKZ" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">Compare and Contrast</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h1 style="display: inline-block;font-size: 1.35em;margin-top: 0em;margin-bottom: 0em;margin-left: 0;margin-right: 0;line-height: 1.35em;font-weight: normal;font-family: gorditamedium, sans-serif;color: #001544;letter-spacing: -0.1px;"><strong style="font-weight: bold">Greetings!</strong></h1><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><br></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><span style="color: #d0021b"><strong style="font-weight: bold">ESSAY QUESTION:</strong></span><span style="color: #d0021b"></span>Compare and contrast these two statements.</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">1. ‘Mr. Barr installed a phalanx of outside lawyers</strong> to re-examine national security cases with the possibility of overruling career prosecutors, a highly unusual move that could prompt more accusations of Justice Department politicization.’ <a href="https://www.nytimes.com/2020/02/14/us/politics/andrew-mccabe-william-barr-flynn.html?action=click&amp;module=RelatedLinks&amp;pgtype=Article" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">NYT</a></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">2. ‘A Party Committee</strong> is formed by a group of senior CCP members who are given a leadership position inside the halls of public and private companies operating in China.’&nbsp;</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘In China’s</strong> state-owned enterprises (SOEs) the committee’s leading position refers to its competence in setting the right decision, keeping in mind the big picture, and supporting the meeting of shareholders and boards of directors to decide on major issues.</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Within private enterprises</strong> it implements Party’s policies.’&nbsp;<a href="https://thediplomat.com/2019/12/politics-in-the-boardroom-the-role-of-chinese-communist-party-committees/" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">The Diplomat</a></li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><span style="color: #d0021b"><strong style="font-weight: bold">ANSWER:</strong></span></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Compare:</strong></p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">The purpose of Party Committees</strong> appears to be making sure that whenever there is a conflict between a business decision and the will of the Party, the will of the Party wins.</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">The purpose of the ‘phalanx of outside lawyers’</strong> appears to be making sure that whenever there is a conflict between the administration of impartial justice and the will of the President, the will of the President wins.</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Contrast:</strong> No substantive difference.</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">We love ‘Letters to the Editor,’</strong> so send me your thoughts on anything here or anything about China.</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">And please forward</strong> the China Macro Reporter to your friends and colleagues.</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Best,</strong></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Malcolm</strong></p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">NOTE:&nbsp;</strong></h2><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">To read the main articles, please click on the title.</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;            </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 20px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:7px; border-left:0px solid #c80000; text-align:center; font-size: 1.5em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;">How coronavirus affects China Politics</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">Three Scenarios for Xi</span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%" style="background-color:#f6f6f6; text-align: center;"><tbody><tr><td style="max-width:600px"><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td><img width="100%" src="https://webapi.project-syndicate.org/library/ce1e741ee60e6d1d71ba3c6138dd0dd0.2-1-super.1.jpg"></td></tr></tbody></table></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/6VT5oe?track_p_id=evvcaezR3Jj%40zVp5B4SYo_W" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/F5oOqbo1JBgSwB670WGJUki__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/6VT5oe?track_p_id=cDmlCGHCE2vtb5B4SYo_x1z" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">Is Political Change Coming to China?&nbsp;</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Project Syndicate</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Yuen Yuen Ang</strong> | University of Michigan</h3><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘In the third scenario, Xi clings to his post, but it is hollowed out and power shifts over to various other competing factions.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Normally,</strong> a single epidemic, even if mishandled, would not break the Chinese regime. This time is different.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Three possibilities</strong> stand out.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The most extreme,</strong> worst-case scenario is regime collapse. Fortunately, this scenario is unlikely.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Although China</strong> is under unprecedented stress, its economy has not come to a standstill.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘As Shang-Jin Wei</strong> of Columbia University&nbsp;<a href="https://www.project-syndicate.org/commentary/china-coronavirus-three-factors-limit-economic-impact-by-shang-jin-wei-2020-01" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">pointed out</a>, China’s highly developed e-commerce industry allows residents to continue shopping from home.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘And while tens of thousands</strong> of Chinese are infected with the virus and many more are furious at the government, the vast majority of the population is nowhere near desperation.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The second scenario</strong> is a change in leadership at the highest level.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Xi cannot avoid blame</strong> for the backlash against his restrictive domestic policies and assertive actions abroad, which had already begun to&nbsp;<a href="https://www.nytimes.com/2018/07/31/world/asia/xi-jinping-internal-dissent.html" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">undercut</a> support for him even before the COVID-19 epidemic.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘With the death of Li Wenliang,</strong> a doctor who was rebuked by state authorities for warning others about the virus, the failings of Xi’s&nbsp;<a href="https://www.project-syndicate.org/commentary/xi-controlocracy-spread-coronavirus-by-xiao-qiang-2020-02" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">top-down approach</a> have been laid bare.’<ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘News of Li’s passing</strong> unleashed a firestorm of online criticism of the government, and Xi’s failure to appear on the frontlines of the fight has further&nbsp;<a href="https://www.nytimes.com/2018/07/31/world/asia/xi-jinping-internal-dissent.html" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">diminished his credibility as</a> a&nbsp;<a href="https://www.forbes.com/sites/salvatorebabones/2017/10/20/populism-chinese-style-xi-jinping-cements-his-status-as-chinas-first-populist-president/#3a81be1c152e" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">populist leader</a>.’</li></ul></li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘In principle,</strong> Xi’s abolition of constitutional term limits allows him to stay on as president for life.’<ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But whether</strong> he actually will remain in office after his current term ends in 2022 is now an open question.’</li></ul></li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘In the third scenario,</strong> Xi clings to his post, but it is hollowed out and power shifts over to various other competing factions.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Such an arrangement</strong> would not be without precedent.’<ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘After the Great Leap Forward,</strong> Mao Zedong’s fanatical campaign in 1958-62 to “catch up with Britain in ten years,” killed 30 million peasants, Mao was forced into retirement but remained paramount leader in name.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘(Later, he would stage a comeback,</strong> ushering in another decade-long disaster: the Cultural Revolution).’</li></ul></li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘It is already clear</strong> that Chinese politics and governance will not be the same after the COVID-19 outbreak.’<ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The myth that Xi</strong> and his supporters have sustained about the virtues of centralized control has been demolished.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Li’s&nbsp;</strong><a href="https://www.caixinglobal.com/2020-02-06/after-being-punished-by-local-police-coronavirus-whistleblower-vindicated-by-top-court-101509986.html" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">parting words</strong></a>– “A healthy society should not have only one voice” – will remain etched in the minds of hundreds of millions of Chinese, who have seen for themselves that censorship can endanger their lives.’ &nbsp;</li></ul></li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;            </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 20px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">Only Themselves to Blame</span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/5qwqzw?track_p_id=9nrxQjVNgT7JujR0_upC1Yx" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/2CcBybgkmUCTZbLI5Tbnzki__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/5qwqzw?track_p_id=aVCGgPLG5yH7JujR0_1oeqQ" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">‘The most lasting impact will be on China’s politics.’</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Council on Foreign Relations (CFR)</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Richard Haass </strong>| CFR</h3><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘The most lasting impact, though, will likely be the effects this virus has on China’s politics.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘How the Coronavirus plays out is uncertain,</strong> but what is certain is that the virus has the potential to change China in fundamental ways — and even if it does not, it should change the way we think about China.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Beyond the human tragedy, </strong>the immediate impact of the virus is mostly economic.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The most lasting impact,</strong> though, will likely be the effects this virus has on China’s politics.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Political legitimacy</strong> in contemporary China is predicated largely on economic performance.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Citizens have been willing to accept constraints</strong> on personal and political freedom in exchange for a system that provides an improved standard of living.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Chinese economic growth</strong> was already slowing before the coronavirus outbreak, which means a less-than-ideal situation is fast getting worse.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘China’s leaders</strong> mostly have themselves to blame. The response to the initial outbreak in early December is revealing.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘China suffers</strong> from a “shoot the messenger” mentality:’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Criticism, regardless of its merits,</strong> is taken as a rebuke of the political leadership, and the Communist Party seeks to silence dissent.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘As a result, Li Wenliang,</strong> one of the doctors who first went public with their concerns, was punished.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Precious weeks</strong> were lost as local officials would not assume responsibility lest central authorities subsequently blame them.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘This paralysis</strong> is a consequence of President Xi Jinping’s consolidation of power, which has left provincial officials unable or unwilling to exercise their authority without the central leadership’s blessing.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Xi’s signature anti-corruption campaign,</strong> arguably more of a political purge, has in many instances replaced capable technocrats with party loyalists.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘A hallmark of authoritarian systems</strong> is the difficulty of admitting error and then self-correcting, and China is a textbook case.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The coronavirus</strong> puts the contradictions at the heart of modern China in plain sight.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'There is the need</strong> to get word out to the population so that people can take preventive steps and react appropriately if they fall ill.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But the government</strong> is afraid to allow information to be shared widely, as doing so could feed unrest along with the narrative that the leadership has failed the people.'</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'Policies designed</strong> to stem the spread of the virus — quarantine and house arrest — reflect the same dilemma.'</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;            </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 20px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">China's Continued Raise?</span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/6hodyS?track_p_id=dU%40fAyYG3P1fcI64yc2Q_SJ" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/2CcBybgkmUCTZbLI5Tbnzki__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/6hodyS?track_p_id=4EwAc64yc2Q_nBGYxqFATZp" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">Why the Coronavirus Should Change the Way We Think About China</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Council on Foreign Relations (CFR)</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Richard Haass </strong>| CFR</h3><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘The only thing that is certain is that we cannot assume China’s future will resemble its recent past.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘It is always a mistake</strong> to underestimate China’s ability to rise to challenges.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘After its initial stumble,</strong> it has shown its unique ability to mobilize resources.'</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">'But the coronavirus</strong> has already emerged as Xi’s biggest challenge.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘He has concentrated power</strong> in his own hands to a degree not seen since Mao Zedong; it is difficult to blame others when you have made yourself first among unequals.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘It is also the biggest challenge</strong> to the Communist Party since the Tiananmen Square protests of 1989.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Unless authorities</strong> get the situation under control and restore economic growth soon, it has the potential to become much more significant than Tiananmen.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Instead of thousands of students</strong> calling for reform picture millions of citizens demanding basic competence.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Desperate people</strong> can do desperate things.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘This chapter</strong> should also change the way outsiders think about China.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Virtually everything written</strong> and said about China is premised on the notion of its continued rise.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘But to assume China’s growth</strong> will continue in a steady fashion ignores Chinese history.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The U.S. government needs</strong> to plan for possible futures in which China’s rise is interrupted.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The U.S. government needs</strong> to plan for possible futures in which China’s rise is interrupted.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘We could see a Xi-led China</strong> that turns to nationalism as a distraction in a “wag the dog” scenario in which China would put pressure on Taiwan or Hong Kong.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Or we could see a China</strong> that turns inward amid political convulsion as Xi is challenged. How long this would take and what would result are unknown.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The only thing that is certain</strong> is that we cannot assume China’s future will resemble its recent past.’</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;            </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 20px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; text-align:left;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:5px; border-left:0px solid #c80000; text-align:center; font-size: 1.375em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;">Stock Markets</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">Central Banks to the Rescue</span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/5Ez0Lo?track_p_id=9IYYXVFLSc6CwCpK_sXtylX" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/LVEdRSpgxX4CbqTrlPycNEi__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/5Ez0Lo?track_p_id=24u6CwCpK_OiFwahu6b53aB" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">A Central Bank Driven Stock Market Rally</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">CNBC</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Benn Steil</strong> | Council on Foreign Relations</h3><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘The recent stock market rally is very much a central bank driven rally.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Q: ‘Can central banks </strong>come to the rescue and offset the negative impact of coronavirus?’</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">BENN STEIL: ‘The recent stock market rally</strong> is very much a central bank driven rally.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The market</strong> was very much cheered by the intervention of the PBOC a week or so ago, pumping $22 billion worth of additional liquidity into the market through reverse repos.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘That number in and of itself</strong> is so significant, but it's an indicator to the markets that governments and indeed central banks around the world are willing to step up.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘And, of course,</strong> we in the United States do have some room to bring interest rates down further.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Q: ‘Historically,</strong> how long does it take for the stimulus measures in China to really feed through to the economy?’</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">STEIL: ‘Remember</strong> in the case of central banks, it's not just the indicators that are forward looking, but the market is forward looking.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘To the extent</strong> that the markets believe that this liquidity will feed into increased borrowing, increased production, increased consumption down the road, you see a stimulus effect right away.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘So it's not particularly</strong> surprising that markets are rallying.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Before</strong><strong style="font-weight: bold">the PBOC move</strong> the markets hadn’t been certain that the PBOC was going to take any significant action at all.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘That was the first</strong> serious sign that China is reacting.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Q: ‘And the question is:</strong> Will it work?’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Goldman Sachs</strong> says the Coronavirus will further slowdown China's growth rate from 6.1 to 5.5%. Does that sound accurate to you?’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">STEIL: ‘It really depends</strong> on how quickly the virus is contained.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘If it's contained very quickly,</strong> that's a reasonable, although perhaps optimistic forecast.'</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘If it's not,</strong> Chinese growth over the first half of this year could be something closer to 3%.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Q: ‘Do conventional tools</strong> like monetary policy work well in this scenario, or are there other tools that the federal reserve can use potentially?’</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">STEIL: ‘In the United States</strong> we've got better potential for using this device because debt levels in China have really built up to grossly unsustainable levels.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘China has really been pumping new liquidity</strong> into the market in order to dig ditches that are going to be filled in. This is not productive investment.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘In the United States,</strong> the Federal Reserve does indeed have room to stimulate parts of the economy that are particularly important that are in slowdown mode - in particular of manufacturing and the housing sector.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:10px; font-size:0; border-bottom:10px solid #f6f6f6;">&nbsp;            </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; text-align:left;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:5px; border-left:0px solid #c80000; text-align:center; font-size: 1.375em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;"> Supply Chains</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">Of Bullwhips &amp; Belly Cargo</span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%" style="background-color:#f6f6f6; text-align: center;"><tbody><tr><td style="max-width:600px"><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td><img width="100%" src="https://assets.website-files.com/5c864c33af62620dca1373ac/5e57179cc5f6ac367288fcde_1zMohUdNHFuI6kX11XCkyzl72eJkfbmt4t8yenImKBXdhNIf0Yl8YfRAVzhohB7e.jpg"></td></tr></tbody></table></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/5EwFrU?track_p_id=5EyqN36KTPzC_qMaENF4mtq" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/LVEdRSpgxX4CbqTrlPycNEi__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/5EwFrU?track_p_id=3TgH6KTPzC_E%40DeIUSV3a6b" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">Here's how coronavirus can affect global supply chains</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">CNBC</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Yossi Sheffi | </strong>MIT</h3><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘The loss of these Chinese suppliers - upstream in the supply chain – from the “bullwhip effect” may force foreign companies to move their supply chains out of China to other places.’</strong></h2><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><br></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><a href="https://www.youtube.com/watch?v=exlr3Le5NUo" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">Watch</strong></a><strong style="font-weight: bold"></strong>the 4m video interview</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Q: ‘How is the Coronavirus</strong> affecting the Chinese portion of supply chains?’</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">YOSSI SHEFFI:</strong><strong style="font-weight: bold">‘Disruption to business</strong> from the Coronavirus may be different than most of the disruptions in living memory.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘It's not like SARS,</strong> Fukushima, or the Thailand floods - in that the effect may be relatively small, but the uncertainty is huge.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'So its disruption</strong> might be reasonable like those - or it might be compared to the 1918 Spanish flu epidemic where millions and millions of people died.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">'Another important difference</strong> from those earlier disruptions:’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'It affects</strong> both supply and demand.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">'On the supply side.’</strong></p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'The crisis</strong> is not just impacting manufacturing in China.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'But also getting foreign parts</strong> into in China for assemble in Chinese factories.’<ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'Most freight</strong> - 52% of the ton-kilometers - fly in the belly of passenger planes, “belly cargo.”’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'With the passenger air travel bans,</strong> we have lost most of that “belly cargo” capacity.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'UPS and FedEx</strong> have also cut capacity going into China.’</li></ul></li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'Why is this important?</strong> Consider, for example, 'Apple gets its parts for iPhones from 43 countries that go to China where Foxconn assembles the phones in China.’<ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'Now those parts</strong> aren’t going into China, and iPhones are not getting made.’</li></ul></li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Q: ‘If you are a company</strong> thinking about diversifying your supply chain out of China because of trade issues, does Coronavirus accelerate the timetable? What is the legacy going to be on supply chains in general?’</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">SHEFFI: ‘This takes us to the demand side.’</strong></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Here’s what could happen to demand</strong> in terms of supply chain management. We call it the “bullwhip effect” - what's the “bullwhip effect”?’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Let's say a retailer</strong> sees his sales go down by “X percent.” He has too much inventory. And, he thinks slow sales will continue.’ <ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘So having too much inventory,</strong> he orders “2 X” less percent from his whole wholesaler.’</li></ul></li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The wholesaler</strong> sees the “2 X” less percent reduction from the retailer.’<ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">Using the same logic,</strong> he now orders “4 X” less percent.’</li></ul></li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘And so on up the supply chain</strong> - what we call the upstream of the supply chain.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The result:</strong> You have suppliers, many of them are small and leveraged, that will out of business in droves.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘This could be</strong> the longer term effect on supple chains in China.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The loss of these Chinese suppliers</strong> - upstream in the supply chain – from the “bullwhip effect” may force foreign companies to move their supply chains out of China to other places.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘It's not clear</strong> that they'll move to other places in Asia, but they will have to get out of China to some extent.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;            </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 20px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; text-align:left;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:5px; border-left:0px solid #c80000; text-align:center; font-size: 1.375em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;">the U.S. breaks the gobal economic order</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">               Trump Weaponizes</span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/6ggFSC?track_p_id=25f5IegBy_pMNUdvfvlztcJ" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/2CcBybgkmUCTZbLI5Tbnzki__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/6ggFSC?track_p_id=2zh5IegBy_AtFQCMXGFWs6x" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">'The Global Economic Order is Broken’</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Council on Foreign Relations</strong></h3><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘Indeed, cracks in the U.S.-led economic order are&nbsp;already surfacing, although it could take decades (or&nbsp;longer) for an alternative order to become fully operational.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Four themes</strong> emerged from the&nbsp;<a href="https://councilofcouncils.cfr.org/events/council-councils-twelfth-regional-conference-0" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">twelfth regional conference of the Council of Councils</a>&nbsp;(CoC).’ (<em style="font-style: italic">Read the full&nbsp;</em><a href="https://www.cfr.org/report/council-councils-twelfth-regional-conference" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><em style="font-style: italic">CoC conference report here</em></a><em style="font-style: italic">.)&nbsp;</em>Here is the first.</p><p style="text-align: center;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">___________________________________________</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘1. The Global Economic Order is Broken’</strong></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The world is experiencing</strong> unprecedented weaponization of economic interdependence, as countries turn cross-border trade, investment, and technology transfers into instruments of coercive statecraft.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘While China and others</strong> are contributing to the problem, most global observers perceive the United States in particular as abusing its&nbsp;<a href="https://www.foreignaffairs.com/articles/2020-01-24/twilight-americas-financial-empire" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">privileged position</a> in the international monetary system to coerce and punish those who stand athwart its perceived national interests.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Such economic coercion</strong> represents a significant break from long-espoused U.S. principles of global economic integration for mutual benefit.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘For seven decades, </strong>U.S. presidential administrations, with few exceptions, prioritized economic order building, generating shared growth and global economic stability, while furthering comity among nations.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘In contrast,</strong> the Trump administration increasingly invokes national security as a justification for restricting trade, and its prolific use of quotas, sanctions, tariffs, and the like threatens to destroy the rules-based economic order.’</li></ul><p style="text-align: center;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">___________________________________________</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘These actions</strong> could have dire consequences.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘First,</strong> they promise to hinder&nbsp;<a href="https://www.imf.org/en/Publications/WP/Issues/2019/01/15/Macroeconomic-Consequences-of-Tariffs-46469" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">domestic</a> and&nbsp;<a href="https://www.nytimes.com/2019/06/18/business/economy/global-economy-trade-war.html" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">global&nbsp;</a>economic growth.</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Second,</strong> they could leave the middle and minor powers whose support has bolstered America’s position in the world worse off.’<ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Smaller countries</strong> depend on international rules for a level playing field; weakening those rules makes them&nbsp;<a href="https://www.cfr.org/blog/smaller-countries-lose-us-china-trade-deal" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">increasingly vulnerable&nbsp;</a>to economic and political pressure not only from the United States but other great powers.'</li></ul></li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Third,</strong> Trump’s strategy may reap some limited gains.’<ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But the more</strong> the United States abandons rule of law for rule of power in the economic realm—particularly in an increasingly multipolar world—the more it reduces its global influence and incentivizes other countries to resist&nbsp;<a href="https://www.foreignaffairs.com/articles/iran/2020-01-22/cost-incoherent-foreign-policy" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">U.S. stewardship&nbsp;</a>of the global economy.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Indeed, cracks in the U.S.-led economic order</strong> are&nbsp;<a href="https://www.foreignaffairs.com/articles/2020-01-24/twilight-americas-financial-empire?utm_medium=newsletters&amp;utm_source=fatoday&amp;utm_content=20200124&amp;utm_campaign=FA%20Today%20012420%20The%20Twilight%20of%20America%27s%20Financial%20Empire%2C%20The%20Dictators%27%20Last%20Stand%2C%20From%20Nazism%20to%20Never%20Again&amp;utm_term=FA%20Today%20-%20112017" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">already surfac</a><a href="https://www.foreignaffairs.com/articles/2020-01-24/twilight-americas-financial-empire?utm_medium=newsletters&amp;utm_source=fatoday&amp;utm_content=20200124&amp;utm_campaign=FA%20Today%20012420%20The%20Twilight%20of%20America%27s%20Financial%20Empire%2C%20The%20Dictators%27%20Last%20Stand%2C%20From%20Nazism%20to%20Never%20Again&amp;utm_term=FA%20Today%20-%20112017" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">ing</a>, although it could take decades (or&nbsp;<a href="https://www.washingtonpost.com/outlook/2020/02/06/dollar-other-thucydides-trap/" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">longer</a>) for an alternative order to become fully operational.’</li></ul></li></ul><p style="text-align: center;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">___________________________________________</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The irony</strong> in these developments is that the U.S. weaponization of economic interdependence is&nbsp;<a href="https://www.washingtonpost.com/outlook/2020/01/29/you-cant-always-get-what-you-want-trade-wars/" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">failing</a>.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The Trump administration</strong> has&nbsp;<a href="https://www.worldpoliticsreview.com/articles/28513/even-the-white-house-admits-the-trump-tariffs-are-hurting-u-s-manufacturing" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">admitted&nbsp;</a>that its steel tariffs have failed to achieve their intended aims.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘A temporary&nbsp;</strong><a href="https://www.reuters.com/article/us-trade-wto/eu-china-and-15-others-agree-temporary-fix-to-wto-crisis-idUSKBN1ZN0WM" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">global workaround&nbsp;</strong></a>to the dismantling of the WTO Appellate Body has materialized.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The United Kingdom</strong> has ignored U.S. admonitions against allowing Chinese telecom giant Huawei to peddle 5G technologies in the country.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Maximum pressure sanctions</strong> have&nbsp;not caused&nbsp;Iran, North Korea, or Venezuela to capitulate to American demands.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Trump’s economic gun-to-the-head</strong> trade negotiations with Japan, South Korea, and Canada and Mexico, meanwhile, accomplished little more than offsetting the losses that resulted from his abandonment of the Trans-Pacific Partnership.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘U.S. allies,</strong> all the while, have absorbed one collateral blow after another as the president has engaged exaggerated enemies in trade wars.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">(And I would add </strong>that the disruptive U.S.-China trade war didn’t get the &nbsp;&nbsp;Chinese to do anything they weren’t doing or about to do anyway, except buy more American stuff.)</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;            </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 20px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; text-align:left;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:5px; border-left:0px solid #c80000; text-align:center; font-size: 1.375em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;">Coronavirus' economic impact</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">The Economist Intelligence Unit's Predictions</span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellpadding="0" cellspacing="0" width="100%" style="background-color:#f6f6f6; text-align: center;"><tbody><tr><td style="max-width:600px"><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td><img width="100%" src="https://assets.website-files.com/5c864c33af62620dca1373ac/5e571649fa858f0da4b8beea_The%20Economist%20Intelligence%20Unit%27s%20Predictions%20.png"></td></tr></tbody></table></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">Less Growth, More Volatility</span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/6rtP5k?track_p_id=1i97GzOw_Xobv%40eD%40kPyikv" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/Pd2AGi8v7b5rElII6CSyYki__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/6rtP5k?track_p_id=cUGV6iKm4HXm197GzOw_5rx" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">Coronavirus impact – slightly weaker, more volatile growth</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">CreditSuisse</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">James Sweeney &amp; Wenzhe Zhao |</strong> CreditSuisse</h3><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘Our view, for now, is that this is a shock that will increase macroeconomic volatility more than it depresses average growth.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘We have cut our global growth forecasts</strong> for this year, given the likely impact of the coronavirus outbreak on economic activity in China, Asia and beyond.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘We now forecast</strong> global GDP to grow 2.4% this year, down a touch from our previous forecast of 2.6%.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Our largest downgrades</strong> are for Asia, where we now forecast 5.5% Chinese growth and 0.3% Japanese growth.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘We have cut our euro area</strong> forecast to 0.9%. Our US forecast has been trimmed to 1.8%.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘These small downgrades mask</strong> an expectation of much greater volatility in growth through the course of this year.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘As we discussed</strong> in our recent <a href="https://plus.credit-suisse.com/rpc4/ravDocView?docid=V7kg6U2AC-R5T" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">Global Cycle Notes</a>, global manufacturing and trade is set for a steep, renewed, downturn in coming months.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘That’s due to the ongoing shutdown</strong> in some of China’s factory sector and its consequent disruption to upstream and downstream supply chains.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Some companies</strong> outside China are already affected.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Such a slowdown</strong> will be correlated with sharp falls in manufacturing PMI surveys.</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But we remain</strong> of the view that the drivers of final demand in major developed economies will not be impaired by this shock.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘And so we expect</strong> much stronger growth in the second half of this year as supply comes back on line and catches back up with demand.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘In the meantime,</strong> there could be greater volatility in prices if some products or components face shortages.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Inflation</strong> could surprise us. ‘</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘In the near term,</strong> policy will be biased towards supporting activity, especially in Asia.'</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'We do not expect</strong> the Federal Reserve to cut, but ongoing weak manufacturing data may prompt the ECB to cut rates a further 10bp (to - 0.6%) in Q2.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Clearly,</strong> the outlook remains genuinely uncertain, and our forecasts are subject to further change until it becomes clearer how severe the spread of this virus is, and how broad and prolonged the shutdown to factory production in Asia and beyond will be.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Our view, for now,</strong> is that this is a shock that will increase macroeconomic volatility more than it depresses average growth.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;         </td></tr></tbody></table>

<div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="20" style="height:20px; font-size:0">&nbsp;</td></tr><tr><td style="vertical-align:top"><table cellspacing="0" cellpadding="0" width="100%"><tbody><tr><td style="padding-left:3.5%" a=""><a href="" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank" rel="noopener noreferrer" title="CHINADebate"><img width="100%" src="https://assets.website-files.com/5c864c33af62620dca1373ac/5d86577f82aa6e55afacb4ea_cd%20long-fit.png" alt="CHINADebate" style="width: 110px;"></a></td><td align="right" style="padding-right:3.5%"><a href="" target="_blank" rel="noopener noreferrer" style="color:#001544; font-size:13px; font-family:'gordita', sans-serif; text-decoration:none; border-bottom:none;"></a></td></tr></tbody></table></td></tr><tr><td height="30" style="height:30px; font-size:0">&nbsp;</td></tr><tr><td style="text-align:center; line-height:1"><span style="font-size: 42px; font-family: gorditamedium, sans-serif; color:#0970b3; letter-spacing: -1px; line-height: 1;">China Macro Reporter</span></td></tr><tr><td style="text-align:center; line-height:1.5; padding-bottom:30px; padding-top:10px;color:#001544; font-size:0.8125em; font-family:'gordita', sans-serif; text-decoration:none; border-bottom:none;"><span style="color:#001544; font-size:13px; font-family:'gordita', sans-serif; text-decoration:none; border-bottom:none;">by Malcolm Riddell<span style="margin:0 6px">·</span>Feb 12, 2020</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:20px auto 0 auto; text-align:left;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:5px; border-left:0px solid #c80000; text-align:center; font-size: 1.375em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;">Opening Statement</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/8HCBuq?track_p_id=3ArY79VwwY_4QV3rv4kz%405h" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/A34-JXbCfNBw6jMh3VQmQEi__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/8HCBuq?track_p_id=9qrI5nt3Y579VwwY_Zy%40rT3" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">Finally, something Peter Navarro and I agree on.&nbsp;</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h1 style="display: inline-block;font-size: 1.35em;margin-top: 0em;margin-bottom: 0em;margin-left: 0;margin-right: 0;line-height: 1.35em;font-weight: normal;font-family: gorditamedium, sans-serif;color: #001544;letter-spacing: -0.1px;"><strong style="font-weight: bold">Greetings!</strong></h1><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">My wife needs</strong> a prescription drug – it’s critical to her health.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">The brand drug</strong> costs well over $1,000 a month.</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">The generic</strong> a fraction of that.</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">After using the brand drug</strong> for a while we switched to the generic to save money.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">My wife’s symptoms</strong> subtly but noticeably returned.</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">So we tried generics</strong> from other makers. None of them worked either.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">We had to go back</strong> to the brand drug and pay up.</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">I didn’t think</strong> much about why those generics weren’t effective.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">Then a couple of months ago</strong> I listened to NPR interview with the author of <a href="https://www.amazon.com/Bottle-Lies-Inside-Story-Generic/dp/0062338781" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><em style="font-style: italic">Bottle of Lies</em></a><em style="font-style: italic">, </em>Katherine Eban of the New York Times.</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">The interview is titled,</strong><a href="https://www.npr.org/sections/health-shots/2019/05/16/723545864/the-generic-drugs-youre-taking-may-not-be-as-safe-or-effective-as-you-think" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">‘The Generic Drugs You're Taking May Not Be As Safe Or Effective As You Think.’</a> This from the summary:</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Eban has covered</strong> the pharmaceutical industry for more than 10 years.'</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘She notes</strong> that most of the generic medicines being sold in the U.S. are manufactured overseas, mostly in India and China.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The U.S. Food and Drug Administration</strong> states that it holds foreign plants to the same standards as U.S. drugmakers, but Eban's new book,&nbsp;<em style="font-style: italic">Bottle of Lies, </em>challenges that notion.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘She writes</strong> that the FDA often announces its overseas inspections weeks in advance, which allows plants where generic drugs are made the chance to fabricate data and results.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘As a result,</strong> Eban says, generic drugs sometimes go to market in the U.S. without proper vetting.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘She describes the FDA</strong> as "overwhelmed and under-resourced" in its efforts to ensure the safety of overseas drug production.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">From a </strong><a href="https://www.nytimes.com/2019/05/13/books/review/bottle-of-lies-katherine-eban.html" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">New York Times review</strong></a> of the book:</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Eban quotes inspector after inspector</strong> saying that they themselves fill only the most essential prescriptions — and will pay anything to avoid taking a drug made overseas.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘They’ve seen how</strong> those drugs are produced, and they live in fear of them.'</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">On to Peter Navarro.</strong> According to the <a href="https://www.ft.com/content/73751cca-4d1a-11ea-95a0-43d18ec715f5#myft:my-news:page" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">Financial Times</a>:</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Peter Navarro,</strong> a senior trade adviser to Donald Trump, has urged the US to reduce its reliance on pharmaceutical and medical supply imports from China and the rest of the world in response to the coronavirus outbreak, calling it a ‘wake-up call” for greater American independence in the sector.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“We are looking</strong> very closely at this now. By onshoring more of our pharmaceutical supply chain it will not only be more resilient. It will offer important opportunities to reduce drug prices through the rapid adoption of cutting-edge advanced manufacturing processes.”&nbsp;</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">For me the issue</strong> is adulterated and ineffective generic drugs from foreign suppliers; for Navarro it’s independence from those suppliers.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">Whatever the reasoning,</strong> we should bring the manufacturer of generic drugs back to the U.S., under the strict FDA control lacking in foreign facilities.</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">Good for our health</strong> and the country’s.</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Peter Navarro and I</strong> do agree on something.</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">We love ‘Letters to the Editor,’</strong> so send me your thoughts on anything here or anything about China.</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">And please forward</strong> the China Macro Reporter to your friends and colleagues.</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Best,</strong></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Malcolm</strong></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><br></p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;">NOTE:&nbsp;</h2><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;">To read the main articles, please click on the title.</h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;        </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:7px; border-left:0px solid #c80000; text-align:center; font-size: 1.5em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;">Coronavirus</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">Why Xi Won't Resign </span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/9EIshk?track_p_id=08QgezO_a5fYEIZOMPdlb3P" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/2P2LxiV-sg54VayqL9X2F0i__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/9EIshk?track_p_id=2nk8QgezO_vOxCzLKBazPo2" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">The Coronavirus Is a Stress Test for Xi Jinping</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Foreign Affairs</strong></h3><h3 style="text-align: left;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Liz Economy</strong> | Council on Foreign Relations</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘Xi’s system of governance has protected him from significant political fallout from the epidemic but has also created the very conditions that allowed the virus to spread so fast in the first place.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘A handful of&nbsp;</strong><a href="https://www.scmp.com/news/china/politics/article/3049233/chinese-scholar-blames-xi-jinping-communist-party-not" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">calls</strong></a><strong style="font-weight: bold">&nbsp;for the resignation</strong> of Chinese President Xi Jinping have popped up on the Chinese Web in recent weeks, from citizens who accuse the country’s leadership of bungling the state’s response to the deadly coronavirus that has spread throughout the country.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘These critical posts</strong> have disappeared almost immediately.’&nbsp;</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The coronavirus outbreak</strong> is on track to become the worst humanitarian and economic crisis of Xi’s tenure.'</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'But the Chinese president</strong> is certainly not likely to resign.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘In fact,</strong> Xi has spent seven years in power building a political system designed to withstand just such a crisis.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘He has centralized authority</strong> in his own hands, enhanced top-down state control, limited the free flow of information within and across the country’s borders, and adopted an assertive foreign policy designed to cajole and coerce other countries into doing as China says.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Xi’s system of governance</strong> has protected him from significant political fallout from the epidemic but has also created the very conditions that allowed the virus to spread so fast in the first place.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Because</strong> the Chinese state apparatus is so centralized, information pools around bottlenecks and often fails to reach those who need it most.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The mayor of Wuhan&nbsp;</strong><a href="https://www.wsj.com/articles/chinas-premier-tours-virus-epicenter-as-anger-bubbles-at-crisis-response-11580109098" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">noted</a>&nbsp;in a televised interview in late January that he passed information regarding the coronavirus to the relevant authorities early on, but he was not authorized to release that information to the public.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Beijing has already</strong>&nbsp;<a href="https://www.globaltimes.cn/content/1178535.shtml" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">decided</a>&nbsp;whom to blame officially for the epidemic’:</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Inept local authorities</strong> in the city of Wuhan—the epicenter of the outbreak—whose inaction allowed the virus to spread.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Whether such scapegoating</strong> will be enough to prevent the Chinese people from turning their anger toward Xi Jinping and other top leaders will depend in large part on how long the crisis lasts.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘For now,</strong> the CCP can point to the new hospitals and quarantine centers it has built and extol doctors and nurses while using local government officials as the fall guys.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But as the death toll</strong> rises&nbsp;and costs mount, the government may struggle to deflect blame that may damage Xi’s credibility and that of the party.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘That the president</strong> has kept a relatively low profile throughout the crisis is telling.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘One would have expected</strong> that “Xi Dada,” who has assumed the Mao-era appellation of “People’s Leader,” would take center stage in Beijing’s public response to the virus.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Yet despite</strong> state media reports&nbsp;<a href="http://www.xinhuanet.com/english/2020-01/28/c_138739962.htm" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">emphasizing&nbsp;</a>the president’s&nbsp;role as an authoritative commander&nbsp;in&nbsp;chief, Xi has largely sought to lead from behind, leaving it to Premier Li Keqiang and Vice Premier Sun Chunlan to inspect hospitals and comfort patients in Wuhan.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘For Xi,</strong> every layer of party bureaucracy provides a buffer between himself and the crisis on the ground.’&nbsp;</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Likewise,</strong> Xi appears keen on preempting a deeper crisis of public confidence.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘In a speech last week,</strong> he&nbsp;<a href="http://www.xinhuanet.com/english/2020-02/05/c_138758520.htm" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">called&nbsp;</a>for initial policy reforms, including an improved crisis management system and the closure of wet markets, the open-air stalls for wildlife trade that were the original source of the current outbreak.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But such actions</strong> are limited in scope and imagination, falling well within Xi’s current governance model.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘What most Chinese</strong> will desire instead is what citizens anywhere would want: an honest accounting for what transpired, changes that will ensure it never happens again, and a leader with the integrity to say, “The buck stops here.”’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Unfortunately,</strong> the history of Chinese politics suggests that they are unlikely to get what they want.’&nbsp;</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;        </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">Bigger Economic Impact to Come </span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/6DohIO?track_p_id=8tuNVdV6a7DOYjm_IqZcezZ" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/cCfPkL6dyO3YRfIP36YTG0i__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/6DohIO?track_p_id=7UZVdsYW7DOYjm_sLHhUPVu" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">China’s Coronavirus will not lead to recession but to stimulus and even more debt&nbsp;</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Bruegel</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Alicia García-Herrero | </strong>Bruegel</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘The bigger the economic shock now, the larger the policy expansion will be needed to achieve the growth target.’</strong></h2><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘This would clearly</strong> bring China to grow well below the growth target announced by Premier Li Keqiang a couple of months ago, namely a growth rate slightly before 6%) and much closer to 5% if not lower.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Li Keqiang’s growth target</strong> is meant to ensure the achievement of President Xi Jinping’s very important target of the Nation’s Rejuvenation, namely that of doubling China’s GDP from 2010 to 2020.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Given the importance</strong> of achieving this objective before the People’s Party 100th&nbsp;Anniversary in 2021, it seems clear to me that no effort will be spared to achieve a high enough growth target to achieve this goal.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘This is why</strong> we should all be expecting unequivocally lax demand policies from the Chinese government in the next few days, weeks and months.’ &nbsp;</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The bigger the shock now,</strong> the larger the policy expansion will be needed to achieve the growth target.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Such policy expansion,</strong> however, has an important constraint, namely inflation, which will might be pushed higher by the limited supply of certain goods.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘This means that,</strong> in the short run, the PBOC’s may not be able to use the most visible tool, namely interest rates cuts, but rather temporary liquidity injection, as has already been announced, and targeted lending and window guidance to steer the cost of funding down.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The People’s Bank of China</strong> immediate and bold reaction to calm markets with the equivalent of USD 170 billion in liquidity injection says it all about the pressure for Chinese policymakers to mitigate the impact of the coronavirus outbreak on financial markets, on sentiment and on the Chinese economy, more generally.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Debt will continue to pile up,</strong> for corporates, for the government and even for households, as they are pushed to consume more durable goods with subsidies and discounts.’ &nbsp;</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘More debt</strong> for an already highly indebted country like China can only mean lower potential growth than the road.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘In that regard,</strong> one could argue that the negative consequences of the coronavirus on the Chinese economy may be more medium term than immediate and the reason is simply the large stimulus which I expect will follow and, the unavoidable excessive leverage resulting from it.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘More generally,</strong> the exchange rate might be the most effective demand policy to use and we are already seeing signs of the latter as the RMB quickly goes back to the psychological barrier of 7 RMB to the USD.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘It seems difficult</strong> for Trump to denounce China of current manipulation at such a difficult time so the room is clearly open for more depreciation.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Moreover,</strong> weaker economic fundamentals and potentially laxer monetary policy will exert downward pressure on the RMB so it will be hard to argue this is not a market-driven process.’ &nbsp;</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Finally,</strong> fiscal policies in the form of targeted subsidies and potentially infrastructure investment may also be used.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘As such,</strong> we expect the quick policy reaction to avoid a sharp correction in growth so that the Party’s objective of income doubling can be achieved.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘This means that 2020 growth</strong> for China may still hover around 5.7-5.5% but with dear consequences.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;</td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; text-align:left;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:5px; border-left:0px solid #c80000; text-align:center; font-size: 1.375em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;">Belt &amp; Road Initiative</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">Reshaping the World Order</span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/7DPNTM?track_p_id=2CM95Cto6_3dZXVOtHsrL23" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/_WMiBTDcNqqcPnQt-JHFGUi__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/7DPNTM?track_p_id=bwqHYCAH1xbl95Cto6_E3bv" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">China’s Belt and Road - China wants to put itself back at the centre of the world&nbsp;</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">The Economist</strong></h3><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;">&nbsp;</h3><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘The Chinese Communist Party is using the Belt &amp; Road Initiative&nbsp;(bri)&nbsp;to reshape a world order more to its liking.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">This is the first essay</strong> in an excellent <a href="https://www.economist.com/special-report/2020/02/06/china-wants-to-put-itself-back-at-the-centre-of-the-world" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">7-part special report</a> on the Belt &amp; Road Initiative by The Economist.</p><p style="text-align: center;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">_____________________________</p><p style="text-align: center;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><br></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The Chinese Communist Party</strong> is using the Belt &amp; Road Initiative&nbsp;(bri)&nbsp;to reshape a world order more to its liking.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘For China’s leaders,</strong> it represents a prototype for an emerging geopolitical bloc at a time when the rules-based order is under shaky American management.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The notion of a new order,</strong> baldly stated, might alarm. So a more benign idea puts the&nbsp;bri&nbsp;in a broader historical context: the tributary system of old.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘China sits at the centre of the world,</strong> bringing its wealth and power to bear, first on its near-abroad, and linking people into the concept of China as a beneficent power and an alternative locus to the West.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Those who buy</strong> into it receive munificence from Beijing.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Those who do not</strong> will not.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The debates</strong> about the&nbsp;bri&nbsp;began from the outset.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘At one level,</strong> it merely extended a trajectory China had followed for some time, meshing with its major resource suppliers worldwide, as well as its European markets.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘At another,</strong> it was a response to the global financial crisis of 2007-9, which removed a large source of demand for Chinese goods.’<ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The lesson</strong> was that in future China had to make its own markets abroad.’</li></ul></li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘At a third level,</strong> it represented an internationalisation of Chinese industrial policy.’<ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Faced with overcapacity</strong> in steel, cement and more, a party-state whose legitimacy hangs on creating jobs and investment could hardly shut down capacity, as Western countries might do.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Instead</strong> it must try to export it.’</li></ul></li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Lastly,</strong> at a time when the West appeared to be stumbling, both in terms of growth and global leadership, here was a bend in the historical road.’<ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Everything was contingent,</strong> but China’s moment had come and needed to be seized—more Leninist opportunism than Marxist determinism.’</li></ul></li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Projects may fall short</strong> economically because their priority is strategic, above all, securing critical supplies of natural resources, to drive economic growth at home.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Shanghai</strong> now gets half its natural gas from Turkmenistan.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Such pipelines</strong> neatly get around the “Malacca Strait dilemma”: seaborne supplies of oil and gas that could easily be choked off in time of war.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Elsewhere,</strong> strategic benefits might come from developing ports and cementing dominance in the global shipping industry.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘They could be stepping stones</strong> to China one day projecting naval power far from home—with big implications for Japan, South-East Asia, India and other countries that depend on the world’s busiest sea lanes.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘By rolling out infrastructure</strong> across the Eurasian land mass, China becomes the indispensable power in an emerging supercontinent.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Crucially,</strong> the state directs giant enterprises to do the national bidding, and state banking institutions to provide the financial firepower.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘In January 2017</strong> a train quietly pulled into the sidings on the outskirts of London.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Its containers</strong> had started their journey just 12 days earlier in eastern China, less than half the time than had they gone by sea, at less than half the cost by air, travelling through Khorgos.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The route</strong> is rapidly becoming more popular.&nbsp;hp, an American computer giant, has moved its computer factories to the inland Chinese city of Chongqing, building its business model on rail delivery via Khorgos to the Netherlands.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘In part</strong> because of&nbsp;hp’s move, trains from China to Europe have risen from three a week in 2013 to over 25.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Coming the other way,</strong>&nbsp;bmw&nbsp;sends several trains a week to China, its biggest market.’</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;</td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; text-align:left;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:5px; border-left:0px solid #c80000; text-align:center; font-size: 1.375em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;"> U.S. Trade deficit with china unpacked</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">Trade Deficits Don't Kill Jobs</span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/7B4ShM?track_p_id=5cXduS6255EU_IIbvzTiVoT" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/qAD7kBqLceF6aukL4-Brm0i__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/7B4ShM?track_p_id=3XLL6255EU_QOBd54zNbFqe" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">Did you miss Trump’s biggest China win?</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">American Enterprise Institute</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Derek Scissors</strong> | AEI</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">“Promise made, promise kept.”</strong></h2><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘The best response is: “That promise you kept doesn’t mean much.”’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘A politically important trade number</strong> was published and largely ignored last week.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘America’s goods trade deficit</strong> with China dropped&nbsp;<a href="https://www.census.gov/foreign-trade/balance/c5700.html" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">$74 billion in 2019</a>, a result that will help President Trump’s campaign and may affect future American policy.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘It’s the biggest fall ever</strong> in the US-China goods deficit in dollar terms and&nbsp;is a bit larger than 2009 in percentage terms.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘His opponents</strong> can’t deny this “<a href="https://www.promiseskept.com/" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">promise made, promise kept</a>,” at least so far.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘His trade policies</strong> are no&nbsp;disaster, as some claim. Their failure is not reaching the original, overriding goal’:</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Trade policy</strong> is not generating jobs, particularly manufacturing jobs.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Deficits cost jobs,</strong> especially manufacturing jobs, say President Trump,&nbsp;<a href="https://aflcio.org/press/releases/working-families-welcome-long-overdue-trade-deficit-study" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">the AFL-CIO</a>, and others.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Evidence</strong> says otherwise.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘In 2009,</strong> the China trade deficit plunged and so did&nbsp;manufacturing employment.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Unemployment</strong> ended the year at&nbsp;<a href="https://data.bls.gov/timeseries/LNS14000000" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">9 percent</a>and workers’&nbsp;<a href="https://www.bls.gov/webapps/legacy/cpswktab1.htm" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">weekly earnings slipped</a>.’&nbsp;</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘In 2017-2018,</strong> the China trade deficit rose, and&nbsp;manufacturing employment also rose.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Unemployment ended</strong> at 3.5 percent and weekly earnings rose.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘And, the President’s two “bad” trade deficit years</strong> averaged 227,000 new manufacturing jobs.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘In 2019,</strong> the China trade deficit fell and manufacturing employment again&nbsp;rose, but barely.’ &nbsp;</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The good trade year 2019</strong> had only 45,000 new manufacturing jobs.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The reason,</strong> of course, is&nbsp;many factors other than trade balances drive employment.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘This is</strong> President’s&nbsp;Trump’s mistake.’&nbsp;</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘When he&nbsp;says</strong> “promise made, promise kept” on the China trade deficit, he’s right.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The best response</strong> is not that there were&nbsp;terrible costs — there weren’t.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The best response is:</strong> “That promise you kept doesn’t mean much.”’</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;</td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">Gaming Trump's Tariffs</span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/8yPLQ8?track_p_id=2sL9LJ4H8_lWxZxvoeORBWh" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/qAD7kBqLceF6aukL4-Brm0i__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/8yPLQ8?track_p_id=2Xh9LJ4H8_b5H2YKdZE2btP" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">China Lost  $74 Billion in Trade - or Did It?</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">American Enterprise Institute</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Derek Scissors</strong> | AEI</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘That $74-billion drop in the deficit may be $74 billion in lost foreign exchange for China. The catch: China may not have lost $74 billion.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘On the technical side,</strong> most economists underemphasize the importance of bilateral trade deficits.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘They don’t matter</strong> to our economy but certainly matter to others.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘That $74-billion drop</strong> in the deficit may be $74 billion in lost foreign exchange for China.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘These are valuable funds</strong> to stabilize its&nbsp;<a href="https://data.worldbank.org/indicator/BN.CAB.XOKA.GD.ZS?locations=CN" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">now-fragile international balance of payments&nbsp;</a>and support high-profile activities like the Belt and Road Initiative.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The catch:</strong> China may not have lost $74 billion.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The US says</strong> imports from China fell 16 percent last year.'</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Beijing says</strong> its overall exports rose five percent.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘One explanation</strong> is firms based in China exporting to the US&nbsp;<a href="https://www.wsj.com/articles/companies-find-ways-to-bypass-tariffs-on-chinese-imports-11580986804" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">through third countries</a>.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Total American imports</strong> fell only two percent because, for instance,&nbsp;<a href="https://www.census.gov/foreign-trade/balance/c5520.html" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">imports from Vietnam soared</a>.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘This could be</strong> Vietnam replacing China, or China shipping through Vietnam.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘If such trans-shipment</strong> was small in 2019, it can easily climb.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘With tens of billions of dollars</strong> or more at stake each year, both Chinese firms and multinationals will&nbsp;<a href="https://www.aei.org/china-global-investment-tracker/" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">invest in Vietnam and elsewhere&nbsp;</a>to circumvent tariffs.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Say President Trump</strong>&nbsp;is entirely right about trade deficits — tariffs on goods from China would&nbsp;still be just a band-aid.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The phase one deal</strong> provides time to develop other paths to the US.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘That’s a policy angle</strong> that must be addressed, but it’s&nbsp;too wonky to be an election issue.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The election&nbsp;issue</strong> has been lost in claims of devastated farmers and&nbsp;<a href="https://www.reuters.com/article/us-usa-trade-mnuchin/u-s-china-putting-trade-war-on-hold-treasurys-mnuchin-says-idUSKCN1IL0JG" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">repeated pandering to the stock market</a>.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;        </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; text-align:left;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:5px; border-left:0px solid #c80000; text-align:center; font-size: 1.375em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;">State-Sponsored Technology</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">The How of China's Tech Boom</span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/6jB67U?track_p_id=08eYnyI_LTr4ShCgn2yBuPz" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/_WMiBTDcNqqcPnQt-JHFGUi__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/6jB67U?track_p_id=1d8eYnyI_cppFdw3raikDdn" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">Chinese technology - With the state’s help, Chinese technology is booming</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">The Economist</strong></h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘China’s failure to catch up in technologies like internal-combustion engines, civil aviation and, to date, semiconductors shows how hard it is to make humanity’s most complex mechanisms.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">This is the first in a 7-part series,</strong><a href="https://www.economist.com/technology-quarterly/2020/01/02/with-the-states-help-chinese-technology-is-booming" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">‘Technology in China: A new revolution,’</a> from The Economist.</p><p style="text-align: center;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">_____________________________</p><p style="text-align: center;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><br></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The Communist Party’s ability</strong> to ensure the successful deployment of a technology is not restricted to funding.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The state</strong> hedges risk, squashes&nbsp;nimbyism and pays for infrastructure.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘But two other factors</strong> are taking over from raw state power as the motor of Chinese technological development.’</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘One is the place</strong> its companies occupy in many of the most important supply chains in the world, giving them easy access to all sorts of technological know-how.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘As workshop to the world,</strong> China—and particularly the Pearl River Delta region that includes the booming cities of Shenzhen and Guangzhou—makes components for almost everything, understands how to assemble them, and is set up to bring together the right ones as quickly as possible.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘This geoepistemological advantage</strong> explains why the only successful smartphone companies founded since 2010 have been those set up around Shenzhen. (They are all non-state firms.)’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Their success</strong> has spread to new markets based on similar components.</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The consumer-drone market</strong> is dominated by China because drones are basically phones with rotors.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Secondly,</strong> the size and particularities of the Chinese market have become spurs to innovation in their own right.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘WeChat and Alipay,</strong> which use&nbsp;qrcodes to make payments with phones, emerged and took hold in China because payment cards were not yet established; as a result Chinese cities are becoming cashless.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The Communist Party’s need</strong> for social control has stimulated an entire industry of machine-learning technologies catering to the security services.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Not every peculiarity </strong>of the Chinese system is a benefit.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘State support</strong> is frequently doled out to firms or industries based on non-commercial factors.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Ignorance and corruption</strong> mess things up; so does a thirst for prestige.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘In the crucial battleground of semiconductors,</strong> Beijing’s investment policy is largely based on chasing after the highest-value sections of the supply chain by pumping money into Chinese versions of the foreign companies now commanding those heights.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Truly innovative</strong> and effective semiconductor businesses sometimes suffer merely because they are less coveted by party officials.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Some trends</strong> are subtler.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘China’s failure</strong> to catch up in technologies like internal-combustion engines, civil aviation and, to date, semiconductors shows how hard it is to make humanity’s most complex mechanisms.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The organisations</strong> which manage to do so depend on arcane insights and baroque procedures carefully nurtured by corporate hierarchies over decades.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘That even an economy</strong> as mighty as China’s can scarcely catch up should give pause for reflection about the possibilities for innovation elsewhere.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘For countries</strong> which wish to co-exist with China, its weaknesses reveal good places to invest in developing one’s own capabilities.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘For those who wish</strong> to reduce or curtail Chinese technological power, knowing its strengths and vulnerabilities is vital.’&nbsp;</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;        </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; text-align:left;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:5px; border-left:0px solid #c80000; text-align:center; font-size: 1.375em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;">Breaking the Rules</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">The Problem with Managed Trade </span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/9ApZPU?track_p_id=8xbcqmwjk7IdIQo_pD%40sMK1" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/VcdAHHrWxK2Oai7z2r1MjUi__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/9ApZPU?track_p_id=157IdIQo_qXVUMCi115yDF3" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">Bread, Circuses, and Managed Trade</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Center for Strategic and International Studies (CSIS)</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Bill Reinsch |</strong> CSIS</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘All of them are agreements where the goal was not trade liberalization or even trade growth but trade management—market manipulation designed to run counter to normal market events.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Much has been written</strong> about the relative modesty of the trade deals that have been completed—the United States–Korea Free Trade Agreement, the United States-Mexico-Canada Agreement (USMCA), and the Japan and China phase one deals.’&nbsp;</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Economists</strong> have generally concluded that any positive economic impact of these agreements so far is minimal.'</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘More serious</strong> than the market access implications of the agreements, however, is their form.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘All of them,</strong> one way or another, are agreements where the goal was not trade liberalization or even trade growth but trade management—market manipulation designed to run counter to normal market events.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘This is the opposite of free trade,</strong> and it is no surprise that the word “free” no longer appears in U.S. trade agreements.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The president</strong> has always had a transactional focus in trade. He wants to make deals, not reach agreements, that have tangible short-term benefits he can brag about.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘In the case of China,</strong> for example, it is much more important for him to be able to go to Iowa and say, “I got them to buy more corn and soybeans,” than it is to say, “We got better rules on state-owned enterprises and intellectual property protection.”’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The latter</strong> is more important than the former, and while both are on our agenda, there is little doubt which the president cares about more.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Likewise,</strong> Ambassador Lighthizer pursued managed trade when he was at the Office of the U.S. Trade Representative in the Reagan administration and seems quite comfortable returning to it now.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The rules at the WTO</strong> have changed in the interim, making it harder to pull off.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But with the demise</strong> of the organization’s Appellate Body, he will be able to get away with it despite the objections of those who lose because of it.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘This approach</strong> is shortsighted.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The United States</strong> is a big winner in a rules-based system, but if the United States tries to substitute short-term&nbsp;<em style="font-style: italic">quid pro quos</em>for it, it will be a loser in the long term.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘This is also sad</strong> because it is occurring in other areas of the government as well.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Institutions and rules</strong> that have been painfully built up over many years are being sacrificed in the interest of short-term benefits.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Roman emperors</strong> mastered this tactic when they provided bread and circuses to the masses.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘It would be nice to think</strong> we have learned something in the last 2,000 years, but it appears we have not.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;</td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">          Hurting the Little Guys</span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/4nT33o?track_p_id=cvZwtbaX45koW7KdKYQ_dkx" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/DKFLL_WFNIxtoniJ10LrLki__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/4nT33o?track_p_id=cdG%40OZLdvf3Sv7KdKYQ_nW3" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">Smaller Countries Lose in the U.S.–China Trade Deal</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Council on Foreign Relations (CFR)</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Edward Alden</strong> | CFR</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘In a world of bilateral negotiations, smaller countries will no longer have the protective umbrella of those rules and will at best be able to cut unbalanced deals with the big players like the United States, China, and the European Union.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The real danger</strong> of the new U.S.-China trade agreement is that it replaces a trading system based largely on agreed rules with one based purely on negotiating muscle.’&nbsp;</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The United States</strong> long championed a rules-based system.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But it is now discarding</strong> it in favour of a power-based system where the strong do what they can and the weak suffer what they must.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Weakening rules</strong> put smaller economies—such as Canada, Australia, the ASEAN nations and Latin America—in an increasingly vulnerable position.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘In a world of bilateral negotiations, </strong>smaller countries will no longer have the protective umbrella of those rules and will at best be able to cut unbalanced deals with the big players like the United States, China, and the European Union.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Recourse</strong> for the affected countries will be limited.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘They can complain to the WTO</strong> that the China–US deal violates the core principle of non-discrimination in trade, but neither the United States nor China is likely to pay attention to a WTO ruling.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The&nbsp;</strong><a href="https://www.washingtonpost.com/business/whats-next-for-the-wto-after-sabotage-by-the-us/2019/12/11/db45de8e-1bd3-11ea-977a-15a6710ed6da_story.html" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">death of the appellate body</strong></a>—after the United States vetoed new appointments—effectively gives large countries a veto on WTO panel rulings.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Any decision can now be blocked,</strong> and smaller countries cannot risk retaliating against bigger ones without the cover of a WTO decision.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;        </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div>

<div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="20" style="height:20px; font-size:0">&nbsp;</td></tr><tr><td style="vertical-align:top"><table cellspacing="0" cellpadding="0" width="100%"><tbody><tr><td style="padding-left:3.5%" a=""><a href="" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank" rel="noopener noreferrer" title="CHINADebate"><img width="100%" src="https://assets.website-files.com/5c864c33af62620dca1373ac/5d86577f82aa6e55afacb4ea_cd%20long-fit.png" alt="CHINADebate" style="width: 110px;"></a></td><td align="right" style="padding-right:3.5%"><a href="" target="_blank" rel="noopener noreferrer" style="color:#001544; font-size:13px; font-family:'gordita', sans-serif; text-decoration:none; border-bottom:none;"></a></td></tr></tbody></table></td></tr><tr><td height="30" style="height:30px; font-size:0">&nbsp;</td></tr><tr><td style="text-align:center; line-height:1"><span style="font-size: 42px; font-family: gorditamedium, sans-serif; color:#0970b3; letter-spacing: -1px; line-height: 1;">China Macro Reporter</span></td></tr><tr><td style="text-align:center; line-height:1.5; padding-bottom:30px; padding-top:10px;color:#001544; font-size:0.8125em; font-family:'gordita', sans-serif; text-decoration:none; border-bottom:none;"><span style="color:#001544; font-size:13px; font-family:'gordita', sans-serif; text-decoration:none; border-bottom:none;">by Malcolm Riddell<span style="margin:0 6px">·</span>Feb 8, 2020</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:20px auto 0 auto; text-align:left;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:5px; border-left:0px solid #c80000; text-align:center; font-size: 1.375em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;">Opening Statement</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/7WNYye?track_p_id=esc2q4rpf1Fd3EY7WdV9y_T" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/A34-JXbCfNBw6jMh3VQmQEi__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/7WNYye?track_p_id=7mKojssk7WdV9y_ZuXEiNyR" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">A Death of Distinction</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h1 style="display: inline-block;font-size: 1.35em;margin-top: 0em;margin-bottom: 0em;margin-left: 0;margin-right: 0;line-height: 1.35em;font-weight: normal;font-family: gorditamedium, sans-serif;color: #001544;letter-spacing: -0.1px;"><strong style="font-weight: bold">Greetings!</strong></h1><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;<strong style="font-weight: bold">‘A New Martyr Puts a Face on China’s Deepening Coronavirus Crisis’</strong> in The New York Times refers to the death of Dr. Li Wenliang&nbsp;</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">Dr. Li</strong> early-on warned several colleagues of the danger of a new virus.&nbsp;</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">He and seven other doctors</strong> were reprimanded by authorities for rumor-mongers.&nbsp;</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">Dr. Li died</strong> from the coronavirus.&nbsp;</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">As the NYT title suggests,</strong> after his death, Dr. Li became a hero to the Chinese people and led to a huge outcry on social media, squelched as best the censors could.&nbsp;</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">But what stood out to me</strong> was that a Chinese newspaper, the Economic Observer, took the bold and no doubt dangerous stand of devoting its front page to a photo and an essay titled: ·&nbsp;</p><h1 style="text-align: center;display: inline-block;font-size: 1.35em;margin-top: 0em;margin-bottom: 0em;margin-left: 0;margin-right: 0;line-height: 1.35em;font-weight: normal;font-family: gorditamedium, sans-serif;color: #001544;letter-spacing: -0.1px;"><span style="color: #d0021b"><strong style="font-weight: bold">‘Please Clear the Wuhan “Rumor-Monger's" Name'</strong></span><span style="color: #d0021b">&nbsp;</span></h1><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">This seems to be </strong>an amazing act of defiance.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">You can</strong> see the front page below.&nbsp;</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">I don’t grieve</strong> when some celebrity I’ve never met dies. &nbsp;</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">But I did feel awfully bad </strong>about Dr. Li.&nbsp;</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Not only did I feel bad for him</strong> – he appears to have been a fine fellow and a dedicated doctor - but I felt bad for the Chinese people living in an authoritarian state. &nbsp;</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">We often hear</strong> that as long as the Chinese government provides stability and economic opportunity, the people are willing to accept its restrictions, that they really care too much about their rights as citizens.&nbsp;</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Their reaction</strong> to Dr. Li’s death calls that premise into question. &nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><br></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">We love ‘Letters to the Editor,’</strong> so send me your thoughts on anything here or anything about China.</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">And please forward</strong> the China Macro Reporter to your friends and colleagues.</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Best,</strong></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Malcolm</strong></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><br></p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><span style="color: #d0021b"><strong style="font-weight: bold">NOTE:</strong></span><strong style="font-weight: bold">&nbsp;</strong></h2><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><span style="color: #d0021b"><strong style="font-weight: bold">To read the main articles, please click on the title.</strong></span></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;        </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:7px; border-left:0px solid #c80000; text-align:center; font-size: 1.5em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;">The Death of dr. li</span></td></tr></tbody></table></div><div><table align="center" border="0" cellpadding="0" cellspacing="0" width="100%"><tbody><tr height="0"><td width="0"></td></tr><tr><td width="0"></td><td align="center"><div style="width:600px;"><img src="https://img.scoop.it/0e8CKEXJzTXDfVNvn-Y9HDl72eJkfbmt4t8yenImKBXdhNIf0Yl8YfRAVzhohB7e" style="border-style: none;" alt=""></div></td><td width="0"></td></tr><tr height="0"><td width="0"></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">          Dr. Li Wenliang: Rumor-monger          </span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/7oXtIm?track_p_id=08Sogb0_nz5wsLxjM4udZGL" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/EcOyUKayX-HuEWP1HEfXXki__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/7oXtIm?track_p_id=9rMkj2zvLj8Sogb0_%40ftQxV" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">&nbsp;‘Please Clear the Wuhan “Rumor-Monger's" Name'</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">New York Times, Washington Post &amp; the Economic Observer [经济观察]</strong></h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">&nbsp;</strong></p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">&nbsp;‘Please Clear the Wuhan “Rumor-Monger's" Name'</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><a href="http://www.eeo.com.cn/2020/0207/375845.shtml" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">经济观察</strong></a><strong style="font-weight: bold">. ‘In official records,</strong> Dr. Li is still a "rumor-monger.”'</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The public regards</strong> Li Wenliang as a hero, perhaps just because Li Wenliang, like other doctors who "make rumors," warn the people around him as much as he can.’&nbsp;</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><a href="https://www.washingtonpost.com/world/asia_pacific/doctors-death-from-coronavirus-sparks-a-digital-uprising-rattling-chinas-leaders/2020/02/07/a4cb3492-4998-11ea-8a1f-de1597be6cbc_story.html" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">NYT.</strong></a> ‘The salmon-colored Economic Observer [经济观察]<strong style="font-weight: bold">,</strong> whose readership comprises China’s business elite, pushed the envelope: It dedicated its front page [above] to Dr. Li Wenliang with a <span style="color: #d0021b"><strong style="font-weight: bold">headline</strong></span> directly beseeching authorities':</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><span style="color: #d0021b"><strong style="font-weight: bold">&nbsp;‘Please Clear the Wuhan “Rumor-Monger's" Name'</strong></span></li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><a href="https://www.washingtonpost.com/opinions/global-opinions/the-virus-that-shook-chinas-system/2020/02/07/b125b2a0-49d2-11ea-bdbf-1dfb23249293_story.html" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">WAPO.</strong></a><strong style="font-weight: bold"> ‘Eight Chinese doctors</strong>&nbsp;<a href="https://www.washingtonpost.com/world/2020/02/04/chinese-doctor-has-coronavirus/?tid=lk_inline_manual_1&amp;itid=lk_inline_manual_1" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">expressed concern</a>&nbsp;about a new sickness in Wuhan in December and were reprimanded for spreading rumors.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘One of them,</strong> Li Wenliang,&nbsp;<a href="https://www.washingtonpost.com/world/asia_pacific/chinese-doctor-who-tried-to-raise-alarm-on-coronavirus-in-wuhan-dies-from-disease/2020/02/06/8bf305a2-48f9-11ea-8a1f-de1597be6cbc_story.html?tid=lk_inline_manual_1&amp;itid=lk_inline_manual_1" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">died&nbsp;</a>on Friday of what has now been identified as a novel coronavirus, and he quickly became a powerful online symbol of speaking truth to power.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Dr. Li, a 34-year-old ophthalmologist</strong> at the Central Hospital of Wuhan, was reprimanded by the police after he shared concerns about seven new cases of pneumonia in an online chat group on Dec.&nbsp;30.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘At the time,</strong> the Wuhan health commission was telling hospitals not to say anything publicly and just report the cases internally.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The police accused</strong> the eight doctors of rumor-mongering.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘They compelled Dr. Li</strong> to sign a&nbsp;<a href="https://thechinacollection.org/wuhan-police-letter-reprimand-li-wenliang-translation-analysis/" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">statement&nbsp;</a>answering the questions “Can you stop your illegal behavior?” and “Do you understand you’ll be punished if you don’t stop such behavior?”'</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘He wrote,</strong> “I can” and “I understand,” and put his red-inked thumbprint on them.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><a href="https://www.nytimes.com/2020/02/01/world/asia/china-coronavirus.html" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">NYT.</strong></a><strong style="font-weight: bold">‘Dr. Li, an ophthalmologist,</strong> went back to work after being reprimanded.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘On Jan. 10,</strong> he treated a woman for glaucoma. He did not know she had already been infected with the coronavirus, probably by her daughter.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘They both</strong> became sick. So would he’.</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;        </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">Dr. Li: Face of the Chinese People's Discontent'</span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/86iDcu?track_p_id=9WaDd62dgE7KUZ7W_kZri6W" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/3QKIJ28TXRxlm_PNLipujEi__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/86iDcu?track_p_id=3G3p7KUZ7W_MuiJFG4Gt3Ul" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">A New Martyr Puts a Face on China’s Deepening Coronavirus Crisis&nbsp;</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">New York Times</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Chris Buckley&nbsp;and&nbsp;Paul Mozur</strong> | NYT</h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><br></h3><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;">'The death of the doctor whose warnings about the coronavirus were silenced has become a potent symbol of Beijing’s failures.'</h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><a href="https://www.washingtonpost.com/world/asia_pacific/doctors-death-from-coronavirus-sparks-a-digital-uprising-rattling-chinas-leaders/2020/02/07/a4cb3492-4998-11ea-8a1f-de1597be6cbc_story.html" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">NYT.</strong></a><strong style="font-weight: bold"> Li Weidong</strong>, a former editor of the China Reform magazine, said the government is likely to heap praise on Li in the coming days to soothe public anger, but not backtrack with an apology.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘He doubted</strong> that the administration of Xi Jinping, who has emphasized maintaining the party’s iron grip over society, would respond to public criticism.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><a href="https://www.nytimes.com/2020/02/07/world/asia/china-coronavirus-doctor-death.html?action=click&amp;module=RelatedLinks&amp;pgtype=Article&amp;utm_medium=email&amp;utm_content=apDZvz7nhuEOdtheqb0dkdQ0WzeokdIcojJVB9a2SE1yw0PoDZ3oLr54HsWtML0S" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">NYT. </strong></a><strong style="font-weight: bold">The deluge of mourning and anger</strong> at the death of the doctor,&nbsp;<a href="https://www.nytimes.com/2020/02/07/world/asia/Li-Wenliang-china-coronavirus.html" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">Li Wenliang</a>&nbsp;— from the same virus he was reprimanded for mentioning — at times overwhelmed China’s sophisticated censorship and propaganda systems.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Many on social media</strong> called the doctor a martyr and a hero, and government officials, celebrities and business leaders risked rebuke by the Communist Party to join ordinary citizens in expressing frustration and grief.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘For a few hours, </strong>a trending hashtag called for freedom of speech.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Unable to fully expunge the discussions,</strong> Beijing has turned to state media to transform Dr. Li into a loyal soldier aligned with the government’s cause. The country’s state media released its own remembrances, in some cases working to subtly co-opt Dr. Li’s story.'</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘China’s National Health Commission</strong> recalled him not as a Cassandra warning about the virus, but instead as a doctor on the front lines of the response.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘A television broadcaster</strong> at a China’s state-run outlet said, sought to link Dr. Li directly to Mr. Xi’s own words about the battle against the epidemic: “Beating this devil virus is the best consolation to the deceased.”</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘On Friday, bowing to popular pressure,</strong> Communist Party officials said they would send a team from the powerful anticorruption committee to investigate the circumstances surrounding Dr. Li’s death.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The State Supervisory Committee</strong> has “decided to send an investigation team to Wuhan, Hubei Province, to conduct a comprehensive investigation on related issues reported by the masses about Dr. Li Wenliang,” it said on Friday, releasing a one-line statement on its website.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘A part of Dr. Li’s appeal</strong> has been his Everyman sensibilities.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘He loved fried chicken thighs,</strong> was annoyed when cherry prices rose too high and often got stuck working extra shifts at the hospital.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Like many others in China,</strong> he wrote all about it online.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘</strong><a href="https://www.nytimes.com/2020/02/01/world/asia/china-coronavirus.html" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">The New York Times spoke to Dr. Li&nbsp;</strong></a>a week before his death.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“If the officials</strong> had disclosed information about the epidemic earlier,” he told The Times, “I think it would have been a lot better. There should be more openness and transparency.”</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“I felt I was wronged,</strong> but I had to accept it,” he said of his arrest. “Obviously I had been acting out of good will.”</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“I have felt very sad</strong> seeing so many people losing their loved ones.”</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;        </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; text-align:left;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:5px; border-left:0px solid #c80000; text-align:center; font-size: 1.375em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;">Interview: Bill Bishop &amp; Derek Scissors</span></td></tr></tbody></table></div><div><table align="center" border="0" cellpadding="0" cellspacing="0" width="100%"><tbody><tr height="0"><td width="0"></td></tr><tr><td width="0"></td><td align="center"><div style="width:600px;"><img src="https://img.scoop.it/LqYj4TdhPoCII-RuiYVTHTl72eJkfbmt4t8yenImKBXdhNIf0Yl8YfRAVzhohB7e" style="border-style: none;" alt=""></div></td><td width="0"></td></tr><tr height="0"><td width="0"></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">          Coronavirus &amp; the Stock Market          </span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/8OsXx2?track_p_id=1e8Ve7na_B2g4rx5F3C35aU" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/GsI4H4IAu0R9DEiBPcItgUi__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/8OsXx2?track_p_id=eMJRAQzsG%40hrXp38Ve7na_U" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">Why the Coronavirus Hasn't Affected the Stock Market</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">CNBC</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Bill Bishop</strong> | Sinocism</h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Derek Scissors</strong> | American Enterprise Institute</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘In the short term, of course, there's uncertainty, but we kind of know what that uncertainty is.&nbsp;It’s not an “unknown unknown.”'</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><br></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><a href="https://www.youtube.com/watch?v=dwiRUbCLR2E" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">Watch</strong></a><strong style="font-weight: bold"> Bill and Derek’s </strong>5m interview.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">And, as I've often said,</strong> if you don't subscribe to Bill Bishop's <em style="font-style: italic"><strong style="font-weight: bold">Sinocism </strong></em>newsletter, you should. Have a look and <a href="https://sinocism.com/" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">subscribe here.</a></li></ul><p style="text-align: center;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">____________________________________</p><p style="text-align: center;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><br></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><span style="color: #d0021b"><em style="font-style: italic"><strong style="font-weight: bold">Q:</strong></em></span><em style="font-style: italic"><strong style="font-weight: bold"> ‘The thing I can't figure out</strong></em><em style="font-style: italic"> is the way the stock market has reacted over the past week. It's almost as if this whole coronavirus hasn't even happened. Derek, what's happening here?’</em></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><span style="color: #d0021b"><strong style="font-weight: bold">DEREK SCISSORS:</strong></span><strong style="font-weight: bold"> ‘I think the stock market</strong> is probably right.’</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘As economists,</strong> we look at productivity, the labor force, the capital stock.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘China has 800 million workers.</strong> The coronavirus isn't a natural disaster that destroys capital stock.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘As long as people</strong> recover fully from the coronavirus, which we all hope they do, it's not going to affect productivity.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The market is looking down</strong> the road a year, a year and a half, and saying, this is not a long-term economic event.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘In the short term,</strong> of course, there's uncertainty, but we kind of know what that uncertainty is. It’s not an “unknown unknown.”'</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘There's going to be a big hit</strong> to Chinese GDP in the short term, but the market already knows that.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘So the market</strong> is comfortable with the level of risk.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><span style="color: #d0021b"><strong style="font-weight: bold">BILL BISHOP:</strong></span><strong style="font-weight: bold"> ‘One other thing. </strong>The market reaction today about China’s tariff cut - it seems like the market's buying the same horse for the fifth time.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘That reduction</strong> is part of the trade deal. And, so that cut was to be expected.</li></ul><p style="text-align: center;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><br></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;        </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">Coronavirus &amp; Supply Chains</span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/8h2sHA?track_p_id=96CXYENKln4uglDy_dZNU2A" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/GsI4H4IAu0R9DEiBPcItgUi__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/8h2sHA?track_p_id=3UmN4uglDy_mscfUx6yPzJr" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">Risks to  Supply Chains</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">CNBC</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Bill Bishop</strong> | Sinocism</h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Derek Scissors</strong> | American Enterprise Institute</h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><br></h3><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘This crisis just adds another very obvious risk to any multinational company and any company that sources from China.'</strong></h2><p style="text-align: left;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><br></p><p style="text-align: left;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><a href="https://www.youtube.com/watch?v=dwiRUbCLR2E" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">Watch</strong></a><strong style="font-weight: bold"> Bill and Derek’s </strong>5m interview.</p><p style="text-align: left;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><br></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><span style="color: #d0021b"><em style="font-style: italic"><strong style="font-weight: bold">Q:</strong></em></span><em style="font-style: italic"><strong style="font-weight: bold"> ‘Wilbur Ross</strong></em><em style="font-style: italic"> made a comment last week - and he got killed for saying it - that multinational companies will think again about keeping their supply chain in China &nbsp;in part because of this crisis. Do you believe that?’</em></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><span style="color: #d0021b"><strong style="font-weight: bold">DEREK SCISSORS:</strong></span><strong style="font-weight: bold">&nbsp;'People have been rethinking</strong> their supply chains for a while.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Why?</strong> One, slowing growth in China; two, China's conflict with the U.S. - that's not resolved by the phase one deal.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘But now there is a third reason.</strong>&nbsp;This makes the Chinese government look less competent.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘That may not be fair.</strong> Who could do better?’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But it does,</strong> nonetheless, make them look less competent and points to problems and information transmission.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘People not wanting</strong> to tell their bosses what's going on because it makes them look bad.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'The possibility</strong> of another purge by Xi Jinping.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘So all these add</strong> to the pressures, but there are not by themselves enough to change global supply chain practice.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But, while companies</strong> may not bring any jobs back to the U.S., the Chinese do have to worry about jobs leaving China.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><span style="color: #d0021b"><strong style="font-weight: bold">BILL BISHOP:</strong></span><strong style="font-weight: bold"> ‘Right now</strong> they have much bigger worries in the short term.’</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘They need to get</strong> the virus contained and the economy back functioning.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Normally the factories</strong> would start filling up again by end of this week. Now, we're looking at March, best case.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘And then longer term</strong> they have to figure out whether or not they can slow the wave of decoupling. Good luck to them.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘This crisis</strong> just adds another very obvious risk to any multinational company and any company that sources from China.'</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'You just cannot have</strong> too much reliance on that one single country.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;        </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">The Biggest Crisis Since Tiananmen</span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/8zDCbI?track_p_id=6JEaW1W8nBPB8_JpBWCYZf2" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/GsI4H4IAu0R9DEiBPcItgUi__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/8zDCbI?track_p_id=eUsFOeTv6dII5e18nBPB8_N" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">A Failure of Performance Legitimacy</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">CNBC</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Bill Bishop</strong> | Sinocism</h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><br></h3><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">'The Chinese leadership is looking at a real potential failure of what you could call performance legitimacy.’</strong></h2><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><br></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><a href="https://www.youtube.com/watch?v=dwiRUbCLR2E" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">Watch</strong></a><strong style="font-weight: bold"> Bill and Derek’s </strong>5m interview.</h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><br></h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><span style="color: #d0021b"><em style="font-style: italic"><strong style="font-weight: bold">Q:</strong></em></span><em style="font-style: italic"><strong style="font-weight: bold"> ‘What are President Xi</strong></em><em style="font-style: italic"> and the people around him thinking?’</em></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><span style="color: #d0021b"><strong style="font-weight: bold">BILL BISHOP:</strong></span><strong style="font-weight: bold"> ‘From the perspective</strong> of the Chinese leadership, this is really the biggest crisis they faced in many years, perhaps since 1989.’</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘First, they're looking at</strong>&nbsp;a short-term economic hit, but they're also looking at a significant economic hit of unknown duration.’</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Second, they're also looking</strong> at a massive human tragedy, which is affecting millions, tens of millions of people right now.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Again with no sign</strong> of it abating anytime in the next several weeks or in a couple of months.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">And third, they're looking at</strong> a real potential failure of what you could call performance legitimacy.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘They’ve just spent</strong> the last year talking about the superiority of the socialist system.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Now they're in a situation</strong> where a province of tens of millions of people is effectively shut down.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Food is still in good supply, </strong>but people are also seeing a pretty significant stressing and failure in some areas of the medical system.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;        </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; text-align:left;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:5px; border-left:0px solid #c80000; text-align:center; font-size: 1.375em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;">Xi's WorldView</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">'The 10 Priorities' </span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/9HNWvQ?track_p_id=bqOFdLe1XUWr57jl6s_w2zU" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/Tad6xj_ebVw7qqeNRLm3H0i__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/9HNWvQ?track_p_id=6Ikwge%4057jl6s_OuXQ4oxgT" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">The World According to Xi Jinping</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Project Syndicate</strong></h3><h3 style="text-align: justify;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Kevin Rudd</strong> | President of the Asia Society Policy Institute &amp; former Australian prime minister&nbsp;</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘An underlying worldview guides Xi as he seeks to realize his dream of making China the global great power of the future.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">&nbsp;‘An underlying worldview</strong> guides Xi as he seeks to realize his dream of making China the global great power of the future.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Xi has </strong>ten priorities.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘These may best be seen as ten sets of concentric circles</strong> emanating from the party center,'</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">1. ‘Keep the Chinese Communist Party</strong> in power.’</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">2. ‘Always maintain national unity,</strong> because that is central to the CPC’s internal legitimacy.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘This is why</strong> there have been sustained crackdowns in Tibet and Xinjiang under his rule, as well as a consistent hardening of policy toward Taiwan.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">3. ‘Expand</strong> the economy.’</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">4. ‘Incorporate environmental sustainability</strong> into China’s growth matrix.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The Chinese people</strong> will not tolerate high levels of air, soil, and water pollution.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Still, sustainability,</strong> including action to combat climate change, will always compete with priority three (economic growth), both in domestic industry and in the transnational infrastructure projects envisioned in Xi’s signature Belt and Road Initiative (BRI).'</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">5. ‘Expand and modernize</strong> the Chinese military.’</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">6. ‘Secure benign</strong> and (when possible) compliant relationships with China’s 14 neighboring states and six maritime neighbors.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Russia has been key</strong> to this project, having gone from being an historic adversary that occupied much of China’s strategic attention to a virtual ally.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘On the maritime front,</strong> China has made clear that it will not yield on its territorial claims in the East and South China Seas.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">7. ‘On China’s eastern maritime periphery,</strong> push the United States back to the “second island chain” that runs from the Japanese archipelago through Guam to the eastern Philippines.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘China also wants to weaken</strong> (or sever, if possible) America’s longstanding security alliances in the region, particularly those with South Korea, Japan, and the Philippines.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The ultimate objective</strong> here is to enhance China’s capacity to secure reunification with Taiwan – by force, if necessary.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">8. ‘Secure China’s western continental periphery</strong>.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Xi wants to turn the Eurasian landmass</strong> into a new market for Chinese goods, services, technology, and critical infrastructure investment.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Through the BRI,</strong> he also wants Central Asia and the Middle East, as well as Central, Eastern, and Western Europe, to become increasingly sensitized to and supportive of China’s core foreign-policy interests.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">9. ‘Develop the</strong><strong style="font-weight: bold">large-scale market potential,</strong> not dissimilar to that of Eurasia, across the rest of the developing world, in Africa, Asia, and Latin America.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘This is manifested</strong> in the “Maritime Silk Road,” which is becoming as significant as the BRI.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">&nbsp;10.</strong> ‘<strong style="font-weight: bold">Reshape the global order</strong> so that it is more accommodating of Chinese interests and values.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘China’ leaders</strong> see the post-1945 liberal international order as reflecting the worldview of the victorious white colonial powers that created it.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Xi considers</strong> the world of 2020 to be radically different from that of the post-war era.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘China</strong> has therefore developed a two-pronged strategy.’<ol style="margin-top: 0px;margin-bottom: 0px;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Increase its power,</strong> personnel, and financial influence within the existing global-governance institutions.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Build new,</strong> China-centric institutions like the BRI and the Asian Infrastructure Investment Bank.’</li></ol></li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Not everyone</strong> in the CPC’s senior echelon shares Xi’s worldview.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘There is much internal dissension</strong> and debate about whether China is overextending itself in departing from Deng Xiaoping’s longstanding strategy of “hide your strength, bide your time, never take the lead.”</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Time will tell</strong> how these debates shake out, particularly in the run-up to the party’s 20th National Congress in 2022.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘That Congress </strong>will make the crucial decision about whether to extend Xi’s leadership term beyond previous term limits – through the 2020s and possibly beyond.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;        </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; text-align:left;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:5px; border-left:0px solid #c80000; text-align:center; font-size: 1.375em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;"> china’s Million+  cities</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">          China 113 / U.S.-EU 114</span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/4u10Zk?track_p_id=ab3vzznnlHS8Dlwha_WvLWj" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/oyFWmq90zHwm5iYuCjNUIUi__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/4u10Zk?track_p_id=5ht1TA8Dlwha_q2%40Vf33Kx6" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">Infographic: Meet China’s 113 Cities With More Than One Million People</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Visual Capitalist</strong></h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">&nbsp;</strong></p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘The massive scale of rural-to-urban migration isn’t just a major development within China, it has no parallel in modern history.’</strong></h2><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><br></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Great graphic </strong>comparing China and the U.S./EU million+ cities.</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘According to</strong> Demographia’s&nbsp;<a href="http://www.demographia.com/db-worldua.pdf" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">World Urban Areas report</a>, there are now 113 urban areas in China that surpass the one million population threshold.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘In comparison,</strong> North America and the EU combined have 114 urban areas that surpass one million people.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Below </strong>is a full breakdown of China’s one million+ cities':</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;        </td></tr></tbody></table></div><div><table align="center" border="0" cellpadding="0" cellspacing="0" width="100%"><tbody><tr height="0"><td width="0"></td></tr><tr><td width="0"></td><td align="center"><div style="width:600px;"><img src="https://img.scoop.it/s1b5A0AXlJsLH8JjmAvL2zl72eJkfbmt4t8yenImKBXdhNIf0Yl8YfRAVzhohB7e" style="border-style: none;" alt=""></div></td><td width="0"></td></tr><tr height="0"><td width="0"></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div>

<div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="20" style="height:20px; font-size:0">&nbsp;</td></tr><tr><td style="vertical-align:top"><table cellspacing="0" cellpadding="0" width="100%"><tbody><tr><td style="padding-left:3.5%" a=""><a href="" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank" rel="noopener noreferrer" title="CHINADebate"><img width="100%" src="https://assets.website-files.com/5c864c33af62620dca1373ac/5d86577f82aa6e55afacb4ea_cd%20long-fit.png" alt="CHINADebate" style="width: 110px;"></a></td><td align="right" style="padding-right:3.5%"><a href="" target="_blank" rel="noopener noreferrer" style="color:#001544; font-size:13px; font-family:'gordita', sans-serif; text-decoration:none; border-bottom:none;"></a></td></tr></tbody></table></td></tr><tr><td height="30" style="height:30px; font-size:0">&nbsp;</td></tr><tr><td style="text-align:center; line-height:1"><span style="font-size: 42px; font-family: gorditamedium, sans-serif; color:#0970b3; letter-spacing: -1px; line-height: 1;">China Macro Reporter</span></td></tr><tr><td style="text-align:center; line-height:1.5; padding-bottom:30px; padding-top:10px;color:#001544; font-size:0.8125em; font-family:'gordita', sans-serif; text-decoration:none; border-bottom:none;"><span style="color:#001544; font-size:13px; font-family:'gordita', sans-serif; text-decoration:none; border-bottom:none;">by Malcolm Riddell<span style="margin:0 6px">·</span> Feb 5, 2020</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:20px auto 0 auto; text-align:left;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:5px; border-left:0px solid #c80000; text-align:center; font-size: 1.375em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;">Opening Statement</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/7EYzeC?track_p_id=8Xhpw5aGZ7WdV9y_ThkAfgX" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/A34-JXbCfNBw6jMh3VQmQEi__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/7EYzeC?track_p_id=81cFPmQOp7WdV9y_Ly6AHIn" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">Big Ideas</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h1 style="display: inline-block;font-size: 1.35em;margin-top: 0em;margin-bottom: 0em;margin-left: 0;margin-right: 0;line-height: 1.35em;font-weight: normal;font-family: gorditamedium, sans-serif;color: #001544;letter-spacing: -0.1px;"><strong style="font-weight: bold">Greetings!</strong></h1><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">I didn't plan it,</strong> this issue of the China Macro Reporter covers a lot of big ideas.</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><span style="color: #d0021b"><strong style="font-weight: bold">Black Swans.</strong></span> China has just given us one Black Swan event with the coronavirus.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;">And China may be poised to give more, points put Walter Russell Mead of Bard College, whether another epidemic (cororavirus is already the second after SARS) or meltdown of the Chinese financial system.</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><span style="color: #d0021b"><strong style="font-weight: bold">New Chinese Leverage.</strong></span> The trade deal, rather than giving the U.S. leverage over China, will China leverage over the U.S., argue Joshua P. Meltzer of Brookings and Neena Shenai of AEI.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Because these purchases</strong> [by China under the trade deal] are not market-based (if they were, the commitments would have been unnecessary), they actually create stronger US dependencies on China.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Because of its state-led</strong> and controlled economy, China could gin-up demand to try and meet these commitments, but the spigot could likewise be turned off at any point and for any reason.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><span style="color: #d0021b"><strong style="font-weight: bold">‘Tossing the Wok.’</strong></span><span style="color: #d0021b"></span>Li Yuan of The New York Times writes: ‘All in all, ‘the Chinese people are getting a rare glimpse of how China’s giant, opaque bureaucratic system works — or, rather, how it fails to work.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The coronavirus outbreak has undermined the myth</strong> that the Chinese political elites win assignments and promotion purely on merit.’ <ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Critics say quietly</strong> that, under Mr. Xi, the party began promoting loyal political cadres over technocrats — the experts and skilled administrators who comprised the backbone of China’s bureaucracy in the 1990s and 2000s, when the country grew the fastest.’</li></ul></li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Those officials</strong> could often be corrupt, but even the party’s fiercest critics sometimes acknowledge that they got things done.’ <ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Liu Zhijun,</strong> the former railway minister,&nbsp;<a href="https://www.nytimes.com/2013/07/08/world/asia/ex-rail-minister-in-china-gets-a-suspended-death-sentence.html" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">is serving a life sentence</a> for taking bribes and abusing power.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘He also oversaw</strong> the creation of China’s high-speed rail system, which&nbsp;<a href="https://www.nytimes.com/2013/09/24/business/global/high-speed-train-system-is-huge-success-for-china.html" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">vastly improved life in</a> the country.’</li></ul></li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘</strong><span style="color: #d0021b"><strong style="font-weight: bold">Silver Bullet’ Solution.</strong></span><span style="color: #d0021b"></span>‘The United States should reduce its “Phase Two” demands on China to one: allow the free movement of capital,’ recommends Brian McCarthy of Macrolens</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Restricting the ability</strong> of the Chinese citizenry to “vote with its wallet” is the cornerstone market distortion that enables all others.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The “forced savings”</strong> which has financed all manner of Chinese subsidy and market-distorting practice becomes impossible to marshal in the existence of a liberalized capital account.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><span style="color: #d0021b"><strong style="font-weight: bold">Fear &amp; Growth.</strong></span><strong style="font-weight: bold"></strong>‘Fear itself can shock global growth,’ write James Sweeney and Wenzhe Zhao of CreditSuisse. ‘The coronavirus creates great fear.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘We expect</strong> that the nascent global growth rebound from late last year is already over.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Lots to think about</strong> in this issue. We love ‘Letters to the Editor,’ so send me your thoughts on anything here or anything about China.</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">And please forward</strong> the<strong style="font-weight: bold"> China Macro Reporter </strong>to your friends and colleagues.</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Best,</strong></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Malcolm</strong></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;            </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:20px auto 0 auto; text-align:left;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:5px; border-left:0px solid #c80000; text-align:center; font-size: 1.375em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;">china's black swans</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">The Next Chinese Black Swan</span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table align="center" border="0" cellpadding="0" cellspacing="0" width="100%"><tbody><tr height="0"><td width="0"></td></tr><tr><td width="0"></td><td align="center"><div style="width:600px;"><img src="https://img.scoop.it/u0qXmPOZr08OAcuvVTEAKjl72eJkfbmt4t8yenImKBXdhNIf0Yl8YfRAVzhohB7e" style="border-style: none;" alt=""></div></td><td width="0"></td></tr><tr height="0"><td width="0"></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/4h5C5o?track_p_id=4XXuP8K8Htu_AdlV5RlOo3B" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/K9fKxwrt-0GqvuYSovNp30i__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/4h5C5o?track_p_id=72HDtGkd8K8Htu_aNPhykMA" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">China in an Age of Black Swans</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Wall Street Journal</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Walter Russell Mead</strong> | Bard College &amp; Hudson Institute Fellow</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘The 21st century has been an age of black swans.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The mighty Chinese juggernaut</strong> has been humbled this week, apparently by a species-hopping bat virus.'</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘While Chinese authorities</strong> struggle to control the epidemic and restart their economy, a world that has grown accustomed to contemplating China’s inexorable rise was reminded that:” <ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Nothing, not even Beijing’s power,</strong> can be taken for granted.’</li></ul></li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">&nbsp;‘Epidemics </strong>also lead us to think about geopolitical and economic hypotheticals.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘We have seen financial markets</strong> shudder and commodity prices fall in the face of what hopefully will be a short-lived disturbance in China’s economic growth.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘What would happen if</strong>—perhaps in response to an epidemic, but more likely following a massive financial collapse—China’s economy were to suffer a long period of even slower growth?’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘China’s financial markets</strong> are probably more dangerous in the long run than China’s wildlife markets.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Given the accumulated costs</strong> of decades of state-driven lending, massive malfeasance by local officials in cahoots with local banks, a towering property bubble, and vast industrial overcapacity, China is as ripe as a country can be for a massive economic correction.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Even a small initial shock</strong> could lead to a massive bonfire of the vanities as all the false values, inflated expectations and misallocated assets implode.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘We cannot know</strong> when or even if a catastrophe of this scale will take place.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But students of geopolitics and international affairs</strong>—not to mention business leaders and investors—need to bear in mind that:’ <ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;">‘<strong style="font-weight: bold">China’s power,</strong> impressive as it is, remains brittle.’</li></ul></li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘A deadlier virus or a financial-market contagion</strong> could transform China’s economic and political outlook at any time.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The consequences</strong> of a Chinese economic meltdown would travel with the same sweeping inexorability.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Commodity prices</strong> around the world would slump, supply chains would break down, and few financial institutions anywhere could escape the knock-on consequences. ‘</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Recovery in China and elsewhere</strong> could be slow, and the social and political effects could be dramatic.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘So far,</strong> the 21st century has been an age of black swans.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘From 9/11 to President Trump’s election</strong> and Brexit, low-probability, high-impact events have reshaped the world order.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘That age isn’t over,</strong> and of the black swans still to arrive, the coronavirus epidemic is unlikely to be the last to materialize in China.’</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;            </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; text-align:left;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:5px; border-left:0px solid #c80000; text-align:center; font-size: 1.375em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;">Phase One trade deal</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">China's New Leverage Over the U.S</span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/4zFWPw?track_p_id=1W5QhcMw_Q3q%40%40OmkUlbrqZ" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/qAD7kBqLceF6aukL4-Brm0i__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/4zFWPw?track_p_id=5kNrpI5QhcMw_f1H4QIVJCE" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">Why the purchase commitments in the US-China trade deal should not be replicated, ever</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Brookings &amp; AEI</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Joshua P. Meltzer</strong> | Brookings</h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Neena Shenai</strong> | American Enterprise Institute</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">&nbsp;</strong></p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘This deal gives China leverage over the United States that it did not previously possess.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Under the Phase One deal,</strong> China has agreed to purchase $200 billion worth of US goods and services in 2020 and 2021, on top of the amounts imported in 2017.’&nbsp;</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Viewed as a simple purchase contract</strong> between two private entities, the deal may make some sense.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘However</strong>, understood correctly as a trade deal between two sovereign nations, the purchase commitments are not merely out of place — they create two specific and related problems.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘One, this deal gives China </strong>leverage over the United States that it did not previously possess.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Two, these commitments undermine</strong> market forces and the rules-based trading system, with both direct and strategic costs for the US.’ [Not discussed here – please read about it in the report]</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘First, while the US</strong> may believe it has created leverage over China through this managed trade relationship where China is depending on US exports, it’s actually the opposite.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Because these purchases</strong> are not market-based (if they were, the commitments would have been unnecessary), they actually create stronger US dependencies on China.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Because of its state-led</strong> and controlled economy, China could gin-up demand to try and meet these commitments, but the spigot could likewise be turned off at any point and for any reason.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Many US exports</strong> are fungible and depend on long-term certainty.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘We have already</strong> seen the&nbsp;<a href="https://www.reuters.com/article/us-usa-trade-china-agriculture-insight/u-s-farmers-see-another-bleak-year-despite-phase-1-trade-deal-idUSKBN1Z20CK" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">costs</a> to US agriculture from targeted Chinese tariffs during the US-China trade war, for instance.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Consider how much damage</strong> could be done where the dependency is to the tune of $370 billion.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;            </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; text-align:left;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:5px; border-left:0px solid #c80000; text-align:center; font-size: 1.375em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;">Why China's officials are failing</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">'Tossing the Wok'</span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table align="center" border="0" cellpadding="0" cellspacing="0" width="100%"><tbody><tr height="0"><td width="0"></td></tr><tr><td width="0"></td><td align="center"><div style="width:600px;"><img src="https://img.scoop.it/ZHbBPYogoahtW-OJq1Cn-Dl72eJkfbmt4t8yenImKBXdhNIf0Yl8YfRAVzhohB7e" style="border-style: none;" alt=""></div></td><td width="0"></td></tr><tr height="0"><td width="0"></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/5HPqk4?track_p_id=6fpIdmY7zUnKo_YBVIrCrF6" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/3QKIJ28TXRxlm_PNLipujEi__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/5HPqk4?track_p_id=24A7zUnKo_UlcVzTjaoJwDr" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">Chinese Officials 'Tossing the Wok'</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">New York Times</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Li Yuan</strong> | New York Times</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘The outbreak has undermined the myth that the Chinese political elites win assignments and promotion purely on merit.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Senior officials</strong> are engaging in an unusually blunt display of finger-pointing.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Wuhan’s mayor</strong> blamed higher-ups.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘A senior disease control official</strong> blamed layers of bureaucracy.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘A top government expert</strong> blamed the public: The people, he said, simply didn’t understand what he told them.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘So many officials</strong> have denied responsibility that some online users joke that they are watching a passing-the-buck competition. (It’s “tossing the wok” in Chinese.)’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The wok tossing</strong> in China stems in part from the tension between the technocrats, who hold a large number of positions with China’s provincial and national disease control centers, and the political cadres — the mayors, governors and the provincial party secretaries.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The outbreak has undermined the myth</strong> that the Chinese political elites win assignments and promotion purely on merit.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Critics say quietly</strong> that, under Mr. Xi, the party began promoting loyal political cadres over technocrats — the experts and skilled administrators who comprised the backbone of China’s bureaucracy in the 1990s and 2000s, when the country grew the fastest.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Those officials</strong> could often be corrupt, but even the party’s fiercest critics sometimes acknowledged that they got things done.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Liu Zhijun,</strong> the former railway minister,&nbsp;<a href="https://www.nytimes.com/2013/07/08/world/asia/ex-rail-minister-in-china-gets-a-suspended-death-sentence.html" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">is serving a life sentence</a> for taking bribes and abusing power.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘He also oversaw</strong> the creation of China’s high-speed rail system, which&nbsp;<a href="https://www.nytimes.com/2013/09/24/business/global/high-speed-train-system-is-huge-success-for-china.html" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">vastly improved life in</a> the country.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The outbreak and lack of disclosure</strong> suggest the political cadres are winning.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘In fact,</strong> even the technocrats are becoming cadres because none of them had the courage to tell the public what they knew about the virus.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘People in China</strong> are now focusing much of their anger on Xi Jinping, China’s top leader and the person many blame for creating a culture of fear and subservience within the Chinese government.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Few people dare</strong> to question Mr. Xi openly, for fear of provoking censors or the police.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But after Mr. Xi</strong> disappeared from public view in recent days, some social media users began asking euphemistically, “Where is that person?”</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘They are also</strong> posting online and sharing pictures of former leaders at the sites of past crises.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘All in all, ‘the Chinese people</strong> are getting a rare glimpse of how China’s giant, opaque bureaucratic system works — or, rather, how it fails to work.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Too many of its officials</strong> have become political apparatchiks, fearful of making decisions that anger their superiors and too removed and haughty when dealing with the public to admit mistakes and learn from them.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“Under the high-pressure environment</strong> of the anti-corruption campaign, most people, including senior government officials, only care about self-preservation,” said Xu Kaizhen, a best-selling author who is famous for his novels that explore the intricate workings of China’s bureaucratic politics.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“They don’t want to be</strong> the first to speak up. They wait for their superiors to make decisions and are only accountable to their superiors instead of the people.”</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Chinese officials</strong> are spending as much as one-third of their time on political studying sessions, a lot of which is about Mr. Xi’s speeches.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Political loyalty</strong> weighs much more in performance evaluations than before.'</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Now the rule of thumb</strong> in Chinese officialdom seems to be demonstrating loyalty as explicitly as possible, keeping everything else vague and evading responsibility at all costs when things go wrong.’</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘In an interview</strong> with state television, Ma Guoqiang, the Communist Party secretary of Wuhan, acknowledged that Wuhan residents “are a little anxious and a little nervous” and said that he would mobilize all party cells to comfort them.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“But the most important comfort,”</strong> he added, “comes from Party Secretary Xi Jinping.”</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;            </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; text-align:left;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:5px; border-left:0px solid #c80000; text-align:center; font-size: 1.375em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;">Just One 'Phase Two' Demand</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/4rJZvE?track_p_id=4VWRN5yL5Ha_U4twlwMSfCk" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/TuSPDdJZOA8NHN-HNCvvqEi__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/4rJZvE?track_p_id=2Ml5yL5Ha_NaM%40oFiY6VJdK" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">The 'Silver Bullet' Solution</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">U.S.-China Economic and Security Review Commission</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Brian McCarthy</strong> | Macrolens</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;<strong style="font-weight: bold">&nbsp;</strong></p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘The United States should reduce its “Phase Two” demands on China to one: allow the free movement of capital.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Brian’s testimony</strong> before the U.S.-China Economic and Security Review Commission hearing on “China’s Quest for Capital: Motivation, Methods, and Implications” covered several topics:</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Brian: ‘While on the surface</strong> the system appears to be undergoing a period of rapid transformation, an underlying reality of China’s system of economic management remains the driving force for “change”: the Chinese Communist Party has no intention of surrendering its control over the allocation of capital to market forces.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Credit markets</strong> remain bank-dominated and State-entity focused.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The recent push</strong> to increase lending to SME’s is just a pivot in the central plan.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Increasingly vibrant equity markets</strong> provide a bastion for market-based capital allocation, but within strict confines.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Increased openness to foreign investment</strong> is driven not by a desire to marketize, but by China’s macroeconomic and geopolitical predicaments.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">His entire testimony</strong> is well-worth a very careful reading.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">From that testimony,</strong> I have highlighted just his ‘Silver Bullet Solution.’</li></ul><p style="text-align: center;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;____________________________________________________________</p><p style="text-align: center;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><br></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Today I propose a “silver bullet” solution</strong> to the imbalances and distortions fostered by China’s non-market practices.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The United States</strong> should reduce its “Phase Two” demands on China to one: allow the free movement of capital.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Restricting the ability</strong> of the Chinese citizenry to “vote with its wallet” is the cornerstone market distortion that enables all others.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The “forced savings”</strong> which has financed all manner of Chinese subsidy and market-distorting practice becomes impossible to marshal in the existence of a liberalized capital account.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘That this immediately strikes</strong> one as entailing a near-impossible-to-endure level of global financial instability illustrates how badly corrupted the system of global trade and finance has already become as a result of China’s persistent prevention of economic equilibrium via brute force policies unsanctioned by democratic consensus.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘In allowing a large,</strong> centrally-planned Chinese economy to become increasingly integrated into the global system, we resign ourselves to persistent macroeconomic disequilibria, which we seem increasingly tempted to offset with market distortions and central plans of our own.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Removing this linchpin</strong> of Chinese central planning is the key to restoring a market-based system of global trade and finance - one that will tend towards equilibrium as designed, and perhaps save the system from having to defend itself from China by emulating it.’</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;            </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; text-align:left;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:5px; border-left:0px solid #c80000; text-align:center; font-size: 1.375em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;">coronavirus: economic impact</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">CreditSuisse on the Impact of the Coronavirus</span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/5ZaB4C?track_p_id=2xH63lv82_Yv%40CrBESTaR1C" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/_YQ17yeZMB_-brHNHu-CQ0i__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/5ZaB4C?track_p_id=8LTROTBaK63lv82_1NHWZTG" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">'A Sizeable Shock to Global Growth'</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">CreditSuisse</strong></h3><h3 style="text-align: left;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">James Sweeney &amp; Wenzhe Zhao | </strong>CreditSuisse</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘Even in the mildest case, a sizeable shock to global growth that has likely been already delivered.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Fear itself</strong> can shock global growth.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The coronavirus</strong> creates great fear.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Given the lack of relevant precedents,</strong> economic forecasting scenarios have little tangible basis.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But we expect</strong> that the nascent global growth rebound from late last year is already over.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The mildest scenario</strong> for the impact on global growth we can conjure is a temporary shock to Chinese growth; the most severe echoes historical pandemics.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Figure 1 shows</strong> global industrial production (IP) momentum with three scenarios of a China-centric shock to production. (Because the shock is centered in China, these charts use global data including China.)’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The first scenario</strong> shows something like the “mildest” scenario and even it creates a sharp but temporary downturn in global industrial production, after the recent rebound.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘This reduces</strong> global momentum to its lowest level in recent years.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Even in the mildest case,</strong> a sizeable shock to global growth that has likely been already delivered.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The other stylized scenarios</strong> are based on a longer shock that spreads geographically.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">And ‘the longer</strong> that factory activity is limited, the worse the shock will be.'</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">The reasons </strong>for such impact:</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘China represents</strong> about 30% of global value added in goods production.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘China’s economy</strong> will not be functioning normally once the extended New Year’s holiday ends.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Hubei province,</strong> epicenter of the outbreak, represents near 5% of Chinese manufacturing and is a major transport hub.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Supply chain bottlenecks</strong> are probable, short-term inventory and equipment investment and volume imports will likely drop sharply too.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;            </td></tr></tbody></table></div><div><table align="center" border="0" cellpadding="0" cellspacing="0" width="100%"><tbody><tr height="0"><td width="0"></td></tr><tr><td width="0"></td><td align="center"><div style="width:600px;"><img src="https://img.scoop.it/-ptDmSkl6PtnOmtig7rPlzl72eJkfbmt4t8yenImKBXdhNIf0Yl8YfRAVzhohB7e" style="border-style: none;" alt=""></div></td><td width="0"></td></tr><tr height="0"><td width="0"></td></tr></tbody></table></div>

<div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="20" style="height:20px; font-size:0">&nbsp;</td></tr><tr><td style="vertical-align:top"><table cellspacing="0" cellpadding="0" width="100%"><tbody><tr><td style="padding-left:3.5%" a=""><a href="" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank" rel="noopener noreferrer" title="CHINADebate"><img width="100%" src="https://assets.website-files.com/5c864c33af62620dca1373ac/5d86577f82aa6e55afacb4ea_cd%20long-fit.png" alt="CHINADebate" style="width: 110px;"></a></td><td align="right" style="padding-right:3.5%"><a href="" target="_blank" rel="noopener noreferrer" style="color:#001544; font-size:13px; font-family:'gordita', sans-serif; text-decoration:none; border-bottom:none;"></a></td></tr></tbody></table></td></tr><tr><td height="30" style="height:30px; font-size:0">&nbsp;</td></tr><tr><td style="text-align:center; line-height:1"><span style="font-size: 42px; font-family: gorditamedium, sans-serif; color:#0970b3; letter-spacing: -1px; line-height: 1;">China Macro Reporter</span></td></tr><tr><td style="text-align:center; line-height:1.5; padding-bottom:30px; padding-top:10px;color:#001544; font-size:0.8125em; font-family:'gordita', sans-serif; text-decoration:none; border-bottom:none;"><span style="color:#001544; font-size:13px; font-family:'gordita', sans-serif; text-decoration:none; border-bottom:none;">by Malcolm Riddell<span style="margin:0 6px">·</span>Feb 1, 2020</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:20px auto 0 auto; text-align:left;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:5px; border-left:0px solid #c80000; text-align:center; font-size: 1.375em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;">Opening Statement</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/910Apk?track_p_id=cZPcp3PHxrM316QWRQs_1zS" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/A34-JXbCfNBw6jMh3VQmQEi__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/910Apk?track_p_id=9z3Bs36TUZ6QWRQs_TiSLa5" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">'The Mandate of Heaven'</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h1 style="display: inline-block;font-size: 1.35em;margin-top: 0em;margin-bottom: 0em;margin-left: 0;margin-right: 0;line-height: 1.35em;font-weight: normal;font-family: gorditamedium, sans-serif;color: #001544;letter-spacing: -0.1px;"><strong style="font-weight: bold">Greetings</strong>!</h1><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Just as the trade war</strong> took all the analytical oxygen out of the room, now so &nbsp;has the coronavirus.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">Unlike the protracted trade war,</strong> developments and perspectives on the coronavirus are worthy of frequent and careful attention.</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">This issue looks</strong> just at the coronavirus and its impact:</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">Life in China,</strong> impact on the Chinese and global economies, political reactions, and supply chain disruptions - there is a lot here today.</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">BTW, one of the most interesting things</strong> I found was the suggestion that the coronavirus could cause Xi to lose the Mandate of Heaven and, with that power.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">Not remotely likely,</strong> but you have to wonder if that idea goes through the minds of the Chinese people.</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">With luck</strong>, the coronavirus will wind down quickly with the fewest deaths and the least damage to economies.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">But probably not.</strong> So we will likely be revisiting the issue here more often than anyone would ever want.</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">&nbsp;The China Macro Reporter</strong> and I love <span style="color: #d0021b">'Letters to the Editor.'&nbsp;</span></p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">So email me</strong> your thoughts on anything here today or on any China issue you would like to comment on.</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">And be sure to forward</strong> the China Macro Reporter to your friends and colleagues.</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Best,</strong></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Malcolm</strong></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;            </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:7px; border-left:0px solid #c80000; text-align:center; font-size: 1.5em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;">LIFE IN CHINA</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">The Party's Grand Gestures</span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/7yU0NU?track_p_id=04q8yMA_wa1yuhTq1%40rvqGp" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/3QKIJ28TXRxlm_PNLipujEi__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/7yU0NU?track_p_id=buTYcaPUSfQQ4q8yMA_SanF" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">Coronavirus and the Panic Epidemic&nbsp;</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">New York Times</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Ian Johnson</strong></h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">&nbsp;</strong></p><h2 style="display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘Now that it’s being tried, not just in Beijing but also across the country, the effects are kind of thrilling to watch.'</strong></h2><h2 style="display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘Apartment compounds like mine are being fumigated. (With what? Who cares!)’’</strong></h2><h2 style="display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘People are walking around with loudspeakers blaring out warnings against the virus.’</strong></h2><h2 style="display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘Villages are closing their gates as if bandits were on the prowl.’</strong></h2><h2 style="display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘And going to a restaurant or a bar is almost an act of treason or, at best, foolish selfishness.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">Yesterday </strong>when<strong style="font-weight: bold">&nbsp;</strong>I spoke with Piper Tseng, who is in Beijing, she described what the city was like in the efforts to contain the coronavirus.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">She told me</strong> it's just like Ian Johnson's op-ed in The New York Times (including the hassle he describes of getting through the gate to his apartment compound).</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">Here's some excerpts</strong> from the op-ed, but the entire essay is well worth a read.</li></ul><p style="text-align: center;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">_______________________________</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘When faced with a crisis,</strong> the party can’t seem to avoid grand gestures:’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Building hospitals</strong> from scratch in two weeks, locking down tens of millions of people, banning millions more from traveling to big cities and so on.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The German language</strong> has, as usual, a hyper-specific word for this phenomenon: “Aktionismus,” literally Actionism, or action for action’s sake.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘What I was witnessing was Aktionismus</strong> in the face of a problem that required a sensitive response involving public trust.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But since the Chinese government</strong> cannot elicit either of those things, I was seeing the compensatory flailing-around of a state with no other options.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The most interesting question</strong> is why the party feels the need to carry on like this.'</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;">‘I think it knows the people don’t trust it in these cases and assume there has been a cover-up.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Considering the underlying distrust,</strong> it’s hard for the government to say what many epidemiologists are saying: This outbreak is serious but not catastrophic.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Because if the state leveled</strong> with the people, it would also have to admit that there is no need for this degree of social control.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Some 259 people</strong> were reported to have died as of Saturday evening, in a country of nearly 1.4 billion, and there is no indication that we are at the start of a Hollywood disaster-style movie.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The government’s inability</strong> to formulate a measured response will turn this outbreak into a direct successor of the SARS epidemic.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘That hardly was a huge public health disaster</strong> — fewer than 800 deaths — yet it has taken on a legendary reputation as a catastrophe of unimaginable proportions, one that should never be allowed to recur.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Does this mean</strong> that the state will suffer? I don’t think so.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘For despite their mistrust</strong> of the system, people over all are going along with the lockdown.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘In private conversations</strong> and on chat rooms, they say it’s impossible not to take drastic action in a country as big as China.’’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘In this sense,</strong> the population has absorbed the government’s narrative of Chinese exceptionalism:’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Running China requires a strong hand,</strong> and these measures, as absurd as they seem, are proof that the government is doing a good job — and portend that the party will come out of this, as always, triumphant.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;            </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">               Droning On               </span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/8fH2Ei?track_p_id=bmwxztwubkZt5o2Knm_KMBe" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/qjLTSUvCwV0XhOtDnpckV0i__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/8fH2Ei?track_p_id=aXWBZuSLpDa5o2Knm_zItD2" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">Coronavirus: Watch Drones Scold Civilians for Not Wearing Masks in China</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><br></h3><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">New York Magazine</strong></h3><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Shanghaiist</strong></h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><br></p><h2 style="display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">“The gentleman with a pink coat riding a motorbike. "</strong></h2><h2 style="display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">"Yeah, you!"</strong></h2><h2 style="display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">" Please put on your mask.”</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><a href="https://twitter.com/globaltimesnews/status/1223218977570078721" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">Watch</strong></a> the video compilation of drone warnings.</p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><a href="http://nymag.com/intelligencer/2020/01/coronavirus-watch-drones-scold-maskless-civilians-in-china.html" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">New York Magazine.</strong></a><strong style="font-weight: bold"> ‘Some in China</strong> have been using drones to publicly scold people walking around outside without wearing a face mask amid the country’s growing coronavirus outbreak.'</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘On Friday,</strong> the English-language version of the Global Times — a publication controlled by China’s ruling Communist Party —&nbsp;<a href="https://www.globaltimes.cn/content/1178134.shtml" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">passed along&nbsp;</a>some footage of the drone warnings after they were shared on China’s popular Weibo social network.'</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘In the viral video,</strong> residents of a village in Inner Mongolia are startled when they hear a disembodied voice from a hovering drone admonishing them for not wearing face masks outside.'</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“Yes, Auntie,</strong> this is the drone speaking to you — you shouldn’t walk about without wearing a mask,."</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'In another segment,</strong> the drone warns a small boy, “The coronavirus is very serious — Run!” (He then does — away from the drone.)'</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><a href="http://frame.bloglovin.com/?post=7307227297&amp;blog=2500499&amp;frame_type=none" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">Shanghaiist.</strong></a><strong style="font-weight: bold"> ‘Traffic police</strong> in the Jiangsu county of Shuyang have shown off&nbsp;<a href="https://www.weibo.com/3266943013/Is3GFpA6j?refer_flag=1001030103_&amp;type=comment" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">footage</a>&nbsp;of one of their officers talking to unmasked pedestrians via hovering drone at a road crossing.'</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“The gentleman</strong> with a pink coat riding a motorbike. Yeah, you! Please put on your mask.”</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“Hey, guy on the phone!</strong> Where is your mask? Wear your mask!”</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;            </td></tr></tbody></table></div><div><table align="center" border="0" cellpadding="0" cellspacing="0" width="100%"><tbody><tr height="0"><td width="0"></td></tr><tr><td width="0"></td><td align="center"><div style="width:600px;"><img src="https://img.scoop.it/RiaGgABXvAs5rMvAfijkwDl72eJkfbmt4t8yenImKBXdhNIf0Yl8YfRAVzhohB7e" style="border-style: none;" alt=""></div></td><td width="0"></td></tr><tr height="0"><td width="0"></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; text-align:left;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:5px; border-left:0px solid #c80000; text-align:center; font-size: 1.375em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;">The politics of the conronvirus</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">               The Coronavirus &amp; the Mandate of Heaven               </span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/7b469A?track_p_id=dYPAOWzbhkzF648HWvOA_XU" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/_WMiBTDcNqqcPnQt-JHFGUi__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/7b469A?track_p_id=eEGXb4vEqTF4XGh8HWvOA_R" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank"> Xi Jinping wants to be both feared and loved by China’s people </a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">The Economist</strong></h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘But a botched response to the virus would lay bare tensions inherent in the party’s hybrid claims to legitimacy.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Modern-day Chinese</strong> may not believe that a rampaging coronavirus signals divine anger with Mr Xi.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Still, the party chief</strong> has a great deal at stake in this crisis, precisely because large claims are made about his wisdom, which is now taught in schools and studied by party members as Xi Jinping Thought.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The result</strong> is an awkward hybrid.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘On the one hand,</strong> officials make claims about the efficiency of collective party leadership that would be familiar to any Soviet apparatchik.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Yet at the same time,</strong> the party’s propagandists lay claim to a very different form of legitimacy, involving the people’s love for and trust in one man, Mr Xi.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘So sweeping</strong> is their praise of him that it leaves essentially no room for the idea that Mr Xi could make a serious mistake.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘This convoluted claim</strong> to legitimacy can be heard in the context of the current coronavirus outbreak, as leaders insist that their system of government is ideally suited to tackling the disease.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘It is too simplistic</strong> to assume that all bad things that happen in China must harm Mr Xi.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘If the crisis does not end well, </strong>scapegoats will be found, and underlings punished.’                     <ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘In recent days,</strong> Chinese state media have dropped heavy hints that the mayor of Wuhan, the industrial city where the virus was first detected, will lose his job.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘When Li Keqiang,</strong> China’s prime minister, was appointed to oversee virus-control work, cynics suggested that his role was to take the fall should the outbreak spark a pandemic—in effect, to protect President Xi Jinping.’</li></ul></li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘That alone</strong> would not have to shake Mr Xi’s authority, which can always be shored up with repression, still greater ideological discipline and nationalist propaganda.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But a botched response</strong> to the virus would lay bare tensions inherent in the party’s hybrid claims to legitimacy.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Mr Xi’s China</strong> is two things at once.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘It is a secretive,</strong> techno-authoritarian one-party state, ruled by grey men in unaccountable councils and secretive committees.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘It also claims</strong> to be a nation-sized family headed by a patriarch of unique wisdom and virtue, in a secular, 21st-century version of the mandate of Heaven.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘If forced to choose</strong> between those competing models, bet on cold, bureaucratic control to win out.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘For Mr Xi and his team</strong> learned their own lesson from the Soviet Union’s fall, five years after the Chernobyl disaster.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Expressions of public love for Mr Xi,</strong> the “People’s Leader”, are all very well. But keeping power is what counts.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;            </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">               Is China Up to the Task?               </span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/86iN9M?track_p_id=bPYQP5ZLEo5Y6xdeMY_uRc3" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/VcdAHHrWxK2Oai7z2r1MjUi__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/86iN9M?track_p_id=6TUXUJz6xdeMY_uadlz%40ITH" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">The Coronavirus Outbreak &amp; Chinese Politics</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Center for Strategic &amp; International Studies</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Jude Blanchette</strong> | CSIS</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">&nbsp;</strong></p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘Facing a dynamic and volatile crisis, it is unclear if China’s bureaucratic system has the requisite flexibility to manage the situation.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">The Center for Strategic &amp; International Studies </strong>concise yet comprehensive paper on the coronavirus is in the form of questions on a range of issues with answers from top experts.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">We’ve only</strong> included two in today’s issue.</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">Read</strong> the entire report <a href="https://www.csis.org/analysis/novel-coronavirus-outbreak" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">here</a>.</li></ul><p style="text-align: center;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">&nbsp;___________________________________-&nbsp;</strong></p><p style="text-align: center;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><br></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><span style="color: #d0021b"><em style="font-style: italic"><strong style="font-weight: bold">Q3: ‘Is the Chinese political system capable of containing the virus?’</strong></em></span><br><strong style="font-weight: bold">Jude Blanchette:</strong>&nbsp;‘<strong style="font-weight: bold">This past weekend,</strong> there was a meeting of the seven-member Politburo Standing Committee, which is chaired by Xi and which sits at the apex of the CCP.’               </p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘During the meeting,</strong> Xi&nbsp;<a href="http://www.xinhuanet.com/politics/2020-01/25/c_1125501969.htm" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">proclaimed&nbsp;</a>that, “Faced with the serious situation of the rapid spread of [the coronavirus virus], it is necessary to strengthen the centralized and unified leadership of the CCP Central Committee” and “unswervingly implement all decisions and arrangements” that Beijing commands.’</li><li style="text-align: left;margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Xi also announced</strong> the creation of a new policy-coordinating “leading small group” headed by Li Keqiang, the CCP’s number two leader and premier of the State Council.’</li></ul><p style="text-align: left;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘While Li</strong> is an extremely able manager and bureaucrat, he has long been sidelined by Xi and has come to be seen as relatively weak and feckless, leading to speculation that Xi has made Li a possible scapegoat if the virus is not soon contained.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘This is in keeping</strong> with other problematic policy areas, including U.S.-China relations, where Xi has opted to remain somewhat aloof, preferring to place deputies on the front line.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘If a crisis is averted,</strong> Xi can claim ultimate responsibility, but if problems arise, he can point the finger at lower-level officials.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Beijing’s handling</strong> of the coronavirus highlights many of the unique, and problematic, features of the CPP-dominated political system.’&nbsp;</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'Now that Xi</strong> has made the issue a central priority, the CCP’s organizational might will kick into gear, ensuring that vast resources (e.g., media, financial, material) are thrust at the problem.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Resource mobilization</strong> is a key strength of command-and-control systems like China’s, as evidenced by&nbsp;<a href="https://www.reuters.com/article/us-china-health-hospital/chinas-wuhan-to-build-second-designated-hospital-to-treat-coronavirus-patients-state-media-idUSKBN1ZO0C4" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">reports</a>&nbsp;that Wuhan plans to build two medical facilities in less than one week, each capable of admitting more than a thousand coronavirus patients.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Yet in this environment,</strong> where the CCP must be seen to be completely in control and the situation as continually improving, the space for divergent or independent opinions will remain highly constrained.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Rather than focusing</strong> on the already significant challenge of containing a public health emergency, party-state officials are burdened with the extra load of considering the potential political costs of their actions.’&nbsp;</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Finally,</strong> there is also the problem of a bureaucracy that feels disempowered to act until it receives the green light from Xi Jinping, a direct result of his extraordinary campaign to consolidate power and decisionmaking.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Indeed, as the mayor of Wuhan</strong> recently stated in&nbsp;<a href="https://www.thepaper.cn/newsDetail_forward_5651377" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">a rare rebuke&nbsp;</a>to Beijing, “As a local government official, after I get [sensitive information about the spread of the virus] I still have to wait for authorization before I can release it. . . . This is one thing people didn’t understand at the time.”</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Now facing a dynamic and volatile crisis,</strong> it is unclear if China’s bureaucratic system has the requisite flexibility to manage the situation.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;            </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; text-align:left;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:5px; border-left:0px solid #c80000; text-align:center; font-size: 1.375em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;">coronavirus &amp; china's economy</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">               Conclusion: Substantial Impact               </span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/5SrQJc?track_p_id=1U80MC1G_NevrEPCIRAGIrZ" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/VcdAHHrWxK2Oai7z2r1MjUi__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/5SrQJc?track_p_id=dWQBVKISXwWLbS80MC1G_5E" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">Coronavirus: Impact on China's Economy</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Center for Strategic &amp; International Studies</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Scott Kennedy </strong>| CSIS</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">&nbsp;</strong></p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘The most likely scenario is a substantially slower than expected first half of 2020 followed by a juiced-up economy in the second half of the year.’<br></strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">The Center for Strategic &amp; International Studies </strong>concise yet comprehensive paper on the coronavirus is in the form of questions on a range of issues with answers from top experts.</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">We’ve only</strong> included two in today’s issue.</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">Read</strong> the entire report <a href="https://www.csis.org/analysis/novel-coronavirus-outbreak" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">here</a>.</li></ul><p style="text-align: center;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">&nbsp;_____________________________________-</strong></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><span style="color: #d0021b"><em style="font-style: italic"><strong style="font-weight: bold">Q4: ‘What effect is the virus and the policy response likely to have on China’s economy?’&nbsp;</strong></em></span><br><strong style="font-weight: bold">Scott Kennedy:&nbsp;‘Much depends</strong> on whether the virus is contained or if it turns into a full-blown pandemic, but at a minimum, there will be a substantial hit to China’s 2020 growth prospects.’<br></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘According to&nbsp;</strong><a href="https://fingfx.thomsonreuters.com/gfx/editorcharts/GLOBAL-MARKETS-VIRUS/0H001QXXPBJW/eikon.png" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">Reuters</strong></a><strong style="font-weight: bold">,</strong> the 2002-2003 SARS epidemic shaved off a little more than one percent of China’s gross domestic product.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Fewer people</strong> have contracted or died from 2019-nCoV thus far, and Hubei province accounts for only three percent of China’s total economy.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But we should expect</strong> the cost to outstrip SARS and have implications beyond the direct effect on Hubei.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The government’s response</strong> is meant to stop a pandemic, but its drastic measures translates into less economic activity.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘China’s economy</strong> is over 7 times larger in nominal terms and 3.7 times larger in real terms than it was in 2003.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘If half a month of economic activity</strong> drops by two-thirds, that would mean a 2.7 percent reduction in total GDP (or $380 billion of $14.1 trillion).’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘This would mean a drop</strong> from 6.0 percent annual growth, the recent estimate made by the IMF, to something closer to 5.8 percent.’&nbsp;</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘At the micro level,</strong> the outbreak and response will, at a minimum, slow activity up and down the supply chain will have financial repercussions, putting stress on banks’ balance sheets and securities markets.’<br><strong style="font-weight: bold">‘Given the likely negative effect</strong> on the economy, there will be substantial pressure on the Chinese government to adopt a variety of stimulus measures.’               </p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘We should look</strong> for looser monetary policy, a lowering of banks’ reserve requirements, tax cuts, subsidies (perhaps re-raising them for vehicles), and expanded government procurement.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘If the slowdown is severe,</strong> we may even see a weakening of the Renminbi, which currently is at 6.94 to the U.S. dollar, to support exports.’&nbsp;</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;            </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">               Conclusion: Moderate Impact               </span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/5Dl6mm?track_p_id=edEMPCyzADYAA438IAWQo_3" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/ePQqSM4lVhVp54K8OEgutUi__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/5Dl6mm?track_p_id=8UeSEfuYd8IAWQo_zZxx45W" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">Will the Coronavirus Cause a Major Growth Slowdown in China? by Shang-Jin Wei</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Project Syndicate</strong></h3><h3 style="display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Shang-Jin Wei | </strong>Columbia Business School</h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘Remember that Chinese policymakers still have room for both monetary and fiscal expansion: the banking-sector reserve ratio is relatively high, and the share of public-sector debt to GDP is still manageable.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Some fear that the epidemic’s timing</strong> – at the start of the week-long Chinese New Year celebration, and in the middle of traditional school-break travels – will exacerbate the economic fallout by keeping many people away from shops, restaurants, and travel hubs.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But three important factors</strong> may limit the virus’s impact.’’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘First, in contrast to the SARS outbreak,</strong> China is now in the Internet commerce age, with consumers increasingly doing their shopping online.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Much of the reduction in offline sales</strong> owing to the virus will likely be offset by an increase in online purchases.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Many factories</strong> have scheduled production stoppages during the Chinese New Year holidays anyway, so the timing of the epidemic may minimize the need for further shutdowns.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The government</strong> has just announced an extension of the holiday period, but many companies will find ways to make up the lost time later in the year.'</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The short-term negative impact</strong> is thus likely to be concentrated among restaurants, hotels, and airlines.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Second, all reports indicate</strong> that the Wuhan coronavirus is less deadly than SARS (although it may have a faster rate of transmission initially).’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Equally important,</strong> the Chinese authorities have been much swifter than they were during the SARS episode in moving from controlling information to controlling the spread of the virus.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘By implementing aggressive measures</strong> to isolate actual and potential patients from the rest of the population, the authorities have improved their chances of containing the epidemic much sooner.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘That, in turn,</strong> increases the likelihood that the lost economic output this quarter will be offset by increased activity in the remainder of the year.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Third, whether or not</strong> China’s trade negotiators realized the severity of the Wuhan virus when they signed the “phase one” trade deal with the United States on January 15, the timing of the agreement has turned out to be fortunate.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘By greatly increasing its imports</strong> of facemasks and medical supplies from the US (and elsewhere), China can simultaneously tackle the health crisis and fulfill its promise under the deal to import more goods.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The virus’s impact</strong> on other economies will be even more limited.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘As a rule of thumb,</strong> the negative impact of a decrease in China’s GDP growth on the US and European economies is about one-fifth as large in percentage terms.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘For example,</strong> if the current coronavirus epidemic lowers China’s growth rate by 0.1 percentage point, then growth in the US and Europe is likely to slow by about 0.02 percentage point.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The impact on Australia’s economy</strong> may be twice as large, given its stronger commodity-trade and tourism links with China, but a 0.04-percentage-point reduction in growth is still small.'</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">'Of course,</strong> the impact on China and other economies could be more severe if the coronavirus crisis were to last much longer than this baseline scenario assumes.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘In that case,</strong> it is important to remember that Chinese policymakers still have room for both monetary and fiscal expansion: the banking-sector reserve ratio is relatively high, and the share of public-sector debt to GDP is still manageable compared to China’s international peers.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘By using this policy space</strong> when necessary, China’s authorities could limit the ultimate impact of the current health crisis.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;            </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; text-align:left;"><tbody><tr><td style="max-width:600px;"><span style="display:block; background-color:#c80000; font-family:'gordita', sans-serif; padding:5px; border-left:0px solid #c80000; text-align:center; font-size: 1.375em; font-weight:900; color: #ffffff; line-height:1.5em; letter-spacing:-0.1px; text-align:center; font-style:none; text-transform:uppercase;"> supply china disruptions</span></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">               Impact on Global Manufacturing               </span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/7Tlkh6?track_p_id=eE5jrkZWHu2AiaO79yvTK_T" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/K9fKxwrt-0GqvuYSovNp30i__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/7Tlkh6?track_p_id=4wn1a79yvTK_TUYfrBX3Zt3" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">Coronavirus Quarantine Will Ripple Through Global Manufacturing</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Wall Street Journal</strong></h3><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘Many international economists have tried to establish how much a dip in China’s economy would reduce global output.&nbsp;But such analyses largely focus on the demand impact, not supply chain disruptions.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘As&nbsp;</strong><a href="https://www.wsj.com/articles/what-we-know-about-the-wuhan-virus-11579716128?mod=article_inline" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">the spread of the new coronavirus</strong></a>&nbsp;in China causes&nbsp;<a href="https://www.wsj.com/articles/businesses-suspend-chinese-operations-amid-coronavirus-fears-11580338133?mod=article_inline" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">more factory shutdowns</a>, the effect on global industrial supply chains could linger for years.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘China now makes up</strong> more than twice the share of global merchandise exports it did in 2003, when the SARS virus hit.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Guangdong province</strong> alone exported more in 2018 than China did as a whole 17 years ago.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘It is not just</strong> China’s size that makes it important.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Global supply chains</strong> are considerably more complex than they were in 2003, shortly after China’s accession to the World Trade Organization.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Even manufactured items</strong> with a very marginal quantity of Chinese content will be affected as production is halted, and the increasing complexity of products means replacing specialized manufacturers is difficult.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Evidence from</strong> previous unexpected supply shocks is discouraging.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">'</strong><a href="https://quotes.wsj.com/GM" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;"><strong style="font-weight: bold">General Motors</strong></a><strong style="font-weight: bold"></strong>shuttered it U.S. and European plants after&nbsp;<a href="https://www.wsj.com/articles/SB10001424052748704050204576218710838251784?mod=article_inline" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">earthquakes in Japan in 2011</a>and&nbsp;<a href="https://www.wsj.com/articles/gm-to-shut-four-plants-temporarily-after-japan-quakes-1461342005?mod=article_inline" rel="nofollow" style="color: #001544;text-decoration: none;border-bottom: 1px solid #008dc8;">again in 2016</a> because vital parts that couldn't be easily found outside Japan suddenly became unavailable.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Research published</strong> in 2015 suggests that as much as 60% of the total economic impact of Japan’s 2011 earthquake in terms of value added was borne by other countries, with 25% carried by the U.S.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The International Monetary Fund</strong> has drawn attention to the particularly steep impact of so-called risky imports: items such as complex machine and vehicle parts, hard drives and certain electrical items that are particularly vulnerable to supply shocks. ‘</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘For every 1% increase</strong> in such risky imports from a country which suffers a natural disaster, there is a 0.7% fall in the importer’s exports during the same year.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Many international economists</strong> have tried to establish how much a dip in China’s economy would reduce global output.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘But such analyses</strong> largely focus on the demand impact, not supply chain disruptions.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;            </td></tr></tbody></table></div><div><table align="center" border="0" cellpadding="0" cellspacing="0" width="100%"><tbody><tr height="0"><td width="0"></td></tr><tr><td width="0"></td><td align="center"><div style="width:600px;"><img src="https://img.scoop.it/rtFEgnGsF-7xdoDeIa14vjl72eJkfbmt4t8yenImKBXdhNIf0Yl8YfRAVzhohB7e" style="border-style: none;" alt=""></div></td><td width="0"></td></tr><tr height="0"><td width="0"></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width: 600px; width: 100%; height: 30px; margin: 0 auto; padding: 0px; background-color: #001544; text-align: center;"><tbody><tr><td width="40" height="auto" style="border-bottom: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td><td rowspan="2" height="40px"><span style="font-family: Georgia, serif; padding: 8px 40px 8px 0px; font-size: 1.2em; font-weight: 900; color: #ffffff; line-height: 1.25em; letter-spacing: -0.1px; font-style: italic; text-transform: none;">               Impact on Tech               </span></td></tr><tr><td width="40" height="auto" style="border-top: 7px solid #c80000;"><p style="font-size: 0px;display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;">&nbsp;</p></td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; text-align:left; background:#fff"><tbody><tr><td height="12" style="height:12px; font-size:0; border-top:1px solid #ddd;"></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:0 auto; border-bottom: 0px solid #ddd; text-align:left; background:#fff;"><tbody><tr><td width="45px" style="display:block; overflow:hidden; margin-left: 20px; margin-top:2px; border: 1px solid #ddd; border-radius:10%; box-shadow: 0 4px 8px 0 rgba(0, 0, 0, 0.2), 0 2px 6px 0 rgba(0, 0, 0, 0.19);"><a href="http://sco.lt/9C8vgm?track_p_id=bE3wgZagSzh39FQ0mk_uZNz" style="border-bottom: none;color: #001544;text-decoration: none;" target="_blank"><img height="45px" width="auto" src="https://img.scoop.it/K9fKxwrt-0GqvuYSovNp30i__cjguAuwrRM5-qsdIhQ=" style="display:block; border:none; width:auto;"></a></td><td width="100%" style="padding-left:5%; padding-right:3.5%; line-height:1.425"><a href="http://sco.lt/9C8vgm?track_p_id=1W9FQ0mk_qnRJlMuyHrtEob" style="text-decoration: none; color: #001544; font-weight: bold; font-size: 1.35em; font-family: Georgia, serif; letter-spacing: -0.1px; line-height: 1.35; border-bottom:none;" target="_blank">Tech Sector Fears Supply Delays as Effects of Virus Ripple Through China</a></td></tr></tbody></table></td></tr><tr><td><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; margin:10px auto 0 auto; border-top: 0px solid #ddd;"><tbody></tbody></table></td></tr><tr><td style="padding:0 3.5%; margin: 0 auto; font-size: 1em; font-family: gorditamedium, sans-serif; color: #001544; line-height: 1.5em; letter-spacing:-0.1px;"><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p><h3 style="text-align: right;display: block;font-size: 0.85em;margin-top: 0em;margin-bottom: 0.1em;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #5d5d5d;letter-spacing: -0.1px;line-height: 1.35em;"><strong style="font-weight: bold">Wall Street Journal</strong></h3><h2 style="text-align: center;display: block;font-size: 1.25em;margin-top: 0;margin-bottom: 0;margin-left: 0;margin-right: 0;font-weight: normal;font-family: Georgia, serif;color: #c80000;border-top: 0px solid #ddd;padding: 0.5em 3.5% 0.5em 3.0%;letter-spacing: -0.1px;line-height: 1.35em;background-color: #f6f6f6;"><strong style="font-weight: bold">‘The world’s biggest tech companies are facing disruptions to their supply chains from prolonged factory closures and labor shortages in China, as the deadly coronavirus outbreak threatens the nation’s vast manufacturing network.’</strong></h2><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">&nbsp;</strong></p><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘The world’s biggest tech companies</strong> are facing disruptions to their supply chains from prolonged factory closures and labor shortages in China, as the deadly coronavirus outbreak threatens the nation’s vast manufacturing network.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Electronics, telecom and semiconductor companies</strong> all rely on factories in China, honed to efficiency by years of servicing Western tech giants.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Wuhan, the epicenter of the outbreak</strong> that is under lockdown by Chinese authorities, is home to numerous high-tech component suppliers and is a key transportation hub.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Suppliers to Apple</strong> with major manufacturing footprints in mainland China are gathering information and grappling with uncertainties over workers and production.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘Apple is slated to launch a new iPhone</strong> in March; Chief Executive Tim Cook told investors this week it’s working on backup plans to make up for any lost production.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Foxconn,</strong> the world’s largest contract manufacturer, said it has “measures in place to ensure that we can continue to meet all global manufacturing obligations.”</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘It said facilities</strong> in China remain on a holiday schedule.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘At telecom giant Huawei Technologies Co.,</strong> “some materials are in short supply” amid supplier disruptions in Hubei province.’</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">“Huawei is taking</strong> backup or ‘pull-up’ measures to minimize the impact of work stoppage on supply in epidemic-free areas,” a spokesman said.’</li><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The company canceled</strong> a developers conference in Shenzhen that was set for Feb. 10-11, he said.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"><strong style="font-weight: bold">‘Wuhan is home</strong> to many manufacturers of optical components, crucial to telecommunication networks; the area where many of these companies are based is known as “Optics Valley.”</p><ul style="margin-top: 0px;margin-bottom: 0.5;"><li style="margin-top: 0.5em;margin-bottom: 0em;"><strong style="font-weight: bold">‘The components</strong> are so critical that supply disruptions could lead to delays in the rollout of China’s forthcoming 5G telecommunication networks.’</li></ul><p style="display: block;margin-top: 0.5em;margin-bottom: 0.5em;margin-left: 0;margin-right: 0;font-size: 1em;font-weight: normal;letter-spacing: -0.1px;line-height: 1.5em;color: #001544;font-family: gorditamedium, sans-serif;"></p></td></tr><tr><td height="0" style="height:0px; font-size:0; border-bottom:0px solid #fff">&nbsp;            </td></tr></tbody></table></div><div><table cellspacing="0" cellpadding="0" style="max-width:600px; width:100%; background-color:#fff; padding-bottom:10px; margin:0 auto 10px auto; border-bottom:1px solid #ddd;"><tbody><tr><td style="max-width:600px;"><img src=""></td></tr></tbody></table></div>

‘Wall Street will be the next US-China battleground’
August 1, 2019
1. TRADE TALKS
2. BEYOND THE TRADE WAR
3. HONG KONG
4. GEO-POLITICS
5. ECONOMY
6. ONLINE BANKING
7. MANUFACTURING LEAVING CHINA
8. CHINESE INVESTMENT IN THE U.S.
‘China’s continuing drag on the global economy’
June 27, 2019
1. ‘The Value of Global China’: McKinsey
2. China's Maritime Militias in the ‘Gray Zone’
3. ‘The Failures of the “Failure of Engagement” with China’
4. Hardline trade minister joins China’s negotiating team
5. ‘The Continuing Chinese Drag on the Global Economy’
‘Does China rule the Fortune 500?’
July 24, 2019
1. ‘Who Likes Facebook's Libra Currency? Not the Chinese.’
2. ‘Does China rule the Fortune 500?’ Pro & Con
3. ‘China's Private Firms Continue to Struggle’: Nick Lardy
4. ‘Does China’s “Invisible Hand” Steer Funds to State-Owned Firms?’
5. ‘Party Loyalty in China Helps Private Companies Get Cheaper Loans’
6. 'Why the United States doesn’t need to return to a gentler China policy'
'China’s State-Driven Growth Model Is Running Out of Gas'
July 20, 2019
1. Trade war fallout not crushing China’s economy: Stephen Roach
2. ‘Trump tries to woo Federal Reserve in China trade fight’
3. ‘China’s State-Driven Growth Model Is Running Out of Gas’
4. ‘U.S.-China Trade: If We Get to Yes, Will It Make Any Difference?’
5. ‘Who Actually Pays Tariffs?’
6. ‘Is China Weakening the Yuan to Fight U.S. Tariffs?’
7. ‘China’s Exchange Rate Policy Woes’
China’s slowing economy not caused by trade war
July 17, 2019
1. China’s slowing economy not caused by trade war
2. China’s economy doing better than latest numbers
3. ‘China’s global business footprint shrinks’: China Global Investment Tracker (CGIT)
4. China: ‘The Art of Wait and See’
5. Why China Still Needs Hong Kong
‘U.S.-China Positions Have Hardened’
July 13, 2019
1. ‘U.S.-China Positions Have Hardened’
2. Impact of tariffs on business decisions: Richmond Fed President
3. ‘China tariffs: We can do better’
4. “Who Knew Trump Would Offer A Truce With Xi?”: The Mystery Of The Wall Street Trump Trades
5. ‘Trump’s tariff claims are demonstrably false. Here’s why.’
6. 'Is the China model a threat?'
‘How China Failed to Fail’
July 10, 2019
1. ‘Graphic Truth: China Since Tiananmen’
2. Secretary Pompeo’s two-prong China strategy
3. ‘The Fed Is Trump’s Secret Ally in the Trade War’
4. ‘Should China help secure the Strait of Hormuz?’
5. ‘Why I’ve Lost Faith in China’s Private Sector’: Shuli Ren, Bloomberg
6. ‘How China Failed to Fail: Can China’s Glass Remain Both Half Full and Half Empty?’
'China Is Not An Enemy'
July 6, 2019
1. ‘China is not an enemy’
2. Alipay & WeChat: China’s retail payment revolution
3. Can Facebook’s Libra replicate WeChat Pay’s digital payment dominance?
4. 'Hong Kong Has Nothing Left to Lose'
Trade war: 'Wet US-China firecracker at G20’
July 3, 2019
1. ‘What the US and China each got out of the Trump-Xi meeting in Japan.’
2. ‘Wet US-China firecracker at G20’: Derek Scissors
3. ‘Trump's “brilliant stroke” with China's Xi a win for US’: Michael Pillsbury
4. ‘The Chinese move only to the extent that it suits their domestic economic agenda.’: Kevin Rudd
5. Peter Navarro on the trade war cease fire and Huawei
6. ‘The big takeaway from this meeting is that you have a ceasefire.’: Michael Hirson, Eurasia Group
7. ‘Trump hasn’t reversed his position on Huawei’: Michael Pillsbury
8. From the World Economic Forum in Dalian China
At the G20, 'Xi still believes he has the upper hand'
June 29, 2019
1. G-20 leaders face a toxic trifecta of political instability, trade tensions and slowing global growth
2. Trump & Xi at the G20: the context
3. Trade War: Xi Still Believes He Has the Upper Hand
Xi's 'Self-reliance' - Why Blacklisting Huawei Could Backfire
June 26, 2019
1. Xi Jinping’s Trade Conundrum: Why the Chinese Leader Isn’t About to Back Down
2. Why Blacklisting Huawei Could Backfire
3. BACKGROUNDER | Huawei: China’s Controversial Tech Giant
4. Mao Redux: The Enduring Relevance of Self-reliance in China
Roubini on the U.S.-China trade war, the impact on the global economy, and the stakes at the coming G20
June 22, 2019
1. Roubini – ‘Dr. Doom’ - on the U.S.-China trade war
2. ‘The Global Consequences of a Sino-American Cold War’
3. The Coming Sino-American Bust-Up
4. The Growing Risk of a 2020 Recession and Crisis
'Trump Has Gotten China to Lower Its Tariffs. Just Toward Everyone Else.'
June 19, 2019
1. ‘America Must Prepare for the Coming Chinese Empire’: Robert Kaplan, Eurasia Group
2. 'Trump Has Gotten China to Lower Its Tariffs. Just Toward Everyone Else.'
3. ‘Services are ½ of the value-added in global trade- we just don’t see them or count them.’: David Dollar, Brookings
4. HK Protests: ‘An analysis of events’ by Nuri Vattachi + a response from a noted Greater China expert
Hong Kong Protests: 'If China doesn't back down, the U.S. will make it pay dearly.'
June 15, 2019
1. ‘People v power: The rule of law in Hong Kong’: The Economist
2. What is the proposed law that the protesters oppose?
3. ‘Plugging a loophole?’
4. ‘Hong Kong’s proposed extradition law puts ties with America at risk’: The Economist
5. ‘China Is Courting Disaster in Hong Kong’: Minxin Pei
6. CONGRESS | ‘The reaction that really matters is in Washington, D.C.’: The Economist
7. CONGRESS | Actions by the Congressional-Executive Commission on China (CECC)
8. PRESIDENT TRUMP | ‘So I hope it all works out for China and for Hong Kong.’
9. PRO | ‘There Are Huge Misconceptions About Extradition Bill.’: Ronnie Tong
10. CON | ‘My take on Hong Kong's extradition bill’: Jerry Cohen
11. CON | ‘A convenient legal tool to grab individuals deemed to be “enemies” of the Chinese state’: Minxin Pei
12. CON | President Xi Needs to tell Carrie Lam ‘no amendment now’ : Michael Pillsbury
'Not another downturn in U.S.-China relations: a paradigm shift'
June 12, 2019
1. ‘China’s rise would have eroded any hegemon’s unrivaled power, no matter how skillful its diplomacy’: Fareed Zakaria
2. ‘Not another downturn in U.S.-China relations: a paradigm shift’: Jim McGregor
3. ‘China had America right where it wanted it - and they overreached’: Jim McGregor
4. ‘China's Private Firms Continue to Struggle’: Nick Lardy
5. ‘Why is China so interested in building and buying ports?’: Deborah Bräutigam
'The Middle East has its oil, China has rare earths.’ Deng Xiaoping
June 7, 2019
1. The trade war is paralyzing business decision making.
2. Impact of tariffs on U.S. businesses in China: AmCham China chairman
3. ‘The Middle East has its oil, China has rare earths.’ Deng Xiaoping
4. Trade war: How lawyers vs economists as negotiators lead to the breakdown in talks
5. A primer on how Chinese law might enforce a US-China trade deal
6. Impact of tariffs on U.S. businesses in China: AmCham survey
The 30-year detour: The path from Tiananmen to Xi Jinping
June 4, 2019
1. ‘Tiananmen divides PRC history into before and after’
2. The 30-year detour: The path from Tiananmen to Xi Jinping
3. ‘The Party has relied on brute force since its inception’
4. Tiananmen: Reporting from ABC World News Tonight 1989
5. ‘Assignment: China - Tiananmen Square’
6. The story behind the ‘Tank Man’ photo
Peter Navarro talks tariffs on CNBC
June 1, 2019
1. Peter Navarro talks tariffs on CNBC 💣
2. Navarro : ‘The producers in Mexico and China pay for this. Here's how it works. A tariff goes on that puts pressure on the Chinese or the Mexican producers to lower their prices – otherwise they can't sell.’
3. Navarro : ‘Corporate executives are recognizing that the supply chain is better off in other places in the globe or better yet bring that here.’
4. Navarro : ‘So these people who say that somehow American consumer is going to pay for this - that's simply not true.’
5. Navarro : ‘We’ve had tariffs on dishwashers and solar panels - half of Chinese exports to this country - steel and aluminum and we see virtually no inflation.' — DISHWASHERS & SOLAR PANELS
6. Navarro : ‘We’ve had tariffs on dishwashers and solar panels - half of Chinese exports to this country - steel and aluminum. And we see virtually no inflation.’ — STEEL
‘How China Sees Trump’s Trade War’
May 29, 2019
1 ‘How China Sees Trump’s Trade War’: Victor Shih
2. Nick Lardy on the trade war, fixing capital allocations, & why China’s GDP numbers are right
3. ‘Death by China’ & Peter Navarro
Why the West is getting Xi wrong
May 22, 2019
1. How the West is getting China wrong
2. Now China's Got Its Own Anti-U.S. Trade War Song
3. ‘Trade tensions will persist until global financial imbalances are addressed’
4. ‘Five Big Myths of China's Belt and Road Initiative.’
5. Trump's 2019 Protection Could Push China Back to Smoot-Hawley Tariff Levels
6. More from Bill Overholt
Trade talks breakdown: How the U.S. misunderstands Chinese negotiating style
May 18, 2019
1. Tracing Trump's Aggressive Tariff Strategy Back to the 1980s
2. Tom Friedman explains why he agrees with Trump's China aims but not his means
3. Trade talks breakdown: How the U.S. misunderstands Chinese negotiating style
4. Trade War Won’t Dent China’s GDP
5. Comments on the U.S.-China trade war from PIIE president Adam Posen
6. China’s response: a stable or a weakened Yuan?
Sharpening the US-China trade debate
May 15, 2019
1. It's Trump vs. Xi in the China trade war — and it's personal
2. 'Reaching an agreement can only be done at the top.’
3. Sharpening the US-China trade debate
4. FACE OFF: Brookings vs. American Enterprise Institute
5. Trade war: Is the U.S. panicking due to China’s big hedge?
6. ‘The Chinese don't get this concept “earn” their way out of punitive tariffs’: Michael Pillsbury
'Trump was right to call China's bluff in the trade talks'
May 10, 2019
1. As China Trade Talks Stall, Xi Faces a Dilemma: Fold? Or Double Down?
2. 'Trump was right to call China's bluff in the trade talks': Bill Bishop
3. The US-China trade war is poised to enter the next phase
4. Tariffs on China are no substitute for a trade deal
5. China can earn its way out of Trump’s tariffs
6. Xi Jinping Wanted Global Dominance. He Overshot
7. Trade War Results in Substantial Losses for U.S.
8. Trump Could Raise Tariffs on China. Here’s How China Could Respond.
9. A year of trade losses in the U.S.-China tariff war.....—AEI