2022 letter on life in China
China is in a state of terminal decline and closing off to the world, barring any huge macro trend reversal (CCP loses power)<p>- Factories are quickly moving out of China.  Judging by the recent -40% export collapse from Hong Kong <a href="https:&#x2F;&#x2F;asia.nikkei.com&#x2F;Economy&#x2F;Trade&#x2F;Hong-Kong-exports-post-biggest-plunge-in-70-years" rel="nofollow">https:&#x2F;&#x2F;asia.nikkei.com&#x2F;Economy&#x2F;Trade&#x2F;Hong-Kong-exports-post...</a>, where Hong Kong serves as the main hub to transport stuff out of China, at least 40% of factory outputs have moved out of China.  A few apple suppliers have confirmed the fact <a href="https:&#x2F;&#x2F;fortune.com&#x2F;2023&#x2F;02&#x2F;28&#x2F;airpods-maker-goertek-apple-suppliers-rushing-out-china&#x2F;" rel="nofollow">https:&#x2F;&#x2F;fortune.com&#x2F;2023&#x2F;02&#x2F;28&#x2F;airpods-maker-goertek-apple-s...</a>.  Unlike the majority consensus on hacker news that &quot;it&#x27;s too hard to move out of China&quot;, almost half the factories that were in China in 2022 had already left.  The factories that left and went to Southeast Asia are mainly from the Guangdong and Shenzhen regions.<p>- Apple, a China laggard, has finally decided to pull the string and move itself and all its related supply chain out of China.  Tesla is building its next big factory in Mexico.  Samsung has completely left China.  Dell is asking all of its suppliers to move out of China.  The list of technology multinationals leaving is increasing day by day.  The age of China&#x27;s hold on technological supply chain is over.<p>- There&#x27;s about 80% reduction in retail activities in China, 50% reduction in home prices, and 80% reduction in labor demands.  Judging from on the ground testimonials from social media in China, such as <a href="https:&#x2F;&#x2F;www.youtube.com&#x2F;@realchina">https:&#x2F;&#x2F;www.youtube.com&#x2F;@realchina</a>, <a href="https:&#x2F;&#x2F;www.youtube.com&#x2F;@baixingzhengxiang">https:&#x2F;&#x2F;www.youtube.com&#x2F;@baixingzhengxiang</a>, <a href="https:&#x2F;&#x2F;www.youtube.com&#x2F;@XMKZG666">https:&#x2F;&#x2F;www.youtube.com&#x2F;@XMKZG666</a>, <a href="https:&#x2F;&#x2F;www.youtube.com&#x2F;@ZGQSL">https:&#x2F;&#x2F;www.youtube.com&#x2F;@ZGQSL</a> (need to understand mandarin to view).  There are millions of unemployed young men walking the city streets, and millions that have gave up and returned to the country side to farm.  There are people with entire savings lost in real estate and small business.  It&#x27;s a very volatile situation.<p>- China&#x27;s unwavering decision to be friends with Russia with &quot;no limit&quot; is slow changing into &quot;directly giving military aids&quot;.  US and EU is threatening sanctions on China for this, something that most on this board would consider impossible a year ago.