Hello, everyone. We have a nice crowd. Thank you so much on this gorgeous fall day. I know yesterday a bunch of people walked at Meach Cove on another beautiful day, and thank you so much to those of you who did. I do want to remind you to please turn off your cell phones if you haven't done that. I don't think Eric would appreciate that. So we're very pleased today. This topic is timely. We plan these speeches months in advance, and then you don't know if what you pick is going to be timely at the time, and so far, doing okay. So the title is China and America, Economically and Politically in the Crosshairs. Now Eric Hansen is our speaker. He's the founding partner of the investment firm Hansen and Doremus, which I'm sure a lot of you heard of, established in 1995. He's managed money in Burlington since 1971. A graduate of St. Lawrence University, Eric is both a chartered financial analyst and a certified financial planner. He's been a frequent adjunct in the Grossman School of Business at UVM since the 1980s, teaching courses including money and banking, emerging market investment and personal finance and investments. He served on numerous boards of directors including Chair of the Vermont Symphony, the Vermont Nature Conservancy, and the Wake Robin, Wake Robin Continuing Care Retirement Community. He served on the Board of Trustees at St. Lawrence University, where he's now an emeritus trustee. Presently on the boards of VT Digger and Vermont Chinese School, he and his wife who's pronounced Yang Shun. Is that right? They live in Greensboro, Vermont. Please welcome Eric Hansen. Thank you Carol. And thank you for EE for having me. I've always said that when people teach a course, they learn twice as much as the students. We have to prepare and I've enjoyed doing this. My connection to China, since a lot of the introduction was about Vermont, is that both my parents worked in China in the 1930s. My father is a newspaper reporter for five years. And then we lived in developing countries for another 30 to 40 years. And I have had a, through my parents, had a great interest in China and have visited many times since 1982, I think it is, both for tourism. And once the Chinese stock market picked opened up, you could do research trips to China interviewing companies. I've studied Chinese for 30 years and I'll never be fluent, but it's my defense against Alzheimer's, as I say. It keeps your mind well jumbled. And as Carol mentioned, my wife has a business she manages from Greensboro in China. So I'm here to talk about China. I'll try to make it short and sweet because I'm sure a lot of you have opinions or questions or contradictions of what I said. And I will cut to the chase quickly here. Thucydides was a sixth century historian and general who documented the rise of Athens against the big power Sparta and concluded that the war was primarily due to Sparta's being afraid of the Athenian power and rise. Well, back in 2016, a person at Harvard, George Allison published a book called Destined for War that he coined the term Thucydides trap. And by that, he meant that go back here to read it that the tendency towards war when a rising power threatens to displace an existing one. He looked at 16 cases and I won't bore you with the minutiae here going back to the 15th century and said what happens when a rising power faces off against an existing power. And his conclusion was that in 12 cases, it led to war. In only four cases, it did not lead to war. Now, this is quite controversial. Many, many academic historians question this, either question the 16 examples or question the whole concept. But the point is important. China is rising and the US is more fearful. And a problem with that is that the two largest military budgets, hold on, go back, go back. This will be recorded by Travis for CCTV and will be on at some point in the future. The problem with the situation today is the US and China have the two largest military budgets in the world, the US dwarfs China. But notice how China dwarfs the Soviet Union or Russia up in the top there by multiple amounts. So even though Russia is considered a major power militarily and with nuclear weapons, China certainly dwarfs it. So we have the two powers coming up with big military budgets. Now, this is the problem and some of you will have better examples of this than I do. But from the Chinese perspective, they say they're equal now. Look, we've put in our time, we've grown economically, politically, we're equal to you and we want to be considered that. We remember the century of humiliation during the 1800s and the decline of the Qing Dynasty when they have to time after time after time had to sign very punitive treaties with England, other European powers and Japan. And they said this will never happen again. You can go to China and it's amazing how people you'll meet who you are not historians will remind you of the humiliating treaties even today.  What happened 1800s? They remember today. There is rising nationalism patriotism in China. There's no doubt about that. There is universal opposition to Taiwan independence that there is no question that 90% or more of Chinese think that Taiwan is part of China. And it is not correct that either they sit there quasi independently or that the West supports them. There's no question about that in China. The Chinese we shouldn't expect that the Chinese public will side with any move towards independence. And finally, many Chinese students and academics are now going back to China. Many students have come here and more recently have said, look, we've seen the West and your society with its crime, with its poverty, with its people yelling and screaming in Congress and state houses, etc. And China has more opportunity for us. And with the US government somewhat hassling Chinese academics, a number of them have returned home. Now I'm painting a bad picture of the US, but I'm trying to paint it from the Chinese side. Now from the US side, we view China negatively because if the public opinion polls have showed that the majority of Americans now feel that China is a threat and a danger. And our government policy has been a kind of paranoid containment. We fear Chinese economy and the military, and we do what we have to to try to thwart that. We feel that China steals our ideas to dominate the future. And we allow China and Chinese investments and Chinese students and academics in, they don't allow us into their country. And we feel it's a one sided problem. Plus, you have the long term problem here in the US of us complaining about human rights, be it Tibet going back to the 50s, be it Xinjiang with the Uyghurs, be it Hong Kong. So you have a lot of friction points. So I just say I'm not saying here today there's going to be war, but there are a lot of dangerous signals out there that China and the US are headed in the wrong direction. Now just to back up, give you a few minute history of this. Mao Zedong died in 1976. Deng Xiaoping came into power in 78, and he was the dominant power well into the 1990s. And I think he basically said, look, the collectivization that is the communes in China have not worked. And our over reliance on state owned companies or everything owned by the state has not worked. We need to make some changes. And we need to hide our capabilities and buy our time, he says. So which means, let's fix the economy first, then we can deal with the rest of the world later. And he said, we need to do two things. I'm paraphrasing. He didn't say that. I'm paraphrasing badly. Number one, we have to limit population. One child policy, regardless of what you think about that, he said, look, we can create all the wealth we want. But if we're creating even more people, we're never going to be wealthy. We have to contain the population. Secondly, he said, we need the private sector, the people selling agricultural products on the open market or private companies manufacturing goods or providing services. We need them to compete against the state owned companies. And my goodness, he said things like it doesn't matter if a cat is black or white, as long as it catches mice. Or he said, we must cross the river by feeling the stones underfoot, meaning let's try some new policies. And if they're not exactly right, if we feel the stones underfoot, well, we'll change. And the policies he put in place have been unbelievably successful, regardless of your opinion of China. China has lifted more people out of poverty, 800 million in a shorter period of time that anybody has ever done in history. This is phenomenal over a 40 to 50 year, 40 year period now. So he was very successful, but or his reforms were, but he said there's one thing. Here's the contract you have to sign with us that will let you be do capitalism in effect in the economy, make as much money as you want by apartments, by houses, travel abroad, all that, but don't confront the Communist Party. You, you fly too close to the sun. You confront the Communist Party and we will put you down. And in 1989, with Tiananmen Square with the, with the students and others lobbying for more democracy, he put them down. And that's been a signature move by the Communist Party ever since. Now, just a quick, this is an interesting chart I found going back 2000 years. It kind of shows what who would at the time of Christ, who were the biggest, who were the biggest economies and they were India and China. They both declined in importance over the over the centuries and China, in fact, during the Qing dynasty really declined in the 1800s. But since Deng Xiaoping, as you see, China has grown and now it rivals the U.S. as the second largest economy in the world. The other point is China is the world's factory. I'm looking out at you. Everybody is wearing China in this room mostly. China makes everything you look in the label made in China, everything. They were 5% of the world's exports in 2000. They're triple that 15% today. And the U.S. and other Japan and Germany have declined in relative importance over the years. Our exports have grown, but nowhere near what China has. Now, since Deng Xiaoping, there have been a couple of heads of China. Jiang Zemin, Hu Jintao, but they, nobody to rival the power of Deng Xiaoping except Xi Jinping came into power in 2013. If you're subscribed to The Economist, which I think is the single best publication in English on economy, world economy in politics, you should subscribe. Their lead story this week will be, and the cover is Xi Jinping, who they call the most powerful man in the world today. So Xi Jinping needs to be taken into consideration. He's had two terms in power of five years each. He rewrote the constitution so that next month at the 20th Communist Party Congress, he will be elected to a third. And who knows most likely for life if he continues powerful. And he has changed China now more than anyone since Deng Xiaoping. He's basically said when he came in, China has arrived. We're not biding our time and hiding our capabilities anymore. We have arrived and we need to be taken seriously by the West. But there are a few problems we have. The first big one was corruption, is corruption. China has a lot of corruption both at the party level and in the economy. And he has gone after that with a vengeance, which has been popular with the Chinese people. It also has served a second objective. And that is he's gotten rid of all the people that objected to him. Anybody who criticized him, whoops, you're corrupt, you're out. So he's taken care of that. Secondly, he has re-emphasized the state-owned companies and state-industrial policy. Some people, and China is extremely difficult to report on, you know, nobody really knows what's happening inside the leadership. Everybody kind of hears things, but nobody knows exactly if it's true. But most people think that he does not really like the private sector. He doesn't think people will do the right things for themselves if left to do it. He thinks we need to get back more towards state-oriented development. Many people think that's a mistake, but that's what he is doing. And he has shifted China to the right, meaning more muscular, more aggressive policies in the economy, economics, nationalism, everything. He's become more aggressive, and we've seen that here in the U.S. by public opinions, which say that we're fearful of China now. Yes, no, that's a good one. Do we have any free gift cards for? Perfect. That was a good one. 2013, I will change that. Good point. And the perfect point. Xi Jinping talks about the Chinese Dream 2049. Now, that's correct 2049. That's been the 100th anniversary of the People's Republic of China. He wants China to be fully developed by then, and he has benchmarks how you get there along the way. He wants China to be at the center of the stage. He's not talking about just being the term Zhonguo, which is the name for China, means the central kingdom or the central country. He wants China to be there again, and many people in the West are fearful of that. He talks about this new development concept, which I explained is where you re-emphasize state-owned company and de-emphasize a bit the private sector. So we'll see how that goes. For instance, Jack Ma, who is the head of Alibaba, which is the Chinese equivalent of Amazon. He's been quite powerful and a billionaire, and really that Alibaba is an engine, an economic engine. But Xi Jinping thought, you're flying too close to the suns, and he has made in no uncertain terms put Jack Ma down, and everybody has seen that, and all the billionaires and millionaire private sector executives are laying low now, and they understand who is in charge. The last two things, the dual circulation economy is interesting. I want my cake and eat it too. It means that China wants the world to remain dependent on its exports. He wants us to buy all the things we've been buying and more. On the other side, he wants China to substitute for things like Boeing aircraft and GE jet engines and turbines and semiconductor equipment makers, which we're the best at. He wants China to be the best at that. So he wants it both ways. He wants us to buy everything from him. He doesn't want to buy anything from the rest of the world, or he wants China to be independent. And lastly, and this is a scary thought to people in America, he's building a security fortress in China. Now, you might think that means, oh, he's investing in the military, so to protect or China's interest in the Asian Pacific Rim and other places. Yes, that's true. He is investing in the military. But according to the economist, China spends more on internal security than it does on the military. There are cameras everywhere when you go to China. Facial recognition. They know where you are, who you are, when you're there. They monitor your cell phones. They monitor the internet. They know what's up, what's down, and they eliminate things they don't want to be seen. So it is a, it certainly doesn't emphasize personal freedoms and individualism. Now Xi Jinping says, hey, this is a good thing. We're making China safer and so that and more convenient for you. You don't have to worry about crime. You don't have to worry about food safety. We've got cameras that will do everything now. And also, when there's an emergency from the hospital, we can change every, every red light to green to allow the emergency vehicles to get through. We control things, but it's for your benefit. And as long as you don't do anything bad, why should you worry? You know, that's that's an opinion of many people. Now that doesn't fly in America, but it flies even with zero COVID problems in China. I'll get to that in a minute. So here, just a couple of other things on the economy. Not only is China the world's factory, but in some new technologies, China is a lot further ahead than we think. This shows just the red part shows total electric vehicle and hybrid vehicle sales since, well, since 2000, I think it is, 2011. And China has sold half of all the electric vehicles sold in the world. They don't make the most sophisticated Teslas, but they make volumes of electric vehicles and they're selling them and they're getting better at it. So they are forced to be reckoned with for cars that are going to be the future of a vehicle or travel. Secondly, sorry, it's a little bit not that large, but in solar energy, to make the solar energy, you take polysilicon, you slice it, you take these thin pieces of polysilicon, you dope it, you create a solar cell, you take these cells and then mount them on the things you see all around the square modules or panels. And China controls 75 to 95% of every stage of the production of solar. Now this doesn't mean they're going to do that forever, but they've jumped on these new technologies. They're not manufacturing just cheap sneakers or t-shirts or something. They've really moved up the curve here. So they're a serious economy. Now, there are problems. So there are big problems in China. Larry Summers, who was the president of Harvard and former Treasury Secretary says, you know, China may not make it to the next level. They may be like Japan. Remember Japan back in the 80s, 70s, they were going to take over the world. And there was no doubt that manufacturing was incredible. Well, China, I mean, Japan has been kind of in a grand funk for 30 years now and really they're very developed, very affluent, but they've not made any additional headway. Some people say China may be at that point. They have a couple of short-term problems and a big long-term problem too. The short-term, the two short-term problems are zero COVID and the housing market. So zero COVID, you know, China is the only country left that says, look, we're not going to live with this COVID. We're going to deny it. We're going to, it's going to be eliminated. We're just not going to let it in. And to some extent, they have been very successful. I think there are 6,000, they claim 6,000 deaths due to COVID in China. They've been over a million in the U.S. You know, they've been effective in one sense, but they've got a problem today. That is, if they keep going on the zero COVID policy, it means the economy is going to go from start to stop, from start to stop, and just never develop because the economy today is at stall speed, meaning it's just not growing much and one of the big problems is zero COVID. Now, if they open up, they risk a big jump in COVID deaths and that would be very embarrassing to the government. And second of all, a lot of Chinese have not been inoculated. And where they have been inoculated, it's by at least the West claims a second rate vaccine and a lot of Chinese don't have natural immunity because they haven't been exposed to COVID. So they risk a big jump in COVID if they step off the brakes. So I don't know how they're going to deal with this. It's a problem. I'll show you the next slide and then go back to this. The big problem some people say is that China may have the biggest housing bubble we've ever seen anywhere. It remains to be seen, but I think there's a point to it. Housing is over 20% of the Chinese economy. 70% of Chinese wealth is in real estate. Now, if you think about your finances, you have some stocks, you have bonds, you have cash, you have savings, you have a house maybe or you have investment real estate, but investment real estate isn't typically 70% of your wealth. It's some lower number. In China, it's 70%. And I'll get back to this 40% of home sold. Let me just show you how the Chinese real estate market goes and I'll explain these. I'm sorry, this is a little small print. The state owns all the land in China or municipalities of the state. I'll probably have to say this twice. There is no property tax in China. Can I repeat? No property tax in China. So when you go pay your big property tax in whatever town you're in, just remember in China, there's no property tax. A few major, major cities have a very small property tax, but nothing significant. So how does the towns and villages and cities make their money? They make it by selling the land that they own in its entirety to developers. And these developers are not putting up a duplex and a triplex. They're building 10, 18-story towers with 500 apartments in it, big time stuff. And then they're turning around to you and saying, would you like to buy one? Oh yeah, you'd like to buy one? You need to put down deposit and they say, well, how much is the deposit? Well, they'd say, well, that's 100%. So you pay for an apartment that's not going to be built for, say, two or three years or completed. And you pay for it all up front. The developers then use part of this money to start construction. They use more of the money to go back to the towns and say, oh, we'll buy some more land. And they borrow money from the banks to do that in addition. So they're starting two, three, four, five of these projects at the same time. Now, so there's tremendous building. And you as the consumer are not, you're not worried so far because housing prices have done nothing but go up in China because people have got more money, more wealth, and they're able to pay more for housing. So you as a consumer say, huh, let me think, I'll buy an apartment and I'll buy a second, a third, a fourth maybe, and I'll live in one, and I'll flip the others. Carol, are you taking note of this? There are opportunities here in real estate. And so you're, and as long as everything's going up, everybody's winning. The towns are winning. The developers are winning. The consumers are winning. Now everything is going in the opposite direction. The economy slowed. Housing isn't selling well. It's not going up in value. The developers are going bankrupt because they can't raise money to sell new apartments. And so they can't complete the ones they've already sold in. And the previous chart showed that supposedly they're 40% of all the apartments bought since 2013 have not been completed. So there's a tremendous amount of apartments out there. And some mortgage holders in big cities are banding together and saying, oh, we're not going to pay our mortgage. We're seeing the apartment complex we bought into down the block there. There's been no activity for six months. You know, we're not going to pay our mortgage until we see this apartment. So it's a mess and it's big. And so nobody knows exactly how the Chinese government can give the money to the developers to finish the projects without having another explosion in the real estate sector.  The other one is the declining fertility rate. Back in 2016, China said, oh, we made a mistake or we've done enough. The one child policy is over. So go have a second child, a third child, a fourth child as many as you want, go and do it. And the people living in the city said, wow, it is so expensive to raise a child just like in the US, we're happy to just have one. So it shows that the fertility rate is still down about one and a half or so. You need to be at 2.1 to maintain your population. So China is either going to have declining population in the next couple of years or is already experiencing that. And the Chinese workforce is already going down. So you have an economy that's used to five to 12% growth and you don't have the new workers, you don't have the new consumers. It's a big problem. So some people like Larry Summers say, look, China may not be able to get, there's a term called the middle income trap. It means that many countries have been able to exporting to make money, to get wealthy. You make electronics, you make textiles, whatever. But then you get to a certain level of development or wealth and you have to make the next jump to the fully developed. You need innovation, productivity, new ideas, branding. You need to not make the phones for Apple. You need to be the Apple. Apple's the one that makes the money, not the workers in China who assemble it. And a lot of people say, this is a very few countries have made the jump from middle income to fully developed. So that's what China is facing now. So I just put a slide in here. I don't have any answers for you, believe it or not. So I don't know, you know, if you came for answers, you don't get them from me. So what is the implications for faster growth in China or slower? If they have faster growth, maybe China will feel comfortable in its own skin and say, look, we don't have to be so aggressive. We know we're powerful and the world can exist. Or if it grows more slowly, some people say China may get more desperate, may say, whoa, we're not, we're not making as much money as we thought we were and the West knows it and the West knows that we're not as powerful as we were before. We might get desperate. The US and China are very intertwined, meaning China is our largest trading partner. We are China's largest trading partner. More trade is done between those two countries than any two countries. China likes our food, our energy, our high tech, our domestic market. We like their cheap consumer goods, electronics, rare earth elements, lithium batteries, solar panels, and their large domestic market. They both need each other. So they'll never be a war, right? Well, there was a book published back right before World War One by Norman Angel called the Grand Illusion. And he said, you know, the world is so interconnected now, there could never be another war because it would be in no one's interest. Well, the next year, here comes World War One. And Thomas Friedman wrote a great book, still a classic, the, the, and the olive tree, the, the Lexus and the olive tree.  The idea of McDonald's was his proxy for saying no two countries that are so interrelated, trade-wise, have ever gone to war. Well, I got thrown out the door. And Ukraine and Russia both have McDonald's. There have been a number of examples since he wrote that book. But so the point is, no matter how interconnected we are, don't rule out that it could be, it could be conflict anyway. And then the last thing is China peaking power. This is what people like, like Lawrence Summers is, Larry Summers is worried about, meaning maybe they've gotten as high as they're going to go. And like Japan, they're going to level off or come down a bit. But then Lee Kuan Yew, who founded Singapore, he was the, the ruler in effect of Singapore until he died, said it is not possible to pretend that China is just another big player. They are the biggest player in the history of the world.  They're the kind of the real deal. I've always thought that, you know, Russia is to be feared. But and people here and on, on the web, we're going to, going to contest this. Russia is not really an economy.  They, they've got a real economy. So it's to be worried about. Now let me just end with Taiwan.  It always is something that comes out of left field. Well, the obvious thing in China versus the US is Taiwan. But maybe that's not going to be the thing that really triggers anything. We don't know. But the Chinese have said, and Xi Jinping has said, we cannot pass this from generation to generation, which is kind of ominous. He's saying, look, we've got to get this thing settled. And by settled, there is no question. It doesn't mean Taiwan independence. It means Taiwan's reunification with China. In 1949, Zhang Kaixiak lost to Mao Zedong and took 2 million of his followers over to Taiwan and has ruled for 40 years. Well, he died in the mid 70s, mid to late 70s. He ruled the military, almost the military dictatorship. China was at war with Taiwan at war until 1991. And there was a state of war because Taiwan claimed they were going to go back and take over China.  The UN booted Taiwan out and accepted China in what, 70, 1971. The US then, the US tried to keep Taiwan in the UN then by saying, well, we can have two Chinas in there, can't we? And that failed. So in 79, the US recognized China, but they didn't say that means you have Taiwan. It's always been an ambiguous kind of policy towards Taiwan. Will we defend them? Won't we defend them? It's been, it's been goes back and forth. And then in 1992, some unofficial representatives of China met with some unofficial representatives from Taiwan and agreed on a one China policy. But the point was they couldn't agree on what one China meant. I mean, the diplomacy between China and Taiwan has to be number one for ambiguous and vague and however you interpret it. But there's no doubt also that the new generation of Taiwanese, the younger Taiwanese who were not born on the mainland, who were born in Taiwan, the vast majority of them support either continuing the present policy, meaning stay semi independent or independence. China knows that public opinion is not swinging their way, it's swinging away from them. And they know that the longer they wait to do something, the more that public opinion is going to sway. And China had proposed, let's do a one China, two systems thing like we did with Hong Kong. They proposed that for Taiwan. Well, Taiwan has seen what's happened in Hong Kong. And it's been one system, one country or it's a one country, one system and no, no two systems. When China has seen the demonstrations in Hong Kong, they've come down on it and will continue to until what is it 2047 when Hong Kong officially becomes part of China. So I don't know what's going to happen in China. President Biden has said on, I think it's four occasions, we will come to Taiwan's defense. But we'll have to see what that means. And the Taiwanese are getting very affluent. And some people, some older Chinese Taiwanese call the younger generation strawberries. They're beautiful on the outside, they're soft on the inside. And that means do they really have the guts and the strength to fight the way Ukraine is fighting against Russia? Do we do they really, will they really stand up when they're drinking their Starbucks coffee and everything else? We will have to write and see. So I think I'm going to stop here and let you and I guess people on the on the on the web come in with questions or comments or anything. Great. Thank you so much. We have a question in the back here. I just wanted to say for the zoom people. Oh, no, I thought that was that noise was me. For the zoom people, please ask questions. Do we have some we have come on zoomers. So go online, push an icon that says Q&A and type it in. We want to hear from you. So in the meantime, anyone here? Yeah, in the third row there, fourth row. Yes, that's you. Okay. What was the year that I know I forgot the name of the guy that's in power right now. When did he get the power 2013, which I was correct 2013. Okay. I was teaching there in 2011. And the things that you were talking about about the phones and all that, they weren't happening then, whoever that that predecessor was, what things were not happening. You're talking about how they had to see everything everybody does. Now surveillance that back in 2011 when I was there on my students didn't seem to have any that stuff. Yeah, it's happening now. Who was what was the name of the guy who was the predecessor? Who Jin Tao was the immediate predecessor to Xi Jinping. But there's been an enormous explosion of public spending on on internal security after Xi Jinping came in. Yeah, it's surveillance of the streets. It's the surveillance of your cell phone.  If there's been any indication of COVID in your neighborhood, suddenly go to yellow or red.  They have control like this. It's it's serious. So every time you go out, every store you go in, they want to see your cell phone show us your code. The other day, I read that India has now a bigger population than China. I would think in the future that has big implications for China. It does. Yeah. India should be passing China this year next year are very close. And the Indian system is very different than the Chinese in the sense of they do have a democracy. It's a very messy democracy, meaning it takes a long time for things to get done. But they're they have a big educated class. They have great universities. And if they could put it together politically, they could make it happen. But like China, India is very diverse. I mean, in peoples in backgrounds in poverty, wealth. So it's a challenge, but they should be a coming country. Could be in a nuclear power. But you comment on Chinese Russian. Yeah, yeah. Well, just back to that nuclear power. Yes, they are nuclear power. I would be most I think Russia, China and the US are international nuclear powers. I would say India is more regional. Not that they can't fire them longer, but it's India, Pakistan. That's the big trigger point there. As far as Russia and China, I think in just my opinion, China is looking out for itself. It doesn't really care whether Russia wins or loses in the Ukraine. It doesn't really care about the Ukrainians being killed or being displaced. It's trying to figure out what can it do best for itself. And the best thing China says, we just want the West to be disunified or to lose. Disunified would be good enough for them. And if it means Russia is spending all their money in Ukraine and killing and the Ukrainians are killing him, that's not our problem. Our problem is we want to do what's best for us. So I don't think the friendship goes any further than if it's not in China's interest. Friendship ends. That's just the personal. You mentioned corruption in China. What are the specific examples? What do you mean by corruption? Well, when you have a one-party state, everybody's going to appeal to the peak of the pyramid. And that means paying off government officials. It was very common back in 10, 15 years ago when you on special holiday occasions went to see a government official or a town official, if you were a developer trying to buy land, you would take $3,000 Swiss watches. You would take gift cards from every place. Just as a way of greasing the skids of business and then generals in the military or state-owned companies were always getting their family, their children, their relatives set up in businesses to make money. And often it was very, it wasn't, they were making the money, but the family was making the money. And so it was not very apparent. But things like that. If you think about it, if one person or one party is in control, you're going to do what's necessary to appeal to that party. Hello. Can you talk a bit about the similarities or differences between China's communism and Russian's communism and what relationships do these two countries have? Can one still talk about communism when there's so much wealth? Gosh, that is way beyond my pay grade. I would just say that China has been, China has taken socialism as Deng Xiaoping called it, social, and everybody's called it, since socialism with Chinese characteristics, they have been much more willing to do what is seems to work, do what is necessary without diminishing the power of the Communist Party. Russia, China did not like the way Russia had that complete dropping of state-owned companies and trying to go to capitalism immediately and fully. China thought that was a big mistake and they won't want to do that. They don't want to give up the power of the Communist Party and they think you have to do it more gradually That's all about all I can say, but China has always had, if anybody, if you've been to China, you land and people are moving fast, they're making money. It's as if it's a genetic almost, you know, boy, they seem to know how to make money. When I've been to Russia, Russia is not that way. It doesn't seem like the Russians. Chinese communism is very much capitalism in many respects. But as I said, I'm not an expert in that. Let's say, and this we'll get you next. Thank you. You talked about the one child policy and what I remember reading about that is there was a plethora of boys being allowed to mature to adulthood in not so many females. Has that evened out now or not? More but not completely, but because Chinese families who have had one child have had girls and perfectly comfortable with that. But I'd say there still are more boys than girls because in the conservative countryside they'd rather have boys. And that leads to more nationalism issues. If they grow up, they can't find wives. They can't find great economic opportunities. There's going to be more violence and nationalism. Yeah, over here. Yes. What were some of the more important policies that Deng Jiao Pen implemented that resulted in pulling 800 million out of poverty? The biggest one was the opening up the private sector. People, it used to be that farmers could only sell grain or rice to the government at a reduced not market price. And he allowed them gradually over time to sell everything to on the marketplace and income zoomed in the country side. And the people who had five children at home said, oh, we only need three to do the farming. You go off to the city and work and make money, set up a business there. And that also led. So I think it was him being very pragmatic about the private sector. We got the man in blue here. Yes, you got it. Oh, yeah, one more. Okay, right up here. Just a quick question. I saw in the paper this week about the Yangtze River was dry. But does that affect the dam and that affects the entire economy of China? That's the road of China. Yeah, yeah. What do you think? It's not just the Yangtze. It's the whole with global warming, you have drought and you have heat. And you have, you know, it used to be that water has always been the problem in China, especially eastern part of China. And but now you have drought out west where in Sichuan, which is a bread basket, you have so you have the same problems now the rest of the world is having. It's it's serious. Yeah, serious. Yeah, I'm gonna cut over to here and patient. Thanks. Beyond the whole question of Taiwan, do you see that there might come a day when they China might have like ambitions of more conventional type of expansion, building an empire and that kind of thing? Definitely. Certainly, they see the Asian coast as their sphere of influence. And you're knowing they've taken over vacant islands and set up military bases on them. They're not being very nice to the Filipinos, to the Vietnamese in terms of who has rights to what. No, the Chinese feel just like we feel about the, you know, when the Russian, when the Cuba missile crisis occurred, we said, hey, this is our sphere of influence. We're not going to let the Russians set up military weapons there. I think the Chinese feel the same about the Pacific there. And they they're working hard to get everybody out of there in their sphere of influence. It's on. Yes. I read and you have mentioned the number of electric vehicles that are being manufactured and bought. And yet, on the same time, don't we hear that China's building electric plants using coal? Is that is that going to change? Or I mean, on the one hand, this is why is they so deficient on using alternative energies? Not that that was a perfect either, but you know the answer to that. Yeah, I know. I don't. I think, yes, that's a perfect question. The point is if you want to quickly increase your production, you have to get energy there quick. And the energy they can do quick is coal, dirty coal. They have the same problem with solar that we do. It's intermittent number one. But number two, they've got a lot of out west. They've got a lot of solar facilities, but no transmission. And so it's the same thing as us. And so the the the go to power is coal and they don't have the same maybe political pressures that we do here in the US on that. I have another small question.  Is that true? I don't know. I would take that with a grain of salt. I don't know where you stand depends on where you sit. So to speak, you know, you can pay. No, I don't think I don't think China is trying to be belligerent in the world. But I don't think I think they feel they have a sphere of influence in China and around them. And they don't want to they're going to exercise their muscles to to preserve that. Yeah, let's see some more questions. I got a couple more down here with your work here. I remember being in the Greek harbor of Piraeus, and you know where I'm going with this. And thinking this is Chinese. Can you comment on the success? And I forget the full title is it Belt and Road Belt and Road. Yeah, can you comment on that? The Belt and Road is China's version of the Marshall plan. Let's lend money to developing countries in Africa, Central Asia, even in the Greece. And we're not going to give them the money the way the Marshall plan did. We're going to kind of lend them the money. And these were big projects, buying whole ports, building big, big railroads. But now many of the countries can't pay the debts. And China is pulling back on its plans and trying to figure out how do you restructure these debts without looking like you failed. It's so it's not growing. I say it's shrinking right now. Yeah, one more here and there. Yeah. Do you think that we are foolish in drawing a line in the sand around Taiwan and being so determined to help them remain independent? Well, at the time when Zhang Kai-shek was moving over to Taiwan, he was our preferred winner in China. And remember it wasn't too many years after that that the domino theory became popular. One country in Asia's fall, the next country will fall the next, the next, the next. And if we don't stop them here, we're never going to stop them kind of thing. And so Taiwan has been that. And as long as their military was not really able to do anything against our military, it seemed fine. Now it seems more risky because their military is very strong. So but and the other side of coin is Taiwan has developed into an incredibly vibrant democracy. They've had, let me see one, they've had elections every four years since 1996. And the Kuomintang, which is Zhang Kai-shek's former party and the DPP, the Democratic Progressive Party, have alternated winning each time like the Democrats in the Republic. It hasn't been a one-party state. And it's a terribly vibe, you know, wonderful democracy. So it's, it's kind of sad to see them now cutting across hairs. I mentioned, I'm going to show you since let me just see, I got another couple more slides here, but I'm not going to show. Wolf Warrior II. This is kind of an interesting thing to show you how Hollywood can get turned around. Wolf Warrior I, this is the sequel, Wolf Warrior II. It's a story of an African, of villages and a town in Africa, which is being, being attacked by Western in Western thieves or, you know, basically hired, hired guns. And the people are desperate for help. And these people are dominating them, killing them, stealing their wealth, et cetera. There was a ship offshore with a Chinese commando on it and off the coast of Africa. He comes ashore with some fellow helpers and routes the Western for hire guns and saves the day. It's just like the White Hat. We've had, we've had these movies for 70 years in Westerns, in other things, but now suddenly it's turned around. The Chinese are the heroes. We're the devils. And this is the biggest grossing movie in the history of China came out in 2017. It shows you things are, you know, things are not going, I mean, they don't see the world like we see it. They see it the way they see it. Interesting. I mean, microphone issues. So I was wondering what is the role of terrorists right now with China and the US and our relationship? Yeah, well, so far it's been anything that keeps them out and they feel the same way. Anything that keeps us out, they're going to do. They've been dragging their feet on deliveries or buying Boeing aircraft, both as a way to hurt Boeing and to hurt us. We've been dragging our feet about tariffs on their solar panels. We need them, but we want to replace them with US built ones or others. So both countries are using it to whatever advantage they can make in their own economies. Wow, that's great. That's great. So you've seen it. You've seen it. I've always said people, everybody should go to China because you can't believe the development that has happened. I say the national bird of China is the construction crane. You can turn around 360 degrees in any city you go to, and all of them have more than a million people, any city you go to, and you can see those enormous tea cranes everywhere. Here in the US, you know, you see one in Montreal or Boston or something, say, whoa, there's some real development here. China, it's everywhere. Now it may be changing, but everybody should see it because it's both impressive, but it's also scary. It's enlightening. Eric, this has been great. Thank you so, so much. Thank you. Thank you, everyone.