The Ongoing Failure of the Chinese Cult of Leader Xi, Will Cause a Massive Famine in China

From a cultural, economic, and security point of view, I urge you to watch this interview with Peter Zeihan on The Joe Rogan Experience for a refreshingly honest assessment of what is happening in China.

It is hauntingly familiar, a totalitarian leader who makes economic gains only to consolidate power and drives his country down rabbit holes of psychotic policies that end up killing millions.

The most recent example is Putin.

But rest assured, Xi is next in this rarified air of incompetence and megalomania.

When famine strikes China, don’t be fooled, Xi’s self-isolation and systematic removal of all those who disagree with him or could possibly challenge him, combined with China’s totalitarian system and ongoing systemic corruption of the Chinese Communist Party, will have caused the famine.

Companies like Apple say they are thinking about moving their estimated 90% of iPhone production of their iPhones, but Apple has not moved its production outside of China.

China’s internal economic instability and rising labor costs lay bare its low birth rate. So far, they have been able to shield the specific impacts on their labor supply by “overcounting” the size of China’s population.  But the population decline has led to Chinese labor being three times as expensive as labor in Mexico and the labor in Mexico is twice as skilled as Chinese labor.

Apple’s propping up of the totalitarian leader Xi and his regime will continue to negatively impact Apple’s bottom line because they bet on control, corruption, and a population in decline that is profoundly impacting its labor supply, specifically by increasing its costs beyond what is competitive on a global scale.

Of course, the actual population numbers in China compound the overbuilding of apartments and residences in China, and this problem will get worse and worse as China’s population shrinks.

While there are plenty of solid moral reasons not to do business in China, Apple has ignored them.

The economic reasons and the flim-flam of the Chinese system being competitive with the American and Western democracies will be exposed in the coming famine.

And because Apple has delayed and made excuses about why it has not left China — which principally comes down to the fact they refuse to make the large investments they need to make in other nations that they have made in China for decades — Apple will find itself attempting to rapidly disengage from China during a famine, which is a much worse look than Apple has now, propping up the corrupt, totalitarian and incompetent leadership in China.

The irrationality of the Chinese covid policy, which was to lock down the country for three years until they did not, without creating an effective or viable vaccine, then open the country up when the covid variants had evolved into far more contagious versions, is simply bad leadership, illustrative of the cult of decisions by one man.

Apple will reap the disruption by betting on totalitarian and corrupt China.

Apple should spend tens of billions and aggressively and quickly leave China, for economic reasons alone, since the morality of backing Xi and his gang of incompetents who have had to resort to more and more types of control over the population, clearly are not a consideration of impacting Apple decision making.

In fact, there is no doubt I have bought my last iPhone, and after the life of this one naturally dies off, I will buy a South Korean Samsung.  They have virtually no production in China, and no sales of their phones in China either.

Maybe when Apple actually moves its production out of China, I will consider it.

I am beginning to think that a boycott of Apple iPhones is the only way that Apple will decisively act on leaving China, since they clearly are not taking into account the increasing economic weaknesses and vulnerabilities that make Apple’s ongoing iPhone production in China prone to the slow motion failure of the Xi regime.

Apple’s last quarter sales have dropped by the most in five years, and one of the main reasons Apple cited was problems with the production of the iPhone 14 in China.

Apple’s stock price has tanked 27% since 2022.

Apple says that the Covid restrictions ending in China have resolved its production issues in China, but that is not all of the truth of what is going on in China, the fundamental issues of high labor costs and low-skilled labor, spurred on by an education system that rewards plagiarism and mimicking, are not solved by China ending its Xi led national covid lockdown.

Finally, if or when China invades Taiwan, and the US imposes the type of sanctions that are reserved for actions like the Russian invasion of Ukraine, Apple will lose tens of billions of dollars in production and investment in China, far more than if Apple had spent the money to aggressively move out of China quickly.

And post-Taiwan invasion, just like what happened in Russia, there will be a mass exodus of American companies from China, leaving everyone to wonder why these companies did not leave sooner, why they didn’t fix their roof when it was sunny, as opposed to during a rain storm.



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