For years Trump has demonized China. Today Trump folds, because his own country is spiraling out of control. “We’re going to have a fantastic future together. I have such respect for China. The job you’ve done. You’re a great leader. I say it to everybody.” How much longer before Trump announces we will become communist?

Nvidia has denied a report that it plans to ship a China-specific AI chip by year-end. $NVDA The Information, citing employees, said the company was preparing small-batch deliveries of a language processing unit based on Groq technology. The chip was described as compliant with U.S. export rules and designed to work with processors available in China after restrictions on the next-generation Vera Rubin system. Nvidia pushed back hard. A spokesperson said the reporting is incorrect. The company has no LPU sales in China today and no China-specific LPU product on its roadmap. The denial comes as Nvidia’s position in the Chinese market remains constrained. Limited H200 sales to a handful of firms have only recently started, and CEO Jensen Huang has previously said the company has largely conceded the market to Huawei.

Yanliang Miao is right that it would be a mistake to assume that China’s economy is running out of steam simply because property and infrastructure investment are weakening. But I disagree with his suggestion that China can largely replace the old investment-driven growth model with a technology-driven one as it rebalances toward domestic demand. The problem is that China’s extraordinary technological competitiveness is itself mostly a consequence of the imbalances that created the old model. China’s challenge, in other words, is not simply to find new engines of growth by continuing to fund technological progress in the same way it has in the past. It is to develop new engines of growth even as surging debt and growing international tensions force it to reverse the very conditions that created its past technological progress – excessively high investment and excessively low consumption. This was the same challenge the USSR faced in the 1960s and Japan in the 1980s, and neither was able to do so. Their failure was not an accident. As with China today, it was precisely their highly unbalanced economies that funded their spectacular technological advances until debt capacity limits forced a reversal. That’s the problem. Until it figures out how to maintain technological progress while dramatically restructuring the conditions that created it in the past, Beijing will continue to try to “solve” the supply-side “problem” China doesn’t have while worsening the real constraint on its economy, its unbalanced demand.

Tech rotation --> downstream: Lenovo and ODMs outperforming and sucking the oxygen out of semis/upstream/optical in Greater China today. Govt fund also selling down some stakes in big local semi names. Any excuse to rotate.

Yesterday Trump 🇺🇸: Xi Jinping is a dictator. He's sending weapons to Iran. He wants instability. I'm putting permanent sanctions on China." Today Trump 🇺🇸: "He's a beautiful ruler, not a dictator. He's China's president. I don't think about that. He's very smart. He loves his country. I respect him." He had flipped for the 101st time and will flip again tomorrow. 🤣 He has completely lost his mind.