China Overtakes U.S. as World’s Leading Destination for Foreign Direct Investment

Date: 25‑01‑2021

Source: The Wall Street Journal

Flows into America nearly halved as Covid‑19 dragged on the economy in 2020

China’s ability to quickly control the coronavirus within its borders helped its economy rebound relatively quickly. Tourists take selfies in Shanghai in November.

China overtook the U.S. as the world’s top destination for new foreign direct investment last year, as the Covid‑19 pandemic amplifies an eastward shift in the center of gravity of the global economy.

New investments by overseas businesses into the U.S., which for decades held the No. 1 spot, fell 49% in 2020, according to U.N. figures released Sunday, as the country struggled to curb the spread of the new coronavirus and economic output slumped.

The bill for Boris Johnson’s Brexit is coming in and it’s punishingly steep

Date: 25‑01‑2021

Source: the Observer Andrew Rawnsley

Ministers say it is just teething trouble. To many businesses it feels more like root canal surgery without the benefit of anaesthetic

‘All those acquainted with Mr Johnson and his casual relationship with the truth will have taken that with a juggernaut of salt.’

You would have to possess a heart of stone not to weep with laughter at some of those who are now suddenly complaining about Brexit. It is a bit late for Northern Ireland’s Democratic Unionist party, those lusty sponsors of the great experiment with the UK’s prosperity, to be wailing that they have been betrayed. I smiled to see that Roger Daltrey, the Leave‑supporting lead singer of the Who, has joined the chorus of rock stars furious that the post‑Brexit visa rules will ruin their prospects of touring across the Channel. Mr Daltrey will have to sing Won’t Get Fooled Again to himself before moving on to Boris the Spider and I Can’t Explain.

Move to EU to avoid Brexit costs, firms told

Date: 24‑01‑2021

Source: The Guardian

Exporters advised by Department for International Trade officials to form EU‑based companies to circumvent border issues

Requirements for EU transport firms to provide VAT and tariff guarantees have left hauliers refusing contracts to carry loads for small‑ and medium‑sized UK businesses.

British businesses that export to the continent are being encouraged by government trade advisers to set up separate companies inside the EU in order to get around extra charges, paperwork and taxes resulting from Brexit, the Observer can reveal. 

In an extraordinary twist to the Brexit saga, UK small businesses are being told by advisers working for the Department for International Trade (DIT) that the best way to circumvent border issues and VAT problems that have been piling up since 1 January is to register new firms within the EU single market, from where they can distribute their goods far more freely.

Forecast 2021: The Stock Market

• John Mauldin |
• Thoughts from the Frontline
• |
• January 22, 2021

On the Gripping Hand, Part 3

“Extrapolated Indefinitely”
What Were You Thinking?
Decision Time
Vaccination, Geopolitics, and Uncertainty

This will be the third part of my 2021 Forecast Series. You can read the first two parts here and here. The general theme has been “On the Gripping Hand.” Science fiction writers imagined a three-handed alien race with a left hand, right hand, and a very strong Gripping Hand. 2021 is the year of the Gripping Hand, and COVID-19 is what’s gripping us. Making a forecast without the virus at its center is pointless.

All that being said, today we are going to focus on my stock market expectations. As I promised last week, this is a “Generational Call.” For reasons we will go into below, I think we are at a pivot point for stocks, with some clear exceptions I will outline. So maybe like generational call* with an asterisk.

On the Gripping Hand, Part 3

Britain’s refusal to give the EU’s ambassador full diplomatic status is a childish insult

Date: 23‑01‑2021

Source: The Guardian

This petulant slight echoes a move by the Trump administration – one that it quickly saw fit to reverse

‘Our man in Brussels, Sir Tim Barrow, was previously UK ambassador in Moscow and he is unlikely to take kindly to having his own status downgraded, which is the obvious reciprocal action the EU can take.’

Of all people in government Boris Johnson should be first to recognise the status of European Union representatives. His father, Stanley, was a European commission official for many years and the European taxpayer paid the prime minister’s school fees at the expensive Brussels International School and then Eton. 

However, in a row that has been rumbling for a year alongside Brexit trade talks, the government is refusing to give full diplomatic status to the EU’s ambassador to the UK, João Vale de Almeida and his 25‑strong mission. The Foreign Office claims it does not want to set a precedent by treating an international body in the same way it treats a nation state, with diplomats afforded the privileges and immunities under the Vienna Convention.

God at the Inauguration

Date: 22‑01‑2021

Source: The Wall Street Journal

President Biden’s overt religiosity is a relatively modern trend in U.S. history.

President Biden delivers his inaugural address on the West Front of the U.S. Capitol, Jan. 20.

Presidential inaugural addresses are unpredictable, but it’s a good bet that they will refer to the Bible. President Biden did, quoting Psalm 30:5: “Weeping may endure for a night, but joy cometh in the morning.” This is part of a welcome, long‑running trend toward more religious language in public life.

Mr. Biden has cited Psalm 30 in speeches before, and it seems particularly apt in these dark times. Mr. Biden also encouraged his fellow Americans to “open our souls instead of hardening our hearts,” an allusion to God hardening Pharaoh’s heart, beginning with Exodus 7:13.

China’s surging private space industry is out to challenge the US

Date: 22‑01‑2021

Source: Technology Review

An explosion of space startups in China is supercharging tech innovation, opening new markets around the world, and expanding the country’s influence.

China’s space program might have been slowed by the pandemic in 2020, but it certainly didn’t stop. The year’s highlights included sending a rover to Mars, bringing moon rocks back to Earth, and testing out the next‑generation crewed vehicle that should take taikonauts into orbit—and possibly to the moon—one day.

But there were a few achievements the rest of the world might not have noticed. One was the November 7 launch of Ceres‑1, a new type of rocket that, at just 62 feet in height, is capable of taking 770 pounds of payload into low Earth orbit. The launch sent the Tianqi 11 communications satellite into space.

Boris Johnson Must Change His Act

Date: 21‑01‑2021

Source: Project Syndicate by Chris Patten

Chris Patten, the last British governor of Hong Kong and a former EU commissioner for external affairs, is Chancellor of the University of Oxford. 

The United Kingdom may struggle to forge a close and productive relationship with US President Joe Biden’s administration. After all, Prime Minister Boris Johnson still has much to do to persuade the world that he does not regard Donald Trump as a fitting role model for a twenty‑first‑century liberal democracy.

LONDON – Some of the United Kingdom’s right‑wing newspapers – supporters of both Brexit and its principal advocate, Prime Minister Boris Johnson – have been quick to assure us that US President Joe Biden has already forgiven the Conservative government for its obsequious cheerleading for the departed Donald Trump. The new Democratic administration, they claim, will want to do business with a UK that is now distanced from the European Union and ready to assume a new role as an influential global fixer.

Let’s hope those newspapers are correct. But Biden and his team will have to overlook quite a lot for the sake of such transatlantic goodwill. They will certainly have to turn the other cheek and forget about the UK government’s embrace of a policy that required special pleading to Trump rather than a special relationship with the United States.

All Quiet on the Populist Front?

Date: 21‑01‑2021

Source: Project Syndicate by Jan‑Werner Mueller

Jan‑Werner Mueller, Professor of Politics at Princeton University, is a fellow at the Berlin Institute of Advanced Study and the author of the forthcoming Democracy Rules (Farrar, Straus, and Giroux, 2021). 

Because every country is different, the ignominious exit of a political figure like US President Donald Trump does not necessarily tell us anything about the fate of authoritarian populists elsewhere. Just as populists tend to learn from one another’s successes, so will they heed others‘ mistakes.

BERLIN – Liberals around the world are daring to hope that there is a silver lining to the violent denouement of Donald Trump’s presidency: namely, that the inciter‑in‑chief’s ignominious exit from the political stage will chasten authoritarian populists elsewhere. Unfortunately, their optimism is naive.

Battle of the Robots Still Favors Japan and Europe—For Now

Date: 20‑01‑2021

Source: The Wall Street Journal

Chinese robotics companies took market share last year amid the disruptions of the pandemic

Covid‑19 has accelerated automation in factories, especially in manufacturing powerhouse China. Foreign companies have long dominated the market for industrial robots and automation tools there—but there are signs that dominance is fraying around the edges.

As the factory for the world, China is unsurprisingly far and away the largest market for industrial robots. Before the pandemic, however, the U.S.‑China trade war was slowing growth. New installations of industrial robots amounted to 140,500 in 2019, a 9% decline from the previous year, but still almost three times the number for second‑place Japan, according to the International Federation of Robotics. Last year was likely much better: Credit Suisse estimates that China’s industrial‑robotics market grew 9.5% in 2020.