learnlearn

chip, software, investment

[learnlearn @learnlearnfree]

@the_empyrean1 @leevalueroach Explain.

[learnlearn @learnlearnfree]

@gonglei89 And buying at high price to rent ratio could be subsidizing the seller more than the renter.

[learnlearn @learnlearnfree]

@gonglei89 Then we are back to running individual properties is expensive and running project buildings risk concentration of poverty.

[learnlearn @learnlearnfree]

@hxiao @ilyasut Dwarkesh interview on the Open AI incident?

[learnlearn @learnlearnfree]

@gonglei89 Sure but you can just directly subsidize the rent without buying the property, especially when price to rent ratio is high.

[learnlearn @learnlearnfree]

@gonglei89 @HundredCHours Hmm, there's no reason for drivers to be more efficient than other countries but cost to the consumer is much lower. Therefore it follows the wage per ride/delivery must be lower. So each worker must do more to earn comparable wages. Population density could help here.

[learnlearn @learnlearnfree]

@gonglei89 @HundredCHours Growth=net reinvestments * ROI. Compared to the savings rate growth is very low, so ROI must be very low. But as I said I am not even that concerned as long as ROI is positive😕

[learnlearn @learnlearnfree]

@gonglei89 @HundredCHours Actually I'm not even that concerned about efficiency. Chinese economic structure obviously provides a lot of consumer surpluses. But if the workers can't consume because of low wages they are not getting the majority of the consumer surpluses.

[learnlearn @learnlearnfree]

@gonglei89 @HundredCHours Obviously there are heavily used infrastructure and there are underutilized infrastructure. But if China is truly efficient with capital with their high savings rate the economy should grow a lot faster.

[learnlearn @learnlearnfree]

@gonglei89 @HundredCHours So either you consume by making personal choices or you consume government services (subsidized infrastructure e.g.). The question has always been at which point the latter becomes inefficient -- e.g. when people don't want to use the infrastructure ostensibly built for them.

[learnlearn @learnlearnfree]

@gonglei89 @HundredCHours No net savings.

[learnlearn @learnlearnfree]

@gonglei89 @HundredCHours But of course you know there can be net savings. If households save other entities must borrow.

[learnlearn @learnlearnfree]

@stevehou Why exclude stock market valuations?

[learnlearn @learnlearnfree]

@stevehou Attention is all you need and total human attention is finite. Borrowing another metaphor from AI, knowledge work is compression, and you run into diminished returns.

[learnlearn @learnlearnfree]

@gonglei89 Many LGFVs were paying juicy yields so lenders were aware of the risks. If junk bonds don't impose losses that's a windfall for investors.

[learnlearn @learnlearnfree]

@gonglei89 (and guarding against fraudulent bankruptcies won't be easy).

[learnlearn @learnlearnfree]

@gonglei89 If LGFVs we're truly resolved we would see local government debt burden go down? It seems to me much were moved onto municipal balance sheets? It's rare to see any bankruptcies because bankruptcy is still quite antithetical to Chinese sentiments.

[learnlearn @learnlearnfree]

@gonglei89 Creation is inherently risky and difficult for public markets to assess with steep information asymmetry.