Subject: False Spring? | EconVue Spotlight March 31, 2018
From: "Lyric Hughes Hale" <[email-masked]>
To: "R. Hunter Biden" <[email-masked]>
Date: Sat, 31 Mar 2018 14:58:51 -0700 (PDT)

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EconVue Spotlight

Dear R. Hunter,

Spring has been a bit tardy this year in the US, and I hear many other 
places, but not in Asia. The title of a recent Brookings meeting at 
Northwestern University was "Japan, the United States, and the Future of 
Asia" but the topic was Korea. I posed the question of whether or not we 
are experiencing a false spring. Talks between the two Koreas, the US 
and China are certainly a hopeful development, but do they mask 
fundamental and growing divisions between the major powers in the 
Pacific? Together, these countries comprise half of global GDP.

Alicia GarciaHerrero

https://about.me/aliciagarciaherrero

, an economist who works from Hong Kong, recently commented that 
tensions could be shifting from North Korea to the Taiwan Strait. A 
number of actions by the Trump Administration point to increasing 
support for Taiwan, certain to roil Chinese policymakers. Countering 
this is piquant analysis by Michael Turton, author of The View From 
Taiwan

http://michaelturton.blogspot.com/

who says that fears are overblown by the media and that Taiwan-China 
relations are better than they seem. Making the point that no one really 
knows what is going on in Beijing, a pithy must-read for all China 
watchers is James Palmer's piece in Foreign Policy

http://foreignpolicy.com/2018/03/21/nobody-knows-anything-about-china/

. There are far too many articles to cite that say the same about 
Washington. And now even Tokyo.

Wishing everyone a Happy Holiday this weekend.

RESEARCH BY ECONVUE EXPERTS

FMI April 2018 Economic &amp; Investment Outlook

https://econvue.com/reports/michael-lewis/fmi-april-2018-economic-investment-outlook

Michael Lewis

https://econvue.com/experts/michael-lewis

As 18Q1 ends, recent data have been mixed, but the economy's continuing 
momentum is clear; After moderating to slightly below +2.5% for 18Q1, 
real GDP growth should firm to +2.75% for the rest of 2018 (and continue 
at healthy pace in 2019); Core PCE inflation, which spiked in 18Q1, will 
continue to trend up, it should breach the +2% target this summer; After 
one rate hike in March, Powell Is headed for three more rate hikes this 
year (and another four in 2019).

The U.S. Surplus in Trade in Services Reflects its Comparative Advantage

https://econvue.com/pulse/us-surplus-trade-services-reflects-its-comparative-advantage

Karim Pakravan

https://econvue.com/experts/karim-pakravan

The Trump administration should keep these points in mind before it 
unilaterally expands the scope of its trade moves on the imports of 
goods.The U.S trade deficit is structural, resulting from the chronic 
gap between country's savings and investment. Therefore, protectionist 
measures cannot reduce significantly the goods trade deficit.

Institutional Crypto Terms

https://econvue.com/pulse/institutional-crypto-terms

Collin Canright

https://econvue.com/experts/collin-canright

The dramas of volatility in the price of bitcoin and scams in 
"coin"-offering fundraising schemes overshadow legitimate cryptofinance 
developments.

For nearly the last year, crypto-coins have been developing into an 
asset class and investment ecosystem. From two conferences I attended 
this year, one in Chicago and the other in Singapore, it seems to me 
that the Chicago firms see the opportunities for developing trading 
infrastructure while the Asian investors and regulators see real 
possibilities for financial innovation.

Relationship-Based Care: "Different Spokes (Care Models) for Different 
Folks"

https://econvue.com/pulse/scaling-relationship-based-care-%E2%80%9Cdifferent-spokes-care-models-different-folks%E2%80%9D

David W. Johnson

https://econvue.com/experts/david-w-johnson

The best, most cost-effective health outcomes occur when providers build 
long-term, trusting relationships with patients and pro-actively treat 
disease through real engagement, frequent dialogue and shared 
decision-making. At its best, primary care helps prevent, mitigate and 
manage chronic disease and other serious conditions.

STORIES IN OUR SPOTLIGHT

China

Nobody knows anything about China

http://foreignpolicy.com/2018/03/21/nobody-knows-anything-about-china/

James Palmer 3/21/2018 Foreign Policy

Outside analysts rue lack of access to good Chinese economic statistics. 
But that does not mean that we can't understand the bigger picture. 
Within China, massive amounts of individual-level digital data is being 
collected every day. Someone is analyzing that.

Some economic consequences of China's recent institutional reform

https://www.linkedin.com/pulse/some-economic-consequences-chinas-recent-reform-alicia-garcia-herrero/

Alicia Garcia-Herrero 3/26/2018 LinkedIn

Long term these are extremely positive moves. Especially the focus on 
China's aging population, a demographic time bomb.

The Strangest Taiwan-China Divide of All

https://international.thenewslens.com/article/92684

The News Lens International 3/30/18

Meanwhile, on the Taiwan side, everyone is kicking back and downing 
margaritas. We don't look at events using the conventional interpretive 
frameworks that focus on promoting China as a serious participant in the 
international system and marginalizing Taiwan. We don't have to sell 
papers or drive clicks to our websites. And we've seen this happen a 
hundred times before.

Xi Jinping is making sweeping changes to how China is run

https://www.cnn.com/2018/03/16/asia/chinese-government-changes-intl/index.html

Ben Westcott and Serenitie Wang 3/17/2018 CNN

"Resistance and confusion" - change always exacts a price, at least in 
the short term. Expect a go-slow period in China as historic levels of 
reorganization take hold.

President Trump signs the Taiwan Travel Act

https://twitter.com/claydube/status/975158184326217728

Duncan DeAeth 3/17/2018 Taiwan News

Observations on Section 301

http://www.aei.org/publication/observations-on-section-301/

Derek Scissors 3/22/2018 AEI

Analysis of the impact of new China tariffs and the case for imposing 
them.

Can Central Asia's poorest states pay back their debts to China?

https://thediplomat.com/2017/12/can-central-asias-poorest-states-pay-back-their-debts-to-china/

Dirk van der Kley 12/1/2017 The Diplomat

Highlights a key concern about China's lending to poorer countries. If 
there is a downturn in the world economy, or interest rates increase, 
will they be able to repay their debt? Negative conditions could hit all 
of these countries simultaneously.

Property tax missing from legislative plan

https://www.caixinglobal.com/2018-03-16/property-tax-missing-from-legislative-plan-101222241.html

Wang Xiaoxia and Pan Che 3/16/2018 Caixin Global

This is an important surprise. Are plans to institute property taxes in 
China on a permanent hold?

Blockchain & Internet

Newly appointed PBOC governor once called Bitcoin ‘inspiring', praised 
its accessibility

https://cointelegraph.com/news/newly-appointed-pboc-governor-once-called-bitcoin-inspiring-praised-its-accessibility

Helen Partz 3/19/2018 Cointelegraph

Yi Gang received his doctorate from the U of Illinois at Champaign in 
1986, one of the world's foremost innovation hubs.

Blockchain, Internet 3.0 and national security governance of China

http://cdf-en.cdrf.org.cn/xzbg/5315.htm?share=true#content

Zheng Yongnian China Development Forum 2018 Background Paper

Key white paper on the opportunities and hazards of blockchain for China 
presented at the China Development Forum in Beijing. Overall bullish 
with Chinese characteristics.

The new ways to save Crypto from Quantum

https://www.coindesk.com/new-ways-save-crypto-post-quantum-world/

Alyssa Hertig 3/17/2018

The real threat to cryptocurrencies is not regulation, but another 
technology.

The biggest headache in machine learning? Cleaning dirty data off the 
spreadsheets

https://www.theverge.com/2017/11/1/16589246/machine-learning-data-science-dirty-data-kaggle-survey-2017

James Vincent 11/1/2017 The Verge

The unglamorous side of AI.

World

Russia's nuclear policy: Worrying for the wrong reasons

https://www.tandfonline.com/doi/full/10.1080/00396338.2018.1448560

Bruno Tertrais 3/20/2018 Taylor & Francis Online

The Russian nuclear problem is real and serious – but it is political 
more than it is military.

Why Canada and Mexico may be big winners from steel tariffs

https://www.cfr.org/blog/why-canada-and-mexico-may-be-big-winners-steel-tariffs?utm_medium=social_share&utm_source=tw

Benn Steil and Benjamin Della Rocca 3/20/2018 Council on Foreign 
Relations

Inside the steel fence.

Chicago leads U.S. in underwater homes

http://www.chicagobusiness.com/realestate/20180316/CRED0701/180319924

Dennis Rodkin 3/16/2018 Crain's Chicago Business

Chicago home values have not risen as fast as LA or NY- still, 
underwater mortgages are now 10% vs 33% at their height in 2012.

Asia is growing rich, but it is also becoming unhealthier

https://www.weforum.org/agenda/2017/12/asia-is-growing-rich-but-it-is-also-becoming-unhealthier

Asit K. Biswas & Kris Hartley 12/8/2017 World Economic Forum

Asia is facing huge demographic challenges, accompanied by significant 
health threats due to behavioral changes, the environment, and simply, 
old age.

With all best wishes,

Lyric Hughes Hale

Editor-in-Chief

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