Dan Wang on the U.S. vs. China

I start my book, my very first paragraph, to say that Chinese and Americans are more alike than any other people...  They're the two great founts of entrepreneurial dynamism in the world.  It is Shenzhen and Silicon Valley that are inventing the future and not so much Europe and Japan any longer.  There's kind of a hustle energy, there's a hastiness... [25:30]

That's another similarity between the U.S. and China: They're often very future-oriented.  They have a sense of optimism, much more so than the Europeans who have a sense of optimism only about the past. [27:45]

[...]

Maybe we can say that China right now has some of the control paranoia of the Soviet Union, some of the manufacturing excellence of Japan and some of the American entrepreneurial hustle.  You combine all of that and that is part of the reason that I think that China is going to be a pretty formidable power going forward.  [1:05:50]

[...] 

I think that China will not become anything like a cultural superpower in part because the engineers are so censorious.  They're so thin-skinned, they censor everything they can't understand, which is a lot.  If you take a look at a lot of aspects of cultural prediction, whether that is books, novels, films, China really has become much more constricted over the past 12 years of Xi's rule.  I think that China will not become anything like a big financial superpower in part because the control tendencies of the engineers is to impose a lot of capital controls and that makes it much more difficult for foreigners to want to hold RMB.  [1:10:20]

[...]

I want the U.S. to be 20% more engineering and I want China to be 50% more lawerly.  I think that it would be amazing if the Chinese state actually respected the creative impulses of its own people... if individual rights would actually be respected.  [1:30:00]

[...]

We can and should recognize both of these things, that repression can grow worse while technological dynamism grows richer.  I always feel myself that I have to fight this two-front war against people who think that China will collapse because of all the repression or that, because China's economic growth has been so impressive at lifting so many millions of people out of poverty, that gives the Communist Party a free pass on all of the sorts of violations that it has inflicted upon the people.  I think we can acknowledge both things are true, that the Communist Party has grown oppressive in more novel ways over the past 10 to 30 years; at the same time, it has grown richer and more technologically capable.  [1:37:20]

~ Dan Wang, "Dan Wang - The US vs China in the 21st Century," Invest Like the Best with Patrick O'Shaughnessy, October 16, 2025

 

The Wall Street Journal on Leopold Aschenbrenner’s meteoric rise

Leopold Aschenbrenner’s forecasts about the future of artificial intelligence earned him a cult following on the internet, where his investment firm’s routine regulatory filings are studied like scripture. 

The parabolic performance of his hedge fund has given the 24-year-old Aschenbrenner a fan club on Wall Street, too. 

Aschenbrenner had no professional investing experience when he launched his AI-focused firm, Situational Awareness, less than two years ago, with a few hundred million dollars. 

Prescient stock picks and whooshes of inflows have vaulted its assets under management to more than $20 billion, according to people familiar with the matter, approaching the size of Bill Ackman’s Pershing Square and Dan Loeb’s Third Point.

~ "The 24-Year-Old AI Wiz Who Counts Jane Street as an Investor," The Wall Street Journal, June 8, 2026

 

 

Dwight D. Eisenhower on the costs of the arms race with the Soviet Union

Every gun that is made, every warship launched, every rocket fired signifies, in the final sense, a theft from those who hunger and are not fed, those who are cold and are not clothed.  This world in arms is not spending money alone.  It is spending the sweat of its laborers, the genius of its scientists, the hopes of its children.  The cost of one modern heavy bomber is this: a modern brick school in more than 30 cities.  It is two electric power plants, each serving a town of 60,000 population.  It is two fine, fully equipped hospitals.  It is some fifty miles of concrete pavement.  We pay for a single fighter with a half-million bushels of wheat.  We pay for a single destroyer with new homes that could have housed more than 8,000 people...  This is not a way of life at all, in any true sense.  Under the cloud of threatening war, it is humanity hanging from a cross of iron.

~ President Dwight D. Eisenhower, "Chance for Peace" speech, April 16, 1953 

(Eisenhower delivered the address to the American Society of Newspaper Editors in Washington, D.C. - broadcast nationwide - shortly after Joseph Stalin’s death and early in his presidency.  The passage highlights the human and economic costs of the arms race, comparing military spending to resources that could instead fund schools, power plants, hospitals, housing, and food.)

 

Kevin Duffy on the Austrian case for free trade

The Austrian (praxeological) method involves deductive reasoning, thought experiments, methodological individualism.  The only way to refute a logical argument is with better logic.  In trade, party A trades with B. Both do so because they benefit.  More accurately, because they expect to benefit.  Both expect to get more through the trade than they give up.  This doesn't mean in a week or a year neither will have regrets, but they do so because they expect to benefit. 

Now party C comes along and wants to interfere.  There are several problems: 

1. Knowledge - Does party C know something that A and B do not? 

2. Objectivity and altruism - Is party C above self-interest? 

3. Motive - By interfering, is party C benefiting at the expense of A and B?

4. Morality - What right does party C have to interfere?

Compounding this problem is that the state (a territorial monopolist on the use of force) acts as agent for party C.  It uses violence to interfere.  The state itself is not above self-interest; it has its own motives.  It benefits by being a broker in political favors.  Finally, there is the cost of maintaining the state, which is paid through violence (taxation). 

It's crystal clear who benefits from free trade (the people) and who benefits from attacking it (the state and special interests seeking protection and privileges).  This is where the intellectuals come in: They are needed in order to blind people to being fleeced.

~ Kevin Duffy

 

Jim Chanos on bull and bear markets

Bull markets, you put a premium on promises and bear markets, you put a discount on reality.  And we're clearly in the former right now.

~ Jim Chanos,  "Jim Chanos: The AI Bubble Is 'Much Worse' Than Dot-Com," RiskReversal Media, 45:40 mark, July 17, 2026

 

Grant's on how CEOs of AI builders see massive demand swamping supply

Open before us is page 8 of the June 8 edition of The Transcript, a weekly roundup of earnings-call excerpts.  The first quotation, from Lip-Bu Tan, CEO of Intel Corp., sets the tone for what follows: "We see token usage exploding.  Agent now consumes 1,000x more tokens than single-event reasoning."

Sundar Pichai, CEO of Alphabet, Inc., is next: "[W]e are experiencing strong demand for our AI solutions from enterprises and consumers, at levels that are meaningfully exceeding our available supply."

He is followed by the CEO of Microsoft Corp., Satya Nadella: "[W]e are supply-constrained...  The thing that we do not want to do is to disappoint especially our enterprise consumers on Azure."

Then comes Jeffrey Clarke, COO of Dell Technologies: "Demand continues to exceed supply with memory as the primary constraint, and we expect to exit the year with meaningful backlog."

And not to forget Jensen Huang, CEO of Nvidia Corp.: "[W]e don't have enough supply.  The reason for that is because the world supply chain is supply-constrained.  We have the support of our ecosystem to have very robust growth, and well in support of whatever guidance we've provided."

Finally appears the CEO of Cerebras Systems, Inc., Andrew Feldman: "What is unusual about AI right now is the builders are so far behind the demand, it's absurd.  We have a backlog of more than $2 billion of demand...  [N]one of us, not us, not AMD, not Nvidia, can keep up with the demand that your employees are driving.  And that's sort of, in a lot of ways, the opposite of a bubble.  We are chasing, right?  Our customers and their customers are moving at the speed of software, and we're moving at the speed of real estate, data centers, right?  Um, and so we are behind."

~ Grant's Interest Rate Observer, "Hanging by a stock price," June 19, 2026

 

Evan Lorenz on DeepSeek's latest model, V4

Evan Lorenz: In January 2025, DeepSeek released its R1 model, which offered comparable performance to the best Western chatbots at a fraction of the price.  As Western investors digested the news of cut-rate, Chinese competition, the Nasdaq sold off.

Grant's: Mr. Market is turning a blind eye so far to the recent unveiling of DeepSeek's latest model, V4.  Like R1, V4 slightly underperforms the leading Western competition but sells at a fraction of the Western cost.  Bloomberg explains how: "DeepSeek's trillion-parameter system uses the Mixture-of-Experts technique, selectively triggering only a small subset of experts and activating only up to 37 billion parameters per task to keep inference costs far lower than for similar frontier models."

DeepSeek has put its model up for sale at 75% off until the end of the month, but once that discount ends, V4 will cost between just one-tenth to one-quarter of the leading American equivalents.

Lorenz: Price competition is what just might deflate the high-cost and capital-intensive AI boom.

~ Evan Lorenz, "The way the boom ends," Grant's Interest Rate Observer, May 8, 2026