RiskReversal Pod Louis Vincent-Gave: From Uninvestable to Unflappable; China’s Semiconductor and AI Blitz Is Rewriting the Trade War
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Dec 15, 2025 
Louis Vincent-Gave, CEO and founder of Gavekal, offers keen insights into the evolving US-China economic rivalry. He discusses the ramifications of the 2018 semiconductor embargo, showcasing how China rapidly improved its industrial capabilities. The conversation highlights China's advancements in AI, despite ongoing chip restrictions, and the strategic advantages posed by state capitalism. Louis also compares market behaviors in the US and China, revealing a shift in global economic power dynamics and the complexities of future tech competition.
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Embargo Sparked China's Industrial Leap
- The 2018 semiconductor embargo forced China to de‑westernize and rapidly move up industrial value chains.
- That national mobilization produced leapfrogging across industries, making China far more competitive by 2024–25.
China's Productivity Myth Debunked
- Chinese factories now combine high productivity with very low labor and healthcare costs compared with the U.S.
- Louis uses Tesla's Shanghai vs. California plants to show Chinese per‑worker output is about double at far lower total labor cost.
Short‑Term Pain Fueled Long‑Term Gain
- China accepted major economic pain (real estate crash, stock collapse) to fund industrial upgrading.
- That sacrifice means China can now pivot from belt‑tightening to expansion with strategic advantages intact.
