Weekend Reading #339
This is the three-hundredth-and-thirty-ninth weekly edition of our newsletter, Weekend Reading, sent out on Saturday 1st November 2025.
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What we're thinking.
Another week of all time highs but we are really beginning to see dispersion even in megacaps now. Meta has been weak leading up to results where Zuckerberg was rather blasé about how much money he is throwing at capex, and in light of his metaverse misadventures the market isn’t too keen. Google on the other hand is flying, and the market seems to think the rising capex there will be well spent! The dollar is really threatening to surge now, and yields are hovering precariously around 4%. Gold and precious metals have had the speculative froth shaken out of them. Private credit names in America (we used to call them private equity names remember?) are quivering amidst mutterings of crisis. Crypto is collapsing as it does. Bitcoin however holds its levels despite performing rather averagely this year. We don’t even consider bitcoin to be crypto anymore. It’s a macro asset and has been for a while. This is a market for those who can hold conflicting ideas in their heads at the same time and profit from them.
What we're doing.
Within minutes of arriving in Shanghai the stark difference to Beijing was obvious. Whereas Beijing is old, square, concrete, Shanghai is like an upgraded Singapore (if that is possible). The spectacular skyline, the beautifully lit up buildings at night, the gargantuan and picturesque Huangpu river and the major difference - the people. Clearly more used to westerners as a function of its history, the people are far friendlier, and many speak English. Life here seems similarly fast paced but there is a beautiful riverfront that allows to catch one’s breath.
There are way more western tourists here and way fewer Chinese tourists. I was told more than once that Beijingers “don’t like Shanghai” as it stands for all the things Beijing does not. It’s flashy, new, connected to the west etc. Whereas Beijing is government, Shanghai is finance. There are also fewer visible police. Yet the overarching themes are similar - perfect infrastructure and signs of development are everywhere.
We decided to stay in Pudong across the river from the main strip. And that turned out to be a great decision. The Bund main strip and Nanjing Road next to it are incredibly busy. This is an understatement. I have never ever seen as many people in one place as on the Friday night we were there. Literally not a speck of road visible. Like ants on a piece of discarded pineapple. But my goodness, it creates a vibe and an energy. The pearl tower is the jewel across the river, but the entire skyline is like a concert with so many coloured and shaped lights on display. I didn’t think something man-made and made of lights could be so tastefully put together.
Pudong is the business district with the banks and insurers holding court in high rises. But along the river where we stayed was beautiful. Far less populated than the Bund side, we cycled along the river, and I went for a great run. Restaurants dot the riverbank and to our relief there was some excellent international food.
We covered all the obligatory stops - the Jade Temple, Xintiandi (the French concession), Yu gardens and of course the famous British Concession or Bund. Shanghai as we see it today is a new city and the Shanghai skyline we see now is famous as per the comparison meme showing it 30 years ago (empty farmland) vs today. But before this it was a front from the opium wars where the British bullied the Chinese into accepting trade of opium amongst other things (they haven’t forgotten). The Bund is a relic of that time. And funnily enough the very first CCP meeting was held in the French concession too.
The day before we left, we took a day trip on a bullet train to Hangzhou, home of Alibaba and now Unitree, which threatens to be one of the most consequential companies of the new robotics era. We weren’t able to visit Unitree, but we did try. Hangzhou itself is also a new city even younger than Shanghai in terms of its own present skyline but it’s massive. Yet at 12.5m people it’s a small city compared to Shanghai (21m) and Beijing (25m). It is really pretty though. Quieter, more serene. A place where according to our young tour guide the youngsters are flocking for jobs given the superior lifestyle and lower cost of living (half of shanghai for rent). It also happens to be where the new jobs are.
Our tour guide was 25 and recently completed her masters in Chinese at Hangzhou university, which she proudly mentioned was also where Jack Ma studied. She said 60% of her class went to work for the government. She wants to travel the world, so she became a tour guide to interact and learn from foreign tourists. Government jobs are attractive not because they pay more (they don’t) but because they are stable. But they are incredibly hard to get given the standard of the exams needed to get in as a start. She added her peer group is very optimistic about the future.
The pride of Hangzhou is West Lake, which is rather lovely. The lake is dotted with traditional (non motorised) boats each with an oarsman taking people on the lake. We went on one and it was super chilled! We also went to the famous Hangzhou tea fields and sampled some Dragon Well green tea. The tea fields are very close to the city - still part of it which allows an interesting melting pot of agriculture and tech. There were zero westerners visible. We were stopped in the street numerous times for photos of our children.
On the whole Shanghai was fantastic. It’s a proper city with all the bells and whistles. The climate is perfect. I hope we will be back here again one day. This is a great advert for modern China.
After Shanghai we flew to Chengdu - Chinas 4th most populated city after Beijing, Shanghai and the city with the biggest population of them all - Chongqing. We don’t go to Chongqing unfortunately but maybe next time!
Chengdu is in the Sichuan province, in the Western part of the country and famous for its spicy food. It is also the city with one of the largest markets for luxury brands in the world. There are malls everywhere and they are BIG. We went to one called Global Centre which is apparently the largest building by area on planet earth. It is way more than a mall - it has an indoor water park, ice rink, convention centre and much more. Just gargantuan. The city itself is rather unattractive. We stayed in the city centre which is rather grim looking indeed. High rises everywhere. Apparently, it’s overcast 60% of the year too.
Chengdu itself is most famous for being home to panda bears. We went to The Chengdu Research Base of Giant Panda Breeding as it is called in English. This is the preeminent panda location in the world, housing 110 pandas at last count. We saw pandas of all ages including some which are a few months old and handled by their keepers like puppies. They are very cute creatures and absolutely adored by the locals as a symbol of their city.
We went to Jinli ancient street with all its stalls and pretty lanterns. Again, only Chinese tourists everywhere. This street reminded me of the one in Hangzhou. The street itself is 2000 years old, but the shops and buildings are all new and made to look “old style”. All in the name once again of modernisation.
Speaking of modernisation, since the economic boom in China, Chengdu has boomed so much that they created an entire new part of the city, known as South Chengdu. This is where the beautiful green spaces are as well as the new, glass and steel more aesthetically pleasing buildings, office parks etc. This section of the city is very gentrified and pleasant. Chengdu also has one of the largest (if not the largest) bike paths - a massive 100km ring road purely for bicycles amongst green space. Pretty cool. It’s a remarkable vision of old China and new China all put together in one place.
We went to the very beautiful People’s Park and experienced the famous teahouse culture. Massive outdoor teahouse seating areas filled with people playing ma jong, Chinese chess and cards while drinking tea. There is also what’s called matchmaking corner which was really interesting. There are two sections of multiple boards - one pink (women advertising themselves) and one blue (men). Adverts list age, sex, marital status (single, divorced, widowed etc) occupation, income, debt status and what they are looking for in a partner. It’s interesting because there are no photos. According to the locals we chatted to photos are not as important. Marriage is more practical here. Our tour guide told us that her friend in America is looking for a husband to stay on given the new visa restrictions. She said it’s representative of most Chinese women. Practicality before soulmatery.
We also went to see a Sichuan Opera at the Sichuan Provincial Opera house. This was really fun. Sichuan opera is famous for its face changing which is done with real style and panache by actors who take great pleasure in performing with a flourish. Super cool.
Also interesting is the dynamic with the older Chinese. As result of the property boom many have gotten wealthy. They are recycling this into the domestic economy and in particular into tourism. They also travel internationally a lot. Our tour guides all over also take local Chinese groups abroad - everywhere. Japan, Australia, Indonesia, South Africa even. This is important as the key question is what is going to drive the next generation to rising wealth levels.
And my suspicion is that it may be the stock market. It won’t be like America. It can’t be as there are far more checks and balances and the government will be wary of rising inequality. But it is maybe the only way now to uplift the younger Chinese who have a problem getting onto the ladder with high property prices. This, along with creating policies to increase consumption, for me is a possible long term structural trend. I will watch closely for signs this is playing out. The question I have always asked as an investor is whether China is a short term or a long-term play. I am increasingly convinced now it is becoming investable long-term, so long as you align yourself with what government is doing.
As we depart China, I’d say it was an extraordinary experience - such a different place to what we are used to and that is the point. I’m delighted my kids have experienced it and hopefully they will remember. It’s hard to envision what it is like without being here and seeing for oneself. There is zero doubt in my mind we are witnessing the rise of a superpower that will influence the world in more ways than just militarily and economically. Chinese soft power is rising rapidly. Chinese brands are going to proliferate even further globally and in the global south in particular - clothing, cars, luggage - everything. The purchasing power of the Chinese consumer is also going to rise. The country will have its crises much like America has over many decades, but the direction is clear. And everyone should attempt to understand better what is unfolding here because relying passively on media and propaganda isn’t going to get you very far.
Next up is Vietnam - a couple days in Hanoi and then off the Phu Quoc for some quieter time on the beach. Will report back from there! DC
What we're reading.
My personal curiosity as to the nature of consciousness too a strange turn this past week or so when I found myself reading a Dan Brown book for the first time in 20 years. I was back involved with Robert Langdon again to my great surprise. Browns style doesn’t really excite me, but the contents of this latest book were all about consciousness and includes all the things I’ve researched myself over the last few years. And it’s really good. So many juicy rabbit holes to go down after this one. And the story was quite fun too. DC
What we're listening to.
I didn’t want to add too much to an already-long newsletter, but the (beautiful) irony of this live acoustic version of Avenged Sevenfold’s Hail to the King – in that a track by a band that is unashamedly heavy metal can go full acoustic and actually sound quite tranquil (in a good way) is something that deserves to be heard and watched. String section on the side fills in for lack of overdrive. To be honest, I wasn’t really sure how this would sound before hearing it, seeing as the band were seated with all acoustics instruments. Turns out the worry was absolutely unnecessary. As one of the commenters on the video pointed out, “even if they made a full acoustic album, you’ll still buy it”. EL