Elon Musk speaks during an event at the site of the company's manufacturing facility in Shanghai on Jan. 7, 2019.

Musk spoke at the site of the company's manufacturing facility in Shanghai on January 7, 2019.

Bloomberg News

The world's richest man was trolled by the second wealthiest.

Jeff Bezos took to the social media platform to draw attention to the close ties with China ofTesla.

Interesting question. My own answer to this question is probably not.

Musk will have to walk a fine line between being a champion of free speech and alienating China, which has banned many American social media platforms.

Elon Musk Opens Tesla's Chinese Plant As Era Of Real Competition Begins
Elon Musk gestures during the Tesla China-Made Model 3 Delivery Ceremony at the company's Gigafactory in Shanghai on Jan. 7, 2020.

Matthew and Tim say that Beijing may look to use that leverage. It now has a friendly face in charge of a global channel for information that is central to Chinese authorities' efforts to amplify narratives favorable to the Communist Party state.

Duncan Clark, chairman of Beijing-based investment consulting firm BDA China, said that China will not hesitate to use any leverage it has.

China probably already gets what it needs from Twitter and all this concern may end up being nothing. Musk may end up regretting buying himself a more complicated life.

Beijing Blues

Beijingers are nervous.

Infections have been creeping up in China's capital, fostering concern that it could be next in line for a lockdown like the one in Shanghai. Nearly all of Beijing's 22 million residents are undergoing three rounds of testing through the weekend. Beijing is following in the footsteps of Hangzhou, an e-commerce hub that is a short train ride from Shanghai.

The number of daily cases in China's political center doesn't seem like a lot. The situation in the financial hub is stabilizing, with infections falling to the lowest levels in more than three weeks.

Beijing Tightens Measures After Recent COVID Outbreak
People line up for Covid testing in Beijing.

The retired editor-in-chief of the Communist Party-backed newspaper said that Beijing is going to prove that the Covid outbreak is just a coincidence.

Just in case, here is some advice from a locked-down, exhausted Shanghai resident: stock up.

Old Playbook

With China's economic growth targets looking more elusive by the day, it is important that Beijing avoids any long-term lockdowns. Some economists think the growth outlook is very bad. In a worse-case scenario, China could face multiple Shanghais each month over the second and third quarters, which would raise the risk of a recession, something the country hasn't seen in the modern era.

China's growth is expected to be below target for the first time in four years.

China's National People's Congress is one of the sources.

The President made a bold commitment to boost infrastructure construction, a tried-and-true formula that has worked in the past but also fueled debt binges that haunt to this day. This strategy may not be as effective as before as authorities take a hardline approach to controlling the outbreak.

The Covid situation needs to be dealt with a greater degree before a full. It is hard to do a lot of infrastructure spending in a locked down city.

The stock rally was spurred by the pledge of President Xi to keep the economy growing, though signs that the outbreak in Beijing and Shanghai are stabilizing could be related to that.

There is more on China's Covid outbreak.

‘Friend-Shoring’

Some of the world's biggest corporations are starting to feel the effects of China's lock downs, and that has led to renewed talk of the need to broaden supply chains.

For decades, companies shifted production into China because of its low-cost labor, massive domestic market and supportive government policies.

General Views in Shanghai as City Lockdown To Hit China and World Economy Hard
Trucks wait to pass through a checkpoint on a highway leading from Shanghai on March 30.

A lot of warnings may end up flooding. Texas Instruments cut its revenue forecast by 10% due to customers closing plants and reduced operating levels in China. Microsoft said the shutdowns have affected its performance and would hurt its ability to produce Surface laptops. Apple warned that supply constraints could cost it as much as $8 billion in revenue during the quarter ending in June.

Global merchandise trade has been disrupted for more than two years by the Pandemic.

The source is WTO.

The idea that a change in the developed world's supply lines is necessary is being considered by key policy makers. Earlier this month, she called for more resilient trade links.

The shift depends on whether consumers accept higher prices for products made closer to home.

Relocating supply chains might cost more, but if you can make smaller quantities that you can sell at a lower price, you can change the game.

It could take a while. The Christmas tree is likely to cost more this year. Despite only a few confirmed cases, the eastern Chinese city of Yiwu locked down its wholesale market, which draws in goods from all over the country. Pressure on supply chains is likely to be added by Yiwu's prominence as a hub for global trade in consumer knick-knacks.

Don’t Look Up

In what seems like a real-life version of the Hollywood disaster movie Armageddon, Chinese scientists are developing a system for monitoring asteroids that pose a threat to Earth and if need be, taking them out.

The deputy director of the China National Space Administration said that China will send a spaceship to an asteroid in the 20th century to study it. The Asteroid Terrestrial-impact Last Alert System, which usestelescopes in Hawaii, Chile and South Africa, was upgraded this year so that it completes a scans of the skies once every 24 hours.

It is a relief that the world's biggest space program is not going to cause any problems with the U.S. since NASA already watches for asteroids that could be on a collision course with Earth. Two astronomer are ignored by the public as a comet hurtles toward Earth.

What We’re Reading

A few other stories caught our attention.

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