The Forecast
Plus, the next Fed chair.
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Welcome back to The Forecast from Bloomberg Weekend, where we help you think about the future — from next week to next decade.

This week we’re looking at a new book comparing the US and China. Plus, with the Fed’s Jackson Hole meeting coming up, we’re checking in on prediction markets tracking the next Fed chair. You can read Bloomberg News’ coverage of the Trump-Putin summit here and here.

America’s Lawyerly Society vs. China’s Engineers

When Dan Wang first heard President Donald Trump describe the date for imposing tariffs on US trade partners as “Liberation Day,” the phrase caught his ear. “‘Liberation’ is not a very American word,” he told me recently. “It’s much more of a Chinese word.”

Wang would know. For years, as a China-based analyst for a macro research firm, he pored over speeches and official documents of the Chinese Communist Party, trying to extract meaning from jargon.

Wang now sees parallels between Trump and President Xi Jinping, he says: the blind loyalty of their base, the demonization of foreigners and a willingness to foment unease among immigrants and minorities by threatening their status within society. “What we have in the US is authoritarianism without the good stuff,” he says. The good stuff being, according to Wang, things such as high-speed trains, well-functioning cities, and political and economic stability.

The United States needs to study China if it’s going to remain a superpower, Wang argues in his new book, Breakneck: China’s Quest to Engineer the Future. But it needs to learn the right lessons — including, most importantly, how to build.

In Breakneck, Wang argues that the key difference between the two giants is that China is run by engineers — in 2002 all nine members of the Politburo standing committee had engineering backgrounds — whereas the US is run by lawyers. China prioritizes building colossal public works such as bridges, dams and airports, as well as products like toys and iPhones. The US excels at making and enforcing rules.

This was a good thing during the 1960s and ’70s, when lawyers pushed back against the American technocratic regime that had damaged the environment, run highways through urban neighborhoods and gotten the country mired in Vietnam. But now the rulemaking has gone too far, Wang says, and it’s preventing the US from keeping pace with rivals.

Wang calls for the US to take a page from Xi’s playbook and rediscover hard engineering as a proud pursuit, to celebrate “the world of atoms instead of the world of bits.” It doesn’t matter how many apps the US designs — or even tools for AI warfare — if it runs out of missiles.

— Christopher Beam, Bloomberg Weekend

Read more: China Is Run by Engineers, and the US by Too Many Lawyers

Predictions

“Cluster flats” are going mainstream in Europe, driven by a housing crunch. “They’re spaces for 8, 10, 12 or even more residents that are increasingly popular with single professionals, families and seniors.” — David Rocks and Levin Stamm, Bloomberg Businessweek

Superintelligence is somewhere between five to 20 years away — but it’s coming, says AI godfather Geoffrey Hinton. — Shirin Ghaffary, Bloomberg Tech

Globalization will survive: “One shouldn’t forget that the majority of global trade doesn’t involve the US… We may be entering a new era, characterized by US retrenchment, Chinese companies investing overseas — and other countries trading more with each other.” — Chris Byrant, Bloomberg Opinion

The US will avoid a recession: “Corporate America has a lot of worries, including tariffs, inflation and consumer demand. A recession isn’t one of them.” — Sagarika Jaisinghani, Bloomberg News 

There’s a US student-loan credit crisis brewing. “Only a third of those receiving [US student loan] bills are actually paying them.” — Claire Ballentine, Bloomberg News

We may be about to reach “peak lobster” thanks to climate change and overfishing. Also, fun fact, did you know “4-foot jumbo lobsters used to be common”? — Gary Sernovitz, Bloomberg Weekend

What Are the Chances...

Who’s going to be the next Fed chair?

Trump said this week that he’d be announcing his pick for the next Fed chair “a little bit early.” That likely means this fall, and there are at least eight candidates under consideration, Bloomberg News reported. So let’s check in on Kalshi to see how the market for the next Fed chair nominee is looking:

Week Ahead

Sunday: Bolivia holds a general election.

Monday: Ukraine’s president Volodymyr Zelenskiy will meet Trump in Washington; Chile and Thailand report GDP.

Tuesday: Canada reports CPI; the US reports housing starts; Home Depot and Xiaomi report earnings.

Wednesday: The Fed publishes minutes from its FOMC meeting where two governors dissented; Indonesia, Sweden, New Zealand and Israel’s central banks all have rate decisions; the UK, euro zone and South Africa report CPI; Target, Lowe’s and Baidu report earnings.

Thursday: Walmart reports earnings; the Fed’s Jackson Hole meeting begins.

Friday: Fed chair Jerome Powell gives his keynote at Jackson Hole; Germany reports GDP; Japan reports CPI.

Weekend Reads

The United States Is Southern Now
It Looks Like a Trump-Putin-Xi World, But It's Really Orwell's
A Forgotten Battle Taught One Man Everything About Humanity
Trump’s Politics of Urban Disgust
When the Dead Are Missing, These Dogs Know Where to Look

Have a great Sunday and a productive week.

— Walter Frick and Kira Bindrim, Bloomberg Weekend

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