How beauty could save the world

Key Markets report for Friday, 5 September 2025

Something altogether different is presently percolating through our culture. It is coming from China and it’s subtle, but it has clearly been making an impact. Over the last few years I have noticed a flood of videos appearing on YouTube and in social media which show Chinese craftsmen and women making a variety of objects of everyday use: tea pots, garments, musical instruments, umbrellas, game sets, water wheels, silk cloth, paper, etc.

The objects are made from scratch by transforming materials commonly found in nature: rocks, dirt, bones, bamboo, animal or fish skins, antlers, sea shells, wood… The process of transformation is captivating and satisfying to watch and it is all done manually with traditional tools and methods. The final products are one of a kind, beautiful objects. The links below show just a handful of examples of this craftsmanship:

• Oilpaper Umbrella, It Took Two Months to Make, Completely Handmade (14 min)

• Using bamboo to make some sophisticated old furniture——Bamboo Sofa (7 min)

• Craft Windows with Shells, Use Cedar for Muntins, to Make Mingwa Projecting-sash and Sliding Windows (8 min)

• Waterwheel Irrigation: Takes One Month to Restore, Used in Ancient Times for Irrigating Farmland (12 min).

• Purple clay teapot making紫砂壶制作 (9 min)

• Making a jacket out of fish skins (short)

All these videos, and there must be hundreds, if not thousands of them, are produced professionally, made in a beautiful, serene setting which accentuates the connection with nature, including with the background sounds. Having watched a few of these videos and noticed that they are getting a lot of traction and commentary in social media, I couldn’t help thinking that these are probably not random expressions of people’s hobbies. Rather, they seem to convey a subtle message which could be profound and transformative as it cuts to the core of human social and economic organization.

To a Westerner, the exercise of these crafts will probably seem curious and quaint but ultimately, they seem overly labor intensive and inefficient. They may even seem wasteful. Since the industrial revolution, we have adopted the model of increasingly efficient hyper-production of stuff and rather than wasting energy and time making things ourselves, we can hop to a supermarket and buy them for next to nothing. Then when they break, or we use them up, we can discard such things and replace them with new ones. Where they come from, how they were made, or by whom, is irrelevant. What is important is that we can acquire them easily and cheaply so we can focus our energy on our own efficient, productive work.

But a number of problems arise with hyper-production of stuff because super-efficient industrial processes can easily turn out more products than the market can absorb, creating a growing surplus which, in turn, creates the problem of deflation. In our economic system, deflation leads to economic depression, so surplus production must find and open new markets for our industries. Since the industrial revolution, this frequently involved gunboat diplomacy: promoting the system of “free trade” with military means of persuasion. Gunboats were needed because the newly “opened” markets invariably experienced economic collapse as local crafts and industries found themselves unable to compete with Western industries.

True, the relationship has inverted today and since the 1980s, China became the producer of large quantities of cheap everything and anything. But today, China may be sending a different message - an alternative to gunboat diplomacy. What if, instead of industrial hyperproduction we made craftsmanship great again? We’d produce less stuff, but that stuff would be more valuable, more beautiful and instead of discarding and replacing them, we’d repair and maintain them. This approach would absorb a great deal of productivity and surplus labor, which is another serious problem of the Western, post post industrial revolution system.

It would also solve the problem of nanny state and failing pension funds. Artisanal production requires hard work, patience and skill. Acquiring specialized skills invariably takes many years, some are refined and perfected over lifetimes. Products or services delivered by artisans with a lifetime of experience under their belts are invariably better than those of novices in ways that can’t be copied. In the markets, they command a premium. Thus, an older artisan will be able to charge a higher price for his products. Furthermore, skills themselves have a market value and many novices will demand instruction from their more experienced colleagues.

In this sense, people nearing retirement don’t become “net consumers of capital,” as Christine Lagarde called our senior citizens. Through their labor, they become people with golden hands: the most valuable, most honored capital in any society. Instead of becoming a burden and a liability, they become our most valuable asset.

I have to confess, it took me some time to ponder these questions as they cut to the very foundations of our societies: not only their economic organization but also the intellectual wrapping and culture. What we study today under the rubric of “economics,” in fact, all began with the industrial revolution and economists like Adam Smith, David Ricardo, Thomas Malthus and Jean-Baptiste Say who popularized and promoted the industrial economy as the only way to advancement and progress. But this type of progress has created a longing for the “return to nature,” because the human spirit doesn’t naturally desire to spend a lifetime in what William Blake named, “dark Satanic mills.”

The subtle message from China seems to suggest that there’s a different way to do things and organize a society. As intellectual heirs to Smith, Ricardo and Malthus, we may think that spending two months to make one hand-made umbrella is wasteful and unnecessary, but “wasteful and unnecessary” is practically the definition of what we call “luxury.” Spending two months on an umbrella could be thought of as a luxurious way to live life. But it’s more than that: that umbrella will certainly have a market value, again as an object of luxury. In that, it will probably be superior to the ones created by Cartier, Hermes or Gucci: it really is one of a kind!

What if…

The same principle could also apply to the production and consumption of foods and wines. What if every morsel of food we consumed and every sip of wine (or coffee, or tea), were produced with the same dedication to quality, the same fastidious attention to detail? What if we also invested as much time and attention to human relationships? What if we applied as much devotion to raising our children and spent time with them rather than spending hours in traffic jams so we could get to those dark satanic mills to be a cog in the giant hyper-production machine and then send our children to war to open new markets for the cheap crap our labor produces? Our economics courses don’t even acknowledge such questions, let alone trying to answer them. But from the commentary in social media, the videos percolating from China have already prompted that debate and it seems to be gathering momentum.

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Today’s trading signals

With yesterday’s closing prices we had no new trading signals. Your exposure should remain unchanged, as follows:

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TrendCompass Key Markets report for 5 September 2025

Best regards,

Alex Krainer