China’s astronomical growth is one of the great economic and geopolitical stories of the modern era. But it’s also coming to an end, says George Friedman, founder of STRATFOR and author of The Next 100 Years.”China has had extraordinary growth for 30 years – the probability it will do it for 60 years is statistical negligible,” he says.

Friedman predicts China will fragment in the coming century and be overshadowed (again) by Japan as the region’s dominant power.

The critical issue – something that’s lost on most Westerners who visit or invest in the country, he says – is that China is “split right down the middle” between its booming, modern Eastern seaboard and extremely poor rural heartland.

“Beijing is trying to balance – in a very ancient way – between one region that’s lost its bearings in China vs. the rest of China that’s bitterly poor and extremely angry,” Friedman says. “It’s difficult to see how a coastal region that has more in common with Los Angeles is going to be held together with 1.1 billion [people] living barely above poverty.”

The ruling Communist Party may be able to suppress rebellion and maintain its power, he says. But it won’t be able to prevent these internal divisions or from other nations, including Western powers and Japan, from making inroads into China.

This will have profound implications for investors who are betting big on China, as well as for U.S. interests in the region, as we discuss in more detail in a forthcoming segment. 

Tech earnings were mixed last week, with Apple delighting Wall Street with strong results and Microsoft posting its first year-over-year drop in revenue. But you can say this much: There weren’t many bad surprises for investors. Does that mean the worst of the recession is over for tech?

My guest, Paul Kedrosky, says the air bubble of panic is gone and that’s good. But here’s the bad: There’s no big catalyst for corporate IT spending. That makes him worry that the big IT names like Oracle and Microsoft and Intel are out of the woods, but don’t have huge organic revenue growth ahead of them. (Oracle will no doubt get a bump when it digests the proposed Sun Microsystems deal, but that’s not exactly the same thing.)

Kedrosky does like a few sectors: Asian Internet companies, solar stocks and wireless. He explains why on the clip.