All VM JITs compile to statically-typed machine code, so it's doubtful that building a VM from the ground up for dynamic code is going to yield major performance improvements. There are some enhancements that give VM-level visibility into dynamic invokation (like INVOKEDYNAMIC in JVM 7), but this has a relatively small performance impact on real-world codebases. In addition, the modern JVM is a sophisticated, highly-tuned machine with millions of man-hours on the books. It's unlikely to be eclipsed any time soon.
This is not true at all. PyPy implements a tracing jit that compiles specific loops for each set of types run through the interpreter. This means it is actually possible to have Python code that runs faster than C code in some rare cases: http://morepypy.blogspot.com/2011/07/realtime-image-processi...
Proving that there are cases where it's faster than C doesn't prove that it's faster than the JVM ;) There are plenty of cases where JVM code will be faster than C too...
