“You’d think by now people would learn.” Such a highly applicable statement for a host of different issues present this very day. Namaste all.

China Morning Missive (from jolly old England) Third times a charm??!! For me, the entire TikTok episode is a reflection of America’s actual ability to “quit” China. And it isn’t looking all the good as Trump kicks the can yet again. Here again, the Beijing leadership sees clearly all of the various pressure points which can be applied. Rare earths was just one example. There are dozens more. Trump to extend TikTok deadline for third time, pushing decision out another 90 days

CNBC

Trump to extend TikTok deadline for third time, pushing decision out another 90 days

President Donald Trump plans to again extend the deadline requiring China's ByteDance to divest TikTok's U.S. business or be effectively banned in ...

China Morning Missive First, before anything else, American policy makers need to stop underestimating the Chinese. This below is just one example of how true ingenuity is applied to overcome obstacles. This sort of activity happens all the time.

China Late Night Missive It’s called brute force innovation. The Americans attempt to contain China through export controls on chips and advanced technology and in return China’s STEM army takes up the challenge. Same goes for DeepSeek and Xiaomi and more names than I can even recall. Thing is, I recall vividly that this was how America operated back in the 90s. Damn. https://www.reuters.com/world/china/us-says-chinas-huawei-cant-make-more-than-200000-ai-chips-2025-2025-06-12/

Meanwhile in Asia, Pete Hegseth is committing to a further “let’s surround China more” strategy. Rather interesting that this map doesn’t highlight S. Korea or Taiwan. This new Trump administration sure has a far more of a warmonger-vibe than the last go around.

No question it is a mad dash here in #China to get end product out of the supplier facility and into a shipping container. The Chinese export engine is truly humming. Interestingly, American buyers are paying a premium to ensure that orders are prioritized. This, on top of the current 55% tariff. Can’t see how prices on the US don’t trend higher throughout the send half of the year.

Another win for China as America remains mired in the Middle East. Play 20th century games win 20th century prizes.

American hubris indeed. In light of the current America/China trade tensions and the on again, off again talks, you’ll find the following clip highly instructive. It is from an appearance made on CNBC in New York and is from all the way back in 2018. Pay close attention to the questions raised and to the answers given. Ask yourself, why didn’t American leadership (political and commercial) take the situation far more seriously? Moreover, should there be any expectation that events will play out any differently today? Copy/paste the comments from this segment, word for word, and what it is you’ll find is that American policy makers and business executives have learned nothing over six years. The Faustian bargain is real, IP theft is a red herring and, ultimately, America’s dependency on China, shown clearly in this clip and during the first Trump administration, has only grown more extreme.

China Morning Missive There is a great deal to address in the supposed “done deal” announced between China and the US. For right now what I want to highlight is the issue of tariffs. The headlines have blared that an agreement was reached for American to place 55% tariffs on Chinese imports with China holding tariffs on American imports at 10%. This is EXACTLY the very same level of tariffs the parties agreed to last month in Geneva. There is nothing new here. For the purpose of optics, what the American side has done is include the tariff rates put in place back in 2018 to the grand total announced yesterday. 25% from 2018 on all Chinese imports, 10% added this year (after being reduced from +100% in April mind you) and an additional 20% punitive tariff for fentanyl. To conclude, when it comes to tariffs the parties are exactly where they were even before the talks commenced in London. https://www.reuters.com/world/china/lutnick-says-us-tariff-levels-china-wont-change-2025-06-11/

Trump got rolled by China and he doesn’t even know it yet. This “deal” is FAR from concluded. Key rule in China ….. it only after you sign a deal that you actually begin to negotiate.

China Morning Missive Agree on a framework? I’m not even sure what that means. From what I can tell, the parties agreed, for the time being, that the US would lift certain restrictions which were placed on China in the past two weeks and, in return, China would begin allowing the export of rare earth minerals. Beyond this, all that looks to have been achieved is for the two sides to continue building a broader list of issues which will be discussed over time. I need to see what sort of messaging comes out of Beijing later this morning. That will provide a counterbalance to the reporting now coming out from the American media outlets. https://www.cnn.com/2025/06/10/business/us-china-trade-talks-london-agreement-intl-hnk

Not sure what this could possibly mean, but Chinese markets reopened for afternoon trading and dived. Nothing news worthy out of London and the ongoing trade talks. At least nothing made public. Could be a volatile day ahead.

Bloomberg.com

Chinese Stocks Drop Suddenly as Investors Await US Trade Talks

Chinese stocks slid suddenly on Tuesday, showing that investors remain on edge as the second day of trade talks with the US gets underway.

China Late Night Missive Iwo Jima?! Haven’t heard that island name in a very long time and yet here we are. China heading deeper into the pacific for the first time. Outside the so called “first island chain”. The physiological batter over the Asian theater is very real and this move is all the more unique. American forces are based from Japan to the north all the way to Australia in the south and various spots along the way. China was supposed to be hemmed in, at least to the east. Genuinely interesting move. https://www.reuters.com/world/china/japan-confirms-chinas-aircraft-carrier-sailed-east-iwo-jima-first-time-2025-06-09/

Here’s a data point to explain why the Trump team scrambled to arrange the meeting with the Chinese in Geneva the other week. Exports to the US from #China cratered!!! Down 34% for the month of May. Just-in-time inventory zealots faced empty shelves and, with it, corporate America understood that they’d all be eviscerated on social media. If you thought the shortage of eggs proved problematic for the Biden administration, what would happen to Trump if hundreds of staple consumer goods all but vanished from the shelves at Walmart or CostCo. I can share the here locally, in China, the manufacturing engine is running at max speed. Both buyers and their local agents are working 24/7 with the concern being that the 145% tariffs will suddenly reappear. And ironically, the Chinese suppliers are charging a premium. They are making money hand over fist.

CNBC

China's exports to the U.S. clock their sharpest drop in more than 5 years — down over 34% in May

U.S. and China struck a preliminary deal in Geneva, Switzerland, last month that led both sides to drop a majority of tariffs.

China is providing a case study for what happens to an economy when it is starved of fiscal stimulus. Prices fall and with it the delicate balancing act continues. While there has been a monetary impulse from the Central Bank, that approach is more about driving greater efficiencies in how money is meant to circulate throughout the system. There has yet to be any material directly positive fiscal stimulus contrary to what you might have read elsewhere. The overall aim by the Beijing decision makers is to address, as best as possible, the over-indebtedness which has built up throughout the system. Again, the outcome of doing so is falling prices. Short term pain, but with the potential for long term strength. I would add that such an outcome is not, by any means, a certainty. At least, however, there is a recognition that there is a problem and steps are being taken to try and address that problem. Can’t say the same for the G7 nations. https://www.reuters.com/markets/asia/chinas-consumer-prices-extend-decline-fourth-month-may-2025-06-09/

China Morning Missive The trade is simple. Chips for Rare Earths. From the stream of headlines over the past week it’s more than clear that America has an obvious dependency on rare earth minerals sourced from China. This China knows and knows well. China, on the other hand, has been all but cut off from high performance chips. This has been the doing not just of Trump, but of Biden before him. The logic behind the export ban is clear. Thing is, you just can’t make a unilateral move if doing so puts your own economy at risk. That penny has now finally dropped for the folks in Washington. Now we have another round of talks between America and China this time in London. It doesn’t matter what messages are conveyed by Bessent and his team. China wants access to chips and will continue to slow roll access to rare earths until said access is granted. I’m sure that there will be much more to share in the coming days. https://www.reuters.com/world/china/key-us-china-trade-talks-set-monday-london-2025-06-09/

China Afternoon Missive Seems as though reality is beginning to sink in for the American President. Moreover, the fact that Trump decided to post the following comments publicly indicates that pressure is building. The scalpel approach taken by China is proving to be far more effective than the American sledgehammer. “I like President XI of China, always have, and always will, but he is VERY TOUGH, AND EXTREMELY HARD TO MAKE A DEAL WITH!!!,” The conditions are exactly the same as they were several months ago. Trump wants Xi to pick up the phone. That just won’t happen. Regardless of all the headlines of some impending call, it’s all just bluster. “Fake it till you make it” shouldn’t be the basis of America’s foreign policy and doubly so when it comes to China. And for all of those out there giddy over the TACO label, putting out a post such as the one above won’t be doing Trump – the man – and favors. The Chinese, and the entire Xi Jinping team, are more than happy to sit back and watch the circus from the cheap seats. The export machine here is humming on all cylinders and will continue to do so until the time when Trump rage tweets that tariffs on China are back at 145%. Trump says 'extremely hard' to make a deal with China's President Xi Jinping

CNBC

Trump says ‘extremely hard’ to make a deal with China’s Xi as trade stalemate fuels calls for leaders to talk

The two countries have blamed each other for violating a trade agreement reached in Switzerland on May 12.

Wife actually picked up the Pura X last month. The now-fully-Chinese OS clearly “borrowed” liberally from the folks in Cupertino.

For all the chip and tech controls the U.S. has put on China, Huawei has been killing it of late. New small foldable phone (Pura X) and more recently the Matebook Fold laptop.

Bloomberg.com

Huawei’s Pura X Is An Intriguing New Foldable — If You’re Outside the US

Review: The clamshell device is the company’s first flagship phone to launch with its new operating system to challenge iOS and Android.

China Morning Missive “China has no choice” ….. perhaps, but then again what does it mean to be a reliable partner. When the trade conflict went hot with China (and the entire world frankly) in early April, I felt confident that the Trump team didn’t have any idea of what it was they were heading into. China had spent four years preparing for exactly what Trump was preparing to do. Lessons were learned from the 2018 trade conflict and preventative steps were taken. Well, watching how event have played out over the past three months demonstrates that Team Trump was even far less prepared that I’d expected. There are no immediate points of pressure the US can apply on China, unlike virtually all other trading partners. The Europeans, Japan, S.Korea, you name it. All have, in some way, shape or form, dependencies on the US. Rare earth minerals are the pain trade and the export controls out of China are now starting to pinch American manufactures. The only question, at least for myself, is what concessions Trump/Bessent will make for China to resume exports. I suspect we will have a clearer idea in two weeks, or perhaps less. China isn’t the party left with no choice. It’s America that will need to move first.

Bloomberg.com

Bessent Says China Has a ‘Choice’ on Whether or Not to Be a Reliable Partner

Treasury Secretary Scott Bessent said Beijing has a choice on whether or not to be a dependable partner with the rest of the world, reiterating tha...