China Morning Missive Not only is there no concrete China policy out of the Trump administration, I am here to also state that the boys in Beijing are very well aware of this fact and are acting accordingly. Two days ago, the business media complex ran with Sec Bessent’s comment that “China want to pull the entire world down with them.” Recoiling from the decision by China to impose tighter export controls, Bessent’s frustration in dealing with the Chinese reached a breaking point of sorts. There was the late last week quip by Trump himself of a new threat of 100% across the board tariffs. That, of course, was walked back before futures opened on Sunday night. Now we have Bessent talking about “decoupling” while in the same breath raising the prospects of a “long truce”. Having personally dealt with Chinese counterparties far more than your average person, what you are seeing is the exact outcome the Beijing negotiators have been seeking. Act in a highly mercurial manner with the objective of frustrating those sitting across the table. Do so long enough and that party will snap, putting them off balanced. Bessent would have had far greater success trying to nail Jello to a wall. The only tactic the Chinese respond to is steely, aggressive determination. The unmovable object. There is no middle ground ever. To make this point a bit clearer, allow me to provide a more real-world example. If you run a business in China, you’ll, obviously, manage Chinese employees and these individuals only have two operating modes. (1) they work and work hard under a deeply seeded concern of losing their job or (2) no real concern is evident in the workplace and with that they will seek out and press aggressively any identified advantage. There are, of course, exceptions but what I’ve laid out here is the rule. I have no idea who is advising the Trump team, but I can assure you those advisors have no idea what they are doing. Failure on a epic scale.

Bloomberg.com

Bessent Floats Longer-Term China Truce After Rare Earths Gambit

US Treasury Secretary Scott Bessent dangled the possibility of extending a pause of import duties on Chinese goods for longer than three months if ...