The talks in London seem to have gone well.
Bessent is a busy man. They were in London Monday and yesterday, and Lutnick (on CNBC) said that yesterday’s talks lasted 14 hours ending at midnight.
Today (Wednesday) Bessent is testifying before Congress.
Agreed the US, the world in fact, is too dependent on China for rare earth magnets, which DJT is working on because there are plenty of rare earths in the US (and elsewhere, like Ukraine) but mining them upsets the environmentalists.
But it works both ways. The Chinese need ethane to make plastic and 98% of that ethane comes from the US and when China cut off the rare earths, DJT cut off the ethane and other stuff that China is dependent on the US for. Both sides have now agreed to give the other what they need.
Incidentally, the US tried to do the world a favor in London. They’ve got a deal to restore US access to rare earth magnets, in exchange for restoring Chinese access to ethane etc. The US tried to go further and get a deal for China to provide unfettered access to rare earth magnets for the rest of the world as well, but that was a bridge too far for China.
Lutnick just explained all of this on CNBC, so it will be interesting how much of what he said makes its way into news media.
Trade wars are simple. Whoever exports more will lose a lot more. And the greater the percentage net exports are, the worse of their economy will be.
China would be the bigger loser. Not sure on rare earth or why us would be more eager than China. Overall everyone is a loser, global gdp will take a one time hit, and change the supply chain.
From what I hear though most people are hesitant to change, as polices easily change from one admin to the next. Everyone is slow diversifying away though.
I’d look past the immediate monetary impacts. This is geopolitics and China does not really care about the pain as long as there is no major unrest within the population.
Our habit of trying to understand China through the lens of economic pain is doomed to fail. We’re constantly behind in understanding that China isn’t a conventional nation-state. If West’s assessment of China were correct, political liberalization would’ve followed economic liberalization - this is nowhere near happening. This same “economy centered” thought process led to the Trump administration being surprised by China not backing down on tariffs last month. Even the administration itself basically admitted that China punching back wasn’t part of the playbook.
Right now US and the West in general would need a coordinated and systematic approach in how to prevent China from increasing influence in the developed world or god forbid, become the de facto imperial superpower #1 in the world.
My view is that the US’s approach is haphazard and whatever long term strategies there is, they’re being stamped over by the erratic behavior of the Trump administration.
That wasn’t the West’s assessment so much as the globalists’ assessment, and if you go back to the 1990s you can see conservatives like Pat Buchanan warning us that the globalists were wrong.
China was front and center in the Republican primary in 1996, when Buchanan lost to Dole, and in Buchanan’s 3rd party campaign (running for Ross Perot’s Reform Party) in 2000. Buchanan 1999: A TIME FOR TRUTH ABOUT CHINA
What has happened is exactly what Buchanan warned would happen and the opposite of what the globalists promised us. Instead of political liberalization, we’ve given the Chi-Nazis the money to become a superpower.
Buchanan used to quote Lord Melbourne (who was speaking about Ireland) “What all the wise men promised has not happened, and what all the damned fools predicted has come to pass.”
The Trump administration wasn’t surprised that China didn’t back down. They had a plan in place for that eventuality which they implemented.
China cuts off rare earth magnets, the US cuts off ethane for plastic, and high-end computer chips, and stops giving Chinese students visas to study in the US (including Xi’s daughter who goes to Harvard). The US telegraphed in advance what it was going to do and then did exactly that.
Very good point but it’s not only the globalists who hold that view - every move the US’s currently does is based on the idea that you can coerce opponents as well as allies into doing something via economic pain. This approach can work with Europeans and democratic countries, but it doesn’t work with China.
The entire tariff debacle was a mishit. The capital market reaction, China’s counter move, Bessent and Trump not coordinating; everything was pure chaos and Trump calling up Xi was the end result of this. I know we totally disagree on this but I really have a hard time understanding how someone can see these Q2 developments as some strategic master plan.
Btw, didn’t know that Xi’s daughter went to Harvard. That’s pretty funny.
The gold standard was set by Nixon in 1973, with the Nixon doctrine that countries should fight their own wars.
Israel’s military was devastated by a sneak attack on Yom Kippur, the holiest of days, in 1973, which left Israel unable to defend herself. Nixon resupplied Israel in Operation Nickel Grass. There’s some great information about it in Buchanan’s book on the Nixon administration. Nixon asked what Israel needed, Kissinger pulled out a list, and Nixon doubled the quantities on the list. Nixon kept US forces out of the war and also managed to keep the Soviet bloc (which was supporting the Arab states) out of it. Israeli Prime Minister Golda Meir called Nixon the best friend Israel ever had.
We’re being shown TV footage of protests in Tehran and the Shah’s son has been wheeled out.
We’ve been fooled too many times before.
Buchanan used to quote from Byron’s poem, Greece Enslaved,
Hereditary bondsmen! know ye not,
Who would be free themselves must strike the blow?
I want Israel to win but to do it themselves,
And if the people of Iran want to overthrow their government, again, do it themselves
added: the Oct 7 2023 attacks were within days of the 50th anniversary of the Yom Kippur sneak attack
What a powder keg of a situation. War in Ukraine, Middle East is a tight rope walk and China is licking its chops looking at Taiwan. Me thinks that if it wasn’t for nuclear weapons and the economic interconnectivity built in the past 30 years, there would be a very good chance of this leading to a Full Retard Mode something akin to a WW3.
Talking about full retard, earlier this week a news site I visit was discussing First World War glass–rubber exchange
In 1916 during WW1, Britain and Germany were worried that they were going to have to stop killing each other because they were running out of supplies. Britain lacked optical glass (from Carl Zeiss) for aiming the big guns (you need the distance to set the angle) and Germany lacked rubber for tires. So they decided to swap so that the killing could continue.
I’ve actually read the Robert Ludlum novel that wiki says was based on this, but didn’t know it was based on a real event.
There’s so much contradictory information out there, it’s impossible to know what’s true and what isn’t.
We’ve been told that bunker buster bombs can take out Iran’s Fordow nuclear site, then others tell us it would need tactical nuclear weapons.
Now this Netanyahu: Israel is capable of striking Iran’s Fordow nuclear site without U.S. support
Maybe it will end up like one of the old James Bond movies with zero zero leading a platoon of marines into the Ayatollah’s lair to destroy the centrifuges.
added: meanwhile, Trump has received yet another Nobel Peace Prize nomination, this time for averting a nuclear war during the recent Pakistan-India crisis Pakistan Nominates ‘Genuine Peacemaker’ Trump For Nobel Prize
If there were any justice, he would have had half a dozen Nobels so far.
Ealier this year: “We believe that the job of the United States military is not to wage endless regime change wars around the globe, senseless wars…”
A couple weeks ago: “It is crucial … this great transformation has not come from Western interventionists flying in with lectures on how to live or how to govern your own affairs. The so‑called ‘nation‑builders’ wrecked far more nations than they built”
let’s fill in the dots
First of all, of what “great transformation” is he talking?
The rapid development of the Middle East
``A new generation of leaders is transcending the ancient conflicts of tired divisions of the past.‘’
What he actually said was
``It is crucial for the wider world to note, this great transformation has not come [the rest of your quote]‘’
Delete ``for the wider world to note’’ and the meaning changes.
The two links both say what I would expect them to say.
WSJ wants to overthrow the mullahs
The Economist says “Orange Man Bad”
As to `Why Wouldn’t There Be a Regime Change?’ it would indeed be a good time for the people of Iran to change their government if that’s what they want. But they need to do it themselves.
``Hereditary bondsmen! know ye not,
Who would be free themselves must strike the blow?‘’
With all her natural resources, Iran should be a very rich country, but instead she’s spent nearly 50 years pursuing her white whale.
Interpret how you will. I think you will be able to finally convince yourself that Trump has successfully navigated the dangerous waters and kept the US out of the Iran war.
Not a matter of what I think, it’s a question of whether the mullahs retaliate, and so far they haven’t and hopefully won’t.
Edit: and it looks like peace has broken out.
Trump said on social media that Israel and Iran have agreed to a “complete and total ceasefire” to be phased in over 24 hours.
If the Pentagon assessment is correct, we’re heading into really dangerous waters. Iran’s power balance has shifted towards the gongho-generals who’ve just been humiliated who probably won’t hesitate to shift into high gear to develop the bomb.
Btw, just typing this made me realize that this would make a great James Bond movie plot
“An intelligence assessment from the Pentagon reportedly found that America’s strikes on Iran did not destroy its nuclear programme, as Mr Trump earlier declared, and probably only set it back by months. The initial findings apparently conclude that the bunker-busting bombs America dropped on three nuclear facilities did not eliminate Iran’s supply of enriched uranium. The White House called the assessment “flat-out wrong”.”
I misread the situation. I think we’re just going to have to trust President Trump on this. He seems have found a way to eliminate the Iranian nuclear program while allowing the Iranian regime to save face by retaliating harmlessly.
A lot of this seems to have been mediated by Trump’s emissary Steve Witkoff who deserves a share of one of Trump’s Nobels.
With the nuclear program gone, Israel and Iran can normalize relations, just as Israel has normalized relations with a number of other muslim countries through the Abraham Accords.
Added: Steve Witkoff
