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President Trump is executing one of the most brilliant geopolitical economic resets in the history of global trade. It really is stunningly remarkable how President Trump has controlled the entire landscape. The consequential phase now begins.
It is fascinating how the financial pundits didn’t see this coming. Perhaps one of the best indicators of where things are today comes from this quote within the South China Post:
Administration - Section - Tariffs - China - Retaliatory
“The Administration’s Section 301 tariffs and China’s retaliatory tariffs will now further disrupt – or even break – many thousands of supply chains in both countries.”
The quote by Nelson Dong is stated *as if* shifting/breaking supply chains is a flaw in the approach. It’s not. Exactly the opposite is true; this is a feature of the strategic reset. A specific and purposeful feature designed by President Trump.
Dong - Deconstruction
What Dong is predicting is the deconstruction of “one-belt, one-road”.
As President Trump highlighted today, over time (and it won’t take long) there will be an exodus of multinational manufacturing. Corporations will shift their purchase agreements, manufacturing and assembly plans to ASEAN countries outside the investment ‘risk zone’ that is now China.
Notice - Nuance - References - President - Trump
Notice some of the nuance (specific references) within President Trump’s tweets. Japan, Vietnam (President Trang Dai Quang), South Korea (KORUS), Philippines and India are positioned to pick-up business.
To counteract the predictable exodus the Chinese state-run enterprises (and banks) will offer incentives to retain the corporate manufacturing business. This process means China, in essence, subsidizes the tariffs:
President - Trump - Announces - Today - Decision
Additionally, President Trump announces today he has not made any decision on the next phase of 25% tariffs on the remaining $350 billion in Chinese products. He doesn’t need to. Merely the possibility of additional tariffs will pause any further investment; and some companies not currently impacted will make decisions to avoid the possibility of impact.
President Trump has walked Chairman Xi into a trap....
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