More Tech Manufacturing Companies Exit China – Nintendo and Sharp Plan Exits…

Against the intense leverage being applied by President Trump, last week Beijing doubled-down and threatened punishment against any company that would leave China and begin manufacturing elsewhere.

The totalitarian response was predictable and expected.  However, also predictable was the corporate response to the threats.

As we shared:  “China is counting on prior western investment being so significant that a corporation will be reluctant to withdraw. However, in this outlook Beijing seriously underestimates the free market because communist controlled China doesn’t understand the action of a inherently free market.

The first loss is the best loss. If walking away from an investment provides more financial security and stability than attempting to retain a grip on a tenuous position – corporations will walk away.” (more)

Now today – “Nintendo Moves Some Switch Production Out of China”:

TOKYO— Nintendo Co. is shifting some production of its Switch videogame console to Southeast Asia from China to limit the impact of possible U.S. tariffs on Chinese-made electronics, said people who work on Nintendo’s supply chain.

It is another example of manufacturers adapting to the tariff threat. Taiwan’s Foxconn Technology Group said Tuesday that it was ready to move assembly of Apple Inc.’s iPhones out of China if necessary, and Japan’s Sharp Corp. , which is controlled by Foxconn, said last week that it planned to move production of personal computers to Taiwan or Vietnam.

Kyoto-based Nintendo has traditionally relied on the Chinese factories of contract assembly companies to make its videogame hardware. That includes the Switch console, introduced in 2017. (more via WSJ)

As President Trump highlighted on May 13th, over time (and it won’t take long) there would be an exodus of multinational manufacturing away from China.  Corporations will shift their purchase agreements, manufacturing and assembly plans to ASEAN countries outside the investment ‘risk zone’ that is now China.

Notice some of the nuance (specific references) within President Trump’s tweets. Japan (Shinzo Abe), Vietnam (President Trang Dai Quang), South Korea (KORUS), Philippines and India are positioned to pick-up business

While the Red Dragon does the only thing the Red Dragon knows to do, we enter the phase when corporate interests, particularly multinationals, recognize China is a communist state-run, controlled-market, system.

The reaction from China is immensely predictable; and creates a downward spiral.  If any corporation is perceived as working against the interests of the state; the state will take control of the corporate interest.   What western business interest would want to do business within China when that reality is the landscape of every economic decision?

The willingness of China to self-immolate is the golden arrow in President Trump’s economic quiver.  The inability of China to modify itself based on downstream economic outcomes is the inherent weakness… Overlay that weakness with the zero-sum outlook and you get this quote from Chinese State-Run broadcast:

…“If the US wants to negotiate, our door is open. If you want to fight, we will fight to the end.”…

Think about the logical reality of this statement as expressed.  Put another way: ‘if you agree to our terms we will work with you; however, if you don’t agree to our terms, we will self destruct.’  That’s the economic reality of the zero-sum dragon mindset.  This inevitable position is what CTH has been outlining for several years.

President Trump has walked Chairman Xi into a trap. There is only downside for China in the current dynamic. In an effort to avoid the downside, China will bleed cash to retain their economic position…. However, this can only last so long.

Meanwhile President Trump, Secretary Wilbur Ross and USTR Bob Lighthizer are not backing down from the pressure.  Trump, Lighthizer and Ross are sending a very deliberate message to U.S. companies.  If you crawled into bed with the Dragon, don’t look for us to help make your bed more comfy… deal with it.

It always appeared that President Trump was fully prepared for this outcome. In hindsight it looks even more obvious how President Trump engaged with China while fully expecting to end-up with a direct and adversarial outcome.

Long before media pundits starting noticing/considering how serious President Trump was about structurally resetting the entire landscape of a U.S-China trade relationship, President Trump quietly and methodically laid the groundwork with personal visits to: Prime Minister Shinzo Abe (Japan); President Moon Jae-in (S-Korea); President Tran Dai Quang (Vietnam); and President Rodrigo Duerte (Philippines).

The November 2017 tour of Asia was President Trump traveling to meet directly, face-to-face, one-on-one with the manufacturing heavyweights of Southeast Asia.

President Trump has positioned this geopolitical trade reset perfectly. Trump began with the end in mind and is now applying Chairman Xi’s own “us -vs- them approach” toward confronting China. The supply chain investment Beijing needs to sustain itself is now being controlled by elements outside China. Beijing responds by attacking those in the international community who control the investment.

As things go forward, China cannot sustain a long-term economic conflict with the U.S. As each day passes the ASEAN alliance will see their investment grow as companies pull-out of China and invest in S-Korea, Vietnam, Philippines, India etc. The GDP of our allies (including Mexico) grows, and the controlled GDP of China, as an adversary, shrinks.

The confrontation between China’s communist controlled economy and the U.S. free market system is the most significant geopolitical event since the collapse of the Soviet Union. The consequences from this reset are far reaching, and extend beyond the tens of trillions of dollars within the combined economies.

The entire system of global trade and supply-chain economics has entered a state of flux.

This will not end well for China.

Watch as time goes along and more companies, and nations, slowly walk toward the exits with China. There is just too much inherent financial risk.  China will have to make a deal fast yet their outlook, their inherent disposition, does not permit them to enter into a deal where they will lose status; and President Trump is in no hurry.

President Trump knows the strength of our U.S. position is that our economy is deep and wide.  The U.S. is a self-sustaining economy.  Almost 80% of our internal production and manufacturing is purchased within our own market.

In the big picture – economic strength is an outcome of the ability of a nation, any nation, to support itself first and foremost. If a nations’ economy is dependent on other nations to survive it is less strong than a nation whose economy is more independent.

The reality of China as a dependent economic model (heck, they cannot even feed themselves) puts them at greater risk from supply-chain consequences Trump is controlling and delivering.  President Trump’s strategic use of geopolitical economic leverage is working by weakening the Chinese economy from multiple simultaneous angles…

Chairman Xi has met his match.  While President Trump keeps pouring vociferous praise upon the Chinese leader; again, the exact same approach customarily used within China’s  own cunning economic strategy; Trump is simultaneously delivering an economic death by a thousand cuts.

Incredible.

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This entry was posted in ASEAN, Big Government, China, Communist, Decepticons, Donald Trump, Economy, G20, G7, India, Japan, media bias, N Korea, NAFTA, President Trump, Trade Deal, Uncategorized, US dept of agriculture, US Treasury, USA, USMCA, Vietnam Summit. Bookmark the permalink.

123 Responses to More Tech Manufacturing Companies Exit China – Nintendo and Sharp Plan Exits…

  1. Diana Allocco says:

    Genius analysis, as always.

    Liked by 14 people

    • bertdilbert says:

      China thinks this is just a trade negotiation between two parties. It is not. Trump is really good at two things.

      1. He knows people.
      2. He knows how to move money.

      Trump wants the money to move to the USA. This is what Trump has been doing all along.

      1. He gave a passport to US money stockpiled overseas the ability to move back to the USA by changing the tax law. A passport however is just the ability to move,

      2. He lowered the corporate tax rate from worst in the world to near the best in the world. Now the money has a passport and a reason to travel.

      3. Now Trump creates uncertainty around the rest of the world. Money does not like uncertainty. Behold the USA! The land of milk and honey.

      Now Trump has forced China to lash out. Without knowing it, the Chinese did exactly what Trump wanted them to do, create the uncertainty that helps the money move.

      China has had a booming growth economy for decades. Booming economies do not work well when they go in reverse. Look at Japan and another example Greece after their booms went bust.

      1. I would keep an eye on China’s strategic supply of sweet and sour pork.

      2. Expect China’s expansion into the South China Sea to become part of the trade negotiations.

      Liked by 23 people

      • WES says:

        Bert: Well stated!

        Liked by 3 people

      • gingergal says:

        Trump is ensuring our country remains competitive even after he leaves office. I can definitely see the big picture here.

        Liked by 1 person

        • bertdilbert says:

          What would compel Trump to run for President? Our lives are finite on this earth. He spent his life building an empire. Ultimately he would leave his empire to his kids and grandkids.

          Trump does not want to leave his offspring a shit hole. Nobody else was willing to step up to the plate and do the job that needed doing. I got this saying that goes like this. “If you do not do your job, somebody will come along and do your job, and you may not like the way it gets done.”

          I am liking the way it is getting done. Trump makes everyone else look like armature hour.

          Liked by 10 people

          • FrankieZee says:

            He is also doing it for his kids, because he knows that if he doesn’t fix the problem, everything he has built and left for his wife and kids will be taken away in a heartbeat by the DEMO CRAPS.

            Liked by 1 person

        • lfdale says:

          That is the one thing the ChiComms want, Trump out of office in 2020. They can steam roll the dimms and they know it, so Trump they want gone. Unfortunately for them Trump will win re-election. Where does the dragon go then?

          Like

      • TarsTarkas says:

        By the very nature of the beast Xi cannot back down. Doing so would destroy him politically if not personally. Meaningful negotiations will only begin again after he has been forcibly removed.

        Liked by 1 person

        • Trump will negotiate a solid win for the US, but he will do it while giving Xi a way to also claim the win.
          ‘Member Berries’ this: The US economy has sustained a $1/2 Trillion Annual suck by China for years and still grew. If Trump can take that down by half that’s an additional $250 Billion in economic activity at home. It is even possible that Trump can still reduce the Trade deficit while at the same time helping both Nations.
          If he can increase China’s Exports by (eg) $50 Billion per year, per year, AND open China’s markets to another $100 Billion of US goods per year, per year. Within just a few years, the Trade Deficit would become entirely manageable and both economies would continue to grow.

          Liked by 2 people

          • jmarshs says:

            China has pretty much reached the limits of it’s economic potential – which they will not be able to go beyond without jettisoning the corrupt, centrally planed economic model that’s coupled to a criminal, censorious, authoritarian, horrid dictatorship. The only reason that China has been able to achieve what they have is because Wall Street and the Chamber of Commerce have bribed the very stoopid Presidents and Legislatures who preceded Trump.

            Trump is merely exposing the Chi Coms for what they are. He’s showing the world that China is a house of cards.

            Like all authoritarian leaders throughout history, the leaders of China will NEVER allow the emergence of a wealthy, vested middle class in China – even if this means their own utter destruction. Trump has know this all along, and his every move since being elected has been predicated on this knowledge.

            Liked by 1 person

      • I worry they’ll attack ASEAN nations.

        Like

      • WhereEaglesDare says:

        What companies will save on natural gas, will pay for them to move back to the USA

        Like

    • roddrepub says:

      Wow I wish more people could see the bigger picture here. I think Sundance is spot on.

      Liked by 1 person

  2. Ospreyzone says:

    Genius. Pure unadulterated genius.

    Liked by 7 people

  3. The Boss says:

    I’ll bet Paul Ryan, Mitt Romney and their ilk are getting all weepy over seeing their commie benefactors squeal like piggies. It’s Dueling Banjos time, losers!

    Liked by 13 people

    • bocephusrex says:

      How much dirt do you think the Chinese have on Bide-O and his vermin son?

      Liked by 1 person

    • CharterOakie says:

      Brings back the image of Mittens sitting in the HoR Chamber during the SOTU speech, looking rather sheepish and dejected, recognizing that Donald Trump surpasses him in every way (unless ladies prefer darker and slimmer).

      Just bow and weep, boys, and be grateful that we now have such a POTUS.

      Liked by 2 people

    • Orville R. Bacher says:

      The Panda wearing Jackboots.
      “Love me or I will beat you.”
      It only works in China, where no one has a choice and they are conditioned by thousands of years of enslavement.
      Emperor Xi’s unintended message? Get the hell out while you still can.

      Liked by 4 people

      • noswamp says:

        Good point. At some point, (and we are seeing signs of it now) China will take off the Panda mask and reveal its real evil face. China is cornered. They will start seizing properties of American corporations soon. And even imprisoning their international country managers for made up stuff in order to gain leverage, but what they don’t understand is that this will just increase the rate companies leave China.

        Like

    • Jederman says:

      Don’t forget slow joe and his son.

      Like

  4. Chris Hagan says:

    This is spot on and only explains why we need an economic and business genius as President Trump. The corrupt media koolaid drinkers will never give Trump a win on this, instead they will heap praise on China. Sickening!!!

    Like

    • formerdem says:

      the corrupt media are doing the same thing, doubling down when they need to back down. Everybody suspects them of lying and partisanship now – and what do they do? Scream the same dumb lies louder and more often. … Buh Bye!

      Liked by 1 person

  5. Elric VIII says:

    Yes, China is in dire straits, but the U.S. Chamber of Commerce will absorb the hardest hit. And they deserve it.

    Liked by 13 people

  6. grlangworth says:

    China has chosen abjectly vulnerable positions because it opposes the free market. It is the free market that will shrink China’s position to that of an also-ran cheap labor provider whose workers have become discontent. China’s local competition has more agility, more hunger, and more freedom.

    Liked by 4 people

    • Rhoda R says:

      Vietnam is no friend of China’s but they are a communistic economy. I wonder what lessons they are learning these days.

      Liked by 1 person

      • Muthaucker says:

        I think China learned not to mess with Vietnam when they invaded the last time (1979). That said, I think the risk of war between China and Vietnam increases as manufacturing moves from China to Vietnam. As Sundance states, China views companies leaving as a hostile act. Going right next door could really piss them off.

        Like

        • Robert Smith says:

          A couple of small invasions aren’t going to make businesses feel more stable about investing in China.

          Liked by 2 people

        • emet says:

          China would like to completely control Vietnam. It used to be a Chinese vassal state and they want it back. Once they have Vietnam under control, the rest of SE Asia falls in line. Its on their to do list.

          Like

          • TarsTarkas says:

            And Vietnam always eventually threw them out. Plus I doubt India would stand by and watch what they consider their rightful spheres of influence diminish. Not to mention the US. IMO Taiwan is the Imperial target of choice. I just hope that if Xi gives the order the navy and army mutiny.

            Liked by 1 person

      • MVW says:

        I can’t imagine any other closely held desire by the entire world of countries than wanting China to fail to make a deal… the windfall in business, the boon to their economies, wealth.

        China is in quicksand, and their prideful struggling is sucking them down.

        Pharma will shift generics production to India. In itself its huge, and easy to scale.

        Sundance was clearsighted, seeing this before I even imagined any trajectory change for China’s anaconda like plans.

        Like

        • mike says:

          Indian govt orders a couple hundred or thousand synthetic sapphire on steel chemical reactors mass produced, makes them available to Bio-/Chem- sci/engrs/PhDs, and China is replaced.

          How China made cheap generic pharma ingredients a drug on the world market …

          Like

    • Orville R. Bacher says:

      Rising unemployment along with rising food prices. And Emperor Xi’s vault of U.S. dollar priced asses is diminishing quickly.

      Liked by 1 person

  7. sarasotosfan says:

    The Chamber of Commerce China must be in a real panic.

    Liked by 11 people

  8. BocephusRex says:

    One need only look at the Koch Bros’ recent decision to back Democrats to understand Trump is winning………and winning BIGLY. Screw the the modern day robber baron globalists. To quote one of my favorite movie heroes, ASH: “Come get some”

    Liked by 9 people

    • Robert Smith says:

      Funny, just a little while ago the Koch brothers were evil incarnate to Democrats. You could read it listen to Democrats without the evil Koch brother’s money coming up.

      Liked by 1 person

  9. Mike Dennis says:

    Xi and Trump, sorta has the feel of Michael Corleone and Hyman Roth maneuvering around each other in Cuba.

    Like

  10. The Demon Slick says:

    It’s brilliant. They can’t even get frustrated and nuke us, because that would destroy the market they need.

    Liked by 1 person

  11. chojun says:

    Trump is one man, but has all of his enemies surrounded.

    As Trump’s first term nears a close, it’s clear his strategy from the very beginning was to prepare all of China’s potential economic competitors in emerging markets for the time when the US would extinguish the Chinese economy.

    Trump also limited the possible Chinese responses to Trump’s strategy by serenading them early in his Presidency with videos from his grand-daughter Arabella Kushner. Note that these videos went viral in China, where the State-run media has very, very tight control over content.

    Trump’s moves against the Chinese economy, when put into context, are essentially an all-out war against the Chinese economy.

    Liked by 11 people

    • CharterOakie says:

      Not to mention the rapid, resolute and massive investment in the US military going on simultaneously to put the ChiCom hawks on notice.

      Like

    • Somewhere in Dixie says:

      We found the enemy and we are surrounded. That simplify things. Chesty Puller. And here we are again. Trump is a genius.

      Like

  12. Ghost says:

    Observations from a smaller branch:

    One of China’s largest problems will be the same as all communist, socialist states. Their not understanding free markets compiled with complete control of the banking systems lead to the inevitable downward spiral in their currency which in the end will be useful only as toilet paper. I doubt the accuracy of these numbers put out by the Bank of China;

    Bank of China report:

    Yuan denominated:
    New loans: Monthly
    June: 1180B
    May: 1020 B
    April: 1690B
    March: 886B

    M2 Money Supply: Year over Year;
    June: + 8.5%
    May: + 8.5%
    April: + 8.6%
    March: + 8.0%

    They are pumping hard, at some point it will become fruitless then look for economic melt down per Venezuela as a possibility.

    Not a fan but a link. Reuters.
    https://www.reuters.com/article/china-economy-loans/china-may-new-bank-loans-rise-to-1-18-trln-yuan-below-forecasts-idUSZZN3ELP00

    Bank of China:
    http://www.pbc.gov.cn/english/130721/index.html

    Liked by 2 people

    • rah says:

      Devaluing one’s currency is a double edged sword. Sure it drops the price of the products one sells but it also increases the price of what one buys. There is a limit to how much China can try to negate what Trump is doing by playing their usual monetary games and that does not even consider the effect heavy devaluation will have in the global political realm, or in inflation in their own country which will not be good. So China, if they don’t bend to a deal, is destined to play a dangerous game of monetary fluctuation and subsidization of their own industries. In essence they are stepping out on a tight rope and that rope will get narrower and narrower as the tariffs increase and companies pull out.

      I wonder though. Is what is going on in Hong Kong part of Dragon’s reaction to what is happening to them? Are they moving there NOW to try and ingest the wealth they don’t now control in order to try and use it to help sustain them at least until 2020?

      Liked by 6 people

  13. Grassleysgirl/Breitbartista says:

    🐼 spits fire until he burns himself

    Liked by 1 person

  14. Rhoda R says:

    China will probably spend their last dollar supporting the President’s opponent in 2020.

    Liked by 3 people

  15. alliwantissometruth says:

    No one ever said communist leadership is smart, except maybe the brainwashed nitwits of the West

    What a ridiculous way to live life, spending all your time oppressing your own people and manipulating business interests in order to control things for a little extra profit

    What a bunch of immature and insecure losers

    Well losers, meet the freedom bully. He goes by the name of Trump. You can learn a few things from him. Righteousness, how to be a real man or a person of high character

    Oh, and you commie “tough guys”, you may even learn the real art of the deal, if you’d only expand your little boy minds and get off your power trips

    Liked by 2 people

    • GenEarly says:

      Everything you said so exactly fits the democRats and kocherRinoes here in the USSA. We must Restore the rule of law, Equal Rule of Law in a restored Republic to survive. It’s going to be close call, but it is All coming to a head, Now. CYA, it will be bumpy at best, maybe frisky.

      Liked by 1 person

    • TarsTarkas says:

      They don’t oppress for the money, they oppress for the greater good! It’s in your own best interest that you knuckle under and kowtow and sing hosannas! Stupid deplorables.

      But appealing to virtue is how the Marxists continue to get acolytes, useful idiots, and recruits. Because of course anybody who opposes the General Will is both dead wrong and a bigot.

      Liked by 1 person

      • alliwantissometruth says:

        I agree with most of what you say Tars, but don’t think for a minute the communist power elite aren’t socking away big bucks

        Just as our system attracts those with good intentions, they ultimately turn and become part and parcel of the corrupt oligarchy, and power / profit becomes their only goal

        Like

    • MVW says:

      China was smart vs our corrupt sellout ‘leaders’.

      Like

  16. sundance says:

    “testy” 😀 😀 😀

    Liked by 11 people

    • CharterOakie says:

      Decades of thought and preparation now fully in action.
      Awesome.

      Liked by 2 people

    • Terrific summary from POTUS.
      When asked if he has a deadline—POTUS turns inscrutable as he points to his head–“it’s right up here”.

      Masterful!

      Liked by 2 people

    • CountryDoc says:

      The Trump Haters are uncomfortable with his “Cockiness” “narcissism”. He could gloat so much more, but relative to what he has accomplished, and is accomplishing, he is pretty humble. He is letting others take the credit for their work and executing his ideas.

      Yes, this is hard for him. But he is in his element. He is having a ball. He is teaching with his actions, and smart people will flock to learn his world view, his ways of thinking.

      Liked by 2 people

  17. Mncpo(ret) says:

    China’s economy is a mile wide but an inch thick. If you cannot feed or fuel your country, you are F’d, period. They stole, compromised, hacked every idea that they turned into profit and our past Presidents supported them. China and their cohorts internationally exfiltrated trillions from us.

    OOPS-Trump. She was supposed to win.

    It was NOT supposed to come to this. Premier for “Life” has got to be a little shaken by the circumstances.

    I know i would be if my and my compatriots whole plan for conquering the world just blew up in our faces AND my billion+ people are starting to get pissed off.

    Liked by 10 people

  18. Hehevd says:

    Why not retweeted???????

    Like

  19. ristvan says:

    The situation is more nuanced than black and white. There are three basic ‘buckets’.

    1. Foreign investment mainly to supply the domestic Chinese or regional Asia market. P&G is an example. Doesn’t pay to ship toothpaste and shampoo from US to Asia. Not much affected. MOTs ~10000 Chinese employees in Tianjin (when I was a senior Mot exec) produced semiconductors and auto electronics for the Chinese market. We didn’t dare make any ‘good stuff’ there because of IP and trade secret theft.

    2. Foreign investment to supply foreign markets and China. Apple assembler Foxconn is a good example. Both Foxconn and Apple could be hurt badly by China if they exit. Foxconn because almost all their contract manufacturing capacity is in China (~1.5 million employees). Apple because China is a major Apple market. So they are both stuck if hit by US tariffs. GM autos is another example; Buick crossover SUV Envision is built in China for the US market in a JV plant that also builds Chinese brand GM autos for the Chinese market. GM is stuck.

    3. Domestic investment for foreign export. An example is wooden furniture. US SE industry was devastated. 39% of world wood furniture production is now Chinese, centered in Guongdong province around Shenzen. Most is also China owned. Import raw US wood, turn it into furniture, export furniture to US. Here, the customers need to find or fund new suppliers elsewhere. Takes some time to find them and set up new factories. Textiles and clothing is another example where China’s intransigence is an India/Pakistan/Bangladesh/Vietnam opportunity. Simple household goods is another. Reordering supply chains is ‘easy’ when machinery is not expensive and easy to fabricate—Yarn spinners, looms, knitting machines, sewing machines. Lathes, saws, sanders, paint booths. Plastic compounding and injection molding machines for cups, containers, bowls, stainless steel utensil stamping mills. And when the labor pool is not high skilled.

    Bucket 3 is where Xi loses bigly and quickly and his economy takes a real employment and financial hit. IMO Xi will have to do a deal with PDJT before the election. To painful to wait the 2020 election out in the hope PDJT loses because by then bucket 3 supply chains will have been reordered.

    Liked by 18 people

    • The Boss says:

      Thank you for this.
      (FYI, something is being done about one example in #3).

      Liked by 2 people

    • CharterOakie says:

      As as aside, one fewer small SUV (of average quality) supplied to this market will be almost inconsequential. But GM’s investment is material, no doubt, which is your point there.

      Liked by 1 person

      • WES says:

        Oakie: My brother works for gm but hasn’t been to China for at least two years now. Yeah gm is kind of stuck and any plans to make then export cars to US is now probably not viable. China still has a big domestic car market but it is cooling lately.

        Like

    • MVW says:

      Pharma. Easy to shift to India as India is already big, and a competitor in generics. China’s plan was to swallow this market whole. Not anymore.

      Like

      • GB Bari says:

        India or China making our pharmaceuticals doesn’t sound safe or secure to me. Theres no reason those cannot be made here – I would imagine those are highly automated processes.

        Like

    • Remember the comment Xi made about the long walk and how (I think it was SD) described it as a walk to their death for most? He said this is China’s next long walk, or something similar.
      China’s going full tilt and the chances aren’t even 1 in a million…barring one of two possible nuclear options they have available.

      Like

    • Ristvan,
      Great insight regarding the different “buckets” of manufacturing plant investments.

      I agree that Xi will make a deal rather than wait until after 2020. Once supply chain investments are shifted elsewhere, intransigence to bring the manufacturing back to China sets in. And, frankly, other countries offer similar opportunity regarding labor with potentially cheaper shipping costs.

      Liked by 1 person

    • USTerminator says:

      Number 2 is actually easy to divest from China. Apple/Foxconn makes 150M phones in 1 or 2 factories in China. Even without the trade war, that would be a big risk to concentrate you business like that. Remember Fukushima earth quake, if some natural disaster happens in the factory area, Apple can really be screwed. Apple/Foxconn can divert 50M out of China to make in US start out using China supply chain while building supply chain outside of China slowly. As time for new models, Apple can allocate that US plants will build new models NA and Europe while China continues to build old models and new models for China and Asia market. So you slowly cut back production in China depending on cost and risk factor. It is much safer to dual sources or triple sources, every businessman would know that.

      Liked by 1 person

  20. Dutchman says:

    I think China watched what happened, with Reagan vs. USSR, and envisioming the same thing could happen to them, they ATTEMPTED forestall it.

    This was why they shifted from agrarian economy, to manufacturing.
    WTO, MFN, etc and built up as manufacturing plant to the world.

    They hoped to reach the point thru OBOR, China 2025, where they could have expanded their influence enough to kill off the U.S., and survive.

    Cause they knew U.S. was and is an existencial threat. They have been in an economic war with the West, and particularly U.S., for 30 years.

    Bribery/corruption, of our ‘leaders’, infiltration of our institutions, they hoped no one would notice, or do anything about it, until too late.

    And it ALMOST worked,….and as the panda mask comes off,….well, there are just some things, that once you see them, you can’t “unsee”.

    Liked by 11 people

    • CharterOakie says:

      Good summary overview.
      Day of reckoning coming for the traitors among us. They had better have a ‘come to Jes…POTUS’ moment soon, if there’s still time.

      Liked by 1 person

      • Dutchman says:

        Unfortunately, there will always be those who will succumb to blackmail, coersion, bribery/corruption, its human nature.

        I see going after the briber is more important than going after the bribee.

        Otherwise, you take out one bribee and two rise up to take its place. Like a Hydra.

        Gotta kill the beast. I do hope the bribees experience some justice, some consequences fot their actions.

        But gotta kill the beast, and at this point I don’t see any move China(CCP) can make, to avoid the inevitable. Remember what coupist wanted to do, first to Flynn, then Trump? Well, THATS whats happening to CCP. and theres NOTHING they can do about, methinks.

        Liked by 2 people

        • GenEarly says:

          US cut off oil supply to Japan in 1941, Pearl Harbor and US entrance into WW II followed.
          President Trump has to thread the eye of the needle with China. Not that he can’t, not that it must be done, But deftly. So much rides on President Trump’s shoulders, at home and abroad. Hubris on our part isn’t needed or useful either, We despise it in others, like the Elitist Progs, so we shouldn’t repeat it ourselves.

          Liked by 2 people

          • TarsTarkas says:

            Actually it was the Dutch who cut off the oil (and rubber), while we cut off the supply of scrap metal. The Dutch wouldn’t have done it though without pressure from FDR (and Winston). Nobody expected the Japanese to go so far so fast in the first six months of the war.

            Like

          • Dutchman says:

            When you have to warn yourself against hubris, or overconfidence, it means ya got a pretty good reason to feel confident.
            And, after watching a country rob our country and commit unspeakable attrocities against their own people, I don’t have a major problem with a little cheering, seeing them finally get their cummupence.
            I am going to have no trouble sleeping at night, or looking myself in the mirror.

            Like

    • MVW says:

      China is in huge trouble with farming due to draught and disease, huge trouble.

      Like

  21. Meanwhile:

    China extradition clashes plunge Hong Kong into historic violence

    https://news.yahoo.com/china-extradition-clashes-plunge-hong-kong-historic-violence-132641623.html
    “Hong Kong was rocked Wednesday by the worst political unrest since its handover to China, as police fired tear gas and rubber bullets to disperse protesters who tried to storm parliament and blocked roads in the financial hub.
    “The violent demonstrations were the latest expression of widespread public anger over the government’s controversial Beijing-backed plan to allow extraditions to China.”
    __________________________________________

    Like

  22. franuche says:

    Bottom line for me: I hope China “fights to the end” and all of the manufacturing comes back to the US, or to non-tyrannical countries. They can have fun slouching back to China circa 1960.

    Buh-bye.

    Liked by 2 people

  23. Somebody's Gramma says:

    I pray China doesn’t do something really stupid in retaliation. I also would love love love to be able to purchase quality American products at an affordable price. I’m so sick of the cheap crap (clothes, furniture, even kitchen utensils!). I remember when you could make your own clothes, curtains, etc cheaper than you could buy. Now fabric is a ridiculous price, and clothes are terrible quality. What to do? Yes, even designer brands are terrible quality. How about appliances and things like vacuums, kitchen mixer, etc., that would last 30+ years!! Now those same brand items cost a ridiculous amount and have to be replaced in less than 10 years, sometimes less than 5 or 2. I know not everything is made in China, a lot in Mexico, etc. But, QUALITY has left the building and I would welcome its return. I’d gladly pay a little more for something that lasted. Oh, and doesn’t the China thing affect AMAZON???? LOL. Wouldn’t that be rich? I order most things through Amazon because I am rural. But, I remember the Sears catalogue. You could just about get anything from Sears and it was Quality. My down-to-earth 2 cents on China vs USA.

    Liked by 3 people

    • When every economy in the world is failing, raw mats. prices come down, and quality becomes affordable. I just don’t like rooting for others to lose just because the elitists running their countries are corrupt, stupid, socialists (read as communists).

      Like

  24. litlbit2 says:

    When I was in China in 2004, learned of the conditions and requirements to setup shop and do business there, I wonder how long it would take for companies to see reality? Never could understand why these startup CEO’s did not ask at what point or time frame do I become taken over?

    Now many are finding out, they never did own anything in China. Furthermore not only were they owned they also gave away all secrets as well as producing competitors and lists of customers.

    Liked by 4 people

    • cthulhu says:

      You can talk to the office shredder guys, if there are any more around who will admit to being part of that fiasco.

      Liked by 1 person

    • lydia00 says:

      Great points, it’s hard for money people to ignore cheap labor and what looks to be an emerging market of middle class customers A friend of mine looking at business in China 20 years ago made the point he couldn’t get Mao, the Cultural Revolution, Struggle Sessions And re-education camps and more recently, Tianamen Square out of his mind. For him, it was a long term trust issue. They were still operating as a planned economy. But many either don’t know history or are naive about the totalitarian mindset. That’s how I view Google getting into bed with totalitarianism in China. They think they are so smart.

      Liked by 1 person

  25. 10en6ixty6ix says:

    It is incredible !!!

    Like

  26. StuckInBlue says:

    Let the China caterwauling commence. They made their bed, and President Trump is merely forcing them to lie in it.

    Like

  27. Tiffthis says:

    Fantastic news. Winamins all around today, treepers 👍🏼

    Like

  28. TreeClimber says:

    Husband and I were discussing Sundance’s excellent article about Kim Jon Un/his brother, this morning before husband left for work. Husband feels as bad for Un as I do, now – trying to slip that leash and get free of that hostage situation. Husband (see the world in black and white) suggested just nuking China (which is his go-to solution for everyone/thing he sees as a potential enemy,) and I said that, I think Donald Trump, being Donald Trump, probably wants to rescue the hostages of the whole world – including the Chinese people.

    Which was all to say, is it possible PTrump is attempting/going to attempt a total economic reset of China and other Communist/Socialist countries? He appears to be trying to force Mexico to rescue themselves, he’s made clear his support for the Iranian people, he’s supporting nationalist leaders the world over… is Donald Trump attempting to rescue the whole world while President of the US?

    Liked by 2 people

    • Maquis says:

      He surely is setting the stage and the tone. People are paying attention and leaders are stepping up. President Trump’s example will resonate for centuries to come.

      Liked by 1 person

    • CountryDoc says:

      As I have observed on other threads. PDJT’s MO is to treat everyone equally in the beginning and given everyone many opportunities to work toward win win. And really that is the best long term, peaceful, and stable solution, that allows maximum profits in the future. But he will not back down, and if you get violent, he will escalate. He is honest. He is consistent. He will continue to give them opportunity to be a good neighbor, but he is not afraid to let you feel his superior position if you push back.

      Liked by 1 person

    • Maquis says:

      Love it.

      “The Hon Hai senior executive said it will respond swiftly and rely on localized manufacturing in response to the trade war, just as it saw the need to have a base in the U.S. two years ago before the trade dispute began.”

      Just who helped Foxconn see that need? 😁

      Like

  29. L. E. Joiner says:

    How far do we really want to push China? At some point, even pandas will fight back. Are we prepared to defend Taiwan?

    Like

  30. Greg says:

    So when Trump or his surrogates met with Mexico last week do you think they mentioned that manufacturing will be leaving China and looking for a stable non tariffed Country to set up shop and spend a few billion in? Billions must be a very big incentive to Mexico I would think.
    I really didn’t have much faith in Mexico to do the right thing on the border, but Sundance has given me a reason to have hope.
    This Trump guy is a genius and the liberals are missing out on all of it. No matter what China or Mexico does, the US wins. If Pelosi and Schumer were paying attention they would know they were screwed, blued and tattooed, damned if they do & damned if they don’t.
    LOL…the EU is so screwed………and the US is so Blessed, Thank You Mr President!
    Thank You Sundance!!

    Liked by 3 people

    • CountryDoc says:

      More billions than the cartels can offer, and with much more honor. We might even share some of our winnamins with you. But you can’t hold the jar of winnamins!

      Liked by 1 person

  31. rcogburn says:

    China is one front of a two front war. The first is Trump vs China, which plays out in on the front page. The second front is quieter. This is Trump vs the corporate interests, multinationals, banks, and US politicos like 1% Joe Biden who benefit from this gravy train as much as China does.

    As Trump pressures China, he pressures C-suites to get out of China or risk huge losses. The old corporate forecasts are being torn up. At this point, no major manufacturer can afford to assume that China will endlessly “subsidize” tariffs. Sooner or later, China will pass it on to manufacturers (and are no doubt already threatening to do so), who either have to eat it or drastically raise prices, neither of which looks good on a P&L. If Sharp doubles the price of a TV, consumers don’t think about electing a different president. They think about buying a Samsung.

    China’s “friends” in the US were supposed to have stopped Trump long before things ever went this far. Xi must be burning paper lanterns for being forced into a pissing match he was told would never happen.

    Far from over, but not a good week for Xi.

    Liked by 2 people

  32. clipe says:

    Right now, Hong Kong is ground-zero. Trumpenomics presents China with a real conundrum.

    Do we go full Tiananmen Square? No, that wouldn’t be a good idea.

    That’s the way the egg rolls.

    Like

  33. Narayanan Subramanian says:

    Sir: you said-
    In the big picture – economic strength is an outcome of the ability of a nation, any nation, to support itself first and foremost.

    Please also show how this principle work with respect to UK, Europe, etc.

    Much appreciated.

    Like

  34. Brainiac says:

    If Xi is losing face, would he not have to generate a national security smokescreen/threat to survive?

    Like

    • L. E. Joiner says:

      That is the problem. Enter Taiwan.

      Like

      • GB Bari says:

        Do NOT think for one nanosecond that PDJT didn’t think of that possibility a long time ago and has already accounted for the risk in his overall strategy.

        Remember the $700+ Billion per year x 2 years budget for the military he frequently likes to remind us about?

        Like

  35. Rynn69 says:

    A sobering thought for all American voters must be to recognize how inept and ill-equipped Presidents and Congressional leaders have been after Reagan (1988 – 30 years!). We are bearing witness to what a truly qualified President looks like . . . and it is glorious.

    President Trump is courageous, cunning, smart, savvy, tireless. A happy warrior that brings a refreshing authenticity to the Presidency sprinkled with a delightful dose of wit. A true leader is what we are witnessing and why the hatred is so deep from the inept Swamp. We all see the clown car called Congress (with the exception of the Freedom Caucus) and we all see the corruption junction called the Senate (led by Decepticon Overlord McConnell).

    Liked by 2 people

    • Arrest Soros says:

      Inept? No, those Presidents and Congress Critters weren’t inept.
      They did what they did purposefully. It started with Bush Snr and his “New World Order” speech.
      Then came the corrupt crooked Clinton who sold out the West by bringing China into the World Trade Organisation in 2001.
      China was still relatively poor and backward until they entered the WTO. Then they took off like a rocket.
      From memory, China GDP was still below $2 trillion before 2000. They are now 5 times that in such a short time all thanks to the calculated corruption of Bush Snr and Clinton.

      Like

  36. Narayanan Subramanian says:

    …Right now, Hong Kong is ground-zero. Trumpenomics presents China with a real conundrum.

    Do we go full Tiananmen Square? No, that wouldn’t be a good idea…

    What do we know about force deployment/readyness in southeast China?

    Like

  37. Mr BiG Time says:

    “The entire system of global trade and supply-chain economics has entered a state of flux.”

    Yikes Stripes ! Wowza !

    MAGA

    Like

  38. CountryDoc says:

    Our nation was losing its principles. Disrespect for morals and law was being flaunted. The Chicago way of thuggery and street fighting, extortion, and fear based muscling had spread to Washington. The transition from good to evil is often driven by fear, not greed.

    Trump the disrupter is demonstrating the value of honesty, transparency, strength, pride, nationalism, protecting the home and community, grace, professionalism in business and economics. He is growing in the process. He is forcing others, those who were moving with the flow to china, drinking the Kool-Aid to see the deeper principles of loyalty.

    We all have it in or DNA to recognize good vs evil, and we would all rather be well-fed, safe, and good, than well-fed and bad. Trump has a lifetime of watching human nature respond to and hunger for the win-win deal. The democrats/leftist/RINOs/Uniparty/Globalists fight law and structure. PDJT is teaching the world to use our fighting skills to build a community, make enemies declare their true nature, and protect the home front.

    Liked by 1 person

  39. Gary Lacey says:

    As I have followed sundance’s synopsis of China’s painting themselves into a corner on trade, it begs the question, what in the hell are the Chinese thinking?!
    There is only one way out and that’s to accept Trump’s deal,
    However, I think they could come to the table without intending to honor their agreement, and that will be a fail.

    My GOD, Trump has the Chinese over a barrel and how!

    “The art of the Deal”

    Like

  40. Narayanan Subramanian says:

    Interview with Brigadier General Spalding.

    Sir,. Have you seen it?
    Was it analyze discuss by CTH ?

    Much appreciated.

    Liked by 1 person

  41. lydia00 says:

    The problem is too many in power here benefit from China. We must identify those people and put them front and center as supporting totalitarianism for personal gain against the US. We can start with Biden, Clinton’s, Amash, etc, etc.

    We built this country on tariffs. It’s not a dirty word and there is no such thing as free trade as they are using the term. Only imbalanced trade. But the corrupt benefit.

    Liked by 1 person

  42. scrap1ron says:

    When your only tool is a hammer, everything looks like a nail. Typical reaction by the chicom thugs. Now their bought & paid for proxies and advocates in our country need to be publicly exposed, excoriated, and aborted from any positions of authority. Move over Benedict Arnold, you’re going to have company.

    Like

  43. Phil Garber says:

    It seems to me that Trump is doing to PRC on the economic front what Reagan did to the USSR with the arms race: raise the ante until the opponent bankrupts himself trying to stay in the game.

    Like

  44. askandgettruth says:

    never tired of winning. we need to take the money away from china’s military build up in which they want to wage war on the USA. just like pres. Reagan did to the USSR.they are not our friend. our forefathers told us not to trade with the enemy cause it would make them strong and they would some day try to kill us all and try to take over the world.we don’t need their poison

    Like

  45. Biting Flies says:

    “When God desires to destroy a thing, he entrusts its destruction to the thing itself. Every bad institution of this world ends by suicide”. Victor Hugo

    Like

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