Appearing on CNBC this morning, Treasury Secretary Scott Bessent gives an outline of the discussions between the USA and China.  Bessent and U.S. Trade Representative Jamieson Greer held meetings with the Chinese delegation in Geneva, Switzerland this past weekend.

Pay attention to Secretary Bessent describing [05:40] how Chinese ‘overproduction’ is now reaching the shores of partnered nations, that is the element CTH previously outlined {SEE HERE}, which is a rather significant issue right now.  The goods themselves are not ‘generic’ in nature, they are branded high-end products awaiting labeling and distribution once their component part of the global tariff is determined.  This is part of the ‘urgency’ motive for Beijing to seek some understanding of the timeline.

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As expected by anyone with common sense, the statement by Chinese Vice-Premier He Lifeng is considerably different from the U.S. media interpretation of the White House statement.

According to He Lifeng: […] “The atmosphere of the meeting was candid, in-depth and constructive. The meeting reached substantial progress and achieved important consensus. The two sides agreed on establishing a consultation mechanism for trade and economic issues, identified the lead persons on each side, and will carry on further consultations relating to trade and economic issues of their respective concerns. The two sides will finalize relevant details as soon as possible and will issue a joint statement reached on May 12.”

[…] “China’s position towards this trade war has been clear and consistent; that is, China doesn’t want to fight a trade war, because trade wars produce no winners.  But if the U.S. insists on forcing this war upon us, China will not be afraid of it and will fight to the end.” 

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This ‘clarification‘ of sorts by Big Panda should not come as a surprise, despite the White House press release and the wording of the title.

Neither Secretary Bessent nor USTR Greer would make an announcement of a “trade deal” in advance of President Trump’s personal announcement. PERIOD!

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White House National Economic Council Director Kevin Hassett always does a good job of framing the current status without impeding the negotiating strategy of the White House trade delegation.

In this morning’s interview, happy Hassett outlines the motivation for China to quickly get to an agreement on principle about their U.S. trade position, and the structure of the personnel who are present on Beijing’s behalf to organize the discussion.  As noted earlier, Bessent and Greer were very careful in their language to promote positive advancement of agreement to the framework but avoid calling the outcome of the discussions a completed deal.

Hassett encapsulates the current trade status with China and other nations.  WATCH:

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No doubt President Trump is leaning back a little following the White House statement.  The Chinese announcements are not as forcefully positive as the White House ‘headline’ press release.  There’s a disconnect afoot that needs to be reconciled quickly or it makes the White House look weak while cunning panda smiles.

It would be surprising to see an actual “trade agreement” with China, before the commitments from ASEAN countries to stop transnational shipping exploitation are in place.

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The White House has released a statement headlining: “U.S. Announces China Trade Deal in Geneva.” However, the use of the wording “trade deal” is being disputed by China who prefer to say, a “consensus was reached.”

Indeed, if you listen to the wording from Treasury Secretary Scott Bessent and U.S. Trade Rep Jamieson Greer, there is no talk of an actual deal in their language. Methinks whoever wrote the White House headline, that is (not accidentally) currently manipulating the markets, will be soon given the exit. Here’s the remarks from Bessent and Greer:

The White House statement is below:

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The background IS HERE and seemingly doesn’t change much.  President Trump notes in an announcement via Truth Social that “GREAT PROGRESS MADE.”

The terms “total reset” and “opening up of China” are noteworthy.

[SOURCE]

Praise for the Panda face is always part of the “art of the deal’ dynamic.

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President Donald Trump is confronting the dragon behind the panda mask with precision. It’s very obvious the prior reconnaissance, trade probes and tariff tests of ’17, ’18, ’19, are paying dividends.

President Trump has cut off the transnational shipping lanes by globalizing the tariffs against China. Beijing is in a forced holding pattern waiting to see the outcome of Southeast Asia and European trade agreements.

Having spent some serious time in the field in advance of ‘Liberty Day’ all of my contacts have the same message; China is trying to find position.

In a little reported reality, in order to offset the problem, many Chinese manufacturers have actually continued the production of several branded product lines (very well-known and established brands) despite the absence of orders for the finished goods from the companies.

Several shipments of those finished goods have started to arrive at China-partnered ports. This is very interesting, because it may lead to market dumping of a higher quality product than most anticipate.

Within the apparel sector, ASEAN consumers cannot afford the fashion branded product at the prices determined by the actual brand owners. However, there is now a strong likelihood -based on what is being reported by the receivers- that the product itself will be marketed -likely dumped- without the brand label. This is actually high-quality apparel distributed for a fraction of the price of the brand.

I’ll be getting more details on this soon, however, it looks like the broad outlines are verified by multiple sources. I’ll use some fake names to explain.

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In the U.K and throughout Europe May 8th is known as “VE Day” designating Victory of Europe Day, commemorating May 8, 1945, marking the Allies’ acceptance of Germany’s unconditional surrender.

In Russia May 8th is known as “Victory Day” celebrating the defeat of the Nazi regime and honoring the 27 million Russians killed in World War II. By several magnitude Russia suffered the most casualties in the war, losing approximately 9 million military and 18 million civilians.

Today, President Trump signed a proclamation designating May 8th also as “Victory Day” [SEE HERE], recognizing that without the United States entering the war, the German Nazi regime would not have been defeated.

Russia and the USA using “Victory Day,” while Europe uses “VE Day.” Huh, maybe a message in there somewhere.

The announcement was made during the swearing-in ceremony for David Perdue as U.S. Ambassador to China.  The media questions begin at 9:11 of the video below.  WATCH: 

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WHITE HOUSE – Today, our Nation proudly commemorates the 80th anniversary of the Allied Powers’ triumph over national socialism and fascism, and the end of World War II in Europe — one of the most epic victories for forces of freedom in the history of the world. On this Victory Day for World War II, we celebrate the unmatched might, strength, and power of the American Armed Forces, and we commit to protecting our sacred birthright of liberty against all threats, foreign and domestic.

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The media have been going bananas wondering when President Trump will begin negotiations with China.  President Trump has been very clear that there is no need to open negotiations with China, but all discussions are welcome.

Essentially the point is that tariffs will remain in place until Beijing gets to a point where they acquiesce to the reality of President Trump’s terms for reciprocal trade.  The goal is to bring manufacturing back to the USA, not generate terms where manufacturing remains in China.

The Chinese trade delegation is scheduled to be in Switzerland at the same time as Treasury Secretary Scott Bessent and U.S. Trade Representative Jamieson Greer are scheduled to be there.  Both Bessent and Greer announced today they will meet with their Chinese counterparts on the sidelines of their travel to Switzerland.

USTR Press Release – […] “At President Trump’s direction, I am negotiating with countries to rebalance our trade relations to achieve reciprocity, open new markets, and protect America’s economic and national security,” said Ambassador Greer. “I look forward to having productive meetings with some of my counterparts as well as visiting with my team in Geneva who all work diligently to advance U.S. interests on a range of multilateral issues.”

While in Switzerland, Ambassador Greer will also meet with his counterpart from the People’s Republic of China to discuss trade matters.” (link)

Treasury Secretary Press Release – “During Secretary Bessent’s visit to Switzerland, he will meet with President Karin Keller-Sutter of Switzerland, during which the Secretary will follow up on their recent meeting on the sidelines of the recent World Bank Group (WBG) – International Monetary Fund (IMF) Spring Meetings. 

While in Switzerland, Secretary Bessent will also meet with the lead representative on economic matters from the People’s Republic of China (PRC). (link)

As we previously noted, the Swiss are very interested in resolving their trade status quickly.

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I don’t want to say ‘I toldya so’, but….  Listen carefully to the answer to the first question at (05:00 minute mark) as President Trump responds to the question about the USMCA with Canadian Prime Minister Mark Carney next to him.  The USMCA is “effective, and it’s still effective, but people have to follow it,” inferring the issues of Canada as a tool to avoid China tariffs, President Trump said.

Then comes the part everyone will overlook as President Trump notes, “as you know it terminates fairly shortly. It gets renegotiated fairly shortly.” Then comes the biggest statement, “this was a transitional deal, and we’ll see what happens, we’re going to start renegotiating that”… “I don’t know if it serves a purpose anymore.”  …. “And the biggest purpose it served was, we got rid of NAFTA.”  This presents the future of the USMCA and specifically the U.S-Canada aspect to the trade deal exactly as we anticipated.

President Trump is going to exit the trilateral USMCA in favor of two distinctly different bilateral trade agreements between the U.S and Mexico; and the U.S and Canada.  The only consideration now is the timing.  President Trump is 100% focused on the BIG ECONOMIC PICTURE; it’s not about the politics, it’s all about the economics. [Also pay attention to USTR Jamieson Greer]  WATCH:

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Prime Minister Mark Carney knows what is coming. His response about stepping up their military spending to meet NATO obligations is part of that dynamic.

The 51st state remarks were all about getting Canada into a position where Trump is about to open up two distinctly different bilateral trade agreements.  The relationship that Canada has with China is a major risk to Carney’s position.  Canada doesn’t stand a chance.  In essence, at the end of this journey of economics North American trade is going to be entirely different.

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Earlier today President Trump signed an executive order blocking the U.S. development of “gain of function” research, the manipulation of biological agents to weaponize their lethality. [Executive Order Here]

As Health and Human Service Secretary, Robert F Kennedy Jr noted in his remarks, the modern U.S. development of the bioweapons program was an outcome of a little-known subset within the Patriot Act that allowed scientists to develop bioweapons without legal accountability for any negative outcome.  Let us not pretend….

In 2014 a U.S. developed bioweapon escaped a lab and in response President Obama stopped the program.  However, the stoppage only blocked development of the bioweapons on U.S. soil.  The various government agencies then continued the “gain of function” bioweapon development by offshoring the experiments and conducting the research in foreign countries.  The SARS-CoV-2 weapon, COVID-19, was developed in one of those labs in Wuhan, China, and escaped creating the pandemic of 2020.  WATCH:

EXECUTIVE ORDER – Section 1. Purpose. Dangerous gain-of-function research on biological agents and pathogens has the potential to significantly endanger the lives of American citizens. If left unrestricted, its effects can include widespread mortality, an impaired public health system, disrupted American livelihoods, and diminished economic and national security.

The Biden Administration allowed dangerous gain-of-function research within the United States with insufficient levels of oversight. It also actively approved, through the National Institutes of Health, Federal life-science research funding in China and other countries where there is limited United States oversight or reasonable expectation of biosafety enforcement.

This recklessness, if unaddressed, may lead to the proliferation of research on pathogens (and potential pathogens) in settings without adequate safeguards, even after COVID-19 revealed the risk of such practices.

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