I pay a lot of attention to what is happening in Asia, specifically China but also Korea, Japan, and Vietnam.
I see confusion (misinformation) about the state of trade with China.
I would argue it is the most important economic and military subject in the world right now.
1. China has the best and most diversified supply chains in the world.
2. China has made it a focus for decades to secure mining rights and to build transportation for the resources it is obtaining.
3. Building mines is not enough. Those are trivial infrastructure projects for a first-world country. It's processing what is mined that is the critical value-added part of the operation.
4. China's real advantage on the planet is that it processes and refines tons and tons of dirt to extract and collate the valuable minerals. These are energy-intensive processes and increasingly utilize cutting-edge science. China offers many degrees in processing technology that aren't found elsewhere.
5. By controlling the flow of resources for which there are no analogues like antimony and bismuth, industries like military, aerospace, and high technology are dependent on the Chinese.
6. Magnets are essential to industrial production. They are in every device, from fridges to SUVs to smartphones. China basically owns the global magnet supply.
7. Recently, Trump claimed to have made a "deal" with China for access to resources (see end note). The Chinese did agree to open up some trade that was globally banned, but only for non-military industry. You can still get a dishwasher, but not fabricate APC. You can build an air conditioner, but not an interceptor missile.
8. As Carl Zha (Silk and Steel podcast) has said, the Chinese are not going to supply the US to build a military that will engage China.
9. The Chinese leverage on rare earth and magnets is the trump card of all trump cards. They don't need to fight with their already impressive military; they can turn off the supply spigot and watch the West squander what inventory it has in Israel or in foolish adventures against Ansar Allah. Maybe sending more and more to Ukraine.
10. If this topic interests you, and it should if you care about geopolitics, IMO, watch this short series of clips with Carl on another podcast with some inserts of relevant information. He's ethnically Chinese but grew up in America. https://www.youtube.com/watch?v=70AVNpbUZ84
11. Think about what it means to "the Empire" if they are short on bullets. Extrapolate that to the economy, to the colonies, to foreign policy. Many ramifications.
I welcome any feedback/suggestions on what I have missed, what I may have overlooked about how the West can work around this challenge.
About Trump making a deal, several US manufacturers have been talking about moving to China, which is the opposite of what Trump wanted to do. Their thinking was that, without magnets, they could not produce. It would be better to make their stuff in China than not at all. Tariffs get passed on to the consumer.
Trump had to cut a deal to prevent a hemorrhaging of industry and to save retail inventories before back-to-school. The Chinese want trade and are not trying to destroy America. My reading of the situation is that the Chinese want to surpass and then ignore the West, the way the West (supposedly) surpassed and pretty much ignores Africa.
The relative first and third worlds are poised to flip over the next 50 years.
Posted by: LoveDonbass | Jul 3 2025 16:59 utc | 33
China's GDP is undervalued.
China has a fraction of the real estate transactions that occur in the West.
Nothing new is created when you sell your house. Nothing new is created when Real Estate transaction fees get rolled into the total sale price.
Posted by: LoveDonbass | Jul 3 2025 17:12 utc | 36
