Dear Reader,
Happy Friday. Friday the 13th. Woooo…
I have young kids, so it’s fun to scare them with this kind of stuff. I like to jump out of the closet - boo!
I hope you can have some fun with it.
Anyway, today I want to talk about the “trade truce” with China (which, by the way, isn’t really a truce. China has a gun to our head and has given us six months to relinquish or reduce semiconductor restrictions).
This is the most shocking thing I’ve ever seen.
I’ve never seen the U.S. give up leverage so quickly.
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The reality is, we have some things China wants…
China has something we need.
China would like access to our markets. They want advanced semiconductors.
We need rare earths.
We need what they have. They don’t need what we have.
That’s just the bottom line.
Whoever has the thing the other side needs has the leverage. Period.
So we went into this trade war, guns blazing, and China has taken the guns out of our hands and pointed them right back at us.
They’ve given us six months to lift these restrictions.
I could hardly believe the news - I felt like I was looking at The Babylon Bee, The Onion or Saturday Night Live!
I couldn’t believe the headline - I was just shocked we gave away all of our leverage.
And it raises a bunch of troubling questions.
I’ve been asking myself, “do we actually have a China trade strategy?”
Really - the President was president for four years, out of office for four years. So he’s been around national security for a while.
We all know about the vulnerability we have in rare earths as a national security issue…
We can’t make our F-35s fly without them. And China has them.
So I just keep asking myself…
Does the President know that China has this kind of leverage over us?
Do we have a China strategy?
Did we go into a trade war misunderstanding which side has the ultimate leverage?
Do we understand how critical rare earths are to our national security?
Why are we talking about a strategic reserve of Bitcoin, when we need a strategic reserve of rare earths?
Why are we even talking about Bitcoin?
Why isn’t there an all-hands on deck effort around rare earths?
What kind of stockpile of rare earths does our military have?
Is it six months’ worth? Because if we went to war with China, could they literally just wait six months, until we run out, run down the clock, and then kick our butts?
How vulnerable are we here?
Was the bill that’s going through the House and Senate written by people who don’t understand the leverage China has over us?
This demands some answers here.
If our leaders understood, I would think a big part of that bill would be stockpiling rare earths.
But our leaders don’t seem to understand the leverage China has over us.
Again - we have something they want, sure. But they don’t need it. They have something we need.
Are the people around the President not telling him this?
Though, of course, he’s been in, out, around the White House for 8, 9, 10 years now.
If we know it in Boca Raton, FL… if the world knows it, if anybody that focuses on defense knows it, he’s gotta know it.
Or, are people “yes-ing” him to death?
I know corporate America is scared to speak out (which is weird in a free speech democracy).
But are his advisers afraid to tell him when he goes half-cocked into a trade war…
Whoa, buddy - you don’t understand the leverage dynamics here.
If they’re not telling him the truth, are they not serving him well?
If that’s the case, should these people be replaced?
I’m not saying any names, because I don’t know the inside baseball - stuff is leaking out, obviously - but basically China has given us six months to start releasing advanced semiconductors…
Can you believe it?!
We’ve been going around telling everybody, “you’ve got three months to do this, six months to do that,” and China just told us what we have to do…
We have to dance to their tune.
We’ve got six months to get them the chips they want or they’re going to cut us off from rare earths we need.
Another question - what happens in six months? Do they cut us off from rare earths?
Holy mackerel.
I am stunned.
Now, if we have not built a stockpile since the election, and China knows this, are they going to slow-walk the rare earths that they’re licensing out so that they know we’re on a critical level, and then make a move on Taiwan?
Here’s what that looks like.
I am telling you - this is exactly what I was afraid of.
This is literally the worst-case scenario in this negotiation with China.
You are watching it unfold in real time.
It’s astonishing.
This raises a lot of troubling questions about our national security. About the country we have. Do we think we’re stronger than we actually are?
And, how are we going to catch up on rare earths?
Why is anybody talking about anything BUT rare earths in this country?
You cannot have an adversary having this kind of leverage on you. Can’t do it.
They will make you dance in ways that are not good for your national security.
For example, China could say, you got six months to start giving us those best Nvidia chips.
What are we going to say? No?
The President will try to bob and weave and dance, and say all these clever things, but the bottom line is they have the leverage.
This has raised so many disturbing questions that any citizen, any thinking person, must be asking him or herself this week.
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