Trump cares less about Taiwan than Ukraine. 
Taiwan, Ukraine, and Trump
Trump’s only concern about Ukraine is how to take its rare earth mineral wealth. Trump does not give a damn about Taiwan at all.
Please consider a Bloomberg Interview of Trump ahead of the election.
Look, a couple of things. No. 1, Taiwan. I know the people very well, respect them greatly. They did take about 100% of our chip business. I think, Taiwan should pay us for defense. You know, we’re no different than an insurance company. Taiwan doesn’t give us anything. Taiwan is 9,500 miles away. It’s 68 miles away from China. A slight advantage, and China’s a massive piece of land, they could just bombard it.
They took almost 100% of our chip industry, I give them credit. That’s because stupid people were running the country. We should have never let that happen. Now we’re giving them billions of dollars to build new chips in our country, and then they’re going to take that too, in other words, they’ll build it but then they’ll bring it back to their country.
Trump’s Ambassador to China
Please consider Opening Remarks SFRC Confirmation Hearing Ambassador Designate David Perdue, for ambassador to China.
As Ambassador, I will support the United States’ one China policy, guided by the Taiwan Relations Act, the three Joint Communiques, and the Six Assurances. We remain committed to a peaceful resolution that is acceptable to the people on both sides of the Strait.
A one-China policy means China will get Taiwan and all of its chip capabilities.
Trump does not at all see this as a strategic issue for the US.
Trump’s Tariffs Don’t Apply to Chips
The New York Times comments Trump’s Tariffs Don’t Apply to Chips, but Taiwan Remains Wary
Taiwan, the center of the global supply chain for computer chips, woke up on Thursday to the news that President Trump had put new 32 percent tariffs on the island’s exports to the United States. Except for semiconductors.
The decision not to impose tariffs on the chip sector does not mean they won’t be coming for Taiwan or anywhere else, including South Korea, another major source of chips.
Taiwanese companies have spent decades and billions of dollars building up a network of factories that conduct the complex process of etching tiny circuits onto pieces of silicon.
These chips — and a broad range of electronic devices that contain them — are Taiwan’s main exports. And they are increasingly the focal point of the Taiwanese-U.S. geopolitical relationship, which has undergone a markedly transactional shift since Mr. Trump took office.
Mr. Trump previously said Taiwan had gained an unfair dominance in making semiconductors and threatened to impose tariffs on the sector. He has also accused Taiwan, which depends on the United States for political support against China’s claims that Taiwan is part of its territory, of spending too little on its own security.
Taiwan Semiconductor Manufacturing Company, the world’s largest chipmaker, said it would spend $100 billion in the United States to expand its operations in Arizona. TSMC announced plans for the plant during Mr. Trump’s first term and got a big financial assist under former President Joseph R. Biden Jr.
On Wednesday, in announcing the tariffs on Taiwan, Mr. Trump praised TSMC for investing in the United States. He and his aides are hoping other chip companies that committed to invest in U.S. operations during the Biden administration, like the South Korean giants Samsung and SK Hynix and Global Wafers of Taiwan, will pledge to spend even more.
The Taiwanese government “thought too optimistically about the relationship with Trump,” said Jason Hsu, a senior fellow at Hudson Institute and former member of Taiwan’s legislature for the opposition Nationalist Party. “It was a little bit too naïve thinking Trump would be nice to them, especially after the TSMC announcement.”
Advice to Taiwan
Since Trump won’t give a damn about Taiwan once the technology is here, Taiwan is best advised not to build a chip factory in the US.
One of the few things Biden did correctly was get Taiwan to build here. Biden did that by offering subsidies to Taiwan. Trump thinks Taiwan should pay the US to be here.
The problem for Taiwan is that in four years is J.D. Vance could be president with the same mindset.
Insurance Policy
“You know, we’re no different than an insurance company. Taiwan doesn’t give us anything,” says Trump.
That is how economic illiterates think.
Given illiterates are in charge, Taiwan needs to reconsider the deal to expand here because it’s turned into a trap. Trump will have no use for Taiwan if and when full scale production is here.
The US needs Taiwan’s chips. And that is why Trump made an exception to chips.
Taiwan should politely tell Trump to go to hell. That’s the only way Taiwan keeps its insurance policy against an invasion by China.
That is the big question. Do they acquiesce or do they stand up. Trump has gotten accustomed to having people suck up to him, and he likes it so much. But, if countries and companies start to stand up to him, does he get offended? Negotiate? Or fold like a cheap suit? Modern negotiations in business aren’t about just “winning” on your side, they are about created win-wins for the parties involved so that both can benefit in the future. Trump has this childish impulse to come out of any negotiation feeling as if screwed his counterparty and got the best of them.
There is no choice but to comply because the choice is move the factories to the US slowly or move all of them if China commits suicide. The world and the US must not to have the most advanced chips factories 60 miles from the Chinese coast. From the Matrix, “there are levels of survival we are prepared to accept.” This poker game we can see all the cards except one, whether China commits suicide. The One China war strategy for the US is for the US is to bomb the chip factories if China gets close and Taiwan knows it.
TSM has already hedged themselves with building plants in mainland china and usa besides their own. i’m not sure but i’m sure they have or have plans to build more on other continents. i think in phoenix they could not find enough talent and had to bring folks from taiwan who could build chips…..trump and whitetrash musk are just pure nihilists……they don’t care about anything or anybody. we’ll start bombing persia or somewhere else soon besides yemen and gaza supply……..amerikans are nihilists. so we elect nihilists. democracy works perfect. all evil empires crumble. a good thing for humanity. we have 50 states that will function just fine. the us navy is an anchor on our well being…….financially and personal safety. see 9.11.01 for the contingent liabilities our department of war has in the footnotes.
Paper Tiger China has a lot of people fooled. lol
I suggest listening to this lady on the true farse unfolding in China: https://www.youtube.com/@LeisRealTalk
Chip factories will not prevent the reunification of Taiwan with the rest of China. Taiwan is part of China. The US has recognized that for 50 years. Taiwan never claimed to be an independent country. It claimed to be the legitimate government of all of China. That’s why they called themselves the Republic of China. There is no way that the US can perpetually prevent the reunification. The question is whether Taiwan wants to do it the easy way or the hard way. We should allow immigration into the US from Taiwan. We should allow their companies to set up shop here if they want to, but we should stop arming them, basing troops there and instigating trouble in the South China Sea.
Trump is right about all the technology and industries America and the WEst allows to go offshore.
And then America subsidizes it all with defense spending to defend these nations.
Its true and the US should never have allowed such a critical industry as semiconductors to go offshore.
you think we defend the world. my lord. freedumb bombs for iraq and gaza and ukraine and libya and viet nam………………we don’t allow anything. the world is allowed to build chip factories. we have some here. just our people too stupid to work them. we do annuity sales and easy shit like build houses and bombs at 10000% markups to the department of war.
i used to drive by ON chip factory everyday in phoenix.
Dow futures down another 5% today, maybe tariffs won’t matter, as nobody will have money for electronic gadgets.
The knife is picking up speed.
The Dow futures entered: Jan 31/Feb 1 2024 BB, 38,720/ 38,212. still above 2022 high.
Until John Q. 401k wakes up and sees that.
let’s bring this sucker down 75% like the tech bubble blowout turn of the century long ago………..i like bargains.
some background here: With Trump’s Help, Intel Could Hand Control of Chip Plants to TSMC – The New York Times (archive.ph)
AP: Over 50 countries ready to talk to President Trump about tariffs.
Only Trump has the balls to push it all in on the global poker table…. Not Ted Cruz, not any other of the 535 in the House and Senate. Trump certainly is a better man than the gutless whiners who think that 2025 Trump Tariffs are the same as back when The Smoot–Hawley Tariff Act was used to protect American farmers. That was a different time and a different situation. But even back then it wasn’t the tariffs that did the real damage.
The Smoot–Hawley Tariff Act wasn’t the real problem. It was all of the Sovereign Debt Defaults – not the tariffs. Look it up. All the major countries defaulted along with the banks. Tariffs had nothing to do with that. Learn your history before you go shooting your big mouth off… What the public schools and universities teach is a whole lot of crap.
You can learn your tarrif history by simply visiting Marty Armstrong’s free site…. it’s all there in black and white.
Marty doesn’t like the Trump Tariffs, either, but at least Marty has spent the time and money to do meaningful research, and as a public service lay it all out in black and white…
It wasn’t the tariffs then, and it isn’t the tariffs now, either. What took the global economy down for so many years back then was Sovereign Debt Defaults. And that’s what’s going to happen again. The stock market crash of 29 was only the beginning of the SHTF then and it will be only the beginning this time, too.
It’s the Debt bubble stupid.
The war against Germany cont after WWI. Wilson reduced the use of 90 days “Good Will Consignment Notes” in favor of US gov bonds to finance WWI. The 3M Good Will Notes paid industrial workers salaries in the US, France and Germany. Germany collapse after the Good Will Notes exchange was closed and bilateral agreements excluded Germany from trading with: GB, France and the US. Germany traded with Turkey and Japan. The fear of Germany led to the rise of Hitler, with some help from wall street and Hollywood. They trusted Dr Schacht.
Yes, it’s all on the poker table now. Unfortunately trump is playing “Go Fish”.
I imagine there are scenarios where he could win, but none of them are very likely.
It’s easy to go all in with other people’s money.
sort of correct. the real reason was the Russians went commie and stopped trading with the world after ww1. the us farmers commodity prices boomed after war due to europe being flattened. by 1926 bank foreclosrue on farmers began as europe farms came back online. the stock market did not catch up until 29. the rest was defaults of debts like you say and the tariffs and then the extreme weather causing dustbowl and homelessness……….lots of reasons. we are now just another over extended evil empire. like the romans and the soviets etc……….bombs away next month to persia and more to yemen and ukraine…… we’ll go right over the cliff
“A one-China policy means China will get Taiwan and all of its chip capabilities.”
My understanding is, there has been a rhetorical game played for many years since the PRC was admitted to the UN and Taiwan expelled, in 1971. There was a lot of diplomatic fudging on this, to satisfy the PRC and also Nixon’s political needs: The US ambiguously touts “one China” but does not say which one. So this rhetoric alone does not settle the longstanding matter, IMO.
Trump’s attitudes are another matter, but he is, let’s say, beyond flexible on most things. He is a walking ambiguity, even intra-day. For example, he flipped completely on TikTok and crypto. That’s why I view him as less of a businessman, more of the ethos of a golf hustler.
One of the Chinas has 1.3 billion people. The other one has 23 million. Gee, I wonder which one is the real China.
Thousands laid off at Intel in Oregon due to tough competition from chip makers using newer technology but Taiwan “Took” the business away? Thinking we forced it away due to high state corporate activity taxes, massive Gang Green™ U.S. and State enviro regs plus soaring power costs. (thank you again, Gang Green™ climate policies) Would this be a good country to set up a new chip factory in, even with a Trump Tariff Gun held against your head?
Good analysis, Mish. I hadn’t thought about this from Taiwan’s perspective.
Thankfully Trump understands he’s not president of Taiwan.
Maybe we should import a couple of million Chinese from Taiwan to work in their American chip factories after they move much of their chip Manufacuring plants to the USA. I’d rather have a million hardworking Chinese from Taiwan rather than import the dregs of the third world. Then after we rebuild our totally broken American education system, our new High school and college graduates can be integrated into working in our new chip factories. Those who remain in Taiwan (as well as S. Korea and Japan, etc.) can work out their own hopefully peaceful relations with China. I am not one who believes China wants to conquer the World–economically maybe, but we have made that possible with our own stupid policies from our own corrupt, stupid leadership. Maybe we should start by getting rid of our own leaders and the corrupt Oligarchs who own them.
The chaos that is about to ensue is going to take us into unchartered territory.
We don’t know where we’ll hit, but the ground is coming up fast.
Speaking of illiterates on some subjects,
The United Nations and almost every country in the world supports the One China policy that you condemn Trump for. The One China policy is the legislated position of the U.S. congress. The One China policy is the official position of the U.S. state department and has been for over fifty years. It signed off on the U.N. One China policy as it should have since the U.S. was advocating and even insisting on that policy at the U.N.
And ….wait for it….it is the official position of Taiwan, at least until about a year ago. That is when the current President of Taiwan won a three way contest with only a plurality of the votes and has set about convincing people with the help of the western media that Taiwan is and always has been a separate entity from China. The two opposing candidates in that election who combined received more votes than the winner were both strong advocates of the One China policy.
It is worth noting that the majority, governing party in the Taiwan Legislature still holds to the view that there is only One China.
I have been to Xiamen – a city on a small island next to PRC in the strait of Taiwan – and seen left over pill boxes on the shore line. The story I hear was that the communists lost so many people (tens of thousands) trying to capture Xiamen that they did not try to take over Taiwan (hundreds of miles further away and with so much more shoreline) because the communists woudl have lost so many people (hundreds of thousands).
My stance is Taiwan is the last stronghold of the Nationalists that fought against Mao’s communists.
Taiwan is in the PRC creed (the PRC bible). Revenge against our colonial enemies to restore our national honor and rule China with an iron fist are other components of the creed. If China takes Taiwan ==> they no longer can rule with an iron fist, after deflating their creed. Either Taiwan or breaking China apart for a small island. The want of Taiwan is more important than ruling a deflated Taiwan. Two hundred and fifty years ago GB lost its 26 colonies for the Rocks of Gibraltar. Yankees for monkeys.
Taiwan (among others) did take advantage of the US. It took advantage of the non-existent industrial policy, letting decisions to the market, i.e. Wall Street. The Wall Street has the foresight of the idiot, and the patience of a 5-year old.
Nothing to blame Taiwan for.
It is a strategic blunder to allow critical items to be manufactured by another nation. It is essential that we bring back to our nation the manufacturing and business that are critical to our security and national growth. Do you really want to be held hostage by a foreign power?
It is a strategic blunder to be beholden to China, Russia, non-allies for critical materials. I don’t have (or didn’t) have that concern with Canada.
This is one instance that I support subsidies. Abd it is one thing Biden did correctly, to get Taiwan to build here. Trump Ruined Canada. I don’t know about Taiwan yet, but possibly.
Agree. Of all the strategic items we need to import, the vast majority of them come from Canada. They are literally our ace-in-the-hole. Our closest friend, trading partner, and ally. And we are doing our best to piss them off and turn them away.
85% of our potash
60% of our imported aluminum
23% of our imported steel
45% of our nickel imports
80% of our lumber imports
60% of our oil imports
30% of our uranium imports
93% of our electricity imports
What kind of strategy is it to put tariffs on strategic items that we must import?
wait, is a Trump a genius, or Hitler? I can’t keep up….
Is it possible both?
inconceivable, to the media, an individual can only represent one thing or it makes the propaganda campaign too complicated.
At this point it makes little sense for foreign companies to build in the U.S. as Trump sees their assets as something to take. Nor does it make sense to invest in U.S. treasuries or dollar denominated assets. Trump is deliberately destroying our nation and its relationship with the world in an all out effort to return us to the 1950’s.
Trump has to be the worst president in history with a first term legacy of mismanaging Covid and now a catastrophic upending of the world economy.
His poorly thought out tariff’s are isolating our nation from global markets and forcing our competitors into our allies open arms.
Sad times for all of us as trump can not be trusted and has lost all credibility.
What credibility? Was there something to lose?
Bingo!
No, open borders, DEI, and a deranged energy policy were no better.
Wrong, Things were significantly better. We are awash in oil and this with the sanctions on Russia. America produces tremendous volumes of products and most Americans have great jobs that pay massively above world standards. If a crashing economy (again) under trump is making our country great? I’ll gladly take the under.
Trump has cost Americans over $5 trillion (in the stock market alone) so he might be able to collect $500 billion in tariffs. He is not capable of basic mathematics. The tariffs will solve nothing!
Furthermore; Our corporations were already engaged in on-shoring production because of the supply chain problems with Covid. They are having a hard time finding labor to do the jobs!
Trump remains a lying clown and a sociopath.
Fire Him!
Taiwan faces a problem of loss minimization; Trump offers less loss than China offers. Trump needs to keep China out of Taiwan until high tech manufacturing in general can be brought back to the US.
In China export fell from from 2/3 of the GDP to 1/3 within a decade. The attempt to convert to RE and consumption failed. China deflates. Xi is facing us and the Europeans. A ceasefire in Ukraine will force Putin to convert his war industry to civilian industry. It takes years. He might keep the boys in the front line to prevent high employment. If signed Russia will deflate for years. Globalization deflates oil prices and utilities bills. The US produces 1/3 of Russia annual weapons production. That’s unsustainable. Demand for highly skilled workers and skilled workers will rise in civilian and the military industries. Taiwan: be with us be a Chinese colony. Countries which want to be benefit from our markets have to pay “Rent”.
@Mish – one TSMC fab in the US is woefully inadequate for US’s advanced chip needs, not even close by a thousand miles of chips – their fabs in Taiwan are absolutely essential to US security and tech dominance, esp in AI accelerators. WRONG CONLUSION sorry to say, though I admire your insights 98% of the time.
If anybody on this site thinks last week’s stock market decline was empty noise, they should try to explain why consumer staple stocks frequented by lower and middle income consumers were hit hardest, while Dollar Store stock rose. If you are not among the top 10 percent, get ready for a lot of pain. And yes, Dollar Store is waiting for you.
DG worse nightmare is Chinese tariffs. DG pulled the trigger on Aug 28/29 gap. It will be closed within 2/3 months. AMZN is backing up under 2022 high. QQQ might make a rd trip to 2021 high, before breaching 500 within a month or two. We cannot build our industries without the high tech sector. There are too many Pavlov dogs who repeat what the puke media says.
Trump seems to think that the US is not culpable for anything and that the deck is stacked against America. The US has world beating conglomerates operating everywhere with banking and currency advantages and it’s still everyone else’s fault and the US is “so hard done by”. Spare me. If Taiwan excelled in the chip industry, it’s because the US prioritized other things and the Taiwanese had a long term strategy. By all means, take back manufacturing over time if that is your wish but do it smartly over time with a game plan and expect that other countries will develop strategies to protect themselves and the world will be different. This is a zero sum game and frankly just dumb.
What Trump doesn’t get is that our work force does not have the skills to work in modern manufacturing. Sweatshops yes, but that’s not what the MAGA crowd wants.
The corporations, the universities and schools, the media, is working on a thing called “training” .. This entirely new, never heard of (apparently) concept, will allow “unskilled” individuals to learn processes and methods to acommplish complicated processes allow completion of goods, materials and finished goods, in a timely and profitable manner.
Look, the problem of our education system is that you either have college education or you have nothing. A college education is not a good background for manufacturing; it’s a general education with no specific skills. And with no education, you are also not very employable. American companies in particular don’t like to provide a massive on-the-job training program at their own cost. The countries successful in modern manufacturing all combine some type of apprenticeship system with on-the-job training.
USA has the largest uneducated third world population among the advanced industrial economies. They are perfectly capable of working in sweat shops.
I did a masters in STEM in early 80s. Hardly any native born amerikans. They all go for jewish engineering MBA
Taiwanese who studied at American universities built their semiconductor industry just as many mainland Chinese studied in the US in STEM majors returning to build industries there. Patents and technologies were stolen , hacked or violated also. China’s requirement that foreign auto makers building cars in China partner with a local company was another way to purloin technology and now the US, Japanese and European automakers face a formidable competitor esp in E-cars. Kind of a twist (pun intended) on the capitalists will sell the rope we will hang them with.
our boys too dumb to handle STEM for the most part. there are some exceptions of course. the shrewd ones go into finance like mish and many others we all know. go to a STEM grad department at any great usa college. you’ll see who attends. not too many native born amerikans. i did it long ago. more true today.
China will never have to invade Taiwan and if you understand anything about China you will understand why … they have all the time in the world. … it will all be done through the Taiwanese ballot box … Trump is just pushing Taiwan deeper into China’s arms … products made in America are more expensive than in the far east due to social and labor charges … manufacturing will always seek the country of lowest costs and quality … that is definitely not the United States and no longer Europe … and this is why those countries need tariffs …
A country cannot invade one of its provinces. A state can inflict civil war on one of its provinces though. Then, the bigger one wins. Better to avoid such unnecessary bloodshed and to give up the secession.
another CCP shill. I suggest you move to China (unless you’re a CCP bot). Taiwanese who live in freedom don’t want to live under the CCP’s repressive, corrupt boot on their neck.
Tell that to Canada, they keep claiming they are an independent nation..
But no one is invading Canada. They are just sending them mean tweets. Naturally Canadians are totally freaked out.
not just “Freaked out” several have actually had their feelings hurt, and won’t leave their homes or other abodes.
I am very discouraged. As Ezra Klein said in a podcast that I watched, we are caught between a party that doesn’t want government to work and another party that can’t make government work. Maybe that has been how the parties have been for a long time but when they compromised it did work because the compromises stopped each party’s worst impulses.
Good insight!
why would you watch a podcast, when you can just listen while you actually do something useful?
And why would anyone listen to Ezra Klein?
America was founded on the notion that there would never be what you call a working government.
Trump seems to like Big Government.
way worse than that. a world wide war mongering empire that is now broke.
That’s what democracy with 2 party system. They must show their value, view, preferences, etc and oppose most of the time. If they work together there will be one party only. 2 party system not needed.
Better fasten your seat belts as we are going to see something that has never happened in this country, to this extent, in history.
The roaring twenties all over again.
go live in charleston SC for a decade and learn some amerikan history. pro tip. the ones who stayed solvent got out of confederate dollars and into gold
Trump doesn’t do “the cyber”… he has no idea what microchips do, or who makes them.
though i despise Trump, he’s not that dumb, nor is Bessent or any of his advisers. He’s supportive of Biden’s wise incentives to build advanced fabs in the US, but does want them to pay for the US security umbrella, without which the CCP would have invaded long ago and subjugated the freedom-loving Taiwanese under the CCP’s repressive, corrupt regime.
like most people in the world…
Utz is made here.