Both sides will announce a win. But no key issues will be resolved.
Fundamental Issues Unresolved
Bloomberg reports US-China Trade Truce Leaves Fundamental Issues Unresolved
Three Key Takeaways
- Chinese and US trade negotiators have lined up diplomatic wins for Donald Trump and Xi Jinping to unveil at a summit, pleasing investors but leaving deeper core conflicts unresolved.
- The deal is expected to see China resume soy purchases and America walk back its latest tariff threat in exchange for securing Beijing’s critical rare-earth magnets.
- Analysts cautioned that the deal ignores thorny issues, including fundamental fights over national security and Trump’s stated core mission of rebalancing trade, which will be harder to tackle in the future.
US-China Trade Deal Issues
Fundamentals Not Changed
“Both sides now seem to be focused primarily on stability,” Daniel Kritenbrink, partner at The Asia Group and former US assistant secretary of state for East Asian and Pacific affairs, told Bloomberg Television. “But none of the fundamentals in this relationship have changed.”
The removal of fentanyl tariffs on China could limit its US export losses to less than 10%, according to Bloomberg Economics’ Maeva Cousin.
Ultimately, the deal signaled amounted to a mix of small issues, said Scott Kennedy, senior adviser at the Center for Strategic and International Studies in Washington, noting Beijing’s industrial policy seemingly wasn’t up for discussion.
“They’ve kicked the can to the side and are focusing on very concrete, narrow issues, putting aside broader questions about China’s economic system and economic security,” he added. “It’s highly unlikely they’ll ever address those broader issues head on.”
How We Got Here
- Trump put a 20 percent tariff on all Chinese exports on the basis of China’s role in channeling fentanyl to the United States.
- Trump added another 125 percent tariff that he later dropped to 10 percent after China retaliated.
- On October 10, Trump hit China will 100 percent tariffs and backed down when China restricted rare earths.
- Trump placed fees on Chinese ships that dock in American harbors, expanded its technology controls, and threatened an additional 100 percent tariff on Chinese goods as of Nov. 1.
- China retaliated with fees on US ships and Trump backed off.
That’s a very incomplete list.
Now What?
Hooray, China will buy more soybeans, loosen export restrictions on rare earths, and pledge to do more about fentanyl.
In return, Trump will not do 100 Percent tariffs and will roll back some of the so-called fentanyl tariffs.
Since April, there have been about seven major tit-for-tat Trump escalations with China, soon followed by Trump Tacos when China retaliated.
If the above outline holds, congratulations! Things will be back to where they roughly were in March.
Q: Since both Trump and Xi are liars, what do we really have?
A: The answer is an uneasy truce.
There may be other agreements but will Xi honor them? Trump?
No key items will be addressed but China will buy more soybeans, at least for a while, so Trump will brag. He will fail to recall that it was his actions that caused China to stop buying soybeans.
This is a win-win from where we were a week ago, but a big pile of nothing compared to where we were earlier this year.
Related Posts
April 9, 2025: China Retaliates with 84% Tariffs on the US, Most Trade Will Stop
China can easily block rare earth exports to the world. If that happens, Trump will panic.
We should not be in this position, but we are.
June 5, 2025: Two-TACO Trump Day on His Call to Xi Over Rare Earth Elements
Trump is hyping up his call with China’s Xi. But chalk up 2 more TACOs.
Please recall Trump’s amusing statement that day: “There should no longer be any questions respecting the complexity of Rare Earth products.” What a hoot.
August 4, 2025: China Again Chokes Off Critical Rare Earths Needed for Defense
Trump threatened China with tariffs for doing business with Russia. Guess what?
October 19, 2025: Trump and Xi in Standoff, Each Blame the Other for the Trade War
What to Expect at the Xi Trump Meeting
I suspect fluff announcements over soybeans or other meaningless chatter that both sides may praise.
There is no reason for China to offer much. Trump has midterm election concerns, farmer concerns, and he should have recession concerns.
If there is anything, Trump will brag about it.
But unless Trump makes serious concessions, China won’t either.
Regardless, no matter what comes out of this meeting, Trump is prone to trade temper tantrums to which China will respond in kind.
Look for an unstable truce.
But Trump is backing down on some threats already as economic damage sets in.
And so here we are. The promised hype over soybeans is about to begin.
Then we will roll the clock back to April and look forward to doing this all again at some future date.
Trump is infinitely better than the commie clown show duo he ran against, but won by only 1.6% of the popular vote because we live in an easily propagandized, attention deficit, political idiocracy, but he is such a PR show-boater. Example: “Amazing” No, just delaying the inevitable.
Beijing to Resume Massive U.S. Soybean Purchases After “Amazing” Trump-Xi Summit
China Suspends Rare-Earths Export Curbs for One Year
Trump Immediately Cuts China’s fentanyl tariffs to 10%
Beijing Vows to Resolve TikTok Dispute With Trump Administration
U.S. to Pause Rule Targeting Subsidiaries of Blacklisted Chinese Firms
Trump Discussed Chinese Access to Nvidia’s AI chips but indicated he won’t grant access to Blackwell line
The Soviet Union was doomed to fail because of its economic system. China is an authoritarian 100% surveillance state on capitalist steroids. This US-China conflict will only end kinetically.
China signed an updated trade agreement Tuesday with the Association of Southeast Asian Nations, with Premier Li Qiang pitching expanded economic ties.
It’s the third revision of the long-standing agreement, which was first signed in 2002, and came into force in 2010. The free trade area covers a combined market of more than 2 billion people and lowers tariffs on goods and boosting flows of services and investment.
Two-way trade has surged from $235.5 billion in 2010 to nearly $1 trillion last year. ASEAN and China are each other’s top trading partners.
This is the worldwide trend. Almost every country in the world is trying to enhance trade with each other, to everyone’s mutual benefit.
Except the US. Trump is trying to isolate the US from the world and reduce trade.
Incidentally, US-China two way trade totals just $570 billion. And the US represents less than 15% of Chinese exports.
when the calendar turns to 2026, both bannon and michael wolff are going to air dozens of interviews with epstein. the latter is going to subpoena melania now that she sued him. trump will be a staggering corpse by the time november 2026 rolls around. he’s a great grifter and swindler. amerika is a great crumbling empire. stuff happens. like the ussr and the french and spanish empires before her………amerikans are nihilist and only care about useless stuff.
Agree, but to be honest, we have had a long line of grifters and swindlers. Burisma and weaponization of government agencies were only a few examples of our prior president. People who still have faith in either party are not paying attention.
Elect a clown, expect a circus!
With TACO, the devil is always in the details and truths can remain hidden. However, the likelihood of his capitulation is always high.
90 deals in 90 days: fail miserably.
According to multiple reports, Donald Trump signed trade or trade‐related deals with four Southeast Asian nations at the 47th ASEAN Summit in Kuala Lumpur this month: specifically with Malaysia, Thailand, Cambodia and Vietnam.
Countries are not begging to trade with US as Trump claimed.
Trump declared trade war against China.
There are some agreements after tip for tap fighting.
Those agreements are made to be broken at earliest
convenient time especially with Trump.
Not just trade war, there are other battle grounds such
as Ukraine, Middle East, Politics, Propaganda.
To be the global leader. they need to win the hearts and
minds of the nations. That is the delicate battle ground.
Over in Japan:
https://www.moonofalabama.org/2025/10/how-will-japan-handle-its-550-billion-trump-problem.html
We simply can not survive without Chinese goodwill.
The Chinese would be fools to completely relent on their licensing scheme to limit rare earths for military ends — who would enable an adversary who says he wants to destroy you.
There is only one real imperative for DJT — not to appear to be a loser.
Almost all his antics and turn-arounds are explained by this imperative.
When Trump is not reacting, he, or his ventriloquists, display a willful lack of competence & strategy, complete failure to understand the counter-party, and oblivious to the fact that any action is likely to have a chain of consequences that may be contrary to your wishes. In this world, any action is liable to have second and third order effects that go beyond the initial punch.
Mish,
Please revisit this: “Divide millions by what to get billions?”
I’m curious what led us to arrive at different answers. To discover where we diverge, let’s break it down into steps.
A. Let’s turn that into an equation with scientific notation, introduce parens to clarify some order of operation, and replace “what” with “x”. Also, since your original question didn’t specify how many millions of billions, let’s represent that as “y”
y*(10**6) divided by x = y*(10**9)
Are you with me so far? Maybe this is where the confusion resides.
B. Let’s get rid of the pesky “y”. Divide both sides by “y”:
(10**6) divided by x = (10**9)
C. Let’s replace”divided by” with “/”:
(10**6) / x = (10**9)
D. We’re not trying to solve “1/x”. To move X out of its position as a denominator, multiply both sides by x:
(10**6) = x(10**9)
E. Isolate X by dividing both sides by (10**9):
(10**6)/(10**9) = x
F. Divide or simplify exponents:
0.001 = x
Are we still on the same page? If not, where do you disagree?
It is worth noting that Google f*cked up before it even got to the math”:
“You have to divide billions by 1,000 to get millions, not the other way around.“
It essentially replied “stupid question”…
reversed it…
& then proceeded to give a stupid answer.
Yes, it reversed the question. But maybe “dividing by fractions” is not intuitive to most people. So, although Google’s initial approach does not “appeal” to you or me(!) personally, should we say its original answer was “wrong”? Maybe the answer “you would divide by 0.001” confuses most people. … Maybe like the way many people seem to prefer an annoying comparison like “product X is 10 times cheaper than product Y” instead of “X is 1/10th the price of Y”.
Fortunately, we have choice…
What surprised me:
– Grok responded like a dumb bro and agreed to the wrong answer.
– Google incorrectly reversed its answer the next day.
First – which, if any, of Trump’s trade ‘deals’ have been submitted to Congress for approval?
Second – significant trade from China (and elsewhere) was under the deminimis rules. What of that?
but it is our god given rights as amerikan boomers to buy endless halloween decorations made in china. the boomers in amerika all born on 3rd base with huge leads off the base. crumbling evil empire 101. democracy works perfectly. trump is amerikan as apple pie.
There are 4 superstates. We have to coexist. The US and USSR coexisted for 50 years. China sought mfg and REE supremacy. The US reduced our dependency on China without escalating the tension between us to a war. Our former NATO leaders escalated the relationship with Putin to a war. The Arab states escalated the tension with Israel to wars. Trump stopped the war bubble. Between Mar and Oct we reduce our dependency on China.
China has been reducing their exposure to the US since Trump’s 1st term. They are the sole country that prepared for Trump II. If only we would stop buying gigantic amounts of things from them, they would be farther down that road. Their manufacturing sector is growing; ours continues to reset lower. Soon our cattle industry will also shrink as global warming continues to force reductions in the US cattle population.
Cattle industry bs. Demand for our energy and military hardware is high. Since Jan trillions are pouring in to build essential industries. Trump spanked the Europeans parasites, re-educated Xi, got tariffs, stopped wars, deported the illegal and sentence to death drug smugglers in international water. He beefed up the Monroe doctrine, deflated Iran and twisted the evil axis. The Hooties top politicians and military command are also gone ==> vote for Xi and the Hooties if u like them !.
Trump is one big waste of taxpayer money.
And I wouldn’t describe Xi as a liar.
What has Xi lied about in regards to trade?
Trump is the undisputed King.
Good summary by Mish, appreciated.
In my book, a truce is better than 100% tariffs.
RAND Corporation’s recent paper arguing that we need to get along with China has thrown the foreign policy establishment into confusion. Mike Pompeo was seen eating an entire gallon of ice cream. This may not have influenced Trump directly, but a realistic reassessment is good.
https://www.rand.org/pubs/research_reports/RRA4107-1.html
Mike Pompeo and Nikki Haley have been in a tailspin since the events of July 13, 2024 did not turn out as planned. Their sad faces at the Milwaukee convention a few days later attest.
Haley is not smart. If she’d won the presidency with Pompeo as VP, she would not have been long for this world – even though they agree on everything.
Sounds like we got a new framework for a deal (again) but they say the third time is the charm so let’s see how long it takes Trump to have a tantrum.
Meanwhile back home, MAGA screaming they are losing SNAP benefits. Lol!
https://www.youtube.com/watch?v=7joABbGeLyw
MAGA SNAP recipients are mad? Both of them?
The fastest growing SNAP folks are the elderly, most of those boomers voted for MAGA.
https://www.fns.usda.gov/data-research/data-visualization/snap/household-characteristics
They will reap what they sowed!
About 10% of maga admits to receiving snap, the other 20% are hiding.
Thanks for the MAGA update. We all need you on that lookout post.
“Trump and Xi are both liars”. What has Xi lied about?
With the greater and greater dependence of the US economy on AI and it’s incestuous circular money flow, the easiest apple to reach on the destabilizing tree for China is obvious…from Scott Galloway…
….China has had it with America’s sclerotic trade policy. If I were advising Xi, I would say this: If you think of America as an adversary, understand that America has essentially become a giant bet on AI. If the Chinese can take down the valuations of the top 10 AI companies — if those 10 companies fall 50, 70, even 90% like they did in the dot-com era — that would put the U.S. in a recession and put Trump out of vogue.
How can they do that? Pretty easily. I think they’re going to flood the market with cheap, open-weight models that require less processing power but are 90% as good. The Chinese AI sector, acting under the direction and encouragement of the CCP, is about to Old Navy the U.S. economy: They’re going to mess with America’s big bet on AI and make it not pay off
Reminds me of US tanks and logistics versus German in WW2. We just flooded them with cheap and plentiful, reasonably functional stuff. Tigers could blow away Shermans all day, but the Sherman waves kept coming, with fuel and ammo to spare (similar for USSR front). All the courage and warrior ethos in the world (hello Hegseth) couldn’t save the Germans.
> Then we will roll the clock back to April and look forward to doing this all again at some future date.
Each time moving the tariffs higher and higher.
Five steps forward, four steps back. The MSM will say “TACO” to the frogs inside the pot. Just like they did to western Ukraine. Just like they’re doing to Europe.
> “Trump put a 20 percent tariff on all Chinese exports on the basis of China’s role in channeling fentanyl to the United States.”
Can we please stop repeating lies, without putting them in quotes to remind everyone that it’s bullshit?
China makes 80% of active pharmaceutical ingredients (API) globally. They don’t and can’t possibly control every possible use or diversion downstream.
Think of the steel that goes into millions of products. Oceania imperialists might as well blame China steel manufacturers for school shootings.
2A defenders should scoff at these smears against China even more than they scoff at lawsuits against gun manufacturers. Here, it’s even more ludicrous.
The real problem isn’t the production of fentanyl it’s the insatiable desire of Americans to consume it and other recreational drugs. American politicians can’t seem to put the blame where it belongs on the user not the producer.
Started the deal at +100%, ended the deal with -20%.
The Grifter in Chief got a backhander, once again showing how weak he really is. What has achieved apart from revealing the US is a desperate paper Tiger? A big fat zero.
Could China devastate the US without firing a shot?Quite possibly yes.
https://garymarcus.substack.com/p/could-china-devastate-the-us-without
Can our rulers shoot us in our feet and wallets without China firing a shot? All the time.
it seems that Mr. Trump is the best used car salesman America has …