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David Lee

@DavidLe76335983

Dec 4, 2024

🧵 Why 🇺🇸 trade war with 🇨🇳 is destined to fail

Since Trump impose tariff on 🇨🇳 products in his first term, the friction between the world’s 2 largest economies emerged into full blown trade war. The arrest of Huawei’s CFO Meng Wanzhou indicated dirty tricks are allowed in this trade war.

Biden’s admin relentless effort trying to cripple 🇨🇳 high tech sector fell spectacularly with Huawei launched of Mate60 using 🇨🇳 made chip while 🇺🇸 Commerce Secretary Raimondo was visiting 🇨🇳 in 2023. With less than 60 days in office, Biden admin continue to add 🇨🇳 companies to hi tech sanction list (>1400 China companies in the list now)

1/7

🇨🇳 has been reluctant to retaliate other than claiming to “reserve the right to respond”. Eventually, 🇨🇳 impose export control of Gallium and Germanium in 2023. This month, 🇨🇳 outright ban export of Gallium, Germanium, Antimony and Graphite

🇨🇳 ban Germanium, Gallium, Graphite, Antimony export to 🇺🇸 in response to 🇺🇸 prohibit chip export to 🇨🇳. 🇨🇳 also stated any third party diverting 🇨🇳 supply to 🇺🇸 will be sanctioned
🇨🇳 accounts for
94% of Gallium production
83% of Germanium production
77% of Graphite production
48% of Antimony production

Germanium and Gallium are byproducts of Aluminium processing
You cannot “find” Germanium and Gallium if you don’t have large enough Al production

Finding replacement is not going to be easy

2/7

🇨🇳 has long been preparing for this day
In 2009 after GFC, there had been a lot of debates whether holding large amount of UST make sense. As a matter of fact, 🇨🇳 has made many moves under the radar that the west did not notice until the past 3-4 years
2001 Shanghai Cooperation Organisation (SCO)
2001 Investment in EV
2002 1sr Photovoltaic cell production line
2002 SGE to trade #Gold in Shanghai
2002 Union pay, local credit card
2008 Thousand Talents Program to absorb overseas talents
2008 High Speed Rail system
2009 Started RMB swap line (40 agreements by 2023)
2009 1st BRICS Summit (turn an investment idea into an org)
2013 One Belt One Road (later become BRI)
2015 Made in China Strategy 2025
2015 CIPS payment system
2020 RCEP (trade agreement among AP nations)

🇨🇳 also build a comprehensive education system generating 4.7 million STEM graduates per year (437K in 🇺🇸)

Top 🇨🇳 company Huawei invests 23% of revenue in R&D in 2023 vs
Top 🇺🇸 company Apple invested 7.8% of revenue in R&D in 2023

3/7

Read 8 tweets

David Lee

@DavidLe76335983

May 5, 2024

Much talk about #GOLD revaluation recently
Want to do a mental exercise and see how it works
If 🇨🇳 govt declares it will buy unlimited quantity of gold at RMB 1100/g (currently ~550/g), it means 🇨🇳 devalues RMB by 50%. Import for 🇨🇳 becomes expensive but 🇨🇳 export is cheap
1/5

🇨🇳 will flood its export globally killing jobs elsewhere
So other mfg countries will interfere FX to devalue their currencies in order to maintain stability against RMB.
West finds its export collapsing will also devalue their currencies to reach equilibrium with RMB
2/5

In essence, due to 🇨🇳 RMB devaluation against #GOLD, all fiat currencies have to devalue as a result due to powerful mfg base of 🇨🇳
The holdout will be those without #GOLD eg 🇨🇦
3/5

Read 5 tweets

David Lee

@DavidLe76335983

Mar 29, 2023

How to stop drinking milkshake?
Slowly then suddenly

So far this week
Kenya buy 🇸🇦 🇦🇪 oil in Kenyan Shillings
First Yuan LNG deal
🇨🇳 🇧🇷 trade in their currencies
ASEAN discussion on non-USD settlement

Only midweek 😁
#Dedollarization

https://twitter.com/meghupdates/status/1640303645010071552?s=61&t=5ERGqeMwtGeHdk_W7F-7xQ

https://twitter.com/meghupdates/status/1640303645010071552

globaltimes.cn/page/202303/12…

Read 5 tweets

David Lee

@DavidLe76335983

Oct 28, 2022

🇺🇸 playbook is really smart
“Weaken a nation and takeover its asset at discount” works for decades
Ukraine crisis was planned to weaken 🇷🇺 and rob it like in the 1990s. If it fails, Europe is doomed and 🇺🇸 can rob European capital, knowhow, talent, asset like 🇷🇺 in 90s

1

Problem is the world already tired of this playbook and only 777 mn International Community stand with 🇺🇸
The rest of the world knows they need a new “community” and started to look for alternatives, e.g. BRICS, SCO, etc. All of them have key members 🇷🇺 🇨🇳 🇮🇳

2

With more countries like 🇸🇦🇳🇬🇦🇷🇹🇷 joining this alternative community, it becomes more military, political and economic viable, or a mini United Nation that is not based on rules set and kept changing by a bully.

3

Read 4 tweets

David Lee

@DavidLe76335983

Aug 19, 2022

Long 🧵 on 🇨🇳
Many experts’ posts on how bad is the 🇨🇳 economy, but the same experts kept telling their followers that 🇨🇳 number are all made up and unreliable 🤔

The key issue in 🇨🇳 this year is potential leadership change. One needs to learn how to read the tea leaves

1

🇨🇳 leadership for next 5 years will be decided in 20th CPC Congress. The top leadership held their meeting in Beidaihe earlier this summer to decide on personnel arrangement to be approved in the CPC Congress. So called experts not knowing this should not even talk about 🇨🇳

2

What was decided in Beidaihe is not known. Premier Li was the first to emerge in Shenzhen, then Xi went to NE 🇨🇳. Real 🇨🇳 observers follow these actions to read the tea leaves. So, what are the significance of these visits?

3

Read 9 tweets

David Lee

@DavidLe76335983

Aug 8, 2022

Long 🧵 on Taiwan
With the completion of Pelosi Asia trip, many different views on its merits and what will come next. My take is 🇨🇳 🇺🇸 each got what it wants. Taiwan is the clear loser.

1

🇨🇳 started military exercise the day after Pelosi visit. For the first time, PLA exercise around Taiwan, blockading the island. PLA repeatedly move beyond median line and its navy was within 12 miles of Taiwan, completely ignoring median line or “ territorial” water claim

2

The speed and scale of organising such massive exercise shows 🇨🇳 is well prepared for mass mobilisation and is ready to undertake such task at a moment notice. PLA knows full well 🇺🇸 is watching PLA move and is happy to let 🇺🇸 know 🇨🇳 attack plan

3
taiwannews.com.tw/en/news/4617283.

Read 15 tweets

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