In politics, words are flung around sometimes to get votes but words eventually matter. President Trump on the campaign trail, often says China will pay and then goes on to another subject. The issue with the President is he is not a very detailed person, he shouts from the rooftops and then goes to another roof to shout again. Sometimes you might like what he says, sometimes you dismiss him. But what if a target of what he says or tweets can fight back? China is the world’s second largest economy and has very distinct ideas of where it wants to be and is going. Every time the US has dropped from its normal response to anything which happens around the world as it does an inward US first policy, China sets in and takes the US’s place. We have seen China expand its relationships across the Asia (examine You Tube videos on the new Silk Road) and Africa (new ports for Chinese goods have been established and China has lent money to countries) and they will not step back when a new administration is in power in the US.
China is setting the stage for what it will do every time President Trump says China will pay. In an Associated Press article China passed a law restricting sensitive exports to protect national security. The law will apply to all companies in China and take affect December 1. The law in China will apply to civilian, military and nuclear programs, as well as goods, technologies and services related to national security. In simple terms just about everything.
The law is designed if other countries around the world including the US block Chinese communications gear supplier Huawei Technologies, Tencent Holdings’ We Chat, ByteDance Ltd.’TikTok app and others China will have a response. It is noted China has some of the most restrictive controls on its own people through facial recognition programs it can and does scan all the people at sporting events and find those who needed to be arrested. It is both interesting and scary at the same time.
In a related story, China is blaming the US for climate change getting worse. It is true the US has not signed onto the Paris Accord and President Trump’s administration cut regulations for clean air and clean water, but blaming the US without examining the face in the mirror is a little much.
Linking to dividend paying stocks, words from the President of the US or President of the company which you have investments matter. When the words are directed at the competition, expect the competition to have an ability to push back. If you think about the physics notion – for every action there is an equal and opposite reaction; not to expect reaction is foolish. Why would the competition roll over, particularly if they feel you are vulnerable? Measured words are sometimes boring, but measured words tell you about the long term plans, as opposed to what is happening today.
There are more questions than answers, till the next time – to raising questions.