In London, China and the U.S. had a life-and-death talk for 48 hours, temporarily pressing the nuclear button of the trade war, but the fuse is still burning. August 10 is the line between life and death!
Temporary painkillers:
The U.S. has eased its grip on rare earths.
China has also released some pressure, allowing Shenzhen rare earth companies to export again.
The harshest move is the drastic tariff reduction! The U.S. punitive tariffs on China have been slashed from 145% to 30%, and China’s tariffs on the U.S. have dropped from 125% to 10%. This is definitely a significant concession from both sides!
BUT! A time bomb hangs overhead:
August 10 is the deadline! If no agreement is reached beforehand, all the reduced tariffs will “boom” back up, even harder! This is not an agreement at all; it’s merely a delayed explosion!
Surface ceasefire, secret stabbing:
The U.S. is being cunning: The ban on chips and aircraft equipment against China remains unchanged, while boasting that the court supports its 34% “standard” tariff. I see this as a delaying tactic; the big stick could come down at any time!
China is not backing down either: Exports to the U.S. plummeted by 34.5% in May, setting a record; the trade war indeed hurts. But we have the rare earth trump card, forcing the U.S. to come back to the negotiating table; this hand is solid!
The world is terrified:
The World Bank overnight lowered its global growth forecast for next year to a dismal 2.3%.
ECB President Lagarde urgently shouted: Continuing like this will put the global economy in ICU!
Countries like the EU, Japan, and Mexico, especially those in the aircraft business, are begging the U.S. “not to fire”! The market is truly scared to death!
Experts' outrageous remarks:
This is a “Syrian-style ceasefire”—fragile as a piece of paper! The deep-seated contradictions are not resolved at all, entirely depending on the leaders' moods; they can flip at any moment. I completely agree; this “peace” is too unreliable!
The market goes crazy:
Rare earth stocks soar, related companies in Shenzhen are like printing money.
The dollar strangely drops, exposing the market's underlying anxiety.
U.S. companies are schizophrenic: on one hand, they yell “long live the probation,” while on the other hand, they secretly stockpile goods to guard against an August explosion! This blatantly shows that no one believes this ceasefire can last!
My ultimate judgment:
Trump's tariff cannon is already loaded, just waiting to fire on August 10! Beijing holds the rare earth card, and when pushed to the limit, will retaliate fiercely.