The Disconnect: 100% Tariffs vs. Sanctions
Philip Pilkington has been on fire the last few days, especially regarding the Euro debacle and the French situation in particular:
Looks like France is heading for a constitutional crisis. A financial crisis provoked by war combined with a constitutional crisis in France? Some echoes of history. No big deal though. I'm sure everything is fine.
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FinancialJuice @financialjuice
FRENCH PM BARNIER TO USE SPECIAL CONSTITUTIONAL POWERS TO ADOPT SOCIAL SECURITY BUDGET BILL WITHOUT PARLIAMENT VOTE.
Barnier flicked a constitutional suicide switch. Likely outcome will be a budget passed by “untested emergency legislation”. The twin fiscal and constitutional crisis in France has deep 1787-89 vibes. Who knew there were risks associated with bankrupting a country with war?
Both foreign and domestic investors are pulling out of French bonds. Macron might have to get out the begging bowl soon. I hope selling a few Scalp missiles was worth it, homie.
Today Pilkington pivots to the US situation. Now, in fairness to Trump, he never said he’d impose 100% tariffs on countries that sanction the US—just on countries that try to replace “the mighty dollar” as the reserve currency for the world, the backstop for US inflation. Speaking of which:
Looks like even the more sensible parts of the Inflation Reduction Act were a dismal failure. It’s not really clear that the Congress-led American financing system can actually do industrial policy. An alternative is needed.
Now this:
First Squawk @FirstSquawk
CHINA BANS GERMANIUM, GALLIUM EXPORTS TO UNITED STATES IN PRINCIPLE
And that’s not the only military related natural resource ban China is putting in place:
China bans exports to US of gallium, germanium, antimony in response to ...
Today BANGKOK (AP) — China announced Tuesday it is banning exports to the United States of gallium, germanium, antimony and other key high-tech materials with potential military applications, as a general principle, lashing back at U.S. limits on semiconductor-related exports.. The Chinese Commerce Ministry announced the move after the
Correction: These are not potential military applications. They are very real, even crucial, military applications. And China pretty much has a lock on the supply side—China produces 98% of the world’s gallium—certainly in the amounts that the US war machine needs these materials.
Screws tightening massively on the US now. This only a day after Intel - which uses gallium as an input - posted major losses and the CEO quit. The US are blustering about a trade war while the Chinese squeeze what life is left out of the US economy. New strategy needed!
How dare they? Well, they do dare, and that should be a wakeup call. Snarking at hapless Canada is cheap fun, but it’s not a substitute for constructive policy for MAGA.
2. Govini ($400m contract with the Pentagon to analyse the MIC’s supply chain) estimated that the U.S. defence contractor sector relies on over 10k Chinese firms for inputs. The U.S. is trying to untangle this; good luck. China may beat them to it.
America’s Carriers Rely on Chinese Chips, Our Depleted Munitions Too
Americans are being told they just need to “tap their gallium deposits”. Gallium is produced in bauxite processing. You need a massive aluminium industry that would take a decade to rebuild. It’s scary how misinformed Americans are on this topic.
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DeLoss McKnight @DeLossMcKnight
Replying to @philippilk and @DrClaytonForre1
This is just China trying to get the jump on Trump. The US has gallium deposits. They are just classified as not cost efficient. This problem can be fixed with several tools we can use. We'll be fine.
Guess who else has a massive aluminum industry? Russia.
Bluffing is OK for domestic consumption—for a while. It doesn’t work with people who know better.
MoA:
https://www.moonofalabama.org/2024/12/mirror-action-china-to-block-dual-use-exports-to-us-war-mongers-.html#more
Gallium, germanium, antimony and superhard materials are important for chip making in electronics industries and for weapon manufacturers. Graphite is necessary to make rechargeable batteries.
These commodity items are not necessarily rare but China has plenty of them and, more importantly, is nearly the only country which processes them in large quantities. The reason is that the processes to do refine the raw materials are somewhat dirty and only profitable when done on scale.
Somewhat off the particular topic discussed here, but South Korea's declaration of martial law today seems to follow the general pattern of the extreme measures to which the "global order" is willing to go to retain control right now. This appears to be the 16th martial-law declaration since 1948 (around the time of the ROK's founding), but only the first since 1979-80 (following an assassination).
https://www.zerohedge.com/geopolitical/south-korea-declares-emergency-martial-law