10 Questions and Modest Expectations With Trump in China to Meet Xi Jinping

Summary

Sharp China with Bill Bishop

Episode: “10 Questions and Modest Expectations With Trump in China to Meet Xi Jinping”

Date: May 13, 2026
Hosts: Andrew Sharp (A), Bill Bishop (B)

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Episode Overview

This episode covers Donald Trump’s state visit to Beijing, a highly anticipated event featuring a high-profile delegation of American CEOs and multiple rounds of leader-to-leader diplomacy with Xi Jinping. Andrew and Bill break down what’s at stake in the current US-China relationship, the likely outcomes of the summit, and broader geopolitical context, including ongoing tensions over Taiwan, rare earths, and the Iran war. The hosts weigh the potential for meaningful agreements, analyze the public narratives in both countries, and highlight the uncertainty and behind-the-scenes drama inherent in current US-China relations.

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Key Discussion Points and Insights

1. The US Delegation and Summit Optics

• Unpredictable CEO Participation: The White House's list of 10-15 CEOs fluctuated until the last minute, with Jensen Huang (Nvidia) boarding in Alaska after a media stir.

  • “At the 11th hour, literally like 10 o’clock Tuesday night, you text me a photo of Jensen Huang standing on the tarmac in Alaska with a backpack, looking a little bit like a hitchhiker.” (A, 00:54)
  • Trump acted after media reported Huang was excluded: “President Trump saw a media report that he was excluded, said why isn’t he here? Get him on the plane.” (B, 03:11)

• Summit Choreography and Chaos: The summit has low expectations for concrete deliverables, and much remains unscripted—even last-minute meetings between US Treasury Secretary and Chinese officials in Seoul.

  • “There’s not a lot of informed leaking about what’s actually coming out of this summit. It’s kind of interesting…” (B, 04:46)
  • Trump’s management style: “A run and shoot offense from the Trump administration. Two minute drill, all game.” (A, 03:06)

• Optics and Symbolism: The ceremonial airport greeting, Trump's Four Seasons suite details, and even weather manipulation for air quality were noted as part of the spectacle.

  • “The air quality becomes Switzerland-like for a month going into each time he visits.” (A, 11:23)

2. Summit Expectations and Realistic Outcomes

• Stable but Superficial: Both hosts agree the summit is “something,” in that leader-to-leader talks matter for stability, but expect only superficial announcements or ongoing PRC purchases—not substantive policy breakthroughs.

  • “It's probably nothing as far as the direction of travel for US-China relations…my baseline expectation is that it will be business as usual, with some superficial announcements.” (A, 05:37)
  • “I would be surprised if you see any shift...Certainly you're not going to see it from the Chinese side.” (B, 06:57)

• Narrative Building Over Deals: Trump’s tone about “opening up China” plays more to public and media perceptions than to actual negotiating aims.

  • “That ‘open up China’ tone is like from the 90s. It’s really kind of a throwback...” (B, 27:16)
  • “If you think Trump is naive enough to expect China to actually open its market at this point, that's on you.” (A, 28:02)

• Both Sides Seek Time: Both countries want to maintain the current “tentative stability,” to address vulnerabilities—rare earths for the US, export markets and development for China.

  • “Both sides want an extension of the current Busan agreement. They both want more time to address the issues…” (B, 06:57)

3. Lingering Issues on the Agenda

Taiwan

• Arms Packages and Rhetoric: Large US arms sales to Taiwan are causing concern in Beijing; a possible incremental shift in US stated policy ("does not support" to "opposes" Taiwan independence) could be a significant signal if it happens, but is not expected.
  • “The Chinese side would really like the President to change…But I’m hearing not going to happen, but we’ll see.” (B, 38:21)

Rare Earths and Supply Chains

• Mutual Dependency, Reluctant Cooperation: US wants rare earths; China wants relaxation of chip export controls. Both are unlikely to get major changes but will continue transactional exchanges.

  • "No 36 hour visit or nice tweet from the President...are going to change that strategy." (B, 33:36)

• Rhodium Group’s Warning: New report signals to CEOs and governments that the window to counter China’s tightening grip on supply chains is closing.

  • “The Chinese are absolutely doubling down on binding the rest of the world to China through their supply chains and key inputs…that strategy is not changing.” (B, 31:41)

The Iran War

• Limiting Leverage: China wants the Strait of Hormuz reopened but may not have decisive influence over Iran, while the US leverages sanctions to send messages to Beijing.

  • “China is pretty adamant that they want the Strait reopened. But can they force Iran…?” (B, 58:00)

• Risks if Ceasefire Ends: Further escalation could quickly stress US-China relations—especially if American troops are harmed using weapons or intelligence sourced from China.

  • “You have a situation where you start…getting killed by Iranian drones or weapons that are…made with Chinese components. Then it’s going to get much more complicated in the US-China relationship.” (B, 59:53)

Artificial Intelligence

• Potential for Structured Talks: The addition of Michael Kratzios to Trump’s team signals real intent to begin formal AI dialogue, but skepticism remains about enforceability and sincerity.
  • "Any agreement would just be around having a dialogue, setting up some sort of a mechanism...they should be talking." (B, 39:44)

Human Rights and Detentions

• Jimmy Lai Case: Trump is expected to raise the case of imprisoned Hong Kong media executive Jimmy Lai, but hosts are skeptical China would release him without reciprocal concessions.
  • “They don’t feel like they need to give up anything unless there’s something in return.” (B, 43:24)

4. Inside Baseball and Media Narratives

• Unknowability of Trump’s Process:

  • “Sometimes I feel like I’m doing my readers a disservice by not having a hot take…it’s sort of irresponsible." (B, 23:34)
  • “The baseline is just...wait and see.” (A & B, 24:32)

• Media Punditry and Strawmen: The hosts poke fun at exaggerated takes—e.g., a NYT op-ed warning Trump “might tie the US irrevocably to China” with a $1 trillion investment. Both find such scare stories untethered from negotiation reality.

  • “It was just bizarre this week with this trillion dollar idea to see it resurface eight months later and presented as well..." (A, 50:25)

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Notable Quotes & Memorable Moments

• Jensen Huang’s last-minute invitation:
  “President Trump saw a media report that he was excluded, said why isn’t he here? Get him on the plane.” (B, 03:11)

• On uncertain deliverables:
  “There’s not a lot of informed leaking about what’s actually coming out of this summit. It’s kind of interesting…” (B, 04:46)

• On the limits of any quick agreement:
  “No 36 hour visit or nice tweet from the President...are going to change that strategy.” (B, 33:36)

• Cynicism re hot takes:
  “Sometimes I feel like I’m doing my readers a disservice by not having a hot take...It’s sort of irresponsible.” (B, 23:34)

• On AI cooperation:
  “Any agreement would just be around having a dialogue...I don’t think there’s something going to agree on, you know, no distillation or what have you.” (B, 39:44)

• Trump’s CEO-heavy Truth Social post:
  “In actuality, Jensen is currently on Air Force One, and unless I ask him to leave… CNBC’s reporting is incorrect or as they say in politics, fake news." (Trump, quoted by A, 25:15)

• On why leaders-fixated summits matter:
  “The US China relationship…is set at the leader-to-leader level. The Chinese keep saying it, and they're right. Especially…President Trump is…the China desk officer.” (B, 05:18)

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Timestamps for Key Segments

| Timestamp | Segment | |---|---| | 00:00 - 02:30 | Opening, Trump delegation, Jensen Huang’s last-minute addition | | 02:30 - 06:00 | What to expect: something, nothing, or everything? | | 06:00 - 10:00 | Prospects for real deals, summit expectations | | 10:00 - 15:00 | Optics: greeting protocol, Trump’s suite, Beijing air quality, delegation makeup | | 15:00 - 19:00 | Who has leverage? Iran war context, China’s economic needs | | 20:00 - 24:00 | Superficial cooperation: fentanyl, scam compounds, recent sanctions | | 24:00 - 31:00 | The hot take economy and limits of punditry, Trump’s Truth Social, CEO motivations | | 31:00 - 35:00 | The Rhodium Group warning: supply chains and industrial policy realities | | 35:00 - 40:00 | Taiwan: arms deals, rhetoric, and likely outcomes | | 40:00 - 44:00 | Artificial Intelligence: personnel and potential for bilateral talks | | 44:00 - 47:00 | Jimmy Lai and political prisoners: can Trump get a release? | | 47:00 - 51:00 | Chinese media narrative, wild op-eds (e.g., $1T investment rumors) and domestic constraints | | 51:00 - 55:00 | What counts as a “win”—how to read press releases from the summit | | 55:00 - 60:00 | Xi’s domestic political calculus, the Iran war, “bear-hug” question | | 60:00 - End | Finale, handshake vs. hug, what to watch for in coming days |

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In the Words of the Hosts

• Bill Bishop:
  "No 36 hour visit or nice tweet from the President… are going to change [China’s industrial strategy].” (33:36)
  “Sometimes I feel like I’m doing my readers a disservice by not having a hot take... It’s sort of irresponsible.” (23:34)

• Andrew Sharp:
  "If you think Trump is naive enough to expect China to actually open its market at this point, that's on you." (28:02)
  "Wait and see. I can't wait for next week's episode…" (24:32)

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Takeaways for Listeners

• Low Expectations, High Optics: This summit is likely to produce more headlines and photo ops than substantial policy change or grand bargains.
• Both Sides Want Stability: The US and China are pursuing a “tentative stability”—important but fragile, and based on a mutual desire to delay sharper confrontation while shoring up vulnerabilities at home and abroad.
• Unpredictable Leadership Style: Trump’s “improvisational” approach—reevaluating CEO invites in real time—reveals White House chaos but also that key decisions come down to a very small circle, often Trump himself.
• Supply Chains Binding the World: China’s strategy to entrench global reliance on its supply chains isn’t changing, and US business and policymakers are running out of time and leverage.
• Domestic Politics Reign Supreme: Both sides are acutely focused on their own domestic stability; any “deal” is likely to be as much about narrative as reality, especially ahead of US midterms and China’s 21st Party Congress.
• Plenty of Eyes, Few Insights: There’s a profound unknowability at play—even super-informed analysts admit that much remains hidden or undecided until the last minute.
• Key Issues Remain Stuck: Breakthroughs on Taiwan, rare earths, AI, and human rights (e.g., Jimmy Lai) are unlikely; best case scenario is incremental signaling and setting the table for future talks.

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“Wait and see…this is all part of the fun here on Sharp China.”
— Andrew Sharp (24:32, Closing)

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Next week: The hosts will be back to parse what actually emerged from the Trump-Xi summit, distinguishing superficial announcements from real shifts—if any.

Transcript

[A]

Foreign. Welcome back to another episode of Sharp China. I'm Andrew Sharp and on the other line waiting for me on the Runway in Anchorage, Bill Bishop. Bill, how you doing?

[B]

I'm good, but it looks like the plane already left, so I don't know

[A]

what we're gonna do.

[B]

We missed it. We missed our window.

[A]

Recording live from the tarmac in Anchorage, Alaska. Just a spectacular way to kick off a week of int US China coverage. For anybody who missed it, we've got questions about CEOs later on in the rundown, but what happened there? Trump is going to China and bringing a delegation of like 10, 15 CEOs. The biggest, most powerful CEOs in the

[B]

world, although only one actually was on Air Force One that Elon Musk. The others, all the others all have their own rides.

[A]

Well, for the past week there had been various reports that among that group of the biggest, most powerful CEOs in the world, Jensen Wong was not on the list of CEOs who would be going to China. And then at the 11th hour, literally like 10 o' clock Tuesday night, you text me a photo of Jensen Huang standing on the tarmac in Alaska with a backpack, looking a little bit like a hitchhiker. He had the leather jacket and a backpack and he's officially on the trip. So here we go. The U. S. China trip is underway.

[B]

Yeah. And they have landed. And Jensen and Elon Musk, you know, we're seen coming off the plane behind President Trump at the welcoming ceremony. So yeah, we are recording it basically just after midnight Thursday morning in Beijing. So who knows if the president is asleep or jet lagged. But the first meeting start in about 10 hours, I think.

[A]

Yep, 10am he's got a photo op where this is going to be 10pm Eastern in the United States, photo op with Xi Jinping. And then they'll have a bilateral meeting from there. A banquet Thursday night in Beijing, which will be 6am Thursday in the United States. So all the festivities still to come here. But at a general level, as we talk through what might happen over the next couple of days in Beijing, I'm going to borrow a gimmick from sports media here. Rachel Nichols and espn, they used to ask this question about breaking news. Is the U.S. china visit something, nothing or everything? What's your theory of the case on the way into things?

[B]

It's definitely something. It's important. It's good that they're talking. It should help maintain some level of the current tentative stability that exists in the relationship since Liberation Day last year. And Then you know, obviously most recently the Busan agreement from last fall back to we were joking about Jensen Huang joining the trip. I mean, in some ways I think that's emblematic of I think a fairly, you know, we're all probably used to, even if it drives us crazy. A fairly. One could say chaotic, one could say improvisational approach, kind of a run and

[A]

shoot offense from the Trump administration. Two minute drill, all game basketball basketball

[B]

theme run and shoot. So, you know, he was not on the trip and I heard that he's not on the trip because, you know, he was excluded because chips weren't on the table somehow, you know, the official story out there is that President Trump saw a media report that he was excluded, said why isn't he here? You know, get him on the plane.

[A]

That's not just the official media story. That's explicitly what Donald Trump said.

[B]

Maybe, maybe he has good lobbyists who made sure that the President saw that. The report that he wasn't invited, unclear. But again, he's a late addition to what's usually a very heavily scripted and choreographed trip. But I think that ultimately, you know, expectations are low, I think in terms of real deliverables. But again, we just don't know. And what's been interesting is how there has been, there was some reporters got briefed. Readout I got from that briefing was a lot of stuff's not nailed down at this point. But again, I think it is, it

[A]

is a lot of stuff not being nailed down as far as deliverables are concerned and what might emerge, what are the deals?

[B]

Are there going to be announcements of, are there going to be actual concrete announcements of things? Will it just be mous, will they be kind of concept of a sale, concept of a purchase kind of thing? You had the two leads for the economic negotiations. Scott Besant, Treasury Secretary on the US Side and he lifong the vice president, Chinese side. They met in Seoul yesterday, the day before President Trump arrives, which again is a sign, I think a lot of things weren't really locked down. And so whether or not they've actually locked stuff down, we're going to find out. I think that my point was though is this is there's a line. I was at a conference, U.S. chamber of Commerce's China conference every year and it was at the first day yesterday and there's not a lot of informed leaking about what's actually coming out of this summit. It's kind of interesting. But in general, these meetings are important and they can be useful. And clearly the US China relationship. It is set at the leader to leader level. And the Chinese keep saying that they talk about the sort of leader to leader diplomacy. They're right. Especially, you know, President Trump is, as people like to say, you know, the China desk officer.

[A]

Right. Get him in a room, and you've

[B]

got to get him in a room. And so. And so I think for the Chinese, there's a lot of opportunity here. There's obviously some risk. But, but in general, this is. It's good that they're meeting and this should be the first of maybe up to four meetings this year. I think that is what the sort of. The hope is.

[A]

Yeah.

[B]

From both sides.

[A]

Yeah. I mean, it's interesting in, in context as more people pay attention to the US China relationship than are Norma paying attention. Obviously, Trump is in Beijing, and so there are a lot of different people weighing in on what might emerge from the next couple of days. From my perspective, I would say it's something that the visit is happening, but it's probably nothing as far as the direction of travel for US China relations. And I would be surprised, given what we've seen over the last year and a half, if there are any breakthrough announcements to emerge from this trip that actually represent a meaningful policy shift, which isn't to say that can't happen. That's obviously, anytime Trump is in a room with Xi, anything can happen. But my baseline expectation is that it will be sort of business as usual and there will be some superficial announcements about maybe PRC purchases and working groups and whatnot. But if anything, my understanding is the US has been pretty aggressive over the past year and a half. And a visit like this is designed to mollify the PRC side and promote stability and maybe convince them that there's a deal that might get done at some point while the US Continues to do its own work to solidify its security footing.

[B]

Well, and I think the Chinese feel the same. I mean, I think both sides want an extension of this, the current, the Busan agreement. They both want more time to address the issues that, you know, the vulnerabilities they see with the other party, with the other side. Both sides need more time. The US Certainly needs more time when it comes to rare earths. And so I think that I don't. I would be surprised if you see any, any shift from. Certainly you're not going to see it from the Chinese side, but I think from the US Side, if suddenly President Trump decides we don't need to, you know, the US doesn't need to keep doing things that look like they're focused on re industrialization and you know, call it de risking, call it decoupling, etc. I mean, I think you look at his team, you look Secretary Besant Jamison Greer is head of ustr. They're clearly very, very focused on that, but also I think much more sober than they were a year ago and realizing that, you know, there's a lot more larger vulnerabilities the US has than they want recognize. And so, you know, the question is, is okay, well, if there is going to be some sort of an extension of this tentative stability, is it through the end of the year, is it, you know, I think that, I think the Chinese would beloved if they could get some sort of agreement that lasts through the end of President Trump's term. I think that's probably too long for the US Side. But at the same time, President Trump needs some things that he can announce that look like he's helping American workers.

[A]

Yeah.

[B]

And the Chinese, I think, know that. And so then I think it's harder to get them to commit to big purchases of ag products than maybe the US Side thought. And so the question then is what,

[A]

what can the US Offer? Right.

[B]

Offer maybe back off on a few things. I mean, again, we'll see. And then of course there's, you know, the Iran war hanging over things and then Taiwan, I think Taiwan, of course, will be on the agenda. But then the question is what, if anything, is agreed to that would either shift US Policy even rhetorically, or actually, I think as Wang Yi said in his call with Rubio a couple weeks ago, something Taiwan open up space for more development in US Relations. I'm paraphrasing here to get the full quote. So again it's. And the FT has a story today about how Taiwan and other countries in the region are worried that there may be a shift on Taiwan. We just don't know. I think it is worth noting that on his trip over to Asia, it's a long flight from DC to go from DC To Beijing. President Trump's not stopping in Japan, Japan's treaty ally. Chinese have been going nuts over Japan since Takechi's comments last November. The Japanese side is very disappointed with what they see as a relative lack of support, real, actually lack of rhetorical support from the president, from President Trump. Secretary Besant went ahead of his trip to Seoul to meet Holy Fang. But that's. He's not the same as the president. And so I think that is a clear from the Chinese side. I think they see that as something quite positive.

[A]

Right. If you're Trump, it would have been inflammatory to go to Japan like a day before you land in Beijing or

[B]

you could go on your way back. I mean, you refuel in Alaska, pick up Jensen, you can refuel in Tokyo and then refuel again, you know.

[A]

Right. I mean, that's the way I understand it is. I don't, I do think that the US Is invested in stability right now and invested in keeping China mollified. So go straight to Beijing, send Besant to meet with Taka Ishi and others.

[B]

That's a diss. That's a diss to Japan and, and will not be noted with positively in Beijing.

[A]

Perhaps, I don't know that Japan.

[B]

There's no, there is no perhaps here. He flies over Japan to get to Beijing. It's a diss.

[A]

Well, okay, I don't know that Japan feels jilted by President Trump, but I'm sure that there are.

[B]

We should be there. We should have a bet. Let's have a bet on that.

[A]

We shall see. Well, to keep it moving, a specific question on the trip. Trump was greeted by Vice President Han Zhong during a red carpet welcome ceremony at the airport. He was also greeted by dozens of Chinese students waving Chinese and American flags. There's a lot of attention paid to the protocol for these airport greetings. Did you see anything notable from the scene Wednesday night in Beijing?

[B]

I mean, you know, the last time he was there, he was, he was greeted by the Wang Yi's predecessor, Young Jiech. So this is a bit of an upgrade. But you know, Han Jung is also part of his job. He's the ceremonial vice president. He, he, he's a former Standing committee member. It's, it's, he deals with foreign dignitaries, but it's certainly, you know, it's, it's, it's a, it's a nice gesture from the Chinese side.

[A]

Yeah. Okay. Two other fun notes. Trump's stay in Beijing is at the Four Seasons Royal Suite with a private elevator. And it is a 730 square meter suite occupying the entire 27th floor of the hotel. Plus it has a 250 square meter terrace that is equipped with a telescope. So just in case anybody is curious where the President stays while he's in Beijing. And then a second note that I saw before we came on to record, somebody tweeted the reason why Trump is insanely popular in Beijing specifically is because the air quality becomes Switzerland. Like for a month going into each time he visits. As a former Beijing or do you have any Comment on that.

[B]

The air quality wasn't actually great this week. But no, in general, you, when you have some of these big foreign leader visits or big meetings, the air quality does get better. It's clearly much better than when I lived there. Still has some bad days. You know, I mean, I think it's interesting he's saying at the Four Seasons, you know, what they really need is the Trump Hotel. Maybe that's why. No, I mean, maybe. Maybe that's why Eric. Eric, Trump is on this trip and was on Air Force One and got off the plane ahead of like the Secretary State and Secretary Treasury. You know, I seem to remember when Hunter Biden accompanied his dad, one wing of the US Political system went absolutely nuts, that why is he taking his child to China? So, yeah, again, why is the kid there with his wife? And you saw we were talking last night about the nice post that Lara Trump made about team, Team China with five, five wise. Not four, not six, but five wise. Yep. So again, all joking aside, but you know, if the Chinese want to make progress, there's clearly precedent from other countries in how you sort of worked all sorts of angles.

[A]

Yeah.

[B]

And the clear the Beijing skyline is. I mean, they're missing a Trump hotel.

[A]

Well, that could be what Trump is talking about when he talks about opening up the China market. But put a Trump hotel in Shanghai and Beijing, maybe Shenzhen as well. Who knows? I will note that the tweet you sent me last night, I don't know, I can't promise I'm going to put it in the show notes because I don't want to go and find it. But it was a Lawrence Trump selfie with Team China. Stephen Chung was on there. Rubio was in the background. Eric Trump front and center. So, yes, that is part of the delegation. I mean, Trump is bringing like half the cabinet to Beijing. Hegseth is there. Rubio is there. Despite previously being sanctioned. Besson is there as well.

[B]

Greer is there for us. But there's no Howard Lutnick from Commerce, which is interesting. And Peter Navarro, someone needs to do a proof of life check. Peter Navarro has disappeared.

[A]

He's still caged in a White House basement as we record this.

[B]

And so it won't be, it won't be as exciting, I think, as the 2017 visit. You know, the, the chief of staff, CC Wiles, is not on the trip. And you know, in 2017, John Kelly, former Marine, then, you know, then chief of staff, actually got into a fight with a security guard because as someone who was there recounted to Me, he was in a meeting, he came out and he was missing a lapel pin, so he wasn't allowed back in. And things got sort of messy with the security guard.

[A]

Wow.

[B]

And he punched him in the face. And then his security detail saw their boss in trouble, so then they got in some. There's a bit of a scrum. And then Ching Gang resolved it. Then Foreign Minister, then, you know, then he was, I think was. Back then, he was doing protocol. He wasn't Foreign minister yet. He was like the chief protocol guy at the Ministry of Foreign Affairs. Always close with Xi. But anyway, I don't think we'll see those kind of.

[A]

What year was that?

[B]

What? I wasn't. 2017, his last visit.

[A]

Oh, my God. Wow. So who knows what's possible over the next 48 hours in Beijing, but, yes, let's avoid any fist fights in the name of stability.

[B]

I don't think we're going to see that. So it sounded very. It sounded all very exciting. I think it was in the Great hall of People. It sounded like a real fist fight

[A]

in the Great Hall. My God, that's awesome. Well, again, that's not what we want from the US China visit over the next couple days here. Well, speaking of bigger picture questions, you wrote on Monday that you think the China has the upper hand. Takes about the visit to Beijing are overblown. I agree with you, but how did you get there?

[B]

I think I got there. I mean, I apologize. I have not had any hot takes. I mean, there's so many op EDS and things about this upcoming summit and I just honestly, having sort of, I guess, looked at the Trump relations with Trump for so many years, it's just exhausting to try and predict what he's going to do. And so the default position is kind of a crouch and sort of hoping it's over and we can maybe figure out what actually happened. No, but I just think that, look, the idea is somehow that, you know, the US has lost the war with Iran and therefore it's going, you know, Trump is showing up with his tail between his legs and she has all the leverage. Right. You know, there's. The Iran war has not gone the way Trump hoped. There's clearly a lot of problems there. There's, there's, you know, Iran is now asking for a better outcome than they had before the war started. Right. Which is again, interesting in the timing of these demands. I think they have assumed correctly, at least, that the Trump would hold, would keep the ceasefire going, at least through his visit to China. Yeah. So if there isn't a deal in the next 24 hours or 36 hours, does the US start bombing again right after it wheels up Air Force One from Beijing? It's not impossible. Yeah, but I think that at the same time, you know, the Chinese want the Iran situation to be resolved. They want the Strait of Hormuz opened. They are also not in a position where they can fully just take Iran's side because as we learn, an interesting coincidence, probably not coincidental timing of those leaks, I think it was the Wall Street Journal reported, you know, uae, Saudi Arabia, Kuwait have all been launching attacks on Iran. So this is a regional war and those three countries are countries that Beijing also has very important relationships with and doesn't want to piss off.

[A]

Right.

[B]

And so it's, it's, I think a more complicated situation than just the US is losing. And you know, she can sort of dictate to Trump because he can unlock the straight or not, because he can

[A]

tell her he's going to be groveling and begging China.

[B]

And then also, I mean, you know, the Chinese, yes, the Chinese have leverage on things like rare earths, but the Chinese economy is, you know, moving past the positive energy propaganda that we're getting. The Chinese economy is, you know, it's not collapsing, it's not doing great. Yeah, they, they want a stable relationship with the U.S. xi Jinping wants a stable relationship with the U.S. it's better for China, it's better for their development. They still are very much focused on the issues that they have to deal with. And you know, they also, they need things, they actually need Boeing planes, they need aerospace, they need, they need parts,

[A]

they need square from the US as

[B]

well, you know, and they want, they want more chip related stuff. They want the export controls to be relaxed at least, especially on the semiconductor equipment. I'm very skeptical that is going to happen. But again, anything is possible.

[A]

Yeah, it is interesting. Like the natural frame for any of these conversations is who has the upper hand, who has the better cards going into these negotiations. And I just think it's kind of a stupid way to frame it. Like, I think both countries have leverage in different areas, but both the US and China right now are incentivized not to escalate. I think China in some ways with the Iran war is on the back foot with respect to what's happening there and is sort of frozen in response because of the regional relationships with the UAE and Saudi Arabia. Their export markets are hurting in response to the war and threatening the US with some kind of Escalation would probably be a bad idea because then the US has to respond and applies even more pressure to China in a pretty sensitive moment. And the same is true with the US Side, which is prosecuting a war that isn't going as planned. Inflation is a problem, elections are coming up and just further inflaming the relationship with China doesn't serve anyone right now. So I, I look at this as two superpowers kind of eyeing each other warily as opposed to either side being like the big brother in this dynamic.

[B]

I mean, I think that, I agree with that. And I think that also, you know, a year ago, a few months ago, you had talk of some sort of grand bargain. I'm not seeing that I would be. I mean, again, who knows?

[A]

Never with CEOs en route. Right.

[B]

I'm, you know, I think it is more about figuring out a way to both sides be able to declare some wins, maybe not particularly substantive, but and then talk about how the relationship is, you know, they're continuing this very tentative stability in the relationship and then hook that continued stability onto the next meeting, you know, when that will be, probably. And again, if it's going to be four this year, then there's going to be, you know, there's only seven months left in the year. Six, six and a half months left in the year. You know, and there are areas since their, since their last meeting, I mean, you know, cooperation on fentanyl has improved. I think you've seen some actual, some progress around joint law enforcement work on fentanyl. You've seen, I think, looks like there now is some joint coordination to crack down on the scam compounds in Southeast Asia, particularly Cambodia and Myanmar, that targeted millions of Chinese and targeted plenty of Americans, too. Right. I mean, there's a scorch for all of us.

[A]

Yeah.

[B]

So that I think, is that those bits, I think, are positive. The same time, you know, the US has, or the US has also, in the last 10 days or less week, rolled out two rounds of basically sanctions on PRC firms related to Iran. It's three satellite firms. And then also, you know, we had the, a group of, a group of companies are involved in financing, you know, financing, getting money to some of these teapot oil refiners. We had the big sanctions on this hungry oil refiner a couple weeks ago. I mean, the US which is not

[A]

normal on the way to a. Like this.

[B]

Right. But, but it's also, the point is, look, the US Is in a war and they see the Chinese is helping the, the other side. Right? And so I think these, these actions were one important and needed because the Iranian regime is getting a lot of money from their sales to China and they're, they were getting, are getting help in terms of satellite, satellite imagery from Chinese firms. But also I think it's not unreasonable for the US side to say, hey, you know, you want to have a talk, that's great, but remember, you know, you are supporting a side that has done real damage on the US and on your other countries that you say you are friendly with in the Gulf region because a lot of the attacks that the Iranians undertook using the satellite imagery, you know, and satellite provided, you know, through Chinese firms, you know, was targeted on bases in Saudi Arabia, UAE, etc.

[A]

Yeah, well, and notably taking those actions on the way into a state visit does not signify weakness or an intent to grovel in Beijing the way certain commentators have sort of framed what this visit will be just in general as far as the take economy is concerned. Do you ever marvel at the certitude with which people weigh in on how any of this is going to play out and what the US Wants, what China wants and whatnot? Because studying it every week, even me hosting this podcast, there is like a pretty considerable element of we just don't know. And particularly with Trump, it's like a very small circle of people that appear to be making the decisions that matter in all of this.

[B]

And then there's the president who just calls Jensen, says, hey, meet me in Anchorage. Right.

[A]

Whatever the Jensen decision was, it flipped on a dime.

[B]

Somebody made some, some group in the White House administration made that list of CEOs to be invited and he was specifically excluded. And then suddenly. Right.

[A]

So it wasn't an accident that he wasn't on the original list.

[B]

To your question, I, sometimes I feel like I'm doing my readers a disservice by not having a hot take. Yeah, it's not because I'm lazy. It's because honestly, it just, it, it's sort of irresponsible. Well, but it's just, you know, again, sometimes, especially on the US Side, sometimes, and in previous administration and in Trump one, you could actually, I think, have a better people leaked a lot more so you could have a better sense of what was, what the US really wanted here. This, this current administration is not that way. And they do a lot less briefing, there's a lot less sort of outside interaction. And on the Chinese side, the Chinese side is, you know, again, if you read what they say publicly, listen what they say publicly, I mean, they, you know, they want stability. They want, you know, it's, it's the usual. They, you know, they want the US to end its suppression and containment, you know, but, but they're not. And of course, Taiwan is the big issue. But, but ultimately, you know, especially with Trump, it's just like, I guess maybe just wait and see.

[A]

Yeah, wait and see. I can't wait for next week's episode,

[B]

but wait and see. You know, we all live and I mean, thankfully I'm on substack and a different business model or it's, it's subscription. I don't really care about page views or engagement, so to speak. But I mean, we, this is part of the function of the engagement economy. Right.

[A]

Yeah. Right.

[B]

Well, and I, you know, the, you know, you want, the more views you get on your, your Twitter post, the more ad r you get.

[A]

Right. And you can look back at the last several weeks, several months, and piece together some coherent vision of what the US Side is trying to do. But there's also just kind of a baseline element of unknowability with the current administration. And speaking of Jensen Huang on Truth Social, Trump said CNBC incorrectly reported that the great Jensen Huang of Nvidia was not invited to the incredible gathering of the world's greatest businessmen and women proudly going to China. In actuality, Jensen is currently on Air Force One, and unless I ask him to leave, which is highly unlikely, CNBC's reporting is incorrect or as they say in politics, fake news. It is an honor to have Jensen Elon, Tim Apple, Larry Fink, Stephen Schwartzman, Kelly Ortberg of Boeing, Brian Sykes of Cargill, Jane Frazier of Citigroup, Larry Culp of GE Aerospace, David Solomon of Goldman Sachs, Sanjay Morota of Micron, Cristiano Amman of Qualcomm, and many others journeying to the great country of China, where I will be asking President Xi, a leader of extraordinary distinction, to open up China so that these brilliant people can work their magic and help bring the People's Republic to an even higher level. In fact, I promise that when we are together, which will be in a matter of hours, I will make that my very first request. I have never seen or heard of any idea that would be more beneficial to our incredible countries. So a mouthful there, per usual from Trump on Truth Social. Why do you think he's bringing all these CEOs to China? And does Trump actually believe that China will consider opening up its market to all of these American companies?

[B]

I mean, several of them do business there, not all of them. Meta obviously has its own sort of set of issues. MasterCard and Visa are there, but they've had their own set of issues over the decades.

[A]

Saga. Yep.

[B]

Cisco, you know, Cisco used to be quite big there and then, you know, had their market share decimated by government policy.

[A]

And Huawei, Qualcomm still doing good business.

[B]

Qualcomm does a lot of business there. So again, you know, that tone of the open up China is like from the 90s kind of thing. Yeah, it's really kind of a throwback and it, but it isn't, it's certainly not how I think, you know, the folks his, his, his team who work on these issues day to day, like the Treasury Secretary Bessen or the USTR head, Greer, they don't have any illusions about sort of opening up China in the way that it sounds like the predecessor is talking about. So it's not clear if this is something he really thinks or this is just the way he wanted to put together a nice positive energy post, you know, while he's on Air Force.

[A]

I think that is closer to what's actually happening.

[B]

It was funny because like, I think so too. But again, again, maybe not.

[A]

Who the hell knows is the baseline. But, but I think like the tweet from Trump, it spawned news stories in the FT and elsewhere. And then a bunch of China hawks on Twitter start weighing in about how stupid it would be to try to get this deal done. And I got to say, if you think Trump is naive enough to expect China to actually open its market at this point, that's on you. And my read is the CEOs, they're coming on this trip to make it into a bigger event, which potentially helps keep China happy and helps she domestically.

[B]

They all have, I mean, but also, look, they all have big interests. I mean, China is a huge market, you know, and China matters globally, not just to be in the China market.

[A]

Sure.

[B]

Why wouldn't they go as a guest to the President? I mean, it's irresponsible not to know.

[A]

But why would Trump invite them and come with this coterie of 15 CEOs and talk about opening up the market? I think ultimately, I mean, in some ways it's a signal to the world the US is happy to cooperate on bilateral trade and it's China that's not going to move on that issue. I think there's an element of narrative crafting.

[B]

And then again, China, China of course talks about how they will only continue to opening to the world. And so we'll see. Well, again, this Goes to substantively what, you know, cargo, you know, Cargill, they want to sell, you know, ag products. Right. Boeing wants to sell planes. China actually was talking to somebody a couple days ago. I didn't realize, you know, China hasn't bought a Boeing plane in like 10 years. And actually a lot of their fleet's pretty outdated now. They actually need planes. Yeah. And, you know, blackrock, Blackstone, I mean, you know, Blackstone's obviously, you know, Schwarzman's got a school there or I was gonna say.

[A]

Right.

[B]

You know, and there's a lot. There's a lot of money, a lot of Chinese savings that they would all like to access. Right. There's a lot of, you know, they take Blackstone, you know, blackrock, they work with the sovereign. Sovereign wealth fund. Right. I mean, you know, you've got g. Airspace. Well, they have, you know, they're helping to build out China's Boeing, Airbus Killer, you know, their indigenous commercial aircraft program.

[A]

Right.

[B]

Meta makes tens of billions of dollars a year from Chinese companies selling globally x China on their Meta platforms. Right. Even though they're reasons for all of

[A]

them to be there. I just don't think that Trump is actually looking to drive towards some sort of big deal where China alters its policies.

[B]

I hope not, because he tried that in term one when he actually did have more leverage and didn't work. And that's why we ended up with the phase one deal, where phase one was basically purchases and then all the other hard stuff was put into the phase two. That never happened and no one serious. Ever thought would happen.

[A]

Yeah, no, exactly.

[B]

So, I mean, if he really thinks he can go do it now, then, you know, the Chinese, again, I don't think he can. He's doing that, but we don't know.

[A]

Well, and the other thing that you sent me before we came on to record, Rhodium Group, this week, they prepared a report for the U.S. chamber of Commerce that warned countries have, quote, a finite window to respond to Chinese policies that are deepening reliance on its supply chains and harming the global economy. And that's how it was characterized by the Financial Times. With that context, it is fair to ask, like, what deals can even get done? Like, all of this is happening in broad daylight and the risks are now clear to even the most naive CEOs in the world and the most naive governments in the world. So that's part of the structural challenge with delivering anything from a trip like this. What do you think?

[B]

No, I think the report, the Rhodium Timber Commerce Report, is important. It's also quite depressing because you know, it looks at industrial policies, it looks at the new 15 five year plan, it looks at, you know, how it makes the point repeatedly that multiple reports like this have been written over the last decade plus warning of how the Chinese were pursuing effectively industrial dominance across the entire low, medium high value chains made in China. 2025 was the most obvious example. They've been mostly successful and they're going to. And now when you look at the 15 five year plan, they've, they've targeted all these new industries, these frontier industries where they want to dominate. The dual circulation strategy, they have the domestic circulation, international circulation part of the strategy is to further bind global supply chains to China. That is working. You look at what they've done around rare earths export controls, you look at the recent rules around penalties for effectively individuals or companies that want to shift their supply chains out of China. The Chinese are absolutely doubling down on binding the rest of the world to China through their supply chains and key inputs. And that strategy is not changing. That strategy is intensifying under xi. And no 36 hour visit or nice tweet from the President or a set of, you know, set of negotiations with Holy Fong and Scott Besson and Jameson Greer are going to change that strategy. And so I think really the question is well, what can the U.S. i mean from, from the U.S. perspective, what can the U.S. president extract that are both, I think, continue this sort of tentative stability, continue to get some flow of rare earths, rare earth magnets, although it's still not what the US I think expected or wanted, get some wins that he can announce around big purchase

[A]

agreements maybe, but do so without compounding the risks that already exist, but also

[B]

not falling in the trap of the fantas that somehow he's going to ultimately be able to sway Xi and change the industrial policy of China that they just, you know, further, you know, they just ratified a deepening of that industrial policy like two months ago. Right. And so I, I just can't, I don't, his advisors aren't, don't think that way. The President, who knows, I, I, I have to hope that he doesn't think that way. Right. So you know, that's why ultimately you come out of this with sort of baseline is continued stability. If it's a good, if it's good meeting continued stability with what came out of Busan, you know, some announcements around maybe some purchases. But again I think the Chinese expect the US to give things up. Maybe they'll have to pull back on some, like some of the various, like 301 investigations. If they wanted to buy a lot of beans, a lot of other ag stuff. I don't think on the rare earth side, you know, there's not suddenly they're going to allow rare earths to go to like the US Defense, the military industrial complex. Not going to happen.

[A]

Yeah.

[B]

And this idea, there's this idea of a board of investment and a board of trade. I think neither will be fully fleshed out. In an announcement on this trip, you may hear something about a board of trade which is again, more of a let's figure out how to have trade in the stuff that we both don't like, we care about, but isn't going to affect both countries moves towards reducing reliance on critical inputs and critical supply chains, which is fine. I mean, the country should be trading, right?

[A]

Sure. Yeah.

[B]

Like why we shouldn't be paying tariffs on, you know, clothes from China. Who cares? Sure.

[A]

And if there's a way to manage it in a more structured way that makes sense. I also think that they're in some respects just inventing things to talk about as again, both countries continue to do their own thing and continue to take care of their own security footing. So we'll see what emerges. Among the issues that may be discussed this week, There is the $11 billion arms package for Taiwan that I believe has already been approved.

[B]

That was in December. The Chinese went nuts.

[A]

Right, The Chinese. And then a $14 billion arms package for Taiwan.

[B]

19 if you. So the Financial Times first reported that package and they had it pegged around 19 billion. The new York Times came in and said it was 14.

[A]

Okay.

[B]

My understanding is that the Chinese ambassador to the US Ship went to the White House and basically said, if you pass this, the trip will be canceled.

[A]

So he charges into the White House, starts flipping over tables and then he's

[B]

the old Executive office building. But yeah, he. So. So that deal. But it's also not on. It's not unprecedented that a large town arms package would be, quote, unquote, delayed ahead of a presidential summit.

[A]

Right. It has been delayed. There are going to be talks about that second tranche of WEAP sales. And then also Washington and Beijing are weighing the launch of official discussions about artificial intelligence.

[B]

So. So let's talk about AI Taiwan first. So. So it's been. I think there's been some reporting and certainly what I've been hearing pretty consistently since the news broke about this second large package is that, you know, the Chinese don't want The US to sell arms to Taiwan. They also understand that the US Is going to sell arms to Taiwan. They have. Every time the US Makes a sale or announces a sale, they get upset. But previously, for the most part, they've been in much smaller increments, few hundred million billion, not these huge packages. And it's the size of the package. The one end of last year and then this mooted, whether it's 14 or

[A]

19, I mean we're talking about 25

[B]

to 30 million dollars. It has the Chinese and Xi Jinping upset. And so I think the Chinese, you know, ultimately, if it comes out to the US just chunks it up into smaller pieces, the Chinese will be unhappy and will say they're unhappy. But that wouldn't be a deal breaker is my understanding. So that may be an outcome. The other bit that's been reported on, and there were some Trump folks who were seemingly floating this idea, there's talk that the Chinese side would really like the president to change how he, the language the US Uses to talk about Taiwan to go from does not support Taiwan independence to opposes to be a much more active, emphatic opposes Taiwan independence. That would be a win for the Chinese side. That would, I think especially that that would be a sign that the US And President Trump specifically is willing to shift on Taiwan. Even what looks like just an incremental rhetorical shift still has a length of much more meaning if he were to do that. Again, I'm hearing not going to happen, but we'll see.

[A]

Yeah, yeah. There was initial reporting in the Financial Times, I believe that the US Was not going to move on Taiwan policy over the course of this visit.

[B]

Well, Ruben Marco Secret said, Rubio said that and again, we'll see.

[A]

Well, and then on the AI side you highlighted Michael Kratzios is among the administration members that is on this trip

[B]

and he was a last minute addition.

[A]

What do you think what could be accomplished on the AI front as these two sides meet?

[B]

So he's the director of the Office of Science and Technology Policy. He, he's the one who issued that memo two weeks ago now, three weeks ago on the sort of adversarial distillation of US AI models. If there, if there is going to be any sort of a government to government AI dialogue discussion, he would absolutely need to be in the room. So his addition I think is potentially a sign that there will at least be talks. There could be talks or there could be more, at least talks in a more sort of structured substantive way about how to actually start Some sort of a dialogue. Mm.

[A]

I mean, I gotta be honest, my only concern with the AI talks is that the American side has no reason to believe that the Chinese side would abide by any agreement that's brokered there. So I'm kind of skeptical of what could actually be accomplished.

[B]

I mean, you know, I think any agreement would just be around having a dialogue, setting up some sort of a, a mechanism for them to have. I don't think there's something going to

[A]

agree on, you know, no distillation or what have you.

[B]

Yeah, yeah, I, I don't, I don't think they're anywhere near that kind of an agreement, but they should be talking. Right, but there also should be a couple of things. One is, should be, as you point out, a lot of skepticism. Second is actually making sure that the right people are part of that discussion because, yeah, you know, the Biden administration started an AI dialogue and as a one Biden official posted on X, you know, Rustoshi, the Chinese just didn't staff it with anybody who actually was like an AI expert. And it was like lower level, didn't involve the key, some of the key bureaucracies didn't involve the security side of the pla. So it was not.

[A]

So they weren't taking it seriously.

[B]

Boy. Which just wasn't constructive in the way I think the Biden administration wanted it to be.

[A]

Okay, interesting. Well, we'll see what emerges. Another potential discussion point. Trump on Jimmy Lai earlier this week. Week, Jimmy Lai, he said, you know, caused a lot of bedlam. It's like saying to me, if Comey ever went to jail, would you let him out? Might be a hard one for me because he's a dirty cop, but Jimmy Lai isn't that way. But Jimmy Lai, he caused lots of turmoil for China. And Jimmy Lai, of course, is the 78 year old Hong Kong media executive who was convicted of colluding with foreign forces and publishing seditious material and sentenced under the National Security Law. In the wake of the Hong Kong protest, he's been sentenced to 20 years

[B]

in prison, which is, which is his health isn't great. It's effectively a life sentence.

[A]

So what do you make of the chances that China would actually move on this issue in response to President Trump who has said on multiple occasions over the last week or so that he will bring up Jimmy Lai's imprisonment and ask for release?

[B]

I think he has before and he's, you know, there's, that, there's a Pastor Ezra Jin who he said he would also bring up and there's some other folks in prison that may. He may bring up. You know, the question is, is really why would the Chinese release them? And what. What would they want in return? Yeah, and, you know, this is not. We talk about Trump's posts about opening China and how that feels like it's the 90s. The Chinese had a piece today in People's Daily that. On the. In Wednesday by this Guo Ji Ping, which is this homonym for like a international affairs commentator. It's an official commentary. Commentary on the People's Daily.

[A]

Oh, so that's not actually a person.

[B]

No, no, no, no. It sounds like Guardsy Pingland, like international commentary, a couple different characters, but whatever. So. But it's US China relations. Cannot return to the past, but can have a better future. And so part of the past, it just doesn't talk about it in this. In this people's day of the commentary, but part of the. And I have a translation of it. We'll put in the show notes if you really want to.

[A]

I read it.

[B]

It's to scintillate. It is. You know, it used to be that there's a guy named John Cam who has this Duihua foundation out in San Francisco who's done a huge amount of work getting prisoners released from China, Chinese as well as foreign prisoners. And, you know, he used to have a lot of access. You know, he would work with administrations, and the Chinese would usually on these kind of visits, they would release people because, you know, the US had more sort of was the bigger, stronger party. They wanted stuff. They understood that if they let some people go, it would help with the US China relationship. That dynamic doesn't really exist at this point. So for the Chinese to. For ccp.

[A]

When you say that dynamic doesn't exist, is that because the channels to the people who matter in the CCP no longer exist?

[B]

Well, China doesn't. I don't think. They don't feel like they need to give up anything unless there's getting something in return.

[A]

Okay.

[B]

Right. They don't need to make these goodwill gestures. So then the question if the US Side really wants to push for the release of, say, Jimmy Lai or Ezra Jin or some of these other people,

[A]

who is the US Releasing?

[B]

Right. So there's. There's a. There's an mss. The US Says it's an MSS officer who was extradited from Italy last month, who's now is incarcerated in Houston waiting to go on trial for involvement in alleged involvement in hacking. Yeah, of course, the Chinese would want their. Their MSS guy back. Right. And so is that a possible trade? I have no idea. This is all speculation on my part. There's no. No knowledge. But. So I think that. But for. Also for the Chinese, I mean, given the way, you know, the importance of Hong Kong. Given the importance and the way they talk about, you know, the National Security Law and moving Hong Kong from. From chaos to order. You know, Jimmy Lai was sort of the. The big black hand behind all this. I mean, he's sort of the number one culprit as they, you know, they present him. To suddenly release him. I think it would be good. It would be humanitarian. He. He is not in good health, and he's almost 80. He's an old man.

[A]

Does it delete, Delegitimize some of their domestic messaging?

[B]

That's a question for them. I don't know the answer. That's certainly a possible way they might consider it. But even if they were to release him, what are they getting for that gesture?

[A]

Yeah.

[B]

Okay. And what is this Trump? This President Trump? You know, there are people who have access to the president and, you know, people in the Republican Party who are very. On the Hill who very much advocating for the release of Ezra Jin and Jimmy Lai. You know, Trump can sometimes listens to them. So does he feel like, okay, it's worth giving up something or making to get these people out? I mean, honestly, it would be great if he could get them released. It would be that they.

[A]

But it would be. It really would be. I mean, all of that context.

[B]

I hope. I hope he's able to.

[A]

Yeah, it's helpful context for both LIE and the Ezra Jinn saga, which is also pretty upsetting to read about. I mean, a lot of people were offended by Trump's characterization of Lie there, and it sort of spawns a predictable chorus of like, Trump loves dictators, he's a dictator, etc. I would just offer, as a counterpoint, Trump in that moment with that quote online, I think if he actually wants to secure the release of Jimmy Lai, it would serve no purpose to say, this is an innocent man and his imprisonment is an international outrage. So I think some of what Trump is doing is trying to create space for China to be able to do it. And I acknowledge China has a right to imprison Lie, and his release would be a major concession. But to your point, again, it's really good context that China is not in the business of making concessions without getting anything in return. And maybe that is a stumbling block in terms of actually Securing release.

[B]

I mean, when it comes to Timila, I think it is also worth pointing out he's a very devout Catholic. Silence from the Pope because the Vatican is too worried about upsetting Beijing. It's pretty interesting. It's unfortunate.

[A]

Well, that is disheartening. Yes. The People's Daily. So they wrote that commentary. Generally speaking, what do you make of the tone across Chinese media, which you've seen more of than I have over the last several days in advance of this visit?

[B]

It's realistic. It's talking about how, you know, again, they can't return to the past, they can't better future. But, you know, it's, it's generally realistic, it's trying to be positive, but it's also predicating a lot of the positivity or, or improvements on U.S. actions, you know, respecting China's core interests, respecting their bottom lines, obviously having the right view of Taiwan. And on Taiwan, just one other point, you talked about sort of President Trump's comments about Jimmy Lai, and I think in the same press conference or another presser or sort of press spray, he talked about Taiwan and the weapon sales. And yeah, something along the lines, I'll be talking about that. Which of course created another round of outrage that how could President Trump even would acknowledge that he would talk about weapon sales? Because that violates six assurances at the U.S. and so, you know, and, and again, maybe that's what he's doing, or maybe he's just saying, look, we know they're going to bring it up, so yeah, we'll listen. But, you know, he's not saying they're going to do anything. Right. And so, so again, I just think it's premature to say he's violating, you know, the X, Y or z. X, Y or Z is sort of key tenets of the US US Policy towards Taiwan. He could be right. We'll see.

[A]

Well, along those lines. Or in. Cass was writing at the New York Times about the Trump visit and wrote the assumption on the part of many Americans was that Mr. Trump would do everything in his power to sever economic ties between the two countries. Instead, he may be on the verge of tying the United States to China irrevocably. Mr. Trump and Xi Jinping are reportedly considering a deal to allow China to invest in $1 trillion in the United States, largely to build factories on American soil. It would be an unforced error of world historic proportions. And I read that bill only to highlight how crazy the China conversation can get online, because that was in the New York Times. Yeah, like five days ago. And Cass in that op ed is citing reporting from Bloomberg that surfaced in October last year. We discussed it on the show at the time, this idea that China would invest $1 trillion into a stepped up manufacturing process in the US or presence in the United States, creating jobs, giving Trump a big number to sell at a press conference. That reporting went nowhere. And as we said at the time, if Trump tried to do that, Congress would have a big problem with that plan. The states themselves would have a big problem with that plan. And it seemed like it came from the Chinese side, not the American side.

[B]

Well, I think there was talk about bigger investment deals. I think the Cass op ed was basically putting a stake in a very extreme position because I'm not hearing that that is really on the table in any way. But it was to sort of get it out there and say, this is crazy. And then lots of people all said, oh yes, this is crazy. I think as you said, Congress would have a big problem in some of the states would have a big problem with it. You look at, you know, they're now, I think, bill in the House, bill in the Senate, bipartisan bills to block PRC vehicles. Right. Same thing with the Taiwan issue. You know, back to, we've, you know, everyone has domestic politics. If he were, if the President were to make some significant shift on Taiwan or significant concession, I think that would actually cause some, some real heartache on the Hill. Yeah. Because there's a lot of support in the GOP for Taiwan.

[A]

Right. Well, and it was just bizarre this week with this trillion dollar idea to see it resurface eight months later and presented as well.

[B]

I mean, it's also, you want, it's also like, get it out there. You know, again, your hook, your hook, if you're publishing something, is your hook, is the timing right? So you want to get it out there ahead of the summit, you make it part of the discussion. And even if it's effectively a strawman at this point, it's out there, then people can all say, yeah, this would be crazy. And then it's just sort of furthers that agenda of anyone, you know, around the President. You know, this is sort of, if there's any inkling or possibility this could still happen, it sort of injects the criticism back into the skew to make

[A]

the argument that this should never happen. Sure, I, I understand. It's just if you're following this without paying close attention, you see some of that news and you're like, wait, Trump might like in General, there's been a constant worry throughout Trump's term that what he really wants to do is be able to say, we got a big deal done with China. And at no point over the last year or so have there been tangible indications that suggest that's where we're going to end up, like the Grand Bargain fear, and maybe that is where we'll end up. But there have not been phases, not been pushes for structural reforms. And for me, at least, it's been more useful to assume that there will not be a deal than to assume everything Trump's doing is designed to end with him looking like the greatest dealmaker in world history, which I think is how a lot of people understand his.

[B]

Well, I think. I think he wants. I think his real focus is deals that are domestic wins going into the midterms. And so what can he bring back from China that says is good for American farmers, American workers? And that arguably would be where investment would fit in. But again, I'm not hearing that that is, there are any big announcements around that coming. You know, maybe if and when they set up this mooted board of investment, maybe then that will open the door to some investments. But. And maybe, you know, one of the things that's going to be hard to parse through is what is announced after the meetings. You know, either Thursday night US Time or Friday morning US time is whatever the US Side announces. If they're big numbers, are they real, are they mous, how solid are they? Because they're always gonna go for the most aggressive, positive spin, and who's gonna follow through?

[A]

I mean, you've got like, Brett, Phase one deal.

[B]

Yeah. Brett Baier from Fox News is in Beijing, and he's gonna interview the president live from Beijing. And so we're gonna get that. That sort of. No, I mean, it'll be interesting to see how it's spun through that in terms of what you know, and. And then you have to go back and parse through. Okay, well, what was really agreed to and what's actually substantive versus we said maybe, but we're still off to negotiate. Right. Which is a lot of. A lot of how it works where you kind of try and hook on something that sounds super positive, but then you have to keep negotiating the details and details, and by the time you get it done, it's nothing like what you. You told people it was.

[A]

Right. Yeah, absolutely. And sort of wait and see even after the deals are announced.

[B]

And so one thing was interesting, that then Jensen Huang showing up in Anchorage. I guess some of the Chinese AI stocks pop big in Hong Kong because there's hope that, oh, maybe this will unlock some, you know, some more chips for these Chinese firms, you know, the problem.

[A]

And maybe they will. I mean, there's so many fears. I don't think that that's why Jensen Huang was added to the the trip.

[B]

For the record, also, just practically, right, so the US has said you can sell the H2 hundreds. So far, the problem appears to have been more, you know, it hasn't really happened. And some of it appears to be a problem on the Chinese side. And then you run into the issue of one, selling H2 hundreds out of existing stockpiles versus making new ones, given the massive compute support, compute shortage and memory shortage everywhere, which then if you have to make new H200s for China, then you're hurting the US firms. Right. And then also is the hope, of course, Nvidia wants to sell. The Chinese side would like the more advanced Nvidia chips. I mean, I think that would be pretty shocking if there's a new deal for more advanced Nvidia chips. But, you know, but if you're, if you're a tencent Huang, why wouldn't you want to go, Right.

[A]

It makes you look good on.

[B]

I mean, it's just, it's, it's.

[A]

Well, and the president calls you and asks you to come. It's important to have a good relationship with President Trump. So if he's tapping you, you get on the plan plane and go wait on the tarmac in Alaska. The reason I laugh when you mentioned Brett Baer is because it reminded me two things. One, Sean Hannity was also on Air Force One along with Jensen Huang. And.

[B]

Oh, is it. I'm pretty sure it's Brett Bear, not Sean Hannity, who's doing this during the Trump.

[A]

Yeah, I think Sean Hannity was just there. I don't know whether he was there as a journalist or just hanging out. I know he's friendly with President Trump. And also, Brett Ratner, the director of the Rush Hour series, is a member of the traveling party and scouting locations for Rush Hour 4, which has been a Trump administration priority getting Rush Hour 4 made. So, yeah, all part of the adventure here. Two other questions. One, how much does domestic politics inform the calculus for xi? I think we've mentioned various reasons. Domestic politics and the impending midterms does inform some of the American side's thinking in all of this. Does the fact that the 21st Party Congress is supposed to happen next year, does that inform Xi's approach to anything. How do you think they see it?

[B]

I mean, I think broadly speaking, it's not like, I think we're beyond the point where if they're, you know, problems with your sign relationship, she is going to somehow be criticized. Right. But I think stability is always paramount. And so it's a very complicated domestic period. Again, the economy's not doing great, but then you also have now it's probably 17, 18 months until the 21st party Congress if it convenes. When these party congresses usually convene, you want to minimize distractions as much as possible and you want stability. And so continuing this, again, this tentative stability between the U.S. china, at least through the party congress. So, you know, maybe they get a deal into the late 2027. I think the Chinese would be very happy with that.

[A]

It wouldn't make sense to escalate into an all out, no holds barred economic war with the US in the 21st century.

[B]

I don't think it doesn't make sense for either side. It doesn't mean it couldn't happen. But I think, think at this point, you know, again, I just, you look at the last few weeks, the, the US has, there have been some actions that the US has held off on because they're trying to preserve the stability out of Busan, but at the same time they're not doing nothing. Like with these, you know, the sanctions on the, the Hung Lee and some other sort of shanlong teapot refiners, threats to banks. Yeah, I mean, you know, so, so it's complicated. Right, right.

[A]

No, that makes sense. And the trillion dollar question, which we're leaving until the end of the podcast because I don't think that there's much of an answer, but can anything be accomplished on the Iran war? Iran is centered in a lot of the coverage of this meeting, but do you see much surface area where China will potentially intervene, be leveraged into helping more than they have? What do you think?

[B]

I mean, the China is pretty gotten for public diplomatic statements, pretty adamant that

[A]

they want, want the straight reopened.

[B]

Straight reopened. But can they force Iran to do that? Would they even want to? But even if they did, do they have the leverage over Iran or is it now existential? And so that I just.

[A]

There's only so much you can say, right?

[B]

The Chinese are not, I don't think they're going to be sending a naval flotilla to sort of get involved. No, that would make no sense for them at this point.

[A]

That one, I think is another case where the US is asking, and repeatedly, repeatedly highlighting that possibility only to signal to the rest of the world that China is unwilling to do that and is sitting on its hands in the midst of economic crisis. Not necessarily for the United States, not necessarily for China, but for a lot of markets around the world in the wake of the closure.

[B]

But, you know, again, a lot of countries blame the US And Israel. Yeah, Right. And so. And so that. That, you know, China looks like the mature, responsible actor who is upholding the, you know, the global.

[A]

That's the story China tells. And the US Is telling its own

[B]

story, which is China's story. And the story China tells has a lot of tickers. Yeah.

[A]

No, there's no question about it. But perhaps the inaction from the PRC side will be notable and clarifying for other countries around the world in the midst of all this. But I think your point is also very important. Like, if China wanted to intervene, how much could they actually do? Dictating terms to the irgc? I think that's an open question.

[B]

But there is. I mean, again, we'll see how Trump would deal with this potential scenario, but there is, I think, a risk to the stability if the ceasefire ends. And again, I think we shouldn't sleep on the possibility that it ends soon after Trump's visit because he wanted to get through this visit.

[A]

That's been my expectation. Yeah.

[B]

And then you have a situation where you start, you know, there are more American troops put on the ground, and they start getting killed by Iranian drones or weapons that are either directly from China or made with Chinese components. And then you have a situation, satellite

[A]

imagery from Chinese companies.

[B]

And then it's gonna. And then it's gonna get, I think, much more complicated in the US China relationship, if that happens.

[A]

Interesting. Okay, well, for now, I'll close with a bonus question. Tweet this week from Dimitri Sevastopolo at the ft. Donald Trump said Xi Jinping would give him a big fat hug in Beijing. Likely. Dimitri asks, what do you think? I'm putting you on the spot. Will there be a bear hug at any point over the next 48 hours in Beijing?

[B]

I think there'll be a nice big handshake battle.

[A]

A nice firm handshake battle. Great.

[B]

But I don't. I'd be surprised if there's a hug. You know, Putin is supposed to go to Beijing in the next couple of weeks, and maybe he'll get the hug. I don't know. Might cause some envy if that happens.

[A]

I don't know.

[B]

Has.

[A]

Has she bear hugged anybody over the years?

[B]

Good question.

[A]

It's hard for you to imagine.

[B]

Maybe, maybe a listener can send us a video if it's happened.

[A]

I'm not.

[B]

Please do.

[A]

Please do [e-mail]. we're just rooting for no fist fights over the next couple days in Beijing. A hug, that's a bonus. But I enjoyed the tweet from Dimitri. Bill, it's great to see you as always. And we will come back next week with coverage of what does or does not emerge from the visit.

[B]

Maybe some actual hard facts about what happened.

[A]

Who can say yes? And when we get those hard facts, how much of that will evolve over

[B]

the months to come?

[A]

All part of the fun here on Sharp China. But I missed you last week. So it's good to be back. And we'll keep rolling next week, same schedule. Enjoy the rest of the week. Beautiful spring weather here in Washington. I will talk to you on the other side.

[B]

Thanks, Andrew. Thanks, everybody.