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Forget soybeans, auto imports, iPhones, crude oil, and cheap Chinese gadgets. Also forget tariffs, duties, and subsidies. Even forget weapons.
The real reason behind the US-China "trade" war has little to do with actual trade, and everything to do with what China's president, Xi Jinping, said when he visited a memory chip plant in the city of Wuhan in early 2018. In a white lab coat, he made an unexpectedly sentimental remark, comparing a computer chip to a human heart: “No matter how big a person is, he or she can never be strong without a sound and strong heart”.
December - Basis - Conflict - US - China
Because - as we explained last December - what is really at the basis of the ongoing civilizational conflict between the US and China, a feud which many say has gradually devolved into a new cold war if few top politicians are willing to call it for what it is, are China’s ambitions to be a leader in next-generation technology, such as artificial intelligence, which rest on whether or not it can design and manufacture cutting-edge chips, and is why Xi has pledged at least $150 billion to build up the sector. China’s plan has alarmed the US, and chips, or semiconductors, have become the central battlefield in the trade war between the two countries. And it is a battle in which China has a very visible Achilles heel.
But what if the "trade"conflict with China is about more than even technological development? If, as Bank of America assumes, the US-China trade war is about geopolitics and not just economics, the as the bank notes, the "implications for markets are enormous."
Excerpts - BofA - Commodity - Strategist - Francisco
Below are several excerpts from BofA commodity and derivative strategist Francisco Blanch on the true implications of what is shaping up as the biggest civilizational conflict in modern history, which is coming at...
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