Thin newsletter today, I was up late watching democracy function.
President Trump is a weakened, lame duck president, but he is still very powerful when it comes to foreign affairs and trade and I think it is too early to tell what impact Tuesday’s shellacking of the GOP will have on US-China relations. We talked through some early thoughts on the episode of Sharp China we recorded earlier today that will be in your inboxes in less than twelve hours.
One thing to consider is that the Trump Administration held back on some actions on China because of concerns of the PRC response and the impact on the US economy going into the midterms. Does Trump still care about those impacts?
There are a fair number of Republicans in the House and Senate who are unhappy with what they see as Trump’s softness on China in some areas, and especially on Taiwan and chips, and now that they have less to fear from him they may feel unleashed and more willing to work with the large number of Democrats who share their concerns.
PRC policymakers have a lot to figure out, but they should not be overconfident that the GOP loss is good for US-China relations. It may well end up that it is, but it is too early to tell.
With the US mid-term elections over, we are now entering a new phase of US-China relations, so I have started a dedicated chat channel for us to discuss. Please share your thoughts.
In this issue:
1. Cai Qi on the Fifth Plenum
2. Stock market rescue kicks in
3. Increasing scrutiny of Nvidia’s China-related sales
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