The rule, put out Thursday by China’s Commerce Ministry, is viewed as an escalation in the U.S.-China trade fight because it threatens the supply chain for semiconductors. Chips are the [lifeblood of the economy](https://www.wsj.com/articles/chips-semiconductors-manufacturing-china-taiwan-11673650917?mod=article_inline), powering phones, computers and data centers needed to train artificial-intelligence models. The rule also would affect cars, solar panels and the equipment for making chips and other products, limiting the ability of other countries to support their own industries. China produces roughly 90% of the world’s rare-earth materials.Global companies that sell goods with certain rare-earth materials sourced from China accounting for 0.1% or more of the product’s value would need permission from Beijing, under the new rule. Tech companies will probably find it extremely difficult to show that their chips, the equipment needed to make them and other components fall below the 0.1% threshold, industry experts said.
“These rare-earth minerals and the ability to refine them are just the basis of modern civilization,” said Dean Ball, who recently left his White House role as an AI policy adviser to become a senior fellow at the Foundation for American Innovation, a think tank. He added that the rules could cause a U.S. recession if implemented aggressively because of how important AI capital spending is to the economy.
Hey, trade is now so important that China actually locking off its “rare earth” stuff puts us to defcon 4 and falling (see up thread movie).
I went to Kwajalein for a year where I programmed and tested early star wars and anti missile missile systems. I remember waking from intense dreams with intense sweat. Now we have just wandered back into those rooms?
I need a drink.
I was wondering why my AMRRY holdings are up 24% in sympathy.
My motto is 11:00 am somewhere.
China is doing $1.2 trillion in exports last I saw, but to other nations mostly avoiding our tariffs on them. China no longer needs us. Buckle up!
There is no recourse this time. Game on!
David,
I am so glad I have not had a drink in over 32 years. Now it will pay off.
Raising a water glass to y’all
Trade war reloaded is on - have we seen the top?
President Trump ratcheted up tariff and trade tensions with China on Friday. In a post on Truth Social, the president said the US would impose an additional 100% tariff on Chinese goods starting on Nov. 1, 2025.
The president said the move was prompted by China taking an “extraordinarily aggressive” position on trade by announcing new export controls that would take effect next month. Trump claimed the curbs affect more countries than just the US, calling them a “moral disgrace in dealing with other nations.”
The president added that the timeline of the 100% tariff could be moved up based on China’s response. He also said export controls targeting China’s access to “critical software” would go into effect on the same day in November. …
I’m trying to remember what other country/leader imposed tariffs affecting multiple countries at the same time.
Wait, wait. It’ll come to me.
Yeah! I agree with you.
You must be thinking of the EU this week.
The European Commission on Tuesday announced plans to nearly halve the amount of duty-free steel imports, to 18.3 million tonnes per year, while sharply increasing levies on foreign steel falling outside of set quotas to 50%. The new regime, which is set to replace existing steel safeguards due to expire in June next year, would apply to all the bloc’s trading partners, with the exception of Iceland, Norway, Liechtenstein, and, to a certain extent, Ukraine.
DB2
Apologies, more than a little OT, but your comment triggered this memory:
Right after our daughter-in-law delivered her 3rd son, my brother-in-law (who is the eldest of 3 sons, himself), said he had some excellent parenting advice from his mother about raising 3 boys. It involved lots of alcohol.