*** Ross Rant ***
Why the Trump-Xi "trade truce" is a Trump-Xi "victory"
The headlines will call it a breakthrough. Markets will rally. Both presidents will claim victory.
But here's what I learned preparing for my appearance on CGTN's Global Business program: the real story of the Trump-Xi meeting in Busan, South Korea, isn't about who won or lost. It's about two leaders who've finally agreed on something fundamental—how to disagree without destroying the global economy.
After US tariffs spiked to 145% and Chinese rare-earth exports ground to a halt, both sides discovered an uncomfortable truth: neither can afford the costs of unbridled confrontation. This isn't a partnership. It's not even cooperation. It's something more pragmatic and potentially more durable—managed rivalry with guardrails.
The theater of US-China Relations
One of the best lenses for understanding the US-China relationship comes from an unexpected source: Christopher Buckley's satirical novel, They Eat Puppies, Don't They? Published in 2012, the book lampoons Washington's establishment and the complex, often cynical nature of US-China relations through the story of a defense contractor lobbyist working to stir up anti-Chinese sentiment to boost weapons sales artificially.
Buckley's insight—that belligerent public discourse is often driven by self-serving interests of politicians, defense contractors, and think tanks rather than genuine geopolitical conflict—feels even more prescient today than it did thirteen years ago. The novel captures something essential: much of the animosity in US-China relations is rooted in theatrical antics and paranoid maneuvering rather than unavoidable geopolitical forces.
Which brings us back to Busan and what's really happening beneath the surface.
The asymmetry everyone missed
The conventional wisdom frames this as a reset, rewinding the clock to early 2025 before tensions escalated. That's technically accurate but strategically misleading.
Trump and Xi aren't playing the same game. They're not even playing on the same timeline.
Trump measures success in headlines and market reactions. He's the ultimate day trader. He needs visible wins: tariffs coming down from 145% to around 45%, China repurchasing American soybeans, and movement on fentanyl precursor chemicals. These are tangible, marketable achievements he can sell domestically. The three- to four-hour meeting gets him back to Washington with a deal to announce.
Xi measures success in decades—or at least that's what Beijing wants the West to believe. What Xi's buying with tactical concessions—soybean purchases, easing rare-earth controls—is far more valuable than what he's giving up. He's buying time.
Time to achieve semiconductor self-sufficiency. Time to focus on domestic economic challenges while reducing external pressure. Time to pursue his five-year growth strategy centered on state-directed manufacturing and technology investments. And perhaps most importantly, he's securing something Beijing hasn't had since 2015: a formal state visit to Washington with all the symbolism and prestige that entails.
What China's rare-earth gambit revealed
Here's a data point that should worry every global business leader and multinational board member betting on stability: When China cut off exports of rare-earth magnets in April 2025, US automobile factories shut down, bond markets went into a tailspin, and stocks plummeted.
Beijing's message was unmistakable—and new. During Trump's first term, China's retaliation was measured and proportional. This time, Xi's playbook is different. His team spent the period after Trump's 2024 election victory designing an approach rooted in a simple insight: Trump is transactional, not ideological.
The rare-earth cutoff wasn't just about leverage in trade negotiations. It was a demonstration that China is willing to weaponize economic interdependence more aggressively than before. They watched Wall Street's reaction, gauged America's pain tolerance, and concluded they could press harder.
Yes, China eventually eased the restrictions. But they kept control of the supply chain. That's the pattern we're seeing in Busan: tactical retreats that don't surrender strategic advantages.
The real scorecard: What's not on the table
I've analyzed trade negotiations and worked to advance American trade agreements for two decades, and I've learned that what's excluded from discussions often matters more than what's included.
The Busan meeting deliberately sidesteps the structural issues that define US-China competition: China's massive state subsidies, intellectual property theft, forced technology transfers, and state-directed industrial policy. Taiwan's status. The China-Russia relationship. China's expanding presence in Latin America and Africa.
These aren't oversights. They're conscious choices by both sides to focus on manageable disputes while acknowledging that core conflicts remain unresolvable for now.
China gets to continue its technological catch-up strategy without addressing American complaints about its state-led system. The US receives relief from immediate economic pain without securing structural reforms. Both leaders can declare victory because they're measuring success by different metrics.
What this means for your business strategy
If you're a global business executive or multinational board member, here's my advice based on what I'm seeing: treat this as a breathing space, not a resolution.
The tariff rollbacks and supply chain normalization are real and will provide relief. Port fee reductions for shipping will help operational costs. The predictability is welcome after nine months of chaos.
But don't reverse your diversification strategies. Don't re-concentrate exposure to China based on one summit. This meeting establishes rules of engagement for managed competition—it doesn't end the competition.
Specific actions I'm recommending:
First, stress-test your dependencies on rare-earth and critical minerals. China demonstrated it will use supply chain leverage more aggressively. Trump's rare-earth deals with Japan and Australia are the first steps, but alternative supply chains take years to build. Know your exposure.
Second, prepare for volatility to return within 6-12 months. Trump's track record shows he's prone to reversing course when domestic political pressures shift. The underlying tensions—technology competition, Taiwan, strategic rivalry—remain fully intact. And bashing China on the American campaign trail knows no bounds and certainly won't let up in next year's midterm elections.
Third, watch what they do, not what they say. Does China actually place large-scale soybean orders? Do rare-earth exports to US companies normalize? Does the US pause planned technology restrictions? Actions will tell you whether this détente has legs.
The six-month test
Here's what I'll be watching to gauge whether this holds:
The first test comes in 90 days. If China follows through on soybean purchases and the US genuinely pauses new tech restrictions, that would signal that both sides are committed to de-escalation.
The second test is Trump's proposed visit to Beijing in early 2026 — if he actually goes—and if Xi reciprocates with a Washington visit—that creates institutional momentum that's harder to reverse than ad hoc phone calls.
The third test is the one nobody's talking about: what happens when Xi stays in South Korea to attend the Asia-Pacific Economic Cooperation conference after Trump jets off to return to the White House—Xi's positioning of China as the stable, reliable alternative to American unpredictability. If Asian economies begin hedging away from US alignment, that's a strategic win for Beijing that no tariff reduction can offset.
Bottom line
The Busan meeting isn't the end of US-China tensions. It's not even the beginning of the end. Anyone expecting a final resolution misunderstands the fundamental nature of this relationship—negotiations with China are permanent, not episodic.
What Busan represents is an agreement to establish rules for a long-term rivalry that both sides finally recognize they must manage rather than win outright. Trump gets his dealmaker moment. Xi gets time and symbolism. Markets get relief from chaos.
But the fundamental trajectory hasn't changed. We're still heading toward managed decoupling, just at a more controlled pace with fewer market-rattling surprises.
The smart money isn't betting on partnership or Cold War 2.0. The smart money is positioning for a world in which the US and China remain locked in strategic competition, with just enough dialogue to prevent it from spiraling into crisis.
That's not pessimism. It's realism. And it's the world business leaders need to navigate for the next decade.
-Marc
*** Caracal Daily ***
Trump, South Korea reach terms on trade deal: WSJ reports a surprise breakthrough follows months of contentious talks over $350 billion in investments Seoul has pledged to America.
South Korea strikes gold with Trump’s visit, sealing trade deal: Straits Times reports South Korea went on a golden offensive to charm US President Donald Trump during his visit to the East Asian country, as the two sides finally agreed on a trade deal after months of deadlock. The two sides had not been able to agree over the modalities of Seoul’s pledge of US$350 billion (S$453 billion) in investments as part of a framework trade deal struck in July to lower US-imposed reciprocal tariffs of 25 per cent to 15 per cent.
Trump says South Korea will be able to build nuclear-powered submarine: WP reports Trump’s announcement was short on detail but came a day after he finalized a trade deal with South Korea that includes a pledge of $350 billion in investment.
Trump says South Korea to build nuclear submarines in US shipyards: Nikkei reports Lee says undersea ability will enable navy to track China's and North's subs.
Radio Free Asia will stop publishing amid funding crisis spurred by Trump: WP reports the government-funded nonprofit, a staple of US soft power in the region since 1996, is facing nearly total closure after being targeted by the administration and hit by the shutdown.
Toward a Taiwan truce: How Trump and Xi can pull back from the brink. Stephen Wertheim
Looming Trump-Xi meeting revives hope of US-China trade truce: As US President Donald Trump and China's leader Xi Jinping prepare to kick off talks on Oct 30, US negotiators have signalled they seek a return to a fragile trade war truce, but tensions remain high and longer-term economic irritants will likely persist between the geopolitical rivals. Straits Times
As Trump weighs sale of advanced AI chips to China, critics sound alarm: NYT reports the president signaled he would discuss the sale of Nvidia’s Blackwell chips in a summit on Thursday, a move US officials warned would be a “massive” national security mistake.
Trump lost the trade war to China Nicholas Kristof
Analysis: Xi Jinping faces delicate balancing act over Trump meeting: Supreme leader looks to extend his rule but leaves personnel reshuffle incomplete. Nikkei
Xi to Trump: China's rise 'goes hand in hand' with making America great: Nikkei reports at summit, Chinese president calls friction 'normal' as US leader vows 'fantastic' ties.
Ahead of Xi meeting, Trump says he’ll direct Pentagon to test nuclear weapons: WP reports the president said he wanted testing to occur “on an equal basis” with Russia and China, raising the pressure on Beijing as he prepared to meet his Chinese counterpart.
Trump threatens to resume nuclear weapons testing, minutes before Xi meeting: NYT reports just minutes before he was scheduled to meet President Xi Jinping of China, the president threatened on social media to resume nuclear testing for the first time in 33 years.
The US is on track to lose a war with China: Modern warfare is decided by production capacity and technological mastery, not by individual valor. Phillips Payson O’Brien
How China enables Russia’s military: New evidence shows the supply-chain trail aiding Moscow’s drone makers. WSJ-Editorial
Why China and Russia aren’t scared of the US: President Donald Trump has aggressively wielded US power to renegotiate key relationships and cut through entrenched disputes, but mostly targeted weaker actors. Trump will now face bigger challenges from stronger foes, including Russia and China, which are determined to show that his toughness is bluff and are pursuing geopolitical projects at odds with US interests. Hal Brands
Trump rebukes Putin for testing new missiles, tells him to end the war: WP reports Russia tested a nuclear-powered cruise missile that it said is capable of traveling thousands of miles. Trump countered that there is a US nuclear submarine off Russia’s coast.
US reduces troop numbers in Romania, signaling shifting priorities: WSJ reports the Pentagon will no longer rotate Army combat brigades through Romania as part of a strategy that focuses on Asia and Latin America.
US to withdraw some troops from Romania, NATO’s eastern flank: WP reports it is the first announcement of the Trump administration’s plans to scale back forces in Europe, where the US has underpinned security since World War II.
Almost 100,000 young men flee Ukraine in two months: Telegraph reports Kyiv’s easing of travel restrictions for those aged 18-22 prompts an exodus... and complaints from Germans.
WP: Israel says cease-fire is back on after Gaza strikes
Centrists appear to defeat far right in Dutch election, exit poll shows: Le Monde reports Dutch voters appeared to have rejected far-right leader Geert Wilders in favor of centrist D66, exit polls suggested Wednesday.
The Dutch choose optimism over anti-immigrant populism: Rob Jetten beats out Geert Wilders. Economist
Dutch hard-right leader Geert Wilders set to exit power: WSJ reports the Freedom Party’s drop in support holds lessons for Europe’s resurgent far-right.
Wilders’ hopes of becoming Dutch PM in tatters: Telegraph reports hard take on asylum fails to pay off as exit poll shows win for Rob Jetten’s liberal D66 party.
Dutch voters deliver major setback to far-right party of Geert Wilders: NYT reports a center-left party was poised to become the country’s largest political party, according to exit polls. The anti-immigrant Party for Freedom, led by Mr. Wilders, was expected to lose 12 seats.
Spain’s economic outperformance slows: WSJ reports the GDP increased 0.6% in the third quarter, from the 0.8% in the second.
Death toll of police raid in Rio doubles to 132, state watchdog says: WP reports the operation was the deadliest in Brazilian history. Authorities say they were targeting the Red Command, one of Brazil’s most powerful organized-crime groups.
Over 130 killed in bloody crackdown on drug gangs in Rio de Janeiro: NYT reports the death toll in Rio’s deadliest police operation in history rose to 132 people, the state authorities say, sparking outrage and a reckoning.
Javier Milei’s chance to transform Argentina and teach the world: Lessons in public finance from the original sinner. Economist
Post-election euphoria has Milei already eyeing 2027 re-election: Results of midterm elections surprised even the ruling party – with fresh momentum behind him, President Javier Milei has put agreements with governors and Cabinet reshuffle on hold as he begins to eye a re-election bid in 2027. BAT
'Non-interventionist' Trump flexes muscles in Latin America: AFP reports in a speech in Riyadh in May, President Donald Trump denounced generations of US interventionism, saying the Middle East was only made worse by Americans who fly in, giving you lectures on how to live and how to govern your own affairs."
Trump’s grand Latin America strategy starts to bear fruit: Nine months into Donald Trump’s second term, Latin America has become a central focus of US foreign policy. The administration has shifted away from traditional development aid and diplomatic forums, opting instead for a strategy centered on tariffs, military pressure, and bilateral political alignment. Jesus Mesa
US military kills four more people accused of smuggling drugs on boats: NYT reports Defense Secretary Pete Hegseth said the latest strike took place on Wednesday in the eastern Pacific. It came two days after the deadliest set of strikes in the weekslong campaign in Latin America.
US strike on alleged drug boat kills four in Pacific: Le Monde reports this latest strike is the fourteenth in a string of deadly attacks under Donald Trump's controversial campaign against drug cartels in South American waters.
Detroit News: Sen. Slotkin (D-MI) slams Trump's 'secret war' at sea, warns of next steps in 'authoritarian playbook'
Sheinbaum gets a shot at making Mexico grow faster than the US: With the nation at a crossroads, the Mexican president’s decisions will determine whether growth takes off — or becomes mired in stagnation. Bloomberg
US trade war drives Canada to fast-track port expansion: WSJ reports officials say upgrade of Montreal’s port will help Canadian importers and exporters find alternatives to the US.
Senate votes to block tariffs on Canada: WP reports while symbolic, it is the Senate’s second rebuke of President Donald Trump’s trade policies in as many days.
+ Senate advances joint resolution to terminate emergency for Canada tariffs, 50-46
Why we’re forcing Senate votes on Trump’s tariffs: Do our colleagues side with US consumers or back the president’s economically damaging policy? Tim Kaine + Rand Paul
Bank of Canada exhausts tools to help tariff-battered economy: WSJ reports the onus on refueling growth will fall to Prime Minister Mark Carney.
Communication channels open, Carney and Trump ‘had some exchanges’ in Asia, Canada’s ambassador to US tells MPs: Toronto Star reports testifying at a senate committee, Kirsten Hillman said that Carney "had some exchanges with President Trump in Asia" at an APEC leaders' dinner.
If Mark Carney has a plan for how to deal with Trump, he might want to tell Canadians what it is Stephen Maher
Doug Ford urges US ambassador to ‘apologize’ for f-bombs aimed at Ontario diplomat: Toronto Star reports US ambassador Pete Hoekstra angrily complained to David Paterson, Ontario’s Washington point person, about Ford’s anti-tariff ad, sources told the Star.
Doug Ford’s message to America reveals Donald Trump’s weakness Martin Regg Cohn
Stellantis president grilled at House committee over decision move production to US: Toronto Star reports the head of Stellantis says a decision to move production of the Jeep Compass from Brampton, ONT, to Illinois was “not taken lightly.”
30 years after cliffhanger vote, Quebec separatists voice hope for independence: AFP reports the result was excruciatingly close: 30 years ago Thursday, in a referendum on Quebec's independence, 50.6 percent of people voted "no," and 49.4 percent chose "yes" -- an outcome that left Canada whole.
Report: Government shutdown will cost the economy up to $14 billion: WP reports the nonpartisan Congressional Budget Office says the longer the government stays closed, the more costly the pause will be.
What can break the shutdown impasse? Significant milestones over the next few weeks could shuffle the status quo. For now, both sides remain dug in as the closure heads into a fifth week. NYT
The shutdown is now coming for your airport’s VIP security lane: WSJ reports federal officials have warned that an extended shutdown is further straining America’s already understaffed air-travel infrastructure.
A turning point in the government shutdown: Piecemeal bills are a waste of time. Just fund the whole government. WP-Editorial
AP: Trump isn’t canceling travel, golf, or his ballroom, even with the government shuttered and 750,000 furloughed federal employees
Fortune: Powell cuts rates in the dark in historic move, with no jobs data and Trump heckling from abroad
WSJ: Pentagon orders National Guard to establish quick reaction forces for civil unrest, riots
Binance boosted Trump family’s crypto company ahead of pardon for its billionaire founder: Giant crypto exchange facilitated $2 billion purchase of World Liberty’s stablecoin and built its technology; clemency for Changpeng Zhao surprised some in administration. WSJ
Trump nominee at US export bank withdraws amid scrutiny of Russia ties: WP reports Bryce McFerran is a former senior executive at a steel-trading business co-owned by one of Russia’s richest oligarchs and is married to a member of a Russian family with ties to the Kremlin.
The choreographed fakery of American politics: East Wing edition: Trump’s residential immodesty is nothing compared with his anti-constitutional immodesty. George Will
Trump fires White House ballroom inspectors: Telegraph reports Donald Trump has sacked the team of arts commissioners who were reviewing his White House ballroom. On Tuesday, the US president, who has been sensitive to criticism of the new building, sacked all six members of the Commission of Fine Arts.
+ US president to replace board members with people ‘more aligned with America First policies’
History offers warnings to leaders who renovate official buildings: They rarely start from solid foundations. Economist
Trump advisers consider Las Vegas for rare midterm political convention: WSJ reports President Trump’s advisers are considering Las Vegas for the GOP’s midterm convention next year, according to people involved in the discussions.
Trump pivots on 2028 term: ‘I’m not allowed’: The Times reports the president initially said he ‘would love’ to run again — but admitted on Wednesday that he cannot overrule the constitution.
+ Fox News host Mark Levin on Trump: "Nobody gets to run for a third term. Nobody. And he won't. Bannon is playing you."
NYC mayor’s race poll shows Mamdani with 10-point lead: NYT reports the poll from Quinnipiac University found that 43 percent of likely voters supported Zohran Mamdani, with 33 percent for former Gov. Andrew M. Cuomo and 14 percent for Curtis Sliwa.
I want your vote, you bigot: In an odd last-minute appeal, Mamdani accuses New Yorkers of ‘Islamophobia.’ Karl Rove
Mamdani is a New York miracle, not a national model for Democrats Ed Kilgore
JB Pritzker’s dark visions: Twenty-seven minutes with the latest governor Donald Trump wants arrested. Mark Leibovich
Three tough truths about climate: What I want everyone at COP30 to know. Bill Gates
When this reporter comes calling, the White House insults go flying: The administration often criticizes journalists, but the treatment of Shirish Dáte, a reporter for HuffPost, stands out. NYT
Automaker production stoppages begin over semiconductor shortage: Honda starts temporary production reductions and stoppages this week at North American factories. WSJ
Honda halts production in Mexico due to chip shortage: Nikkei reports Nexperia standoff with China affects major car export hub for US market.
CNBC: GM lays off more than 1,700 at sites in Michigan, Ohio, citing EV challenges
+ General Motors laid off more than 1,700 workers across manufacturing sites in Michigan and Ohio, the company confirmed to CNBC.
+ The layoffs include jobs at Detroit’s electric vehicle plant and Ohio’s Ultium Cells battery cell plant, in addition to temporary layoffs at Ultium Cells’ Tennessee plant.
+ The company cited a slowdown in the electric vehicle market.
How Carvana’s same-day car deliveries have become the company’s secret weapon: Carvana’s revenue rises 55% year over year. MW
Nvidia becomes first $5 trillion company: WSJ reports the company’s shares have been boosted by the AI boom and a flurry of new deals.
Nvidia at $5 trillion? What is money anymore? The chip company’s rapid growth is redefining the very meaning of “big” in Big Tech. Jessica Karl
Bloomberg: Meta, Microsoft test investors’ patience with AI spending spree
WSJ: Meta shares fall on higher expense guidance despite record revenue
Meta raises its spending forecast on AI to above $70 billion: NYT reports the Silicon Valley company projected more spending this year and said it would continue in 2026 as it hires AI researchers and builds data centers to power the technology.
Google revenue soars to record as AI boom lifts cloud business: WSJ reports the tech giant says AI spending is set to reach up to $93 billion this year, which it can finance with profit from its advertising and cloud units. Shares were up 5% after hours.
OpenAI is preparing to file for an initial public offering as soon as next year that could give the company a market capitalization of $1 trillion, Reuters reported Wednesday, citing unidentified sources.
Universal Music settles with AI firm Udio: WSJ reports that Udio has agreed to launch a new subscription service for fans to create music based on licensed songs.
Memory-chip makers are enjoying a boom to remember, thanks to AI: WSJ reports Samsung and SK Hynix hit records as their business deepens with OpenAI, Nvidia, and other key firms.
Fortune: Everyone thinks AI is replacing factory workers, but Amazon’s layoffs show it’s coming for middle management first
I tried the robot that’s coming to live with you. It’s still part human. 1X’s Neo wants to be your housekeeper. First, it needs to be controlled by a human in your home. Cool with you? WSJ
The best source of critical minerals is driving down US streets: Mining is the dirty side of the green transition to electric vehicles. Battery recycling could give the US a cleaner, domestic source of critical minerals. WP
Jerry Jones says he has unlocked a $100 billion gas bounty in this drilling inferno: WSJ reports the Dallas Cowboys owner has backed Comstock Resources in its efforts to develop some of the hottest, deepest wells in the US.
Levi’s rolls out new premium denim, but aims to keep appealing to budget shoppers: The brand recently launched its Blue Tab collection to complement its existing lines that retail for as low as around $20. WSJ
By partnering with Shein, a symbol of globalized fast fashion, the BHV department store has muddled its own narrative: The decision could have significant economic consequences for the Parisian department store at a time when public opinion has become a global strategic issue for companies. Céline Chanvin + Anne Zuccarelli
Chipotle lowers sales forecast as consumers curtail dining out: FT reports burrito and bowl chain reduces sales guidance for third time this year, sending shares down more than 15%.
Paramount begins laying off 2,000 people months after Skydance merger: WP reports David Ellison, whose Skydance bought the media conglomerate this summer for $8 billion, announces move “addressing redundancies.”
Two suspects in Louvre heist are caught without jewels: The Paris prosecutor says two men suspected of breaking into the museum lived on the outskirts of the French capital. WSJ
Louvre heist suspects ‘partially admitted’ involvement: WP reports none of France’s crown jewels have been recovered. Paris’s public prosecutor said she remains hopeful, with two suspects in custody.
He’s never been to America. But in China, he’s Trump. Ryan Chen has turned an uncanny impersonation of President Trump into a social media career, and a mirror of China’s fascination with America. NYT
A24 just opened a restaurant in New York, and it’s as cinematic as you’d expect: Wallpaper reports hidden in the West Village, Wild Cherry pairs a moody, arthouse sensibility with a supper-style menu devised by the team behind Frenchette.
99: The number of days until the Milano-Cortina 2026 Winter Olympics.
She hiked the entire Appalachian Trail at 80, unaware she’d just made history: “We put all kinds of limitations on ourselves,” said Betty Kellenberger. “Sometimes the biggest one is we don’t get up and try it.” WP
Is legalized gambling ruining sports? A federal investigation into illegal gambling has rocked the NBA and the sports world. Does it change how you view the game? Jeremy Engle
The joy of Spring skiing: There’s something special about gliding down the slopes in the sunshine. It’s also less crowded and cheaper. WSJ
Enjoy the ride + plan accordingly.
-Marc
Marc A. Ross | Chief Communications Strategist @ Caracal
Caracal Daily | October 30
