Markets don't lie. They don't care about Team Trump's narrative.
While Trump rated his meeting with Xi Jinping "12 on a scale of 1 to 10," markets delivered their own verdict: US stock futures barely moved. China's CSI 300 Index closed down 0.8%. That muted response tells you everything you need to know about what actually happened in those 90 minutes in Busan, South Korea.
The most telling aspect of the Trump-Xi meeting is the one-year timeframe. Both leaders are explicitly acknowledging that this truce is temporary. And markets, having seen this movie before, aren't buying the happy ending.
Ninety minutes to manage a superpower rivalry
Let's start with a number that should shock everyone: 90 minutes.
That's how long Trump and Xi met to address the world's most consequential economic relationship. Factor in translation, pleasantries, and opening remarks (Xi's comment that China's development goes "hand in hand with your vision to make America great again"), and you're looking at perhaps 45 minutes of substantive discussion.
Forty-five minutes to manage technology competition, rare-earth dependencies, trade imbalances, the future of the global economy, and China's "no limits" relationship with Russia.
The brevity isn't a talking point—it's the whole story.
This meeting wasn't a negotiation to resolve fundamental tensions. It was a carefully choreographed exercise in conflict management, with both sides achieving exactly what they needed while avoiding anything that might require actual structural change.
What China achieved
Here's where conventional analysis gets it wrong. Yes, China agreed to resume soybean purchases and suspend the draconian rare-earth export restrictions announced on October 9th. Team Trump's messaging and global news headlines framed these as concessions.
But look at what China extracted in return: US tariffs dropped from 57% to 47%. Technology export restrictions that were under consideration got postponed, not eliminated. Port fees on the Chinese maritime and logistics industries are suspended for a year. And most importantly, Beijing maintained the April licensing regime for rare earths—the opaque system that frustrates American manufacturers and keeps control firmly in Chinese hands.
Xi didn't surrender strategic advantages. He made tactical retreats while extracting meaningful US concessions on issues that matter more to China's long-term positioning.
The rare-earth gambit earlier this year—cutting off magnet exports, forcing US auto plant shutdowns, triggering bond market turbulence—was never just about leverage in one negotiation. It was a demonstration. Beijing has demonstrated a willingness to weaponize supply chains more aggressively than during Trump's first term. They watched Washington's reaction, gauged America's tolerance for pain, and concluded they could press harder.
The message was unmistakable: China has demonstrated its capacity to retaliate. Washington would do well to remember it.
TACO = Trump Always Chickens Out
Taiwan wasn't discussed. Neither were trade imbalances. Or Chinese industrial subsidies. Or intellectual property theft. Or the structural competition for technological supremacy that defines this rivalry.
I've worked on trade negotiations and global politics for two decades, and here's a pro-tip: what's excluded often matters more than what's included. These omissions weren't failures of diplomacy—they were conscious choices acknowledging that core conflicts remain unresolvable.
China hawks in Washington can be relieved that Trump didn't grant China access to Nvidia's flagship AI chips or soften the US commitment to Taiwan. But let's not pretend that avoiding disastrous outcomes is the same as achieving positive ones.
As Jonathan Czin, a fellow at the Brookings Institution who previously analyzed Chinese politics at the CIA, noted in a New York Times article: "I think it's an approach that can safely be described as tactics without a strategy." China, by contrast, has a clear long-term strategy—namely, its recently announced five-year plan, which focuses on state-directed manufacturing and technology investments.
What markets already know
The lack of market enthusiasm tells you sophisticated investors understand something the headlines miss: "We've heard this playbook before—optimistic tone, little follow-through."
Markets wanted a concrete joint statement. They wanted structural commitments. Instead, they got a handshake, diplomatic pleasantries, and a one-year timeframe that explicitly acknowledges the temporary nature of this truce.
Even after the 10-point tariff reduction, the effective US rate on Chinese goods remains above 40%—vastly higher than the roughly 3% historical norm. Calling this "normalization" requires selective amnesia about what normal actually looked like.
The CSI 300's 0.8% decline in closing is particularly revealing. Chinese investors, despite their government securing meaningful concessions, recognized that this doesn't change the fundamental trajectory. Strategic decoupling continues—just at a more managed pace.
Strategic decoupling vs. Full decoupling
Let me be precise about terminology, because the distinction matters enormously.
We're not seeing full decoupling—the complete separation of the world's two largest economies. That would be economically catastrophic and politically unsustainable for both sides.
We're seeing strategic decoupling: the deliberate reduction of dependencies in areas deemed critical to national security and technological competitiveness. Semiconductors. Rare earths. AI. Quantum computing. Advanced manufacturing.
As Stephen Jen of Eurizon SLJ Capital wrote in a note to clients: "Make no mistake, the two countries are drifting apart and are frantically building their own autonomous economic ecosystems."
The outcome from this meeting doesn't reverse that drift. It acknowledges it while establishing guardrails to prevent the drift from becoming a crash.
What this means for your business
If you're a CEO, supply chain executive, or board member, here's my direct advice: the tariff reductions and supply chain normalization are real and welcome. Use them. But don't mistake a one-year truce for a strategic realignment.
Three specific actions
First, accelerate supply chain diversification. China demonstrated in April that it will use economic weapons more aggressively. The rare-earth licensing regime remains in place. American companies are already continuing to seek non-Chinese sources despite this deal. Follow their lead.
Second, the price of volatility returns within 12 months. The one-year timeframe isn't arbitrary—it's both sides buying time to reduce strategic dependencies. When this expires in late 2026, the landscape will be different because both sides will have used the time strategically. Trump's mercurial nature and America's 2026 midterm elections add additional unpredictability.
Third, watch actions over words. Does China actually place large-scale soybean orders, or is this another promise that fades? Do rare-earth exports genuinely normalize, or does the licensing regime continue creating bottlenecks? Does the US truly pause new technology restrictions? The implementation phase will reveal whether this has substance.
The 90-day test
Here are the specific signals I'm watching:
Within 90 days, will China follow through on its agricultural purchases and the US genuinely pause its planned tech restrictions, which suggests that both sides are committed to making this work—at least temporarily?
In April 2026, Trump is scheduled to visit Beijing. If this actually happens (and if Xi's reciprocal visit to Washington occurs), it creates diplomatic momentum harder to reverse than ad-hoc summits. State visits require comprehensive preparation, meticulous protocol, and significant political capital. Additionally, the American business community will have an extensive list of issues and pressure points to address to secure more Chinese market access.
The immediate aftermath saw Trump jet back to Washington for a Halloween party. Xi stayed in South Korea for the full APEC summit, engaging regional leaders. The optics matter: China positioning itself as the stable, reliable partner versus American transactional unpredictability. If Asian economies hedge away from US alignment, that's a strategic victory no tariff rollback can offset.
The reality check
Both leaders got what they needed, and they are both political athletes.
Trump secured visible wins to sell domestically—such as tariff reductions, soybean purchases, and cooperation on fentanyl. His "12 on a scale of 1 to 10" assessment reflects genuine satisfaction with the optics.
Xi achieved something more valuable: time and strategic positioning. Time to pursue semiconductor self-sufficiency. Space to focus on domestic economic challenges without external pressure. Control of critical supply chains despite tactical easing. And a framework for formal state visits that signals great power parity.
But for global businesses caught between these superpowers, the ugly reality persists: underlying conflicts remain unaddressed. Commerce will be rocky for years to come.
The fundamentals haven't changed. This remains the world's most complex, competitive relationship. What changed in Busan isn't the destination—it's the agreement to make the journey less chaotic for the next twelve months.
Markets understood this immediately. The sophisticated response wasn't pessimism—it was realism about what a 90-minute meeting can and cannot accomplish.
Bottom line
The Trump-Xi meeting in Busan succeeded at precisely what it was designed to do: establish guardrails for managed rivalry while avoiding mutually assured economic destruction. That's valuable in a relationship where the global economy, regional security, and technological leadership are serious issues.
But let's not confuse conflict management with conflict resolution. The technology competition continues. The trade imbalance persists. Taiwan remains unaddressed. China's support of Russia continues unchecked. Strategic decoupling accelerates.
The smart money is positioning for a world where these economies remain locked in long-term competition with just enough dialogue to prevent a crisis. That's the world we're navigating.
Markets called it correctly on day one. Everything else is just narrative, spin, and messaging.
-Marc
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Marc A. Ross is a geopolitical strategist and communications advisor, authoring a book entitled Globalization and American Politics: How International Economics Redefined American Foreign Policy and Domestic Politics.
He is the founder and chief communications strategist of Caracal, a geopolitical business communications firm specializing in global business issues at the intersection of globalization, disruption, and politics. Additionally, he is the founder and curator of Brigadoon, a global network of founders and thought leaders shaping commerce and culture.
