Symphony

Cadence of Conflict: Asia, September 17, 2018

https://www.youtube.com/watch?v=qTzNYYL9Gg8

The US is not sending a contingency of Marines to Taiwan to protect it's envoy. This announcement came after reports that the US had such plans. After discussing the non-existence of the plans for deployment, the State Department also discussed that it does not discuss plans for security or other strategies. Perhaps the real strategy not being discussed is that the strategy is not being discussed.

At any rate, the announcement that an announcement has not been made about the discussion of not discussing security strategy and the non-discussion about Marines who will not be deployed should make heads in Beijing spin as they try to figure out just what the US is not doing about what it's not discussing. Fewer Marines in Taiwan would be more inviting for an invasion, if the discussion were under discussion, which it is not—reportedly.

One of the best kept secrets about the brewing trade war between the US and China is that US jobs departed to China. A trade war would move those jobs back to the US.

Consider a US company that set up shop in China. While the financial know-it-alls loose sleep over anything being less pleasant than an afternoon massage, including a US company in China being attacked hyena style as Chinese culture loves to do, the people in the US wouldn't care about that company. That's the company that forsook the American worker. In the mind of the average US working voter, the company that got in bed with China should stay around for the abusive marriage; so leave them to the hyenas! Any Americans who own shares in those companies would do well to keep that information secret from their working, voting neighbors.

The world doesn't work how so-called "financial experts" think it does. The trade war will not hurt the US economy because economies flourish from jobs, not consumption. Claiming that lower consumption of off-shore goods will harm a market would be to measure a farm's profitability based on how much the farming family eats other farmers' food. The real issue with the trade war is a real war.

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Cadence of Conflict: Asia, September 10, 2018

Right or wrong, the US-China tariff war was always coming. Stupid American companies flew into the campfire of Chinese manufacturing like moths into a flame. China was smart inasmuch as they did not become dependent on the outsourced labor, which was always going to ever-only be temporary. China has wasted no time, building infrastructure, such as the highway between Hong Kong and Macau and the silk road, now gaining income by the well marketed tourist attraction.

But, this tariff war was always coming. The political situation in the Pacific indicates that it's not about economics so much as it is about military. Pacific island nations grow more and more irritated by China. Little, small nations are speaking out, demanding China apologize for storming out of a PIF (Pacific Islands Forum) meeting when China's diplomatic representative was told to wait to speak until after heads of state from member nations had their turn. China is not a member, only an attendee. This is not any demonstration of leadership that the region will accept, no matter how much it may have been bestowed by the territorial gods at the universe's center, which is in China of course.

Then, there's Taiwan. If last week was a week of firing off blanks and papers across bows, this week, cannonballs started splashing. Taiwan introduced three different bills amending existing law, stiffening restrictions and penalties concerning anything that could even remotely be construed as interference between Taiwan and China. As if that wasn't enough, Taiwan is increasing its budget for both fighter jets and the navy. And, Taiwan's military even moved up an annual naval exercise to rehearse an attack from China at an earlier date than usual.

In all of this, the rain continues to fall in Taiwan, now flooding different parts of the island than saw torrents over three solid weeks of cloud cover. Not to worry, though. City governments are closely monitoring just how many millimeters of water can drain away how quickly, revamping any old sewer system that can't keep up. Taiwan just seems to have its hands full, as well as its rivers.

Then, there is the tsunami of US diplomacy. Trade wars often prelude military wars. While Taiwan's dwindling allies flip to support China, the US is breaking ties with any country that breaks ties with Taiwan, more or less. Solidarity with Taiwan seems to have bipartisan support in US Congress. With trade alliances shifting, when war breaks out, it will be a financial calculation as a convergence of China's revenue and US dependence on Chinese-made goods both bottom out.

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Cadence of Conflict: Asia, July 30, 2018

The "China miracle" was nothing more than smoke and mirrors as big companies of the West took advantage of Chinese people seeking a living and Western consumers seeking lower prices. Everyone lost. There was no "miracle".

The fad for cutting costs and quick investment returns nickeled and dimed away quality, eventually pushing bean counters to fall in love with China's underpaid labor force. When China opened for business in 1978, the shipments rolled in. Wealth wasn't made, it was only rearranged. A large shipping freighter made a large wake, some sunbathers had to move their towels on the beach when the wave wrecked the sand castles, and the global economist footsie-frat claimed that the sea levels had permanently risen.

Perhaps the label was wishful thinking, perhaps it was a malicious deception, but it wasn't Chinese propaganda; it was globalist propaganda. China's "growing economy" was fueled by an exchange between a planned economy and the free markets of the world. Whatever wave came, it would lower, eventually balance out, and could never have endured any more than spilled crude oil mixes with wildlife on the beach.

The mainstream Western press kept reporting on the "Chinese miracle", encouraging Beijing that China's new economy was here to stay. Western globalist economists should have known better, maybe they did, maybe they didn't, but China is paying the price of the inevitable. Eventually, either the Western economies would collapse—then the one-way flow of cash into China would stop as it did after the opium wars—or a Donald Trump would come along and stop the flow before it got that far. But, it wasn't going to last. The biggest victim of the bean-counter coupon-clipper culture of the West is China. And, making victims reaps nothing more than ill will.

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Cadence of Conflict: Asia, July 23, 2018

Central planning has only so much room for slight of hand tricks to keep up its sleeve. When the going gets tough, everyone goes home. For China, that means devaluing its currency, a complaint Trump has long lobbed against the trade giant.

Maintaining good relations with Apple and almost achieving the manufacturing capability long held by Samsung is quite the accomplishment for the Chinese. Good job. Everyone owes them a hand. China's BOE company hopes to be able to start manufacturing the flexible, "organic" LED displays by 2020.

Devaluing currency as a response to trade tariffs from the US, however, is likely to make those tariffs higher, considering that devaluation of its own currency was one reason Trump argued for tariffs before his election. This, and turning to Africa, means that the international bite is felt. Silicon Valley also has its eyes on Africa, meaning that Apple and China may meet again in Africa, as well as Google. But, doing more of the same things that initiated tariffs is likely to cause more tariffs than tariff problems it alleviates.

China has a hard set of choices ahead and as those choices narrow, the tiger will feel more and more like its been backed against a corner. This path doesn't endure entirely peacefully.

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Cadence of Conflict: Asia, July 16, 2018

Global trade has become too congested and inbred. Enemies make vital weapons parts for each other—well, enemies of the US make vital weapons parts for the US, but don't return the favor. Western companies outsourced to developing markets, then were surprised at workplace hazards, loss in consumer trust, and didn't seem to anticipate that by sending jobs overseas they were downsizing their own customers.

The borderless fling wasn't going to last for a myriad of reasons—cultural incohesion being an impossibility for a manufacturing industry in denial, security conflicts of interest being a concern for Western powers. Internationalization is about governments and cultures understanding each other, not forcing cooperation between peoples who haven't yet learned to gel in the daily routines. Companies like Boeing got themselves too entangled in the scene of borderless manufacturing and are now whining and moaning because the inevitable finally happened. This indicates that their "globalist" action plan wasn't based in foresight, but delusional hopes.

Globalism is inevitable, but it won't take the path that the impatient hopefuls dreamed and thereby planned it would. Globalism needs cultural exchange to precede and exceed industrial integration, not vice versa. Boeing through the cart pulled its horse, banked on it, it backfired, and Boeing is now denying blame.

China and Europe, mainly Germany, are headed for the same blend of oil and water. This so-called "trade war" isn't setting well in China's market. Chinese people blame their government. That government doesn't want any misreporting that could even remotely influence the people into thinking that the unrelated trade and stock market could have any kind of direct relationship. The trouble Trump is making for China isn't demonstrated from rumors of censorship within China or its stock market, but in China's attempt for yet another foreseeably incohesive relationship with Germany. China is being smart, Germany is not.

China is owed everything by the West, but Germany hasn't figured this out yet. China doesn't need to say so because no one tells the obvious. A relationship between China and Germany would rightly favor China, Beijing would have no objection, but Berlin will cry and whine just as much as Boeing, once it all lays flat on the table. And, China will have made the profit.

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Cadence of Conflict: Asia, July 9, 2018

China is reaching out to the world. It doesn't want tariffs imposed by the US. President Xi Jinping likely feels betrayed by the man who was so kind to him previously, President of the United States Donald Trump. The Western press will of course paint China and Trump as the villains—each in their different sectors—while painting the consumer as the victim.

China's role is actually one of confusion. $500B one way and $100B another is fair if China is on the favorable end, of course. Why would someone be so cruel, using that as an excuse?

So, China is making its appeal to international bodies, such as the WTO. But, therein will befall another misunderstanding. The International community agrees on twelve nautical miles of ocean ownership, no more, and building islands doesn't count. China disagrees. So, appealing to International law won't work in China's favor, which will also seem unfair to the Chinese.

The Western press will make China out to be the bad guy, the aggressor. At the same time, the Western press will make Trump another bad guy for imposing tariffs. Of course China doesn't want tariffs, that much is understandable. But, coming to "China's" defense (actually their own) are the globalist businesses who believe that nationality, borders, and citizenship are a farce—that companies are the actual "nations" of the world. They are at war against both the US and China for not merging into one corporation. This is actually a battle for nationhood itself; from that perspective, both the US and China's responses make perfect sense.

As for China being the "bully" as portrayed by the Western press, China really doesn't see itself that way. The Chinese have no clue why the West would do such a thing, they really don't understand.

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Cadence of Conflict: Asia, June 18, 2018

Trump has stopped military exercises near North Korea, but he has not initiated any plans to withdraw troops. His reason for stopping the exercises is that they are provocative and expensive. He has a point: If the heads of state are talking then we are less in need of fighting practice in a scenario where heads of state are not talking.

The military exercises with South Korea are expensive and provocative, as Trump explains. Frankly, they should stop. With healthy conversations and progress toward peace already behind us, there won't be a need for those drills any longer. Rehearsal for conflict that might never exist can often provoke the very conflicts we otherwise would not need to prepare for. As for the "expense" defense, few accountants will argue in favor of nickeling and diming away money as fiscally responsible and no one believes that taxpayers' pockets are infinitely deep except pundits with portfolios in public funding.

The Western news is that Trump is wrong, specifically with regard to China that China wins. According to this week's Western news narrative, China wins because of troop withdrawals that haven't happened, because a friend of China will de-nuke, and because over 30k US troops will be free to go home—or go to Taiwan, Mischief Reef, Vietnam, the Philippines, Japan, or any number of other Pacific island-nations China doesn't get along with.

Economically, China "wins" because manufacturing is leaving China—which must therefore mean that China's innovation and science is the new source of manufacturing elsewhere. Perhaps that includes innovation and science like the Chinese government now trying to track every car with a chip as of 2019. The "Mad Scientist" theorem of the experimental police state research moving from North Korea to China continues to play out.

Just remember with everything: There's more going on than anyone can see. Deals between governments are never fully explained to the public. They shouldn't be. But, as peace develops in one part of the western Pacific, hostilities move around and every pundit seizes opportunity to say, "I was right." No conflict is without news profiteering.

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Cadence of Conflict: Asia, June 18, 2018

Trump has stopped military exercises near North Korea, but he has not initiated any plans to withdraw troops. His reason for stopping the exercises is that they are provocative and expensive. He has a point: If the heads of state are talking then we are less in need of fighting practice in a scenario where heads of state are not talking.

The military exercises with South Korea are expensive and provocative, as Trump explains. Frankly, they should stop. With healthy conversations and progress toward peace already behind us, there won't be a need for those drills any longer. Rehearsal for conflict that might never exist can often provoke the very conflicts we otherwise would not need to prepare for. As for the "expense" defense, few accountants will argue in favor of nickeling and diming away money as fiscally responsible and no one believes that taxpayers' pockets are infinitely deep except pundits with portfolios in public funding.

The Western news is that Trump is wrong, specifically with regard to China that China wins. According to this week's Western news narrative, China wins because of troop withdrawals that haven't happened, because a friend of China will de-nuke, and because over 30k US troops will be free to go home—or go to Taiwan, Mischief Reef, Vietnam, the Philippines, Japan, or any number of other Pacific island-nations China doesn't get along with.

Economically, China "wins" because manufacturing is leaving China—which must therefore mean that China's innovation and science is the new source of manufacturing elsewhere. Perhaps that includes innovation and science like the Chinese government now trying to track every car with a chip as of 2019. The "Mad Scientist" theorem of the experimental police state research moving from North Korea to China continues to play out.

Just remember with everything: There's more going on than anyone can see. Deals between governments are never fully explained to the public. They shouldn't be. But, as peace develops in one part of the western Pacific, hostilities move around and every pundit seizes opportunity to say, "I was right." No conflict is without news profiteering.

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Symphony

Cadence of Conflict: Asia, June 4, 2018

North Korea inches further and further toward talks with the US. China fears this. If Kim Jong-Un get in the same room as the man who wrote The Art of the Deal, North Korea could become a stronger ally to the US than even South Korea overnight. That would likely lead to a quick reunification of the Korean Peninsula, as well as other shifts in power, even before any alliance might be formalized. But, Trump's deal-making reputation should bring no shocks to what is about to transpire in the Singapore Summit.

Then, there's China, about to be left behind. The hardline crackdown on free speech throughout China won't be without consequence. Symphony has been saying so for years; Albert Ho effectively said the same, quoted in a Bloomberg article dated June 4. Party power is getting brittle. But, the consequences of brutal brittality are rarely explored. So, here goes.

Hong Kong won't shut up anytime soon. The whining, whimpering bratty students of Hong Kong may be wrong to demand rights when freedom was largely handed to them by the British. But, those bratty students sure are drawing a press load of attention to China. That alone should be a heavy factor in logistics calculation. Hong Kong is a megaphone for any anti-China sentiment because the world reads about Hong Kong every day. After all, Hong Kong is "Asia's World City".

But, then there's the problem of cracking down within "China proper", the Mainland governed directly by Beijing, not a SAR like Hong Kong or Macau. If China considers friendly sarcasm to be a threat within China—that means tech companies and hardware manufacturers won't have candid conversations about quality control and competitive design. Once free speech becomes a minefield, people will divert mental resources away from fee and open brainstorming toward making sure that they don't say anything offensive. The key to good brainstorm sessions and innovation is that nothing is off the table and no one is allowed to take offense at anything whatsoever. That's can't happen in China anymore. Bye-bye Western manufacturing paradise. It's only a matter of time before Western outsourcing brands figure it out. One little story, like an innovator being locked up for a tech suggestion because it was interpreted as "opposing to the Party", might plunge Chinese factory stocks into the void below.

"Single-Party Rule" is the key topic now, at least according to Western papers. That's the protest mantra in Hong Kong. It's the talking point of headlines and marches. It is the so-called "problem" as is being presented to the world. The Western press is on a path for reporting a narrative that stirs sentiment for two-party rule in China. Whether it's a typhoon, an earthquake, a solar flare, or some other "act of God", if China suddenly adopts a two-party system, Western newspaper readers will have already been prepped to think it is a good thing.

Then, there's Vietnam, exploring foreign investment "zones". Deserved or unfair, distrust is stirring against China as a place of investment. This will have a double-edged effect in Vietnam. Firstly, Western manufacturing will flock to Vietnam as a way of fleeing the newspaper villain, China. But, with a Communist Party having total rule in Vietnam, Western investors will demand certain assurances before dumping too much money into yet another single-party market. Sooner or later, we could be looking at Vietnam adopting a friendly two-party system as a stronger strategy of competing with China. That will only add to the momentum of change in East Asia.

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Cadence of Conflict: Asia, May 21, 2018

Talk only went so far this week. I looks as if North Korea might not be dismantling its nukes, but hiding them, then threatening to close talks when exposed for this, then threatening to cancel the summit for some other list of excuses.

The big question on Kim Jong-Un backing out on the talks relates to his recent visits to China. Not that China has made any wild promises, but he feels somewhat confident in getting lippy with the US.

The big lesson was about Moon's emphasis on diplomacy vs Trump's emphasis on teeth. Diplomacy made progress in terms of leading to more diplomacy. But, actual action is a measurement of its own. So far, Trump's action has led to China losing interest in any kind of trade war and Moon's favored diplomacy seems to be leading to an undiplomatic end to diplomacy.

Things aren't over nor have we seen the last surprise. The big news of the week is that China's on the bench. Moon and Trump will meet to discuss Kim having a discussion with them in Singapore. Where's China?—announcing its surrender on trade, reflecting on past meetings with Kim, another player that doesn't really matter.

If Kim doesn't show up, Moon's populist diplomacy will prove to have failed and Trump will have the "political currency" for action against North Korea. Maybe that's what China hopes for in allowing Kim to gain false hopes in something or other—to rationalize a little retaliatory action of its own. But, if military action was China's first preference, Beijing would have already taken it.

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Cadence of Conflict: Asia, May 7, 2018

https://www.youtube.com/watch?v=0d1Loi7sh1I

This was week of talk. A delegation from Washington went to talk with China. Trump talked about talking nice while talking. Economic talking heads are talking about the talks and everybody's talking about it. Once the delegation that went to Beijing to talk gets back, they will talk with Trump. Warren Buffet even had some things to talk about.

Trump's delegation to Beijing was indeed an olive branch. It spelled out "the line" in the sand, toured it, explained, it, discussed it, explored it, and made that line very, very clear. To quote Morgan Freeman's Lucius Fox, "Mr. Wayne didn't want you to think that he was deliberately wasting your time." But, the line is not the least bit likely to be respected.

China will ignore everything the US delegation explained and forewarned, but they will never be surprised when Trump does exactly what the delegation said he would, though they may act like it. More importantly, the list of expectations shows how well Trump knows China and Chinese methods of doing "business".

Words like "retaliate" and "oppose" often surface with disfavor, as well as the US clearly being wise to the tactic of unofficially using backdoor channels to unofficially impose other restrictions to get what one wants. And, the US maintains its position on the "301" trade notice that China is non-market economy, specifically that China is to drop the matter completely and withdraw its appeals on the matter with the WTO.

There is no wiggle room in the US demands and those demands strongly demonstrate that Trump knows exactly the kinds of things Chins is likely to do. In essence the list of demands forbids exactly what China is most likely to do in the near future.

By contrast, China's demands are mainly that the US back off on its recent action; that's all. Consider the argument going around from pro-China stories about the trade "imbalance"—especially that US' service and consulting help to narrow the "trade deficit". The list of Chinese demands don't account for this or ask that they be calculated in the "trade deficit".

The mere demands, in themselves, tell us that China does not know what is about to happen in Washington and that Trump knows all to well—probably better than any of his advisers in the White House—what will happen in Beijing. China is in great danger.

Surprises are coming, somewhere. That's how history always plays out. No war ends without the unexpected and there's always a joker or two hiding in the deck. The surprises will likely include special and disputed territories, such as Macau, Hong Kong, and Taiwan, as well as international public opinion and some sector of trade or international protocol not yet considered or discussed by anyone—they will surprise everyone. That "surprise sector" could include ocean boundaries or specific products often traded. It could also be an act of God, such as an earthquake, hurricane, or tsunami. But, we have no idea except that any intermediate history student should anticipate at least two surprises before the current cloud passes in the greater storm.

China looks at the US the way the poor working class looked at the aristocracy in Russia. Beijing thinks they are demanding "what is their right". Remember, this is akin to "Opium War III", started by a trade imbalance. China demands that the money and "tax payable by way of free technology" continue to flow net into China; the US demands things like "equal" and "fair" in the flow. That is rhetoric from the Opium War prelude. If that war resurfaces, the "English" speaking country won't be Britain, though Britain still has a dog in the fight: Hong Kong is not to be changed for fifty years, yet this week Hong Kong military youth groups—comparable to Boy Scouts—rejected Chinese requests that they march according to PLA marching steps—meaning that China tried to make a change and Hong Kong could become a target for punitive action from China. Hence, Hong Kong is "fair play" in everyone's opinion, including public opinion about everyone in the game.

If China had any kind of conflict with the West—whether militarily or over trade—the conclusion could require complete surrender of Hong Kong back to British rule—and Hong Kongers wouldn't mind.

In the territorial disputes, Taiwan declaring independence would certainly rock the boat. Research says Taiwanese overwhelmingly view China as unfriendly. So, Taiwanese certainly wouldn't mind making their contribution to making a few waves.

China is already on the bench with the Korean issue. Pyongyang just updated the North clocks to no longer be thirty minutes off, but back in time with the South. Where's China?—exchanging trade demands with the country whose trade blockade preceded the Korean talks.

In all this, Warren Buffet's advice is that China is a good place for the West to invest. We'll see.

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Cadence of Conflict: Asia, April 9, 2018

China has been a source of great change.

Taiwan has received a license from the United States to build its own submarines. Wang, a legislature who sits on the Foreign Affairs and National Defense Committee said that friendliness from the US is the highest it has ever been. Japan just commissioned its first marine force since WWII. 1,500 troops are ready, specifically to repel invasion of Japan's islands. Thanks to China's inspiration and initiative, many nations in the region are also making their contribution to peace and stability in Pacific Asia.

The US is re-evaluating trade with China. While much is just talk, Trump maintains friendly rhetoric. The shakeup with trade will force countries to reinvent and reevaluate trade policy. While a looming "trade war" remains the talk of many so-called "experts", the long-term benefit will be the overall rebirth of trade throughout the world. Everyone will need to rethink trade. Any kind of thinking is good, especially in these times.

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Cadence of Conflict: Asia, April 2, 2018

China and the US have fixed their rudders on a ramming course. The only remaining question will be over whose hull is stronger.

The "yuge" US trade deficit with China is purported to be $375B USD. Bloomberg was sure to point out that the figure is inflated, some way or another. Xinhua news reports that a more accurate figure is a mere $298B USD deficit. Trump sent a "Section 301" notice of unfair trade tactics to China along with $50–60B USD in tariffs, depending on which news source you read. Trump also asked China to reduce the deficit by a whopping $100B USD and China says that the US is being unfair, placing tariffs on US food.

Asian markets are up, but a Caixin market index—something like a DOW Jones average in China—isn't up as much as hoped. Everyone has an opinion on what all that means.

Companies in America believe that tariffs harm the consumer. Some voices argue that the US has a "service" trade surplus with China, but still a deficit overall. Trump argues that trade deficits harm the worker and the overall economy. Basic macro-economic theory would say that workers would afford higher prices with much higher pay.

Trade deficits initiated the Opium Wars with China when China welcomed a one-way flow of silver from Britain for tea, but would not allow the eager Chinese population to import British goods. The Opium Wars ended with surrender of several lands to Britain, including Hong Kong. China's current and main land dispute is over Taiwan. The stage is set for history to repeat and so far it has.

Taiwan is certainly chumming up to the US as China attempts to endear the Taiwanese. Most recently, Taiwan is buying more advanced missiles from the US while two Senators advocate selling F-35s to Taiwan—a sale more likely since Taiwan's current administration is unlikely to set up secret talks with China as the rival party attempted nearly four years ago. China banned Taiwanese movies casting a purportedly pro-independence Taiwanese actor, Lawrence Ko.

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Cadence of Conflict: Asia, March 12, 2018

https://www.youtube.com/watch?v=bMfrJHgqPiw

As talks between Kim and Trump march forward, China is resigned to the new situation at its eastern border and is focusing on other areas, specifically trade. In truth, China's main trade opponent is not the US, but Vietnam.

Vietnam's main edge in trade will be that it is less expensive. Vietnam is, in many ways, less developed, yet more free to be expressive. Hanoi doesn't sanction the same censorship as Beijing does. Many hard-working Vietnamese are hungry, even desperate for income. A hard-working, uncensored, hungry, less-expensive people will be difficult for China to compete with on many fronts. This is entirely beside any point about political tension between China and Vietnam.

The meeting between Kim and Trump is less-than-satisfactorily explained. Suddenly they want to talk? Some "teamwork" consultant trying to sell a book will likely attribute it all to diplomacy, along with the preemptive speculation that Kim would give up the nukes because he got them. More is going on behind the scenes and if the true story is ever told it may not be told for ten or twenty years.

As for the Western spin about China's constitutional changes, it is all about the party, not about Xi. The humble pig farm worker, Xi Jinping, did not rise to power by publicly trying to serve himself. He has followed Robert Greene's 48 Laws of Power to a tee and will continue to do so—that means putting the party first in his public agenda.

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