National Economic Council Chairman Larry Kudlow appeared on Fox Business earlier Thursday to talk about the ongoing U.S. China trade negotiations. Those who follow the Dragon -vs- Panda strategies of China saw earlier yesterday how Chairman Xi Jinping was positioning N-Korea as leverage for the current trade negotiations.

The DPRK dragon-play didn’t work because President Trump knows the dragon’s moves, and predicted their approach from the outset. Remember, POTUS Trump began executing a geopolitical economic strategy toward both North Korea and China well over a year ago. [During the first meeting with Chairman Xi Jinping in Mar-a-Lago (Feb, 2017)]

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After over a year of discussions and structured way-points, China came into the current round of U.S. trade talks with outstretched steel fists. The line-up they sent to the negotiating table are some of the most loyal and die-hard communist leadership within their economic team.

It is obvious China is in dragon-mode knowing they are dealing with an entirely different administration than they faced before.

According to Reuters China presented an initial offer of $200 billion year-one trade deficit reduction. That’s just flat out narrative nonsense. Apparently the Chinese have spent too much time interpreting Trump through Western media who always focus on “deficit reduction” aspects. That type of approach pitches into Larry Kudlow’s wheelhouse but misses the actual substantive sector-based focus of Trump, Ross, Mnuchin and Lighthizer.

POTUS Trump uses the point of “deficits” because it has a familiar catch with the U.S. audience; however, President Trump knows the real issue is the amount of domestic production -vs- the amount of imported foreign goods. If the Chinese team frame their analytic offers from deficit reduction pitches, the actual deals will never materialize.

President Trump, Commerce Secretary Wilbur Ross, Treasury Secretary Steven Mnuchin, U.S. Trade Rep. Robert Lighthizer, and Trade Adviser Peter Navarro are looking at sector by sector trade issues. It is  not simply an import-export equation; it’s about a longer outlook and more balanced and stable manufacturing base.

President Trump is not focused on enhancing interdependency models (deficits), he is looking at expanding independence models sector by sector. Can this sector thrive independent of a need for imported material (raw good, part, service or intellectual property)?

The U.S. goal is for each individual sector (goods or services) not to be necessarily dependent or co-dependent on international import. This America-first approach reduces risk exposure and enhances investment perspectives favorably toward the U.S. by creating long-term economic stability.

Meanwhile, in front of the White House, U.S. Chamber of Commerce President Tom Donohue is riding his bicycle in slow circles and glaring in the windows…

Gina Haspel was confirmed Thursday as CIA director, becoming the first woman to lead the agency.  The Senate voted 54-45 to confirm President Trump’s nominee, with six Democrats supporting and two Republicans defecting.  (story link)

Director Haspel, whose nomination was endorsed by the Senate Intelligence Committee a day earlier, previously was deputy director and has spent her career with the agency.

President Trump met with NATO Secretary General Jens Stoltenberg at the White House today for a bilateral meeting on EU security and trade issues.  During the Oval Office press availability both made remarks but president Trump took the opportunity to have an impromptu presser on other current issues.   WATCH:

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Hopefully everyone paid attention to the North Korea topic. It was not coincidental the stompy-feet assertions of Kim Jong-un and the DPRK were timed at the exact moment Chinese Vice-Premier Liu arrived in the U.S. for important trade talks. Once again Chairman Xi Jinping is using his proxy province of N-Korea to leverage economic benefits:

WASHINGTON – Chinese President Xi Jinping’s special envoy and Vice-Premier Liu He arrived in Washington on Tuesday afternoon. Liu, also a member of the Political Bureau of the Communist Party of China Central Committee and chief of the Chinese side of the China-US comprehensive economic dialogue, is leading a Chinese delegation for the talks.

The delegation members come from major economic sectors of the Chinese government. They include: Governor of the People’s Bank of China Yi Gang, Vice Chairman of the National Development and Reform Commission Ning Jizhe, Deputy Director of the Office of the Central Commission for Financial and Economic Affairs Liao Min, Vice Foreign Minister Zheng Zeguang, Vice Minister of Industry and Information Technology Luo Wen, Vice Finance Minister Zhu Guangyao, Vice Minister of Agriculture and Rural Affairs Han Jun, as well as Vice Minister of Commerce and Deputy International Trade Representative Wang Shouwen.

Before the delegation’s arrival, a Chinese working group arrived in the United States last week and engaged in intense consultations with the US side.
(read more)

POTUS Trump knows exactly what Chairman Xi is doing.  Xi is leveraging the N-Korea talks for a better trade outcome.

POTUS Trump executes the Panda Mask counter-play brilliantly:

♦’We are proceeding as scheduled with Kim Jong-un’…. ‘we haven’t heard anything different from their official position’… etc.

♦Then, President Trump expresses warmth and appreciation for Chairman Xi:  “friendship”, “close”, “together”, etc.

Dismissing the risk; accepting the meeting might not work; making Xi’s leverage less valuable, and then resetting the economic discussion by focusing back on the disparity of U.S – China trade imbalance.

The Dragon behind the Panda mask must be fuming.  President Trump just negated their entire leveraged play, and believe me the Chinese thought this strategy out for weeks, through a process of being immune to the DPRK downside.  Meh, ‘if we meet, we meet – if not, no biggie’….  Now, lets talk about the important stuff – T.R.A.D.E.

Too damned funny.

China dispatched their highest level officials in their play.  The use of the DPRK leverage was the super-fuel they planned to use in their negotiations.  Like.A.Boss President Trump just swatted away the foundation for China’s leverage before he even got to his chair.

Bold.

Takes swagger.

That’s our president.

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