Flynn Reveals More: US-Vietnam Agreement a Win-Win | Daily Livestream Highlights - China Foresight with Jiangyuan Tang

After finishing the red sea cucumber, let's move on to General Flynn's melon. General Flynn, in his post yesterday, said the following. He said, Please pay attention, China watchers. About a week ago, I posted about changes in China's leadership. Xi Jinping is now just an ordinary person. Times are changing. Please read, but don't cry. So, what should we read? In this post, General Flynn also included a link to an article, So, as you can see, General Flynn posted twice, directly pointing out Xi Jinping's loss of power, and stating that Xi is now just an ordinary person. But you'll notice that General Flynn, unlike Slate, the former diplomat, did not provide any evidence or basis for reaching this conclusion. He also didn't mention any sources for his information. Is this simply his own observation and judgment, or did someone authoritative tell him? He didn't say anything about that. He just came out twice, both times using a very certain and unequivocal tone to directly announce this conclusion, telling you that Xi Jinping no longer has any power. So then, why is General Flynn able to be so certain? At present, this is still quite an intriguing question. I think that in the future, he himself may gradually reveal the answer. After all, this has only just begun, especially in the English-speaking world. Among the political elites in the United States, the issue of Xi Jinping is only just starting to be discussed. So let's be patient and keep watching to see what happens next. So, right after the Politburo just issued a new set of working regulations, all those various groups and committees that Xi Jinping previously relied on to consolidate his authority have now been put under strict control, essentially locked in a cage. Yet, just yesterday, the party media reported again that Xi Jinping was presiding over another meeting, and it was a very important meeting as well. This was the sixth meeting of the Central Financial and Economic Affairs Commission, which was held in Beijing yesterday. As soon as you hear the name, it's the Financial and Economic Affairs Commission, so of course it's the highest level economic decision-making meeting within the party. According to official reports, what was the theme of this meeting? The core theme was to further advance the development of a unified national market, to regulate and manage disorderly low-price competition among enterprises in accordance with laws and regulations, and to guide companies to improve the quality of their products, to promote the orderly exit of outdated production capacity. When you hear all this, it all sounds like official rhetoric. But what does it actually mean? Of course, the concept of a unified national market isn't anything new, right? Xi Jinping publicly proposed this as far back as 2013, more than a decade ago. This slogan has been repeated year after year, so there's nothing novel about it. However, this time the meeting specifically mentioned the need to regulate disorderly low-price competition and to promote the exit of outdated production capacity. But this is something new, and it's a core message that deserves our attention. If we put it in plain language, what does it mean? It basically means that the top leadership is now taking strong action, elevating the fight against involution to a historic new level. That's why you see that almost overnight, major industries have started to limit production, imposing restrictions on the scale of manufacturing. As everyone knows, ramping up excess production capacity and then dumping this surplus capacity overseas at low price rate is a signature tactic of Xi Jinping when waging economic warfare against other countries. This has become a major headache, not only for the United States, but also for Europe and even countries like Japan and South Korea. They all see it as a serious threat, right? They consider this a weaponized trade tactic. So from the past dumping of steel and aluminum products to the dumping of daily necessities, and now focusing on the new three right, for example, solar energy, photovoltaic panels, and also things like new energy vehicles over all these years, this approach, this strategy has never changed. However, as you can see, just yesterday, Xi Jinping held an economic meeting, right? The meeting of the Central Financial and Economic Affairs Commission had just taken place, and the first thing on the agenda was the major industries with excess capacity, the biggest ones being photovoltaic and solar energy products. Immediately, there was a large-scale announcement of production cuts because it happened on the very same day. According to reports, the leading domestic photovoltaic glass companies plan to collectively cut production by 30% starting in July. The news came from Liu Qing, the board secretary of Almaden, right? This person is from Almaden, which is a leading company in photovoltaic products. He came out and gave an official response. Reporters confirmed that the news about production cuts in the photovoltaic glass industry is true. As for the purpose, he said it's to accelerate the clearing out of production capacity, in other words, to clear out inventory to promote the industry's sustainable development going forward, and so on, right? Then, on the very same day, the 1st of July, the China Cement Association, which produces cementment, is also a massively oversupplied industry in China since it's part of the building materials sector, right? This is all about infrastructure, isn't it? They issued a directive on anti-evolution, stabilizing growth, and promoting high-quality development. This opinion announced that there would be a significant reduction in production with strict limits on output. So, if you look into it further, you'll find that all those classic industries with severe overcapacity in the past are now imposing major production restrictions. All of them are drastically limiting production. For example, today, the steel sector in the Asia's market experienced an unusual surge. What's the reason? The reason is that steel companies are generally about to start cutting production. Recently, there have been rumors that in Tangshan, from the 4th of July to 15th, sintering machines will have to reduce production by 30%. That's basically cutting a third in one go. So, what happened? An authoritative industry data service provider called MySteel, right? This company conducted an investigation, and the results confirmed that currently about half of the steel mills in China have already received official production restriction notices. As for most of the remaining steel mills, they also indicated that they are very likely to receive such notices as well, and they too will have to limit production. In addition, production restrictions for new energy vehicles are also on the way. For example, starting from the 1st of July, companies like BYD no longer dare to lower their prices. Moreover, several new energy vehicle factories have canceled their night shifts. Their production has been cut by at least one third, and some new production lines have also been postponed. Besides that, there are also restrictions in industries like pork and construction materials, among others. All of them are undergoing significant production cuts. Due to time constraints, we won't list each one for you here. So, think about it. What kind of signal does this series of production cuts send? In my view, the core focus isn't really at the micro level, like analyzing all these production cuts and how we should interpret them, or how much of an impact these large-scale production cuts will have on China's economy, whether the effect is positive or negative, and how significant that impact might be. Of course, these issues are important. But that's not the most crucial part. In my opinion, what is truly at the core? This series of policies is essentially a complete reversal of Xi Jinping's economic strategy over the past several years, basically a total repudiation. So here's the question. Is Xi Jinping himself flipping this pancake? Or is someone else forcing him to do it? Of course, I believe different people may have different answers, and we very much welcome everyone to leave us a comment with your thoughts. As for my answer, I think everyone probably already knows it. In my view, it's clearly the latter, that is. Someone else is forcing him to flip this pancake. Because recently, we've seen the frequency of Xi Jinping flipping pancakes is really a bit high. For example, even in situations where under normal circumstances, he would never flip those pancakes himself, like Hu Jintao's three roles, right? Suddenly, these words come out of Xi Jinping's mouth and even make it to the front page of the party's official media. Or take his father, for instance, with that newly built Memorial Hall. Suddenly, the name was changed. And unprecedentedly, his younger brother was actually absent from the opening ceremony. And so on these are all what you'd call flipping the pancake moves, actions that are completely the opposite of what was done before. In my view, these are things Xi Jinping would never do on his own under normal circumstances. That must mean someone forced him to do it and he had no choice but to comply. That's the relationship here. Of course, in the past, Xi Jinping was all about aggressively exporting production capacity, right? This kind of large-scale, low-price dumping made the whole world treat China like a thief, staying highly alert. It was precisely because of this heightened vigilance that these measures emerged. The CCP has a tactic called the re-export trade, which means the goods don't go out directly from China. They reroute goods to other Southeast Asian countries to disguise the country of origin. However, now this re-export trade and the channel for changing the country of origin are also being targeted. It's already in a very precarious situation. Because just today, President Trump posted an update announcing that after a call with the general secretary of the Vietnamese Communist Party, Nguyen Phu Trong, the US and Vietnam have reached a trade agreement. He mentioned that the main provision of this agreement is that the US will impose a 20% tariff on all goods imported from Vietnam. At the same time, a 40% tariff will be imposed on all goods exported to the US that are transshipped through Vietnam. Conversely, Vietnam will impose zero tariffs on all imports of American goods. In other words, there will be no tariffs at all. It will be duty-free. Meanwhile, Vietnam will also open up its market to the United States. Ah! Then Trump specifically mentioned an example. He said, for instance, SUVs, which perform very well in the US market, could serve as a wonderful addition to various domestic products in Vietnam, and so on. What he meant was that in Vietnam, the popularity of SUVs is still very low. So the market is still huge. That's the point American SUVs could sell in large quantities there. Previously, as we all know, Trump, on his so-called Liberation Day, April 2nd, announced that the additional tariffs the US imposed on Vietnam were very high, at 46%, right? Vietnam was among the top countries affected. And in addition, there was a basic 10% tariff. Later, he said that the implementation would be postponed by 90 days, right? For Vietnam, only the basic 10% tariff would be imposed. But now, according to the officially signed agreement, through negotiations, what happened to Vietnam's tariffs? They were essentially cut by three-fifths. So now, only a 20% tariff is being collected. So you could say this is a fairly satisfactory outcome. For Vietnam, in fact, what really drew everyone's attention in this agreement was the 40% tariff on re-export trade. That is, how to determine which goods are re-exported through China and which are actually produced locally in Vietnam, right? At present, since we can't see the details of this agreement, but I believe that both the US and Vietnam must have, over these past few months, negotiated back and forth, right? They must have established some very detailed inspection and verification criteria to distinguish which products are of local origin and which are re-exported, right? I don't think that's the main point we need to discuss today. The real focus of our discussion should be this 40% tariff, right? It's clearly tailor-made to target the Chinese Communist Party because on the surface, if you look at goods exported directly from mainland China to the US, how much tariff do they face? It's about 50% to 55%. Ah, because previously, this was agreed upon last time in Geneva, right? Both China and the US negotiated and settled on these terms. So this brings up a problem. Many manufacturers and producers in China might think, well, if I re-route through Vietnam, I only need to pay a 40% tariff. If I export directly from mainland China, I have to pay at least over 50% in tariffs, right? But if I go through Vietnam, I can re-export from there. It's still cheaper, about 10 to 15 percentage points less, which is quite a lot. But actually, if you think about it, this kind of re-exporting through Vietnam is definitely gonna come with a price. Vietnam would definitely wanna take a cut. They'll charge a transit fee for sure, right? Plus, Vietnam might also introduce some detailed measures specifically targeting this kind of re-export trade. In short, Vietnam is not going to let itself lose out through this method. If you're using Vietnam as a transit point to get your goods to the US, then Vietnam will definitely want to benefit from it in some way. So when you're factoring all these elements, you'll find that these two routes direct and via Vietnam will probably end up with similar tariff costs. Maybe there will be a difference of just a few percentage points. But there's an issue. If in the end, Vietnam is even just a few percentage points cheaper than mainland China even, if it's only by a small margin, I think it could have a huge impact. That is, many parts of the supply chain might actually move completely to Vietnam. There could really be a shift of the industrial chain. So we can say that this agreement has basically blocked the main channel that the Chinese Communist Party used to take advantage of the US through re-export trade. Because Vietnam is the number one country for re-export trade. So next, this will inevitably lead to re-export trade possibly shifting to other Southeast Asian countries. Of course, for Vietnam. Although on the surface, it offers zero tariffs to the US. Many people might think, isn't that a huge loss? The US charges you at least 20%, but you're giving them zero tariffs. But if you think about it, even for the US, no matter how good your SUVs are, when you sell them to Vietnam, the market for them is actually quite limited, right? As we all know, in Vietnam, most ordinary people ride motorcycles. So for things like SUVs, it's unlikely that there will be a big market for them in Vietnam in the short term. And even if some people worry that with zero tariffs, American agricultural products will flood the market like a tidal wave. Actually, I don't think that will happen. Why? Because Vietnam's main agricultural product is actually rice. The main exports from the US are soybeans and wheat, especially soybeans, right? These are more complementary to Vietnam's agriculture. They won't seriously impact Vietnam's own rice production and exports. Also, think about it. Vietnam has always had an annual trade surplus of about $120 to $130 billion. With that foundation, even if, say, US agricultural products or American cars sell more and the trade surplus gets reduced a bit, Vietnam can still make a profit. I believe the Vietnamese have definitely done very careful calculations and assessments. And they think that even so, they should still be able to make money, just maybe not as much as before in terms of trade surplus, right? Maybe they'll make a few billion, right? A few billion is still quite a lot. For a small country like Vietnam and for the Vietnamese people, they can also consume more affordable American tech products, right? For example, if Boeing sells planes to Vietnam, there will be zero tariffs, which could boost Vietnam's aviation industry and so on. All of these are possible outcomes. It's relatively developed, right? So for Vietnam, I think this kind of agreement is a result they can fully accept. So basically, in my personal opinion, I think this agreement can be considered a win-win outcome for both the US and Vietnam. The only loser here is the Chinese Communist Party because this agreement basically blocks their main channel for re-export trade. And what's more, if you think about it, Vietnam, by entering into this agreement, it's not just about economic significance, it also has geopolitical meaning. It's essentially taking sides with the United States. Think about it, Vietnam has even fully opened up to this American company. It's a completely all-in attitude, making it clear that they're siding with the United States. So in other words, the Vietnamese government has taken the lead by signing this agreement and seized the first-mover advantage in accessing the world's largest single consumer market, which is the US market. The result of this will inevitably lead to other Asia-Pacific countries that follow to possibly, they will lose part of their export share to the United States. For example, countries like Cambodia, Malaysia, and even Taiwan may all be affected to some extent. So for these countries, they face a problem. Should they hurry up and reach an agreement with the United States? Otherwise, if an agreement can't be reached, Trump would definitely raise the tariff again, right? The 10% base tariff will be increased and reinstated. In that case, a lot of their export share might naturally be snatched up by Vietnam first. So think about it, Vietnam, as a leading country in ASEAN, right? With such a status, even when it negotiates with the United States, this is the kind of outcome it gets. Many people think, ah, the US has totally won big here, right? That's the kind of result we're seeing. So just think about what the terms will be like for other countries that might be able to reach agreements later on. It's completely imaginable, right? In short, the trade agreement between the US and the UK has essentially set the foundation. It serves as a model and a benchmark for trade agreements between the US and its allies. Meanwhile, the agreement reached this time between the US and Vietnam essentially sets a model and benchmark for trade agreements between the US and non-allied, more centrist countries. With these two benchmarks in place, the difficulty for Trump to reach agreements with other countries in the future will likely be much lower, much easier, in fact. Of course, each country may have its own specific circumstances. So let's just keep watching this grand drama unfold, shall we? Let's see how much longer the Chinese Communist Party can hold out in this turmoil and just how significant the impact on it will be. All right. Okay, next we have a friend. Oh, this online friend has asked a question that isn't really related to the news. Here's what he said. He wants to know the brand of Mr. Tang's T-shirt. Well, this T-shirt is actually a shirt. Ah, it's actually a long-sleeved shirt and it's called ShenYong Dancer. It's an affiliated product of ShenYong. I have to tell everyone, this shirt is really comfortable to wear. It has two main features. First, let me tell you, it's made of pure cotton. It's very form-fitting, highly absorbent, breathable, and extremely comfortable. But this cotton is actually a very special type called mercerized cotton and it's also sourced from Portugal. So we source this kind of raw material. What's special about mercerized cotton? Well, with regular pure cotton clothes, they're very comfortable and fit well, but they tend to wrinkle easily, right? They're not that crisp. But products made from this mercerized cotton combine the best of both worlds. They offer the same close-fitting, extremely comfortable feel of pure cotton, but at the same time, they don't wrinkle. As you can see, it's very crisp and smooth. So I really like how it feels when I wear it. I've actually bought more than one. You might have noticed I've worn a different color before. So if any of you are interested, we'll ask our editor to put the link, the same one used by Shen Yun Dan-sersing in today's description section. If you're interested, feel free to check it out. All right, let's address two more questions from our friends. So this next friend says, Qiang Xiaojiang is reportedly from the Department of Hydraulic Engineering and is one of Hu Jintao's people. Qiang Xiaojiang is the person we discussed yesterday, right? He replaced Ma Xingrui, correct? Regarding this news, I think, of course, when it comes to Qiang Xiaojiang, whether he's really one of Hu Jintao's people or belongs to Wang Qishan's camp. Since he once worked as a speechwriter for Wang Qishan, he's from the Disciplinary Inspection System, the Central Commission for Discipline Inspection. No matter whose faction he belongs to, he is not part of Xi Jinping's camp, right? That much we can be sure. Off he is from a non-Xi Jinping faction and was originally sidelined. We know that in fact, the United Front Work Department, among all the major ministries and commissions of the CCP, is a rather marginal department, especially during peacetime. In times of war, the United Front Work Department is considered a treasure by the CCP. But during peacetime, it is relatively marginalized. Suddenly, Ma Xingrui was put in charge replacing a staunch loyalist from Xi Jinping's own faction. So this is a case of a non-Xi Jinping faction member replacing a die-hard Xi loyalist. From our perspective, this situation itself is just like that. This is a phenomenon. What does it indicate? It shows that for us, and it's no longer just an isolated case, right? Previously, Li Ganzi was also replaced by Xi Daifeng. Everyone knows Xi Daifeng is from the Tonpei faction, right? So he was replaced as well. Incidents like this are happening. It keeps happening again and again. Just like the example of Li Jiaochao we talked about today, he's completely blocked out and Xi Jinping doesn't mention him at all. You could even call this Confucian Shiism. We could even elevate it to that level. It's basically a public display of Confucian Shiism. In the past, people would always mention Chairman Xi in everything. But now, there's complete silence why such a drastic change. Why this alloy, right? Even Singapore, which has always been especially pro-communist because its economy relies on the Chinese Communist Party, is changing. Why did Singapore's former first lady dare to share an article calling Xi Jinping the mastermind of a mafia? Isn't she worried about consequences? And you, Li Jiaochao, are you also not worried about consequences? Why have they all become so bold now? They're all doing this at the same time. What does that tell us about what's going on behind the scenes? So everyone needs to realize this isn't just some random rumor or gossip, right? These aren't baseless rumors spreading online. This is official information being formally released, right? That's what I'm saying. And there's another friend who added a comment that said, the head of the organization department is an absolute indicator of the political direction. I actually pretty much agree with this point because the head of the organization department holds the ultimate power over personnel. With that power, you can remove all of the other side's people and promote your own, right? So when the organization department head was replaced by Xi Taifeng, we reported in the news at the time and told everyone, look, this is basically equivalent to Xi Jinping losing his grip. The authority over personnel appointments in the government system, as for the military system's personnel authority, since Miao Hua was arrested, he had already lost that. After Xi Taifeng took over, he lost his control over personnel in the party and government systems once again. So under these circumstances, how can anyone still say that Xi Jinping is firmly in control? It's just unimaginable, right? He's lost military power. He's lost the authority to make personnel changes in the government system. So what does that make him? He's just a figurehead. He's basically just the general secretary in name only, right? Okay, there's also some feedback from a friend that I think makes sense. So I like to share with everyone. He said that they deliberately avoid mentioning which organizations are supposed to oversee these small groups and committees. This kind of black box operation is consistent with their usual way of doing things. The people who actually make the decisions often remain behind the scenes. This friend probably has a pretty good understanding of how the CCP operates politically. Their methods and patterns really are like this. Let me put it simply for everyone with a straightforward example. As you know, during the Deng Xiaoping era, he supported three general secretaries, right? The first was Hu Yaobang. The second was Zhao Ziyang. And later, he supported Jiang Zemin. During the entire period when Deng Xiaoping was still alive, right? Everyone knows that in reality, the highest leader was Deng Xiaoping, wasn't it? Those general secretaries were just figureheads, like puppet emperors, you could say. That's really the kind of situation it was. Deng Xiaoping made many major decisions. Do you think he would convene a central committee plenary session or an important Politburo standing committee meeting to make these decisions? Because everyone in the inner circle knows this. What do they know? Deng Xiaoping was especially fond of playing bridge, wasn't he? Many truly significant decisions that shaped the course of history were actually made by Deng Xiaoping at his bridge table with just a handful of people from his core circle. While playing bridge, he would say, okay, we'll handle this matter this way. It's said that removing Hu Yaobang, not Hu Jintao, but Hu Yaobang was also decided at a bridge table. Deng made a call right there saying, this person isn't suitable anymore. We can't use him. That's how it happened. Many people don't really understand this reality. Friends who are familiar with the CCP might think this sounds like a joke, like a story, but this is exactly how the CCP operates. I keep telling everyone, never regard the CCP as a normal regime or government. It is abnormal. It has never resembled any normal form of government at all. It's a freak, a monster, truly a monster. Okay. Thank you all very much for giving us so much feedback. I think your comments are all very pertinent and valuable. That's the end of our live stream for today. Thank you all for watching.