China Won’t Like This One 😬

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CHINA WON’T LIKE THIS ONE 😬 

You know how your parents used to tell you, “If your friend jumped off a bridge, would you do it too?”
Well, apparently, Trump’s economic policy just said, “Nope. In fact, I’m building a bridge with a price floor so no one can fall off again.”

Here’s what’s going on:

Treasury Secretary Scott Bessent said the U.S. plans to set price floors across multiple industries. The goal? Stop China from undercutting American companies by flooding the market with dirt-cheap materials.

Bessent’s argument is simple.
China dominates the global refining and processing of rare earth minerals. These are the metals used in everything from F-35 fighter jets to electric vehicles. And for the last 20 years, China has been playing 4D chess.

slashing prices, wiping out competitors, locking down control.

Translation: “They’re not playing fair, so neither are we.”

The plan includes price floors and forward buying, meaning the government will guarantee a minimum price for key materials. This stops prices from falling so low that U.S. producers can’t compete.

Basically, it’s capitalism on training wheels.

And it doesn’t stop there. The U.S. wants to build a Strategic Mineral Reserve, just like the oil one. Think of it as a “break glass in case of supply chain meltdown” vault.

Even JPMorgan wants in. The bank’s reportedly looking to help set up an exchange and provide lending to support the new system. Because of course they are. If there’s money on the table, Jamie Dimon’s already sitting at it.

The government’s already been warming up this play.
Back in July, the Department of Defense struck a deal with MP Materials, America’s biggest rare earth miner. The deal gave the Pentagon an equity stake, a price floor, and a supply guarantee—a big step toward securing the resources used in missiles, jets, and EVs.

Bessent added that the government won’t go full communist and start taking stakes in every business. They’ve identified seven “strategic industries” where they’ll focus intervention.

After 25 years of letting China run the board, the U.S. is finally picking up its economic sword.

TL;DR:

• The U.S. plans to set price floors in key industries to stop China from crushing competition with ultra-low prices.

• The government will also build a Strategic Mineral Reserve to protect supply chains.

• JPMorgan wants to help run it (and probably make a few billion while doing so).

• The Pentagon already made a rare earths deal with MP Materials to secure materials for jets and missiles.

• America’s new motto: “We’re not asleep anymore.”

1. Invest in U.S. Rare Earth Producers
Trump’s plan for price floors and a strategic mineral reserve means homegrown miners could see steady demand and price protection. Companies like MP Materials $MP ( ▼ 8.92% ) already have Pentagon deals, and more could follow.
📌 Action: Accumulate shares of U.S.-based rare earth and critical mineral miners positioned for government backing and long-term contracts. Hold through policy rollout headlines.

2. Ride the U.S. Industrial Revival
Industrial policy is back, baby. Price floors and domestic sourcing incentives mean more capital flowing into American manufacturing, mining, and infrastructure.
📌 Action: Add exposure through ETFs like $XLI ( ▼ 0.42% )  (Industrials) or $PICK ( ▲ 0.65% )  (Metals & Mining) to catch a broad wave of government-driven growth and onshoring trends.

3. Bank the Bankers’ Boost
With JPMorgan eyeing a role in creating and financing the new mineral exchange, Wall Street stands to profit from this new market infrastructure.
📌 Action: Look at major U.S. banks with commodities exposure—$JPM ( ▲ 1.2% ) , $GS ( ▼ 0.37% ) , and $MS ( ▲ 4.71% ) —which could benefit from lending, exchange creation, and reserve management fees.

Pfizer Wants a Plus-One: China 🌏️ 

The U.S. and China might be beefing in politics, but in the lab? Pfizer’s CEO Albert Bourla says it’s time to make friends.

At a recent event in New York, Bourla basically told everyone that the U.S. pharmaceutical industry needs China if it wants to keep up. Why? Because China’s drug scene just went from zero to Breaking Bad levels of output.

Here’s what’s happening:

• China had about 60 new drug candidates a decade ago. Now it has over 1,200.

• Chinese companies can recruit patients for trials 2–5x faster than U.S. firms.

• China now accounts for 30% of global drug development, up from almost nothing a few years ago.

The U.S. still leads the pack at 48%, but the gap’s closing faster than you can say “clinical trial approval pending.”

Big Pharma’s New Crush

The U.S. has started buying in—hard.

• Licensing deals with Chinese pharma companies hit $21.3 billion in 2024, up 280% since 2020.

• Chinese biotech firms were behind nearly one-third of all major licensing deals last year.

Translation: American pharma isn’t just watching China’s rise. They’re signing contracts to get in on it.

The Awkward Part…

All this cozy collaboration is happening while the U.S. and China are still locked in a tariff war. At the same time, U.S. lawmakers are trying to restrict business with Chinese biotech firms.

So yeah. Pfizer’s over here trying to collab with China, while Washington’s like, “Don’t you dare.”

TL;DR:

• Pfizer’s CEO says the U.S. needs China’s help in drug development because China’s now a biotech powerhouse.

• They’re faster, cheaper, and scaling like crazy.

• American pharma is pouring billions into licensing Chinese drugs, even as political tensions heat up.

• The science says “partner up.” The politics say “don’t you dare.”

THE RECESSION NOBODY SEES 🙈 

U.S. stocks looked like they couldn’t decide which way to go on Wednesday. The S&P 500 climbed 0.4%, the Nasdaq added 0.7%, and the Dow just stood there like it forgot its password.

The bright spots? Strong earnings. The mood killer? Trade drama.

Morgan Stanley $MS ( ▲ 4.71% ) jumped 4.2% after crushing Q3 estimates. Bank of America $BAC ( ▲ 4.37% ) followed with a 4.3% gain thanks to a blowout quarter. $ASML ( ▲ 2.71% ) also impressed, but not everyone joined the party. Abbott Labs $ABT ( ▼ 2.43% ) missed revenue targets, $PNC ( ▼ 3.9% ) guidance flopped harder than a meme coin launch, and $PGR ( ▼ 5.78% ) underdelivered on profits.

Oh yeah, gold is flexing at $4,200 an ounce. Investors are clearly looking for something shinier than stocks right now.

The Recession Chatter

Daniel Jones of Crude Value Insights isn’t mincing words.

He thinks the U.S. is cruising toward a recession defined by stagflation, with trade policies taking most of the blame. He’s gone defensive with his portfolio and suggests everyone else might want to do the same before things get ugly.

The Political Circus

The U.S. government shutdown is still dragging on. Prediction market Kalshi now thinks it’ll last more than 36 days. They also bumped up the odds of three rate cuts in 2025 to 77%, up from 48% a month ago.

The Fed’s Beige Book described economic activity as “changed little,” which is basically Fed-speak for we have no idea what’s going on either.

Trade War Round 2

We’ve already covered the floor prices. But how did China take it?

Not well.

China fired back by sanctioning five U.S. subsidiaries in South Korea. Both sides have also started charging new port fees on each other’s ships.

And just when it couldn’t get more dramatic, Jones warned that a 100% tariff and possible embargo on cooking oil could crank uncertainty even higher.

Bonds and the Fed

The bond market barely flinched. The 10-year yield rose to 4.04% and the 2-year ticked up to 3.51%. Jerome Powell added a small dose of calm, saying the Fed will stop its balance-sheet runoff soon.

Markets ended mixed, optimism battled tension, and traders are left wondering if the next move will be a breakout—or another fakeout.

TL;DR:

• S&P +0.4%, Nasdaq +0.7%, Dow flat

• Morgan Stanley and BofA crushed earnings; others fumbled

• Gold hit $4,200

• Recession fears rising amid U.S.-China trade drama

• Shutdown may drag past 36 days; Fed hints at pause

• Tariffs, sanctions, and cooking oil now in the mix

1. Play the Gold Momentum
Gold just hit $4,200 as investors flee uncertainty around U.S.–China tensions and recession fears. If inflation and trade war rhetoric heat up, gold could keep shining.
📌 Action: Add exposure through gold ETFs like $GLD ( ▲ 1.73% ) or $IAU ( ▲ 1.65% ) . Take profits into strength when volatility cools.

2. Ride the Bank Strength
Morgan Stanley and Bank of America smashed earnings while most of the market hesitated. That shows resilience in the financial sector, even with recession chatter.
📌 Action: Build a short-term position in top-performing bank ETFs like $KBE ( ▼ 1.82% ) or $XLF ( 0.0% ) to ride post-earnings momentum. Tight stop-losses are key.

3. Defensive Dividend Shield
With stagflation talk rising and trade friction building, defensive sectors could become the safe havens. Think healthcare, utilities, and consumer staples—steady profits in choppy waters.
📌 Action: Rotate part of your portfolio into dividend-heavy ETFs like $VIG ( ▲ 0.35% ) or $SCHD ( ▼ 0.34% ) to collect yield while reducing exposure to high-beta tech.

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