Beyond Sun Tzu: Xi Jinping and Strategy #3

While the sycophant and pile-on press are predicting a “difficult” meeting today between Chinese President Xi Jinping and Donald Trump, the facts suggest the opposite.

America suffers from being a bunch of phony sinophiles. Including most reporters.

Sure, business students consider The Art of War a must-read book.  But a tiny fraction of those will go on to read the companion “36-strategies.”

While Art of War is strategic in its perspective, 36 Strategies is six groups of six-tactics each – very much as one would use the Stonewall Attack or the Sicilian Defense in chess.  It’s all in the study of “moves with names.”

Before we go strategy shopping, as I’m sure the real deal-maker advisors have, let’s review some Chinese history:

Chinese media assert that the China has been “invaded by the [box-headed] North Koreans 127-times in  the past 2,000 years.”

Much skepticism of the Trump-Xi meetings has been fanned by embedded holdovers from the previous administration.

Trump pictures himself a “man of deals.” In contrast, practitioners of the “art of statecraft” have a remarkable record of non-achievement. 

Thus, we see Trump’s core “deal team”  more heavily weighted with those able to immediately implement trade – and military – policy.  Missing are protocol dilatants and deal-killers.

Some “old line” diplomats – who wouldn’t have careers without perpetual conflict – would be understandably skeptical.  But we think times have changed. 

We understand that there is a steady outflow of old-line players at the State Department underway.  One not getting much press, but Secretary of State Tillerson is used to an electronically-leveled org chart and nearly instant responsiveness.

Foggy Bottom has, in many regards, run on its own inertia. And what about the remaining neocons?  In time…

Once you wrap your head around the “invasions”  suffered by the Chinese  as the hands of North Koreans over the centuries, Trump’s position improves.

Dating back to the Hahn and Tong Dynasties, it helps develop an appreciation for what China has become.

It is The New Dynasty.

This is not to argue it isn’t communist to its core; it most certainly is.  Learning Party precepts is the short road to the top, no question.

But unlike American-style politics, the Chinese have a history of civil service and there is competitive testing. More emphasis on test scores, less “affirmative action.”

There, more so than here, smart people make it to the top in government faster.

Which of the 36 Strategies?

There are two major deals on the table today, so let’s take them in turn. 

The Wikipedia list of the 36-strategies is here.

Trade is likely the smaller of the agenda items today, although it will be linked – in negotiations – with the North Korean problem.

Trade is the opening discussion point. 

We can see how Trump continues to taunt those who don’t understand his style.  He has deftly used the “Feign madness but keep your balance” approach both in his tweets and overall. He has a direct – media-free – backchannel to the American voting base.

Alternatively, Trump may be using “Stomp the grass to scare the snake” talking tough on trade to rattle the Chinese into thinking he could be serious about trade if they don’t “make the North Korea problem go away...”

Very often, Trump critics fail to grasp that in order to build real estate empires, you not only need a crystal-clear vision of the future, but in addition, you have to put a LOT of your own money on that future showing up.  If that’s madness to your way of thinking, you may be suffering from the anti-Trump brainwashing of the radical left. Trump is expert at cost-effectively “buying a future.”

Since trade talk will involve some subtle moves on Trump’s part, we would expect him to open with a variant of “Point at the mulberry tree while cursing the locust tree.”

This may work out well because chaining strategies is acceptable.  Eventually, you get your opponent to one where you have a plan to win, or an acceptable deal to cut.  Then you “move in  for the close.”

The North Korea part of the discussions will be more difficult because the U.S. remains still “at war” with North Korea.  Remember, the killing of the Korean War ended with an Armistice, not a peace treaty.

As we have previously reminded, North Korea is likely inside the 9-month window of having a strategic weapon (missile) able to reach the U.S.  It looks to be a liquid-fueled rocket, similar to the Cold War Atlas series.

50-year old tech can still kill and a megaton air burst would still kill millions.

The drawback to the old liquid fueled missiles is they require hours upon hours to fill. 

During the Cold War, the US evolved technology for 20-minute fueling and launching, but that is high-tech the NK’s may not have arrived at, although it’s largely in the public domain.  Just a hell of a lot of work.

North Koreans have had more than half a century to dig tunnels which makes detection difficult. Except, we would point to our earlier discussions of HAARP and its potential use as radio tomography for underground “resource” mapping.

Closer in, their solid-fueled rockets are more problematic and made more so by technology transfers to Iran.

Also remember that NY Times report we pointed out earlier this week revealing the NK’s are well-past sufficiency with lithium and they are willing to sell 22 pounds of the material every few months. 

The buyers would be terrorists.

It’s not unreasonable to label North Korea as a direct threat to world peace.  It is also a promoter and arms dealer of high order.  Doubtless, the Trump administration will hold a similar view because the facts support it.

Simply put, the U.S. will never be allowed to realize their ICBM fusion bomb delivery goals.  The U.S. will have to attack first.

The problem from such an attack is negotiating China’s response in advance if they won’t do our “dirty work” for us.

But here’s where the media has again failed America:  There is a way for the U.S. and China to come to terms using another of the 35-strategies:

Kill with a borrowed sword

When the enemy is too strong to be attacked directly, then attack something he holds dear. Know that he cannot be superior in all things. Somewhere there is a gap in the armor, a weakness that can be attacked instead. The idea here is to avoid a head-on battle with a strong enemy, and instead strike at his weakness elsewhere. This will force the strong enemy to retreat in order to support his weakness. Battling against the now tired and low-morale enemy will give a much higher chance of success.”

Please consider China the “borrowed sword.”  

While we may not see a grand announcement, there is very little doubt in my mind that Trump will be offering to soften on trade – a good bit even – if our main retail supplier would faithfully play the role of “borrowed sword.”

Done right, it changes the world for the better.  Done wrong, we see flash-bangs by Christmas, or thereabouts. 

I apologize for turning this into a Peoplenomics-type discussion.  But we dared not reveal the context until the “day of” in order that the “feign madness” or “stomp the grass” can work to full effect.

We will watch with interest to see how well Xi and Trump posture on this.

While the NY Times today is asking “How Long will the Cordiality Last,” I see that a more proper question is “Will China kill as our borrowed knife” if we make acceptable concessions elsewhere?”

Trade rhetoric could be dialed back.  Recognizing Chinese hegemony in the South China Sea might be ancillary.

By the way, notice that the Philippines are planning to occupy all disputed islands now…another potential bump in the road.

It’s clear as a bottom line that Trump wants a deal.  So does China.

No more neocons or  “deal-killers” from State required.

While the Associated Press refers to the US as a “wild card on trade” we insist that China could be our “borrowed sword.”

Side Shows

Former Breitbart exec Stephen Bannon and his reassigned off the National Security Council.

In the Back Ring

We see the Gorsuch nomination heading for a suspension of regular rules and a simple majority vote to confirm this week.

When democrats suspended rules to jam through an appointment in the past, it was acceptable.  Now it’s painted and historic denial by the dems.

Short memories and more useless political BS.  The dems engineered the very changes they now hate.

Challenger Job Cuts Increased In March

Press Release due jour:

Job cuts announced by US-based employers rose 17 percent from the February total of 36,957 to 43,310 in March, according to the latest report on monthly job cuts released Thursday by global outplacement consultancy Challenger, Gray & Christmas, Inc.

March announcements are 2 percent lower than the same month last year, when employers announced plans to eliminate 44,207 jobs from their ranks. Last month’s total is the third consecutive month of lower job cuts than the corresponding month a year earlier.

So far this year, employers have announced 126,201 job cuts. Last quarter’s total was 38 percent higher than the 91,303 cuts announced in the fourth quarter of 2016, and 30 percent lower than the same period last year when 180,920 cuts were announced.

Market futures are set for a bounce – but not much of one.

Labor Department job data in tomorrow’s column… More coffee?

Comments

Beyond Sun Tzu: Xi Jinping and Strategy #3 — 26 Comments

  1. Sadly and against many of his supporter’s intent, Trump has bought into the Globalist dream. Suspected this as his cabinet took shape. It is now proven. Woe is me for voting for the man. Alas, my vote would have done nothing, even so and ‘evermore.’

  2. It’s 9pm and Trump just did the thing that most of his base put him in office NOT to do. He bombed Syria on the basis of CIA and Mossad intel = which is exactly what Hillary was espousing we should do.

    I’m done with Washington and this entire mess as of today. Voting doesn’t make one smidgeon of difference, and the choices are ALL UNIFORMLY evil or compromised. Not for the first time, my not voting for either makes me feel good.

    Saddle up boys and girls; the is just the opening act of this sorry episode…

  3. sad new… http://abcnews.go.com/Politics/rep-devin-nunes-steps-russia-probe/story?id=46620555

    from what I heard on our local station.. he disclosed confidential material.. hmm was that when he let everyone know that trump was right on them monitoring his phones for political reasons.

    as far as which of the stratedgies.I wish that those in Congress would read that book.. I think if they did that and read the very bills they vote in.. they would make a few changes..
    we have outsourced our military. .what seventy countries now.. spent our reserves and working on borrowed money.. we have sold off our ports of entry and toll roads.http://www.washingtontimes.com/news/2014/jul/29/government-oks-arab-owned-company-operate-us-port/. to companies that are controlled from other countries we only check what..less than five percent of incoming containers.. obviously no one has heard about the new defense weapons.. the club K.With our inability to monitor incoming containers these could be sitting in a lot close by..we would be fighting ghosts .https://www.youtube.com/watch?v=f_c_PeIIeMw excuse me.. has anyone heard of an old chess move..of putting your rook in among your opponents pieces to get a win.. Our Absent while on vacation or recess congress that is letting special interest lobbyists control them has in my opinion through their negligence put us in a very precarious position.
    we are letting refugees in.with our military stationed somewhere else it sure wouldn’t take many to make a real mess..

    https://www.facebook.com/ABUAJride/videos/1010678815704933/.

    granted ninety percent are fleeing for their lives but if the extremest are right.. they are infiltrating our country and they have been living with strict Muslim laws.that would be similar to us living the old testament laws.
    We have outsourced our Manufacturing even strategic parts of our defense systems are all manufactured somewhere else.
    I think that should have become even obvious to the member with the lowest IQ when all monitors and cameras were turned on by another country at the same time Hmm. interesting..
    or when our drone was taken over and landed by another country right after Rand Paul brought up the fears of just such a thing happening when they discovered the faulty guidance chips in our missile systems..

    hmm.https://www.rt.com/usa/iran-drone-hack-stealth-943/.

    https://www.bloomberg.com/news/articles/2008-10-01/dangerous-fakes

    What I see happening right before our eyes in slow motion is

    LOOT A BURNING HOUSE strategy
    WAIT AT LEISURE …

    at five hundred plus billion being spent outside our shores on military actions over seventy percent of our military is outside the usa.. we spend another two hundred billion in helping countries other than our own..
    we have let our infrastructure go to the dump and weakened our defense system.what pretty much our infrastructure has been left alone since before I was born.
    but then the profit of a very few must be more important.

    brings to mind a scene in the movie independence day…
    I see the puppet masters standing on a podium and saying..
    WE WILL NOT GO QUIETLY INTO THE NIGHT…
    getting rid of the guy that exposed the lies is really pretty smart and gains them more control over the actions of congress and the ability to shade what they are doing to those that are to busy to really stop and think about it all..
    god there I go on a rant again sorry all of that is just my opinion.. and hey I probably am wrong on all accounts.
    Oh and this.
    https://www.paul.senate.gov/news/press/sen-rand-paul-puts-forward-conservative-vision-for-a-balanced-budget.
    just because I really like Rand Paul and I really like the fact that Trump is taking time to visit with him to get his side of things..

    • The big problem with a critical mass of CONgress is that they are capable of being bribed and especially blackmailed since they have enough dirt to get hanged.

      Failing that, there is sadly the threat of the Kennedy solution to both themselves and their families. It takes a strong man to stand up to that kind of pressure, and I see few of them in CONgress.

  4. Keep up the good work George. The trolls are out for anything you say or do. Some peoplewould complain, even if you hung them with a new rope.

  5. Thank you George for “outside the box ” views on the situation with NK. Trump is a great deal maker, look at the fact he gets along with his ex-wives and you know he is a genius.

  6. Lee Stranahan, formerly of Breitbart, says there is an inside soft coup going on at the WH. He was on local talk radio this morning urging listeners to get informed and then call the WH to protest Trump following the globalist agenda instead of the populist one on which he was elected.

    Kushner and Ivanka brought in Gary Cohn and Dina Powell, formerly of Goldman Sachs and self-avowed globalists, to the WH staff. They are the devil whispering into Trump’s ear and he is listening. That explains his antagonism of the Freedom Caucus and his verbal assault yesterday on Assad.

    The globalists always have a way in, just like the slithering snakes they are.

  7. Well George lets face it North Korea isn’t anymore of a threat to world peace then we are, and probably less so, as we are now in how many countries with our military, for sovereign nations mean little to nothing if we wish to move in, Syria comes to mind while we are killing in Iraq Yemen Africa and Libya which showed that giving up your nuclear weapons is a sure trip to the graveyard.
    As far as the great wall of Mexico that was simply a place to focus peoples attention or their anger on, for if he was serious about illegals he would have simply issued an order that any American caught employing one would be fined $25,000 to $50,000 dollars problem solved, just as Ike did when that problem arose,Trumps working with a very weak hand as he rants about China and Russia, orders more troops to Europe around Russia’s borders while trying to bluff his way on trade deals, while our financial system with its built in debt is little but a ticking time bomb, and I’m sure Russia and China are well aware of that..

  8. Dear George,

    Although the strategies you describe in today´s article might work, I think you forgot one important factor that is essential when dealing with the Chinese. The Chinese are all about “saving face”….We all know that Trump is not the most refined person when it comes to using tact and diplomacy. If his goal is to create a win-win situation for the US and China he will have to choose his words carefully, and not be the proverbial “bull in the porcelain cabinet”. Believe me, Angela Merkel did not hold warm feelings for Trump when she flew back to Germany after her visit.
    I am very curious how this visit between Trump and Xi Jinping turns out. The Chinese aren´t fools either. They know that the average American is not going to work for $6 an hour as they do in China. Also, US companies that now have their products manufactured in China to save on production costs will simply use robots when forced to manufacture their products in the US. It will not help the American economy one bit I´m afraid. Trump may be a shrewd businessman but imho he doesn´t understand the geopolitical forces at work fully yet….!

  9. It is very hard to concentrate reading your column this morning with the horribly obnoxious video running to the right side of the page. No way to get rid of this UX video. I am a paid subscriber and really dislike this abomination. I will consider dropping Peoplenomics this year.

    • I am a bit confused: There are no ads – zero – on the http://www.peoplenomics.com site.

      Urbansurvival is an ad supported site – was this where the ad was? If so, it is streamed from Google’s ad department. We sub that out.

      I would love to be able to work free 8-10 hours every day (since 1997) with nothing out of UrbanSurvival except the handful of subscribers who also complain from time to time that they don’t “like the adss.”

      On the paid content site it is ad-free and (usually) better content. Our trading model as you know went long Nov 11 last year and hasn’t wavered so many subscribers are up 20-35 percent depending how they manage their own accounts.

      I would humbly suggest that models with these kinds of gains are worth a hell of a lot more than $40 per year…and are as good as the $1,000 per year newsletters if not better.
      When we went long with the model the S&P was 2164.45 and this morning it is 2359.
      That’s a raw 8.98% gain, but since most of us play with the triple levered ETFs, our gains are more in the 2025% range – about 4 1/2 months. Some (like UDOW) even toss in some dividend sharing on top of that – I got a check last month for that.

      Show me ANY OTHER NEWSLETTER with this kind of batting average for $40 -hell $100 or $300 and I will shut up and stop whining. Urban is FREE Peoplenomics is PAID and no ads.

      I believe I deliever a LOT more value than what the customer expects.

      But if shut down Urban to save the ads from offending, sleeping in, and raise Peoplenomics rate to its real value level north of $200 per year, if what people want, then I’m good with that. I could put a LOT less effort out on Urban and just focus on Peoplenomics – ad free but for a lot more bucks.

      Subscriber value assessment?

      Show of hands?

      • And PS: That alt energy stock I mentioned four weeks ago at $2.08 has traded $2.59 today. That’s 24%… Zacks came out with it a day or two later as a pick…Again, who else is giving you that quality of trading ideas?
        FMTT

      • Said awhile back to drop Urban and double price of People(along with upgrading it)less work for you and seems like same amount of money…

      • KEEP IT THE WAY IT IS!! with my myopic view of the whirled, I see no ads….

  10. Since…”Chinese media assert that the China has been “invaded by the [box-headed] North Koreans 127-times in the past 2,000 years.” and China is nuclear capable and has the world’s largest standing army, why has China not done anything about North Korea yet? So to bet that Trump is going to change 2000 years of China foreign policy is realistic or is one of the 36 strategies a “teach an old dog new tricks?” I’m not being sarcastic just asking.