00:00Presidents Trump and Xi both slowly moving closer, it seems to, well, certainly markets are betting on a rapprochement of sorts.
00:09Are they right to when it comes to the trade relationship between these two countries, given the tensions that currently exist?
00:16Well, look, Tom, I think that at this point, really what you're seeing is that these two leaders have, you know, I mean,
00:22they seem pretty committed to actually making this kind of a meeting happen.
00:25I realize that tensions have ratcheted up quite a bit over the last week or so.
00:28But, you know, you just heard from Donald Trump there.
00:31I think, you know, the U.S. is still motivated to put a meeting on the calendar with Xi Jinping.
00:36That's certainly something that we've heard from the Treasury Secretary, Scott Bessent, for the last couple of weeks now,
00:41something that they're really, really pushing toward.
00:42And I think that with these upcoming talks happening in Malaysia, where the U.S. and China are ultimately expected to hash out some deals,
00:49that does also seem to pave the way for a pretty smooth visit by the president to the region.
00:55And then ultimately with this meeting that's expected to be prepped in South Korea at the end of the month,
00:59you know, whether they can actually sort out all of the issues between them, I think, is still open to interpretation here.
01:05One thing that we did hear from Scott Bessent just last week was that maybe there could be another pause on the table if they're able to reach some concessions.
01:12Again, I think that's still very much an open question.
01:15But it does seem at this point that, you know, everything's a go for at least getting these two leaders together at the table.
01:21OK, so that meeting is likely to happen.
01:23Jill, what is the expectation from you and the team in terms of what is most likely achievable in terms of agreements between the two sides?
01:31President Trump has been listing his own concerns.
01:34What for you and the team is in focus in terms of what they could actually bridge this divide with?
01:38Well, look, Tom, I think, you know, that Trump laid out pretty much the three biggest issues that are really facing these two countries right now.
01:45You've got, you know, his concerns about fentanyl, which maybe that seems a little bit more achievable,
01:49given that China has already taken some steps to address, you know, some of those with some drug curbs earlier this year.
01:57So that's one thing that Trump has listed.
01:59Another thing is soybeans.
02:01China has halted purchases of U.S. soybeans recently as kind of a point of leverage.
02:05I think that's another, you know, we'll see what actually happens there.
02:08But the big one that Trump said that he really wants to resolve here is this issue of rare earths.
02:13I think that this might be, you know, the most difficult thing for these two sides to ultimately agree to.
02:18So China controls a massive supply of, you know, the earth's capacity of rare earths materials,
02:23you know, something that's used in everything from electric vehicles to fighter jets.
02:26I mean, what really ratcheted up tensions recently was that we had China actually institute new export curbs on sort of shipments of rare earths.
02:36Now, I think, you know, that's going to continue to be a major sticking point when it comes to these U.S.-China negotiations.
02:41Whether we can actually see some kind of a breakthrough there, I think that'll be a really, really big tell as to how much tensions are actually easing,
02:47because, you know, that's something that the U.S. actually thought they had reached an agreement on earlier this year when these two sides held talks in Geneva.
02:55We really haven't seen a lot there.
02:56And I think if you're China, you're looking at this particular issue and you're saying that's really the biggest piece of leverage that they have in any kind of a trade negotiation.
03:03So that's the one I'm most looking out for, whether or not they can actually have a breakthrough.
03:07I think, again, that's much trickier, but that would be a very, very, very significant breakthrough if they're able to reach an agreement that both sides are satisfied on.
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