The manufacturing re-shoring trend from China to the US is something I never thought I’d see happen. But what started as a trickle, has turned into a river. The sheer amount of companies announcing withdrawal from China and plans to build plants in the US is just crazy.

The upshot is, this is going to really change the nature of America’s trade balance with the world, which is going to have major geopolitical repercussions in the years to come.

The downshot, is this potentially increases the risk of kinetic conflict between China and the US as the decreasing economic interdependence also loses its moderating influence.

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If you’re Xi Jinping, and you’re staring down the coming population collapse from the hangover of the one-child policy, and you’re seeing the prospects of America starting to reassert a manufacturing prowess, you might feel like you need to move fast if you’re going to seize Taiwan and get away with it. Because it might actually become increasingly difficult as time wears on. That’s the fear.

"Downshot"

If we build multiple foundries in the US, what do you think the likelihood is the US actually intervenes? I know those take time to construct but as time goes on it becomes less and less in our interest to assist.

I suspect there’ll be a lot more near-shoring too with the likes of Mexico and other Central and South American countries.

Agree. And that’s already happening.

I think Zeihan lays it out well (despite his views on bitcoin)

Also, people act like America has no manufacturing capacity to speak of. It seems like a poorly known fact, that America remains a strong #2 behind China in terms of the volume of manufactured goods. Given China’s demographic challenges, and the increasingly risky investment environment there, with Xi going down the Maoist route, it’s not even impossible to think of a future where America regains is crown as #1. I think America would have to liberalize immigration, among other things, to support that. But it’s no longer an impossible future.

Tell the people who believe that to take a flight to Vegas this week for ConExpo and talk to the exhibitors. Unbelievable amount being produced domestically.

I don't disagree with any of that. China is uninvestable now given the last few years. Too risky and there are a lot of cracks in the China model. I remain bullish on the US.

Ill let you know when I will see a made in U.S.A.

Plenty of things are made in the U.S.A.

Yeah but highly non competitive and ugly looking.

Except retro style things e.g. Harley, Zippo, or Coke or software, IP or things made under Japanese, Chinese or German supervision, Movies ofc. But not the things you meant.

https://www.nytimes.com/2011/06/26/business/global/26bridge.html

But its not the aggregate total, but individual pressure points like chips or rare minerals or specialized parts. I have seen some videos that break this down but never sure how accurate.

The rare earth metals issue is concerning. However, there are significant untapped deposits in the United States. In particular, there are known lithium veins in Nevada and Arizona. There’s additional exploration being done. North America is a very mineral rich continent. Canada has the second largest Uranium reserves behind Australia. There’s the beginnings of exploration for neodymium and such, as well.

While China has some advantages with much more developed mines and processing industry in some of these key areas, it’s not impossible and out of the question to develop substitute value chains in North America. Some of that is, as I said, already starting to happen.

Here is the video. Zeihan has some detractors but I think the data he presents in this is generally on point

https://www.youtube.com/watch?v=UA-jOLF2T4c&t=2163s

Went to high school with this guy!

Alright folks, let's talk about lithium mining in Nevada and Arizona. Yes, the glamorous topic of the day. I mean, forget about politics or celebrity gossip, let's dive into the fascinating world of mining.

Now, some people might think lithium mining sounds like a pretty niche topic, but let me tell you, it's a big deal. We need lithium for all sorts of things, from smartphones to electric cars. So, if you're one of those people who likes to tweet about how we need to save the planet, well, you better be grateful for the people digging up that lithium.

But let's be real, mining isn't exactly a glamorous job. I mean, when was the last time you saw a Hollywood movie where the hero was a miner? Never. They're always spies, or superheroes, or detectives. No one ever wants to be the miner.

And then you add in the fact that it's in the middle of the desert. I mean, I love a good road trip as much as the next guy, but driving through the desert in the middle of summer? No thank you.

I actually knew a guy who worked in a mine in Arizona. He said the only way he could survive the heat was by drinking gallons of water and wearing one of those cooling vests. And even then, he was still sweating buckets.

But you know what they say, no pain no gain. And in this case, the gain is not just a paycheck, but a piece of a sustainable future. So, let's give a round of applause to all the miners out there, sweating their butts off to make the world a better place. And if you ever come across a miner, don't forget to thank them for their service.

Automated mining is also going to be a thing in 10 years with AI and robotics. Mark my words.

#[5] 10 years

"when was the last time you saw a Hollywood movie where the hero was a miner? Never."

Naked miners in Chernobyl 😉

Armageddon.