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Push for CHIPS Act subsidies ramps up ahead of Trump taking office

November 8, 2024
The Biden administration is working to complete CHIPS and Science Act agreements with multiple companies like Intel and Samsung. The administration hopes to finish up the initiative before President-elect Donald Trump returns to the White House.

The act, which stands for creating helpful incentives to produce semiconductors, provides incentives for chipmakers to set up manufacturing in the United States.

The chips are an important component for several products including electronics, vehicles, medical devices and defense systems.

Many in the tech industry are worried Trump’s reelection will have an impact on the revitalization of the semiconductor industry. However, some chips experts say Trump likely won’t roll back the act, despite the negative things he’s said about it.

“That chip deal is so bad,” Trump said on an episode of “The Joe Rogan Experience.” “We put up billions of dollars for rich companies to come in and borrow the money and build chip companies here.”

Both Democrats and Republicans supported Biden’s chips efforts in the U.S., so experts in the field say because of that support, it’s likely the policy would remain regardless of Trump being elected.

The Biden administration signed the bipartisan bill in 2022 committing $53 billion to boost U.S. competitiveness with China.

More than 20 companies are still in the process of negotiating, while others have wrapped up the contract process.

Chipmakers say they’re hoping to avoid renegotiating terms with a new administration.

The Trump campaign hasn’t commented on the CHIPS act since the election.
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Stock market soars to records on Trump election victory

November 6, 2024
The Trump trade is back on and bigger than ever. The stock market surged to record highs Wednesday morning, Nov. 6, on news former President Donald Trump is now president-elect.

The Dow Jones soared up 1,300 points, around 3%, to start the day. Trump Media, which trades like a meme stock on Trump’s political momentum, opened the day 30% higher.

Trump isnt the only one with the largest share of a public company seeing a spike.

“We have a new star. A star is born. Elon,” Trump said when celebrating his victory.

Tesla also got a big Trump bounce, popping about 13% to start the trading day. It’s expected CEO Elon Musk will play a big role in Trump’s administration.

“I will create a government efficiency commission tasked with conducting a complete financial and performance audit of the entire federal government and making recommendations for drastic reforms,” Trump said in September. “And Elon, because he’s not very busy, has agreed to head that task force.”

Musk spent over $100 million on Trump’s campaign through his America PAC. That included the million-dollar daily giveaways he issued through the campaign’s final weeks.

Musk posted on his social platform X, “America is a nation of builders. Soon, you will be free to build.”

The stock market bounce comes in part from the expectations the Trump administration will mean fewer regulations and lower taxes. Also riding Trump’s victory coattails is the dollar. It surged as other major currencies like the euro fell.

Like the dollar, cryptocurrencies are on the rise.

“We have the first Bitcoin president,” Anthony Pompliano told CNBC. “President Trump ran on a campaign point that he was going to protect Bitcoin, he was going to create a Bitcoin strategic reserve, and I think you saw Bitcoin’s price reflect having somebody who was so pro-Bitcoin win the White House.”

Bitcoin traded around $75,000 in the early morning hours.

Along with foreign currencies, other “losers” of the Trump trade are green energy companies and shipping companies.

The prime piece of his economic platform is tariffs, of which shipping companies could be on the losing end of a trade war.

Trump has said revenues from widespread tariffs will not only bring production back to the U.S. but also reduce the deficit, even as he pledges to cut tax revenues.

“It will be a certain tariff percentage, which will be higher than people had heard in the past, and we will be bringing in billions and billions of dollars, which will directly reduce our deficits,” Trump said in September.

The question as Trump’s new term comes into focus is how many of his campaign pledges will be fully realized, especially with certain advisers in play. When Trump raised tariffs on China during his first term, Elon Musk’s Tesla was one of thousands of companies to sue his administration.

This time around, Trump has said tariffs on China will be 60% or more. But China is very important to Tesla’s business. Will Musk’s influence lead to a softer stance?

“This is what I call the silly season. Lots of promises are made,” former Comptroller General David M. Walker told Straight Arrow News. “I think what’s more realistic is you could see selected imposition of tariffs on certain goods from certain countries in order to try to help level the playing field and in order to try to help promote more domestic jobs. But you’re not going to see, I think, across-the-board approaches, and you’re not going to see a fundamental shift away from our historical revenue sources, because the gap is just too great.”

For now, all independent analyses have to go on are those promises made, in which case, the right-of-center Tax Foundation says Trump’s collection of tax cuts and tariff increases will reduce the nation’s revenues by $3 trillion over the next decade.

To get a historical look at Trump’s proposal to replace the income tax with tariffs, click here.
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Japan buying more stealth missiles to deter China

November 6, 2024
Japan’s Air Self-Defense Force is getting pretty offensive. The JASDF flies a fleet of about 150 fifth-gen F-35 stealth fighters. Tokyo wants to ensure they’re properly armed, so it’s spending another $175 million or so to buy more Joint Strike Missiles.

The purchase marks Japan’s fifth order for JSMs since 2018. Norwegian-owned Kongsberg Defense and Aerospace designed the missiles. Kongsberg partners with Raytheon to build the JSMs, which are based on the already combat-proven Naval Strike Missile.

JSMs are stealthy, long-range, precision-guided standoff weapons designed to fit in the internal weapons bay of an F-35, thus maintaining the aircraft’s stealth capabilities as well.

Each JSM carries a 275-pound warhead, is accurate against targets on land or at sea and can hit moving targets thanks to advanced guidance and targeting systems that can even track a target automatically.

Like Naval Strike Missiles, Joint Strike Missiles use a low-altitude flight profile to avoid detection. Kongsberg said the JSM’s range is greater than 150 nautical miles, or just over 170 miles.

Because of that range, payload size and stealth characteristics, the Joint Strike Missile is considered a first-strike weapon. If Japan felt its security was imminently threatened, it may consider using these missiles to take out targets in China before Beijing has a chance to act.

China is acting ever more aggressively towards its neighbors in the Pacific.

In a nutshell, Taiwan wants independence. China doesn’t support this and may decide to invade and take the island by force, which could spark a regional conflict.

Japan doesn’t want this to happen, so it’s been heavily investing in its armed forces and has even changed some laws to make it easier to sell weapons to allies in the region.

The JASDF will be integral to heading off any Chinese aggression towards Tokyo. Japan has three air bases from which it operates its fleet of F-35As. The country owns approximately another 40 F-35Bs, which are designed for short takeoff and vertical landing from ships.

Japan recently drilled with the United States on these tactics using its new J.S. Kaga carrier, the second Japanese naval vessel capable of accommodating F-35Bs.

In a conflict, it can be assumed that these ships would operate near Japan.

F-35s have an operational range of around 1,000 miles before needing to refuel. The Nyutabaru Air Base, in southern Japan, is just 975 miles from Beijing, China’s capital.

The combination of fifth-gen stealth fighters armed with stealthy missiles makes it highly likely Japan’s jets could fly undetected just outside China’s airspace and target launchers, silos, trucks, shipyards, depots and more.

Japan isn’t the only U.S. partner in the Pacific with Joint Strike Missiles, either. Australia announced it’s buying some too and even plans to build a factory to build them. In fact, JSMs are in such high demand that Kongsberg is building another factory in Virginia to keep up.
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China’s Long March 9 rocket aims to rival SpaceX’s Starship

November 6, 2024
China has revealed a redesigned version of its Long March 9 rocket and the new design bears a striking resemblance to SpaceX’s Starship. This update was showcased earlier this week at an airshow in Zhuhai, signaling a major shift in China’s approach to reusable space technology.

The original design of the Long March 9 featured a three-stage configuration with solid rocket boosters. However, the new model transitions to a two-stage, fully reusable rocket.

The first stage is equipped with 30 YF-215 engines fueled by methane and liquid oxygen. Each engine provides 200 tons of thrust to the rocket. This design mirrors SpaceX’s Starship, which uses 33 methane-fueled Raptor engines, delivering 280 tons of thrust each.

The second stage also includes aerodynamic flaps similar to those on Starship, emphasizing reusability as a core feature.

China’s space agency plans to launch the redesigned Long March 9 by 2033. The rocket is expected to support long-term lunar exploration and settlement.

Earlier missions to the moon will use the more conventional Long March 10 rocket. The new reusable design is expected to enable sustained operations, particularly near the lunar south pole. Experts believe that region harbors valuable water ice.

The development of the Long March 9 reflects a strategic pivot by China’s space program, influenced by the success of SpaceX’s reusable technology.

Both nations are racing to secure leadership in lunar exploration. NASA currently maintains a lead through its partnership with SpaceX and its advancements in heavy-lift reusable technology.

As China advances its Long March 9 project, the ongoing space race between the U.S. and China intensifies. Both countries are eyeing the moon as a key step in shaping the future of human space exploration.
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US, Saudi Arabia discuss security agreement, excluding Israel: Report

November 5, 2024
The United States and Saudi Arabia are discussing a security agreement without Israeli involvement, according to Axios. Before the Oct. 7 Hamas attack, the U.S. and Saudi Arabia were attempting to broker a deal that would’ve secured peace between Saudi Arabia and Israel.

The Hamas terror attack shattered talks for the agreement. Saudi Crown Prince Mohammed bin Salman has said he wouldn’t recognize Israel without a Palestinian state.

This comes as the war between Israel and Hamas continues in Gaza, and as it continues for Israel and Hezbollah in Lebanon.

Saudi Arabia’s national security adviser visited the White House last week, Axios reported. He met U.S. National Security Adviser Jake Sullivan and Secretary of State Antony Blinken.

Their talks focused on strengthening relations between the two countries. They hoped to get security, technology and economic agreements signed before President Biden leaves office in January.

Those familiar told Axios the goal is to create a bilateral U.S.-Saudi security agreement. This would be similar to those recently signed by Biden with other Gulf countries.

Those agreements have reinforced U.S. presence in the region. The White House has attempted to counter the expanding influence of Russia and China in the Gulf region.
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- No recognition of Israel without Palestinian state: Saudi crown prince
- Saudi Arabia constructing largest tower in world, size of 20 Empire State Buildings
FBI sets up 24/7 National Election Command Post to handle security threats

November 5, 2024
The FBI has established a 24/7 National Election Command Post in Washington, D.C., to address any threats that may arise before and after Election Day. This weeklong effort brings together over a dozen federal agencies and roughly 80 personnel per shift to monitor for federal election crimes, cyber threats, foreign interference and domestic terrorism risks.

The FBI’s Election Command Post is based in the Strategic Information and Operations Center at FBI headquarters. Agents and officials are prepared to respond to threats as results come in.

Agencies supporting this operation include the Department of Justice, Department of Homeland Security, U.S. Capitol Police and the U.S. Secret Service, among others.

Each of the FBI’s 55 field offices are also operating local command posts. The offices are working closely with state and local election officials to pass on relevant tips and complaints.

James Barnacle is the deputy assistant director of the Criminal Investigative Division of the FBI. He said they’re prepared for the election.

“We feel like we’re well positioned to handle and triage information that comes in. We have the people in place,” Barnacle said.

The NECP’s mission is to protect the election process from potential disruptions while ensuring that information flows swiftly between federal, state and local partners.

This multiagency effort will continue through at least Nov. 9, handling all significant complaints and any incidents that could impact election integrity.
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Chinese solar manufacturers shift operations to bypass US tariffs

November 4, 2024
Chinese solar panel manufacturers have a strategy for circumventing U.S. trade restrictions, responding to new tariffs by relocating production facilities to countries less affected by American policies. This shift has impacted the solar industry in Southeast Asia, following the U.S. Commerce Department’s implementation of duties reaching as high as nearly 300% that are targeted at Chinese-owned factories in the region.

In recent months, some of the largest Chinese-owned solar factories in Vietnam have reduced production and cut their workforce, as these facilities fall under the scope of the newly imposed duties.

As part of their response, Beijing-backed solar companies are relocating their operations to nearby countries like Indonesia and Laos. New factories are quickly being constructed in these nations, with their combined production capacity is anticipated to equal around half of the solar panels installed in the U.S. last year.

The U.S. government has implemented these trade measures amid concerns that Chinese solar companies benefit from subsidies provided by the Chinese Communist Party. American officials argue this enable these companies to offer solar products at artificially lower prices, undercutting manufacturers from other countries.

However, Chinese companies had been anticipating potential restrictions on their Vietnamese facilities and had already decreased their operations in the country prior to the tariffs’ introduction. However, those companies worked to get ahead of the announcement by frontloading exports to the U.S. beforehand.

In the lead-up to the new trade regulations, solar shipments from Vietnamese plants to the U.S. saw a significant increase, with shipments up by nearly 74% through August.

Now that the U.S. is working to cut down on Chinese-produced solar imports from Vietnam, solar panel exports from Indonesia and Laos to the U.S. are starting to grow. Indonesia’s solar exports to the U.S. nearly doubled to $246 million, while American solar imports from Laos, which were virtually non-existent last year, have reached a value of approximately $48 million.

Looking ahead, Chinese solar manufacturers are already planning their next move. A recently signed agreement worth almost $1 billion with Saudi Arabia will see Chinese companies establish a new solar plant in the region. Meanwhile, in the U.S., Chinese firms are working to take advantage of renewable energy incentives from the Biden administration, with a stake in about 20% of the American solar facilities announced since the introduction of those subsidies.
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US winning in one category when it comes to space race with China

November 4, 2024
The United States and China have ambitious plans for space exploration in the future. In order to achieve these goals, both nations will need to lean heavily on international support, and as reported on Wednesday, Oct. 30, the U.S. has taken the lead over Beijing.

The two adversaries are getting as many nations on board with their plans to explore space as they can. The American-led effort known as NASA’s Artemis program aims to send astronauts back to the moon by 2026. However the ultimate goal is building a lunar space station and launching missions to Mars and beyond.

Meanwhile, China plans to build an International Lunar Research Station with phase one expected to be completed by 2035.

However, the United States is currently notching more wins with Chile, the Dominican Republic, Estonia and Cyprus recently joining its coalition. The U.S. now has 47 nations working together on the mission.

Beijing is behind the U.S. in that respect, touting 13 nations as members of its international agreement with Senegal the latest to join in September. However, experts note, there are still many countries up for grabs to join each country’s respective partnerships.

NASA’s Deputy Administrator Pam Melroy said despite setbacks with the Artemis program, like being overbudget, the diplomatic efforts will continue. The agency sees diplomacy and international cooperation as the key to the future of space exploration.
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China furious US approved NASAMS sale to Taiwan

November 1, 2024
Taiwan is getting the same air defense system that protects Washington D.C., and China is none too pleased about it. The U.S. State Department approved the sale in late October of three National Advanced Surface-to-Air Missile Systems, also known as NASAMS, to Taiwan.

The $2 billion deal includes the supporting equipment for the three NASAMS, a host of radars and early-warning detection systems, and 123 AMRAAM-ERs, or Advanced Medium Range Air-to-Air Missiles-Extended Range.

Those AMRAAM-ERs have a published range of at least 40 kilometers, or just under 25 miles. It’s not the type of system Taipei could use to attack Beijing, but NASAMS are great at downing helicopters, jets, drones and cruise missiles.

The AMRAAM-ER was originally designed to be air-launched, like the other missiles employed by the NASAMS. But the system takes those same weapons and converts them into ground-launched interceptors. As a result, the launchers can be pre-positioned for around-the-clock protection. They can be placed close together or far apart, depending on the need, and are controlled remotely by a fire distribution center.

NASAMS were developed by Raytheon and Kongsberg around 30 years ago, but they were designed to keep up with current technologies. In addition to AMRAAM and AMRAAM-ERs, the launchers can also fire the AIM-9X Sidewinder, a highly maneuverable missile which tracks a target’s heat signature and is designed for close-in encounters.

While the NASAMS sale didn’t include any Sidewinders, it is the 17th arms sale under the Biden administration to Taiwan, and one of those sales from last year did include 100 Sidewinders.

Back to the launchers: NASAMS are made to work well with other systems and integrate seamlessly into established air-defense networks. Thirteen nations currently use NASAMS to protect their most vital assets and facilities, like the White House and U.S. Capitol. NASAMS are easily one of the most battle-tested air defense systems available today.

Taiwan first requested them back in 2022, but because the U.S. partnered with Norway to build NASAMS, the Norwegians—and NATO—had to sign off on the deal. They did, and in doing so, sent a clear signal that the military alliance is keeping an eye on what happens in the Pacific.

China continues to make claims to territories it doesn’t own or no longer controls, like fishing grounds around the Philippines and the Island of Taiwan.

So, what does it all mean? The Taiwanese are getting a top-tier air defense system to protect their most critical facilities. This is strictly a defensive system, designed to counter most, if not all, of the weapons the People’s Liberation Army Rocket Force—or PLAARF—would use if Beijing decides it wants to try and take Taiwan.

This isn’t sitting well with China. Its Foreign Ministry denounced the sale of NASAMS to Taiwan, saying China would take “resolute countermeasures and take all measures necessary to firmly defend national sovereignty, security, and territorial integrity.”

No one is really sure what that would look like at this point, since again, NASAMS are defensive weapons, which means the only way China would be impacted by them is if they attack Taiwan.
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What Apple’s big iPhone surge in China tells us about China relations

October 31, 2024
Apple is expected to see its biggest revenue jump in two years when it releases quarterly earnings on Thursday, Oct. 31. While there will be a lot of talk about the state of Apple Intelligence, its iPhone sales are currently boosting the bottom line.

In the three weeks following the iPhone 16’s release, sales in China were 20% higher than sales for the iPhone 15 the prior year, according to Counterpoint. Customers are increasingly trading up to the more expensive models.

In China, the increase in sales could have less to do with the quality of the phone and more to do with the company’s current standing in the nation.

“Apple works with 1,600 factories in China, and they’re very much deeply embedded, not just to get access to the excellent production that the Chinese factories do, but also in terms of really embedding what we call tacit knowledge into those Chinese factories,” Doug Guthrie, executive director and professor of global management at Arizona State University said.

Guthrie previously worked with Apple advising executives in China.

“It’s very clear that Tim Cook and the executive team really continue to be committed to the idea that Apple’s married to China,” Guthrie said.

Last year, Chinese government agencies banned workers from bringing iPhones to work, instructing employees to carry local brands. The move quickly damaged Apple’s stock and sales of the iPhone dipped to third in the country.

“In China, people buy what products are promoted by the government,” he added. “And so my guess is that this is a signal that Apple’s doing things right and in good space with the government right now.”

The recent uptick in sales has now pushed the iPhone into second place in smartphone sales in the Chinese market, according to IDC.

Overall, Apple’s revenue is expected to grow 5.7% in the fiscal fourth quarter, according to data from LSEG.

While Apple is getting a boost from sales in China, the company is reportedly attempting to reduce its reliance on the nation for manufacturing of the devices.

The company exported $6 billion worth of Indian-made iPhones between March and September, according to Bloomberg. The increase marks a 33% jump from the same period last year.

“India is a country that is equal in size in terms of its population and has equal size of migrant labor population and poor people,” Guthrie said. “So India is a real interesting threat. When Foxconn built a plant in Chennai and suddenly iPhones could be assembled in Chennai, I think it was a signal to the market, ‘Yes, we’re married to China, but we have other options now.’”

Still, Guthrie points to those 1,600 suppliers Apple relies on in China. He said it would take India three decades to build supply chain infrastructure to mirror what exists in China.

Replacing China’s place in the manufacturing chain would be a lengthy and lofty goal. At the same time, Guthrie says t he resolution of a border dispute between China and India at the BRICS Summit is a signal that the two nations could be working in tandem into the future.

“Maybe this is a moment where there’s a big pivot away from the West. And Xi Jinping and [Narendra] Modi and others are thinking, ‘Okay, you guys can do your G7 thing over there, and we can be at the kids’ table at the G20, but we’re BRICS and it’s bigger than you thought,’” Guthrie said. “And so I think it’s a really interesting time to watch this because my guess is what we’re going to see is more collaboration and coordination between China and India.”
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