News, of some importance, no need to panic, yet
Not until “Lights Out”, 8th November, 2025, unless Team China bends the knee, admit wrong, or some other process kicks in and saves the Nasdaq day
meaninginhistory.substack.com
China Playing Hardball
Mark Wauck
With trade talks upcoming between China and the US, China is sending a message.
Arnaud Bertrand @RnaudBertrand?
This really isn’t getting enough attention. China has truly gone all in on export controls today, in a major way.
Not only did they announce the unprecedented rare earths restrictions that I posted about earlier ? (targeted, among others, at the advanced semiconductors sector) but they issued 4 consecutive announcements in total with other export controls on:
- The machines and expertise to process rare earths - not just the rare earths themselves, but all the specialized equipment and technical know-how to turn rare earth into usable materials (obviously making it all the harder to try to move rare earth processing away from China)
- High-performance batteries - specifically those above 300 Wh/kg needed for long-range EVs and advanced drones. And, again, export controls on all the factory equipment to make them too.
- The materials inside batteries - both graphite anodes and cathode materials (the two electrodes that are essential for batteries to function at all). Export controls also cover the specialized equipment to manufacture all of these components.
- Industrial diamonds and cutting tools - the ultra-hard materials that are used ubiquitously in precision manufacturing, for instance to cut silicon wafers for computer chips
This is absolutely unprecedented. With this China effectively gets veto power over three critical supply chains simultaneously: advanced semiconductors (via rare earths and related equipment), battery-powered vehicles and drones, and precision manufacturing across industries (via superhard materials).
It will all officially take effect on November 8, in one month.
The official explanation(https://mofcom.gov.cn/syxwfb/art/2025/art_9ef35b6a69f24e61a8cbd63ed0a42d16.html…) is to prevent “dual use” and “safeguard national security”, incidentally the same official explanation the US gave for its own chip export controls to China. As Mao once said: “our method is to learn warfare through warfare”... Or you could also say what goes around comes around...
Here you can find all the announcements collated in a Guancha article (in Chinese). It’s very, very extensive: guancha.cn…
Arnaud Bertrand @RnaudBertrand?
This is actually big, potentially huge,notably because China’s new rare earth export controls include a provision (point 4 here: mofcom.gov.cn…) whereby anyone using rare earths to develop advanced semiconductors (defined as 14nm-and-below) will require case-by-case approval.
Which effectively gives China de-facto veto power over the entire advanced semi-conductor supply chain as rare earths are used at critical steps throughout - from ASML (who use rare earths for magnets in their lithography machines: asml.com…) to TSMC.
The export controls are also extra-territorial: foreign entities must obtain Chinese export licenses before re-exporting products manufactured abroad if they contain Chinese rare earth materials comprising 0.1% or more of the product’s value.
So China is effectively mirroring the US semiconductor export controls that were used against them, with its own comprehensive extraterritorial control regime, except with rare earths.
?Arnaud Bertrand @RnaudBertrand?
“If enforced aggressively, this policy could mean “lights out” for the US AI boom”
?@zzbar?
China delayed this action until now, indicating that it’s on the brink of achieving total self-reliance in advanced semiconductors, or that China is confident that it can attain self-sufficiency in advanced semiconductors before the US can achieve self-sufficiency in rare earth.
So China has shifted its agricultural imports from the US to Brazil and is now tightening the screws on the US high tech sector. Now, this is well above my pay grade, but if you follow the link you can read up on possible counter measures the US could take:
Dean W. Ball @deanwball?
This is a very big deal. China has asserted sweeping control over the entire global semiconductor supply chain, putting export license requirements on all rare earths used to manufacture advanced chips. If enforced aggressively, this policy could mean “lights out” for the US AI boom, and likely lead to a recession/economic crisis in the US in the short term.
Some thoughts and recommendations:
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