Share this postEmerging Market SkepticChina & Hong Kong Stock Picks (March 2025)Copy linkFacebookEmailNotesMoreChina & Hong Kong Stock Picks (March 2025)Tariff Derangement Syndrome + DPC Dash, Haidilao, Nongfu Spring, Tuhu Car, AIA Group, Prudential PLC, WH Group, DFI Retail, CK Asset Holdings, Cathay Pacific, Hutchison Port Holdings Trust, etc.Apr 24, 2025∙ PaidShare this postEmerging Market SkepticChina & Hong Kong Stock Picks (March 2025)Copy linkFacebookEmailNotesMore1Share

Right-wing media often talks about Trump Derangement Syndrome (TDS) making people do destructive things; but now we have Tariff Derangement Syndrome causing entire countries to do the same:

First of all, everyone knows Nike et al branded products being sold for hundreds of dollars probably only cost a few dollars to $30 to make in foreign sweatshops factories. I remember this being widely protested by activists at university campuses in the late 1990s before they moved onto to new things to protest.

However and IF true, I am surprised that luxury European brands are being made in China as, well, I just assumed they are made in France, Italy, Switzerland, etc. That’s why I consider them to be luxury and so expensive. So it seems like Tariff Derangement Syndrome is causing the Chinese to do the most damage to European luxury goods makers - NOT [overpriced…] American branded goods makers…

[Note: Perhaps traditional European, Japanese and American craftsmen who are not outsourcing production to China will be well positioned to fill the hole the Chinese are blowing in the luxury and branded goods markets…]

However, the Chinese revealing all the “secrets” seems to be a game of mutually assured destruction. While the Chinese can try to cut out ALL the middlemen (aka the brands, etc.) and go direct to foreign customer (Temu and Shein has done this to a lesser extent), foreign post offices and delivery services (UPS, Fedex, DHL, etc.) don’t have to deliver the goods (or can be told to not deliver by foreign governments or get slapped with tariffs).

And I doubt many foreign customers are going to visit China just to do some shopping (and then get hit by customs duties when they fly back home on their suitcases full of goodies…)…

As for the western companies making their branded or luxury goods in China, if seeing these videos does not convince them to get out now and find alternative places to make them, I don’t know what else will…

Meanwhile, ZeroHedge has this piece with a number of useful tables or slides concerning Chinese stocks with US or Hong Kong listings who could face delisting in the USA: