Mm-hmm.

And the reality here is the fact that the, after a, you know, series of hearings and investigation, they landed on such a one-sided report would highlight where a lot of Congress sits right now on this issue.

And I think, you know, this is incredibly problematic for the alliance because a lot of work has been done by those in government and in business over the past decade to change the impression of Korea, to highlight the innovation of Korean businesses, the essential nature of those businesses to the US economy, and the future of US tech advancement, right? And under the, in the Biden administration, the, the narrative was, "Look at all these companies investing in the United States," right? "Look at this collaboration between Samsung, LG, SK, and, and American companies." But here we see that shifting, and particularly on the Hill, where many people don't have a very detailed understanding of Korea and what Korea is and what Korean business is, and instead are getting these, these little tidbits of negative storytelling.

Uh, and, you know, to be fair to, uh, those who have been pushing back against Korean actions- You know, some of the tactics that the Korean government has used, particularly the, the liberal use of potential criminal prosecution, um, raids on facilities and, and long questioning, are, are easy for folks to take issue with.

Uh, and you know, the problem though is, is not so much, you know, the Hill is a problem, but the, the issue also is that that is also fleeting over to the administration itself.

And we've heard comments, uh, from the White House after this report was issued, but other times from, uh, USTR Greer and others that, that have a similar approach and, and raise real questions about where we're going in this relationship and whether or not this one issue, which seems so small in the context of the overall alliance, might actually become a major headache, uh, for both sides, uh, on the trade issue, but maybe across broader alliance issues as well.

So in a sense, Korea's made its strategic choice, right? So, you know, how do they, how, how do, how should we think about that, that, that combination of things?

I, I think it's completely fair to say that, that Korea has made a strategic choice over the last decades, I mean, since its modern founding, um, in its relationship with the United States and prioritizing that through some very tough times at, at, at different points in our history.

What does that mean? Are we expecting to see more casualties, the reality of war?

I, I think that's certainly possible, and what we saw over the weekend is a natural outcome of this escalation we've seen since the return to conflict as the MOU and the ceasefire collapsed.

The Iranians are taking this moment to show that they still have reach, that they still have missiles that can, they can hit targets well beyond just the Gulf and, in the case of these service members, US operating areas in Jordan.

And, you know, when we talk about this escalatory spiral, what we're, we're really seeing now is that both sides are actually responding to the other's hits, not looking at their own strategic outcomes as much.

You know, the president came out yesterday and said that he would...

the United States would strike back every time a US service member dies.

Are you saying they're looking at what's happening with Iran and the way Iran's been able to leverage the Strait of Hormuz and saying, "Great, we're gonna do that, too"?

Actually, it looks like the Houthis are kind of getting dragged into this conflict.

of control

mind.

And that definitely was my experience.

you know, back in the corporate days, you know, I'm working on these multiple projects and multiple time zones, getting up every day, just thinking, right, I'll do a bit of meditation and then I'll get on sorting all of these completely out of control projects with this increasingly out of control mind.

And I guess for me, it was more like when any one of us starts to turn to our inner life, And we start to move in that direction of seeing first the potential we all have.

I just think this is so extraordinary to Buddhism.

We call it Buddha nature, a Buddha seed that everyone has this incredible potential within them for love and compassion and wisdom.

Is that still a part of your experience? And if it is, can you just tell me how, I guess, this wider experience of life and process helps you even navigate that scenario? Yeah.

And we don't have a sense of whether Iran is on board with this note, do

we? No, not at all.

And I think, you know, we have to take a step back and think about what we know and what we're kind of inferring, right? It does appear clear from the messages and the tone on both sides in Iran and in Washington that we're moving closer towards some form of agreement.

And it does look like some sort of temporary step or interim agreement that leads to the actual negotiations, right? We've separated these negotiations.

But at the same time, we've also been here before.

In fact, just last Friday, when the president was talking about a deal imminently coming, and yet here we are a week later, and we still don't have that.

And the core issues that the president theoretically went to war over don't seem any closer to resolution, right? This question of Iranian enrichment and the disposition of this highly enriched uranium, which, if the deal moves forward as we're seeing right now, would actually push that negotiation off further.

I mean, is Oman still an ally?

Adam, what do you think?

So I think the...

The premise that the United States needs an assertive policy on North Korea is essential here.

I think that to me is the biggest take.

And I look forward to discussing the specifics of Victor's proposal, which I think has a lot of validity.

But the biggest issue I see right now and moving forward is this idea that if we just close our eyes and look away, North Korea will stop being a problem.

And I think there is a lack of recognition that when things are quiet, that's actually the time we need to be pushing forward, where we need to be trying to move forward on our broader policy objectives of limiting the risks in the region.

So that there's enough overlap that maybe they don't reject it out of hand.

What's the scuttlebutt in the Bloomberg room? Are you guys all just like, "What business is struggling today?" You know what I mean? The o- I'm sure the oil corner of the room is, uh, looking at a bunch of millionaires, but for everyone else, how are you looking at this economic divide that's facing the fallout?

So, uh, uh, in the US, right, where what we're seeing is really this price shock, and this question of how high can it go? Our initial estimates actually saw oil at a much higher ri- rate right now, after two months of closure, and that speaks to both the ways in which the Saudis and the UAE have been getting around the blockade via their pipelines, but also kind of, uh, some under, uh, underpricing in the market of the, the vast supply shock that may be coming towards the United States and other parts of the world.

And, you know, while in the United States that's limited, you know, right now to prices and increasingly in inflation, other parts of the world are really starting to see supply shocks.

And, and-

What is your response to what she's saying, that gas prices matter and that this president doesn't seem to understand that?

Well, I would just say this, Audie.

I, I agree.

Gas prices do matter.

So that kind of setting the stage, what might these more targeted attacks look like if we do go that direction?

So it's clear from what we're seeing and what we're hearing from the president and this reporting that there's a clear focus on the Strait of Hormuz as the primary locus, uh, moving forward, and this idea that the US needs to leverage continued capability to degrade Iran's still present, uh, naval and ground forces that continue to threaten the movement of oil and other, uh, key goods out of the Strait of Hormuz.

And what it says for all of us is that despite now better part of five-plus weeks of bombing of the, of Iran that has destroyed a huge portion of its standing military, it remains capable of inflicting enough damage to close the strait and maintain its deterrent capability there.

And so what it, it continues to show that the president is worried about this.

And despite his assurances that the, the time is on the US side, that they're planning for how they can try and increase their capability to destroy the Iran- the remaining Iranian forces and hopefully both restart oil supply and, in their mind, push Iran back to the negotiating table.

Um, is that escalatory? Is that expected? What do you make of, of those developments?

So I, I think what it highlights again [laughs] is that we're, we stay in this kind of broader sense of uncertainty about the overall state of the war.

You know, while we're in this fragile ceasefire, we also have these dueling blockades that by any measure are, are generally seen as acts of war.

If the US keeps the blockade in place, but Iran says, "We will not negotiate until the blockade is not in place," then where does this leave room for a deal to be reached?

There's simply no question that we have a chicken or egg problem here, and it remains very much unclear what is driving, you know, Iran's position, uh, moving forward, right? I mean, just today it was said very clearly from the foreign minister that they see the US blockade as an act of war and a violation of the ceasefire.

And so, you know, while the president obviously has come out already here and said that he plans to extend it, you know, in, in some extent for quite some time, uh, without putting a deadline on it this time, there is a, you know, another party involved here, and the Iranians get a vote.

And with the United States taking increasing actions to seize Iranian vessels, uh, the, there is this question of whether and how Iran will respond.

After the, the action over the weekend that saw the disablement and seizure of an Iranian cargo ship, Iran explicitly said that they would retaliate, although we haven't seen that as of yet.

So right now we, we don't know how Iran will, will read the US actions and how long we really are looking at calm.

On the China portion of this that we just heard from, from Terry Haines over at Pangea Policy, where, where is, where is China in this, and can China play a role in actually ending this conflict?

So China can certainly play a role, right? They're, they have, uh, very strong relations with Iran and, uh, the Gulf States as well, and, and honestly, the relationship with the Gulf States being arguably more important for China in the long term.

If the US keeps the blockade in place, but Iran says, "We will not negotiate until the blockade is not in place," then where does this leave room for a deal to be reached?

There's simply no question that we have a chicken or egg problem here, and it remains very much unclear what is driving, you know, Iran's position, uh, moving forward, right? I mean, just today it was said very clearly from the foreign minister that they see the US blockade as an act of war and a violation of the ceasefire.

And so, you know, while the president obviously has come out already here and said that he plans to extend it, you know, in, in to some extent for quite some time, uh, without putting a deadline on it this time, there is a, you know, another party involved here, and the Iranians get a vote.

And with the United States taking increasing actions to seize Iranian vessels, uh, the, there is this question of whether and how Iran will respond.

After the, the action over the weekend that saw the disablement and seizure of an Iranian cargo ship, Iran explicitly said that they would retaliate, although we haven't seen that as of yet.

So right now we, we don't know how Iran will, will read the US actions and how long we really are looking at calm.

On the China portion of this that we just heard from, from Terry Haynes over at Pangea Policy, where, where is, where is China in this, and can China play a role in actually ending this conflict?

So China can certainly play a role, right? They're, they have, uh, very strong relations with Iran and, uh, the Gulf States as well and, and honestly, the relationship with the Gulf States being arguably more important for China in the long term.

For now, though, China has the opportunity to leverage the situation to its benefit." So just give us a sense of how you reached that conclusion, and then we'll, we'll do some unpacking.

Of course.

So I think you set it up well in the intro.

There's no doubt that Beijing does not look kindly on the instability growing in the region right now.

While they certainly have, I'm sure, some happiness in seeing the United States strategically dragged into another war in the Middle East that distracts them potentially from the Indo-Pacific, as we'll talk a little bit about more, they're also just very worried about the long-term potential for the, the Gulf to remain unstable for oil supplies to be infrequent and to put stress on the economy at a time when, uh, things are positive on the export side, but still struggling domestically, uh, when with consumption not, you know, reaching the levels that they need to maintain the demand necessary for the amount of production they're doing internally.

But at the same time, there's no doubt that there are real opportunities for Beijing in this moment, and we can kind of look at that through three different lenses.

The first is diplomatic.

When people talk about this having, in some sense, lowered the bar for China to flex its muscles more than it already does militarily in Asia, i-is that a real prospect from this? Because you've identified mainly diplomatic advantages.

But how do you read that decision and, I guess, more generally, the way the China policy is described in this document?

document?So I think up front, it's fair to say that it was a big decision and a surprise decision by the president to allow the H200 chips to be sold, and certainly there is big pushback (laughs) as Shaun said from the national security establishment and those in the tech side of things in the United States who really worry about the loss of US leadership in these key arenas and particularly in the AI race.

It is fair to say the H200 is both not the highest level chip, as you said, it's not Blackwell chips, but at the same time, it would be the most advanced chip that would have ever been sold to China.

So, I think what's intriguing there, as Shaun alluded to, is the fact that this does not seem to align with the policy, even the very general policy put out in this document that labels China as the United States' key economic competitor, and then goes on to actually try and lay out a plan for bringing other partners and allies together to push back on Chinese economic dominance.

Uh, something that I think explicitly the administration is not doing right now.

The document seems to be a moment in time that is far more correlated with the beginning of the administration when many thought the China hawks and the approach that Trump had at the end of his first administration would maintain, and that's not what we're seeing today.

And really, again, it- I think it raises real questions about the value of this document and whether or not we should take it at its word as to how the administration plans to move forward.

You just want to have that t- 'cause you, and you don't really mind that there's a big non-democracy that's gonna get more and more powerful as long as the US is continuing to lead and continuing to be the country that other countries have to buy their tech from.

How would you characterize the US economic and diplomatic strategy here in Asia? I mean, it seems as if it's changing the region and diplomacy and relationships dramatically.

Well, the last part is certainly true.

I think it is helpful, though, to remind ourselves that trade has been an increasingly complicated issue for US efforts and diplomatic efforts in the Indo-Pacific, and that's not new to the Trump administration.

Even in the Biden administration, which set out a very clear policy objective in the Indo-Pacific, basically putting allies and partners first, seeking to compete with China where it was necessary, but cooperate where possible.

Even there, because of kind of this shifting and growing economic nationalism that we saw in the United States and, you know, across the globe, y- Biden administration was unable to move forward with any substantive trade agenda throughout all four years of its administration.

There were efforts, lots of efforts from countries in the region to try and convince the United States to rejoin the Trans-Pacific Partnership, a trading agreement that had actually been built very much by the, the Obama administration.

But that was completely off the table.

What do you think China was trying to signal through these engagements?