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U.S. watching the economics of Xi Jinping's trip to Saudi Arabia

2016 G20 State Leaders Hangzhou Summit

Lintao Zhang/Getty Images News

Saudi Arabia is rolling out the red carpet for Chinese President Xi Jinping, who has arrived in the country for a four-day visit. Xi's plane was escorted by Saudi fighter jets on the way into Riyadh, while he

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"The U.S. shale industry has eliminated the need for a lot of Middle East oil,--- shale oil is in heavy decline...and escalating costs to get that last out of Tier 1 oil, so that is a thing of the past.
Six years ago if you check oil was 27$ a barrel so the Saudis put some marginal producers out of business and then raised the price to the 80$ area. We do not have a shortage only price fixing. If it was beef or dairy many would be in jail. How do you beat the Saudis?
153972 profile picture
The geopolitical world is dividing. There will be two spheres most likely. The US, Japan, W. Europe, India, Australia, Canada, S. Korea and Israel. The second sphere will be China, Russia, Iran, N. Korea and Venezuela. The global south will alternate between spheres depending upon world conditions and trade. For example, the global south in the main did not support in the UN the boycotting of Russian goods due to the invasion of Ukraine.

If you were a betting person, what side wins in 2050 in technology, military strength, cyber, soft power?

What side will have the reserve currency strength, ergo credit?

Xi has been back - footed on buying oil from OPEC +. He can buy from Venezuela, Russia and Iran in yuan but to date no other country wants yuan for oil.

The below link ascertains why.

@153972 who still wants dollar as reserve when US can cut you off just because and US can issue more and more dollars to plug the debt hole. People may not want Yuan but they should don't want dollar either. Perhaps gold.
obobooks profile picture
@153972 India is also making deals wwith Russia.
153972 profile picture
@typecheck Facts are troublesome things. There is no substitute for yankee dollar. No one in the West wants to assume the mantle as the reserve currency. Derivatives, options and trade are largely executed in treasuries for collateral or in eurodollars for trade. Even the Chinese when they enter currency swaps they have to put up treasuries as collateral.

Gold as a trade mechanism was disbanded largely in the 50s due to dollar's ease of transfer between nations and definitely in the Nixon Administration. A nation, company, etc., if it wants payment in gold has to put on plane or ship. Your idea of trade is 19th Century.
Rich in NJ profile picture
This is the price Biden has to pay for being an unwavering defender of democracy, especially after the insurrectionist and authoritarian wannabe who left the White House when he entered.
@Rich in NJ The unwavering defender of democracy who just directed teh courts to provide diplomatic immunity to MBS, contrary to his tall claims before the election?
Rich in NJ profile picture
@nstephen Take a deep breath. He is merely following the law as to the treatment of heads of government, which MBS is. As Dickens said in “Oliver Twist” the law is an ass, and sometimes it is.
@nstephen It's called realpolitik.
machicolation profile picture
"The U.S. shale industry has eliminated the need for a lot of Middle East oil"

Ugh, this is such a vague statement. Look at any supply and demand chart for US oil and you'll see US demand far exceeds shale and regular wellheads production. Also, what is "a lot"? Middle Eastern oil is not the only source from OPEC members.
The US is China's greatest Ally! We are the gift that keeps on giving! Whenever there's a gaff in our Foreign Policy China is there to pick up the pieces. It's not as technical as some makes it out to be. Oh I get it you have to make it sound technical to justify your jobs and to attempt to perform some measure of damage control to mitigate yet another loss on the International Chess Board. The truth is all China has to do is set back and wait for another U.S. Foreign Policy disaster that presents an opportunity to further there Sphere of influence.
Until you can affectively govern your own house don't attempt to try and set the standard for others in how to govern theirs.
Jan 6, BLM, Shouts for an open Race War, Former President who is a devout Racist as seen in the eyes of Foreign Leaders and a history of propping up Dictatorships in the ME; The Afghanistan shit show; enough said, I think you get the Picture!
Chancer profile picture
Xi gets red carpet. Biden gets slap in the face- well deserved.
Biden cannot keep his big mouth shut- with threats, and attacks.
Why should anyone cooperate with him?
After Biden's outrageous attacks on ALL Republicans, GOP House leaders should not even go to White House, if invited by Biden. Biden listed 20 items he will not negotiate on- nothing else to talk about.
SA and China have overlapping interests, and to an extent there exists some overlap with the US. All 3 desire stability in the region. However divergence occurs in how to achieve stability. The US wants free and open democracies, with a focus on human rights and wealth sharing. China and SA are opposed to Democracy, do not care about human rights, and work to concentrate wealth in the hands of the few and chosen. SA needed US military support to preserve their autocracy, and place as arbiter of a delicate balance among nations in the ME. The US is slowly receding in the area, as we pivot away from fossil fuel. China stands ready to supply the military and technological support we will withdraw, and China will not attempt to dictate political or social conditions in SA. Which influencing entity will be embraced, and which will be tolerated for as long as they are usefull ?
@john doe4944

Correct. I would add that it is very difficult to change suppliers of armaments. The components and munitions are not compatible. SA will stay with the US given their existing inventory. The US side must be concerned though that SA might share technology with the Chinese.
@john doe4944 Agree with the above. Additionally, not mentioned above, is the oil deal SA made recently with Russia as it threw "mud in the face" of Biden! The Saudis have sent a loud and clear message to the world; They are now officially aligned with the Communists and will continue to move forward with them! Biden and Congress should now clearly understand that!
As a nation, we have put our O & G industry ahead of our safety. We should have quickly dealt with the Saudis after 9/11 for aiding and financing Bin Laden, but we never did a thing and kept giving them weapons to support their regime. Time to change that.
@john doe4944 The master of US Israel needs the middle eat to be in chaos to feel safe, it's ridiculous to assert that US wants stability in the region.
Coup d'etats in Germany and Peru averted. Crazy Covid.
@Phil Dumfee Coup d'etats averted in Germany, Peru and the United States. Don't forget January 6 and Trump's ongoing shenanigans. The U.S. sees itself as a model for the world. Unfortunately, it has become the model for right wing plots and would be dictators.
China and Saudi Arabia are merely economic prostitutes for one another. They don’t give two $#its about the other. Whatever.
A dictatorship of communist party (China) is trying to displace the displace the dictatorship of Capital (US) and try to get as much oil from the dictatorship of Theology (Saudi Arabia) before it becomes worthless.

All the dictators may pose differently, but they all love money above anything else.
Chancer profile picture
@ding dong
Just like Biden who sent Hunter into the world to collect money for the Big Guy, Biden.
@Chancer Who got loans from and sold condo's to Russian mobsters - and married one of their daughters ?
3carmonte profile picture
Now, we are the pariah.
Another big blunder from the Democrats : Surely and slowly the MidEast is pivoting to Asia , much faster and deeper that the so-called Obama Pivot to Asia . As long as the democrats try to preach morality to autocrats the autocrats will have a big laugh ans rejoice . Saudi Arabia has already accepted to receive Chinese Yuan for its oil : This is a very deep shift away from the US $ hegemony . The USA " Divide et Impera " is not working anymore .
Chancer profile picture
Great- if that also sinks the US/EU worldwide climate change agenda. If they lack the common sense to stop their climate change folly, maybe a majority of the world will force failure.
machicolation profile picture
@trilliardo "Saudi Arabia has already accepted to receive Chinese Yuan for its oil" why is this so unreasonable?

Countries can trade with whoever they want. USA just needs to get on top of its lithium and semiconductor manufacturing on US terra firma and Saudi Arabia can drain its reserves until all they have left is sand and their ridiculous cities. China is an unstoppable juggernaught.
@machicolation It didn't work out very well for Saddam Hussein not accepting Dollars for oil. It might be different for the Saudis.
Mike Holt profile picture
China and Saudi Arabia are pursuing their shared interests, not a shared ideology. Ideology is an issue only to the extent that other countries have prioritized it over the pursuit of shared interests.

Saudi Arabia has oil that China needs, and is also located along strategically important transit routes for both Chinese exports to Europe and imports from Africa.

China has telecom equipment and infrastructure development capabilities that Saudi Arabia needs.
@Mike Holt

Nice try. The Saudi's can go to suppliers other than in China. MBS is getting even with Biden for condemnation for the assassination that MBS ordered. The US should not forget that most of those involved in 9/11 were Saudi citizens and were supported unofficially by persons in the Saudi government. Ideology is most definitely a factor in the relationship.
@LK106218 It is precisely this rigid, aggressive, and conspiratorial thinking that landed the states in hot water with Saudi. It is assuming the Saudi government or anyone in it intentionally helped terrorists attack us because you refuse to give any Muslim the benefit of the doubt.

Nevermind the endless list of reasons why that would be a bad idea for Saudi and it's wealthy elite. Nevermind the reality that if we just wanted oil from Saudi but knew that they for sure did 9/11 that we'd have easily just gone to war and taken over Saudi ourselves instead of battling Iraq. Clearly America wasn't afraid of war at the time.

All your kind of people here think about is how they are bad people for being Muslim and how you dislike and distrust them. That's really what this is about. You don't like their religion and always assume the worst of them in any situation. Biden was reflecting the attitude of the left when he kept harping about Kashoggi when he is just one irrelevant man and other leaders and presidents have either directly or indirectly killed WAY more innocents than that.

Saudi just doesn't need that from a country they've been good allies with for decades. China and Saudi share nothing in common in regards to ideology except maybe anti-lgbt stances and the desire for stability and peace within their borders.

There is no problem with Islam. There is no problem with Judaism. There is no problem with Christianity. The problem is with those individuals who corrupt those beliefs in pursuit of power. SA is not a problem. MBS is. Israel is not a problem. Netanyahu is. Russia is not a problem. Putin is.
We know what Kushner got but what exactly did he do for it during his time serving his father-in-law? The US must prevent crony capitalism rampant among the autocratic governments around Asia. Whether fist bumps or handshakes does not matter.
Saudi Arabia are better off dealing with China,than bunch of Western war monger's preachimg and lecturing the rest of the World. USA is run for benefit of Anglo Saxon race,rest of the races like Black.Hispanic and Asia are expandable asset to be used to preserve the Anglo Saxon status quo. USA are busy supplying oil their 5 eyes allies in Europe. Ordering rest of the World,not to buy Russian oil,typical selfish and self entitled Western Muppets
smallbedbug profile picture
@optimates 100% right...
LexiAlex profile picture
@optimates exactly right
@optimates Spot on.
I watched the "meet and greet" and noticed that there was something different happening. When THE BIG GUY limped into Saudi Arabia there was not red carpet available, so THE BIG GUY walked on the pavement of the runway. President Xi had the red carpet laid out in front of him to not soil his footwear as an assemblage of Saudi dignitaries, slightly bowing, and extending a hand to Xi. NO FIST BUMP HERE.
@kathyjoe1967 When you look like 80 using a walking aid, you'd be slightly bowing too!
ComputerBlue profile picture
The US increased their money supply massively over the last few years racked until record gdp to debt at the same time..there needs to be another option outside of the usd because others are tired of it so it appears.

The increase in M2 was prior to 2022. As with the US annual deficit that declined in 2022, so did the money supply.
ComputerBlue profile picture
@LK106218 ya that’s within the last few years..and m2 has barely dropped fred.stlouisfed.org/...

Thank you for acknowledging the clarification. The money supply and debt growth were mostly during the previous US administration.
SA naturally focuses on the relationship in terms of the economics. There is more than economics involved.

Biden has spoken about the competition between democracy and autocracy, rule by the many verses rule by the few. This competition in the way we are governed has existed since humanity settled into communities.

Autocracies are unstable. They persist through passivation or oppression. Their weakness is fundamental in handling the succession of power. There is an equivalent situation in business where a company outgrows the abilities of a founder. Musk is turning Twitter into the business equivalent of an autocracy.

Those countries that tend toward autocratic governance are drawn together. Saudi Arabia is one of those. China is one of those.

Months ago, I commented that it was time in the US for those born in the 1940's to turnover power and I was pleased to see Pelosi make the decision to withdraw from leadership. Contrast that with Putin or Xi or Khamenei or MBS who have gone as far as having opponents killed to gain and remain in power.

Again, there are business equivalents. Bill Gates gave up leadership of Microsoft which has done fine without him. Mark Zuckerberg continues to run Facebook which seems to be floundering. There are other examples of entrenched leadership in business, and it usually goes badly.
@LK106218 There are just as many examples if not more of companies with leaders coming in and leaving on a regular basis that are in death spirals. And usually the founders are nowhere to be seen. You're seeing what you want to see.

Sometimes a company is just doomed to fail. Twitter was already struggling, Facebook should have never been such a large company to begin with based on the value or lack thereof that it actually has in the world. Mark may be having a hard time, but he's trying to bring a real product to consumers instead of relying on some crusty website for boomers for another decade.

And to be sure, Microsoft has NUMEROUS cases of dire mismanagement across it's history since Bill left. It's just that it is hard to screw up something like Windows when Bill already managed to get everyone hooked on it.

You are getting to the heart of the matter. It is very difficult to remove out of touch autocrats or entrenched founders. Countries that are democracies and companies with diverse boards can remove inept leadership. That is the key difference.
@LK106218 does age matter? Old age doesn't stop biden from being a war monger. Younger leaders will be just as likely be as reckless.

When US government keeps insulting other world leaders, it's no surprise that they will gravitate together and form an alliance.

Having said that, Saudi is very much in US back pocket.
They have so much in common, representing some of the most oppressive regimes in this sad world led by two complete psychopaths
@Amstragram Saudi Arabia and China needs to be punished.
bet727 profile picture
@CL73 Childish comment! China is dominating everywhere except EU and US. BRICS will be the dominate world trade group.
mizesa profile picture
@CL73 Yes that is the opinion of the US as Hegemon. There is a worldwide "Rules Based Order" where we have made and impose the rules and all other countries must submit. Submit or get punished.

The opinion of the US is that our form of government must be imposed on all other nations at the barrel of a gun. Although that didn't work out so well in Vietnam, Iraq, Afghanistan, Syria, etc.

Regardless, American Exceptionalism is what we believe in and it is our job to save the world even if that means destroying it. We are superior and must transform the world into our image. Punishing those who believe anything differently is just part of that mission.

However, other countries are stubborn and will continue to say NO! Other countries will continue to say that they want to make their own rules and pursue their own goals and not be ruled over by the US. They will continue to say that they have the right to have an ideology other than American Exceptionalism.

So yes the US can attempt to "punish" them. However, that tends to backfire as it did in Vietnam and Afghanistan. Two very poor countries who simply refused to give up and who instead insisted on fighting back against US dominance no matter what the costs.

Before the US rushes to "punish" China and Saudi Arabia, much richer countries, perhaps they should first calculate the costs and the chance of success. The last thing we need is a war with them.

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