America Attacks China (and TikTok too...)

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Over 4 years ago, Trump led his fans on an assault against TikTok, claiming it to be a tool of the Chinese Communist Party, used to spy on American citizens, and influence American politics and ideology.

This escalated to legal action from the American government directed at ByteDance, the parent company of TikTok.

ByteDance was shaken by this development, and announced it was happy to look for alternatives, and that selling TikTok to an American company would be acceptable.

But as we all know, Trump did not remain in power, and Covid overshadowed the following few years.

Now Biden reigns (apparently…) and his administration and many other politicians as well, have announced that its their turn to attack ByteDance and TikTok for the exact same reason Trump did those years past.

Only this time, ByteDance have announced that they would rather shut down their US operation altogether, and that a sale would not be allowed by the Chinese Communist Party.

“If you get rid of TikTok, Facebook and Zuckerschmuck will double their business,” Trump said. “I don’t want Facebook, who cheated in the last Election, doing better. They are a true Enemy of the People!”

While Trump has just announced his change of heart, that a ban to a Communist owned social media app would be un-American, the likelihood remains that the vast majority of American politicians support this move, they just might not support the President that could get positive press.

As a result, a ban, or at least an attack on ByteDance and TikTok from the US government seems incredibly likely no matter who wins the upcoming Presidential election.

The really interesting question no one seems to be asking, is what will ByteDance do about it?

A divesture from TikTok would be catastrophic for the company, which is entirely built around TikTok, but equally a loss of the American demographic would damage their user numbers, but devastate their revenues as American’s are by far the wealthiest and most product consumer base in the world.

Companies like Facebook and Snapchat, which are American through and through, would stand to benefit hugely from a TikTok ban, as those phone addicted American’s aren’t going to give up their swiping, they will simply move to a different platform.

And last but not least, we must consider what a move like this would mean for other Chinese companies, and more important, the investments many of this emails readers might have in Chinese companies.

China has for a long time been revered as a brilliant market to grow a business in, due to the nature of how large a domestic business can become.

But China is no longer a growing country, its population is shrinking by the day, and its incredibly likely the country will fall into “the middle income trap” and fail to become a developed country altogether.

For Chinese investors, they have begun dreaming of Chinese international expansion, and ByteDance and TikTok paved the way for these aspirations. But with the New Cold War brewing, and the United States taking more and more shots at China by the day, Chinese investments are likely to be struggling long into the future.

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