Image Source: Pixabay
 

The Busan summit was supposed to symbolize economic reconciliation between the world's two largest powers. The White House spoke of a “historic agreement”; the American media repeated the term “agreement” without mentioning that no text had been signed. Everything was based on verbal promises and a carefully calibrated staging.

Beijing, for its part, has not issued any official confirmation: neither MOFCOM, nor the People's Bank, nor even COFCO, the state agency responsible for agricultural imports, have echoed the commitments mentioned by Washington. The only trace of the alleged “deal” remains an American press release touting concessions that, on the Chinese side, do not exist anywhere in the official records.

The agricultural component was supposed to be the showcase for this new relationship: 12 million tons of American soybeans by the end of 2025, then 25 million per year until 2028. For a few days, the markets believed it. Soybean prices rebounded, Midwest traders welcomed a return of Chinese demand, and Trump spoke of a total victory for American farmers. But reality quickly set in. After a single shipment in early November, Chinese purchases ceased. No new orders have been recorded since, and volumes have fallen to zero in less than two weeks. As is often the case, Beijing let Washington congratulate itself before turning off the tap.

On critical metals, the communication was just as misleading. Trump announced the lifting of Chinese restrictions on rare earths; however, China never lifted anything. It simply implemented a new system, inspired by US practices: the Validated End-User system. This mechanism distinguishes between civilian companies authorized to import rare earths, magnets, or strategic alloys, and those linked to the US military-industrial complex, which are now excluded. In practice, Tesla, Apple, and Boeing (civilian version) can continue to source supplies, while Lockheed Martin, Raytheon, Northrop, and SpaceX Defense have their flows blocked. Beijing is respecting the letter of its promise — to facilitate exports — while changing its spirit: it delivers, but only to those it chooses.

At the same time, China has tightened controls on other strategic metals. On October 30, MOFCOM issued Circular 2025-68 regulating exports of tungsten, antimony, and silver for 2026-2027. Officially, the aim is to “protect resources and the environment.” In reality, these new rules impose a state authorization regime on exporting companies, allowing Beijing to decide, on a case-by-case basis, the volumes and recipients. Silver, used in electronics and solar panels, thus joins the list of metals considered strategic. China is not closing its borders: it is choosing its customers.

While Trump trumpeted the resumption of trade, Beijing signed a 400 billion yuan monetary agreement with South Korea and a five-year industrial cooperation plan. Once again, the contrast is striking: on the one hand, an American “deal” without a text; on the other, a concrete Asian partnership, signed, quantified, and published. This was the real reason for Xi Jinping's trip to Korea: to strengthen yuan settlement channels and accelerate regional financial integration, while Washington indulges in diplomatic illusions.

Two weeks after Busan, all that remains is an empty backdrop: broken promises, frozen agricultural flows, a filtering system for rare earths, and new restrictions on critical metals. The markets bought into a photo op, commentators reported a truce without a text, and American soybeans are still waiting for buyers. In reality, China is pursuing its strategy of selective decoupling: it is maintaining control over technology chains, securing its resources, and making no irreversible concessions. Washington announced an agreement; Beijing signed rules.

Trump has undoubtedly realized that his 100% tariffs on Chinese imports, brandished as an electoral weapon, were beginning to directly harm the US economy. Local businesses, already weakened by rising financing costs, feared the inflationary impact of further tariff increases on intermediate goods and consumer products. In reality, his gesture of “appeasement” towards China was not an ideological reversal but an economic necessity: he had to offer the markets a sign of de-escalation before liquidity stress and mistrust of Treasuries set in.

On this point, Trump played the Busan summit cleverly. He organized the perfect media sequence: a meeting with Xi Jinping marked by reconciliation, triumphant statements about a “historic deal,” and rhetoric calibrated to produce the expected stock market euphoria. Wall Street only needed a photo, not a treaty. The indices jumped, the VIX collapsed, and the narrative of a “Sino-American trade truce” was enough to neutralize short-term concerns. But in reality, there is no “deal”: no text, no formal commitment, no signature.

What has been sealed, however, is a form of détente. After several years of open technological confrontation, the two countries have found a more pragmatic tone, at least temporarily. China has agreed to reopen certain channels of discussion and remove fifteen US companies from its export control list; the US has relaxed its tariffs and suspended some measures taken by the Department of Commerce. It is modest, but enough for the markets to see it as a lasting change.

The détente is such that Trump has even proposed opening 600,000 places for Chinese students in American universities — an unexpected proposal, almost provocative for his electoral base.

This is a complete break from his past rhetoric on H1-B visas and mistrust of foreign nationals. The former president is once again demonstrating his talent for throwing people off balance: he is shifting seamlessly from confrontation to outreach, from nationalist rhetoric to image diplomacy. This ambiguity, which unsettles his MAGA electorate, paradoxically reassures Wall Street: as long as Trump can ease tensions and boost the indices, political consistency takes a back seat.

The Busan summit therefore produced no concrete trade agreement, but it did offer what the market was calling for: a narrative of détente and the implicit promise of a pause in the escalation. China, for its part, continues to tighten its controls on tungsten, silver, and rare earths, while Trump capitalizes on the illusion of a “deal” to maintain confidence. A masterful communication operation, which has changed nothing in the balance of power, but which has been enough to buy time — and a few points on the Nasdaq.

It is therefore not surprising to see the gold price rise again following this “no deal.” Investors were not fooled: behind the facade of diplomatic appeasement, reality remains that of a fragmented world, where strategic tensions persist and confidence in political promises is eroding. Gold reacts not to rhetoric, but to substance — and the Busan summit offered none.

Funds' paper positions were partially unwound during October's liquidity stress, but physical gold purchases never stopped. Central banks, notably those of China (+10 tons), Turkey (+15 tons), and India, continue to accumulate. Even the Bank of Korea has announced that it is considering resuming gold purchases for the first time since 2013, a long-term signal from a country historically anchored to the dollar. Flows on Shanghai and COMEX still show very high delivery volumes: more than 58,000 “stand for delivery” contracts in October, almost double the average level seen at the beginning of the year.

This renewed interest in gold reflects one thing: the market does not believe in the stability promised by the photo in Busan. The episode of the “phantom deal” serves as a reminder that trade policies can change overnight, that commitments are only valid in press releases, and that confidence in the dollar remains conditional.

Every sign of détente between Washington and Beijing is a respite for stocks, but a warning sign for those who know that trade peace now rests on a charade, not a lasting balance.

With soybean sales coming to a screeching halt, strategic metals remaining under Chinese control, and the US de-escalation amounting to nothing more than an unsigned press release, gold is naturally regaining its role as an anchor. Not because it benefits from chaos, but because it is the only asset that needs neither a deal nor a promise to inspire confidence.

More By This Author:

Physical Gold, The Only Safe Haven In The Crypto Storm
A Crisis Of Confidence In The Monetary System
Liquidity Stress Is Intensifying