Luxury product cost-exposé videos spreading on social media platforms
Is the luxury industry’s signature price-hike strategy losing its power?
Luxury market slowdown forecasted from multiple sources

Once seen as impervious to market mood swings, the luxury industry is now being shaken by a surge of skepticism—fueled not by financial forecasts or economic indicators, but by viral videos on social media. In the context of worsening U.S.-China trade tensions, Chinese-made content exposing the real cost of producing high-end goods has started to shift consumer perception. What began as isolated posts has snowballed into a coordinated wave of content, capturing the attention of global audiences and triggering alarm bells within the luxury sector. The timing, tone, and traction of these videos suggest more than casual criticism—they represent a deliberate push in the mounting narrative war between two economic giants.

Viral Factory Videos Fuel Growing Skepticism

On platforms like TikTok and X (formerly Twitter), videos allegedly recorded in Chinese factories are rapidly spreading. These clips claim to reveal the true production costs of premium goods from well-known brands such as Hermès, Nike, and Lululemon. The content is often unverified but highly persuasive—some videos have amassed millions of views, all while calling into question the value proposition luxury brands have long relied upon.

One particularly viral post published on April 13 claimed that a Hermès Birkin bag, a symbol of ultra-exclusive fashion, costs only $1,395 to manufacture. A Chinese factory employee, speaking fluent English, broke down the individual costs of leather, materials, and labor, ultimately concluding that around 90% of the retail price—approximately $38,000—comes from the Hermès logo itself.

Another TikTok user alleged that Lululemon yoga leggings, which retail in the U.S. for more than $100, are produced in Chinese factories for as little as $5 to $6. According to the influencer, the materials and craftsmanship used in manufacturing are virtually identical to the final retail versions. In response, Lululemon clarified that only 3% of its finished products are made in mainland China and emphasized that authentic leggings are sold exclusively through the company’s official channels.

These videos have not gone unnoticed. Analysts and insiders suggest they may be part of a broader strategy by China to push back against U.S. tariffs while directly appealing to American consumers. The message embedded in many of these clips is clear: Western luxury brands are charging exorbitant prices for items manufactured at a fraction of the cost in China. Moreover, some videos subtly promote the idea that consumers should bypass Western retailers altogether and instead purchase directly from Chinese sources. This shift in narrative highlights how digital platforms are becoming arenas for geopolitical influence, with economic frustrations weaponized through viral content.

Luxury Giants Risk a Crack in Their Armor

The luxury industry has long weathered economic slowdowns by leaning into its brand power and pricing boldly. In markets like South Korea, this strategy has been particularly evident. Chanel, for instance, increased prices of key products by an average of 2.5% in January. Hermès raised handbag prices by 10% during the same period, while Louis Vuitton implemented price hikes of up to 13% in January, followed by an additional 3% increase in April.

This confidence in pricing stems from the belief that the prestige and allure of luxury brands are enough to justify ever-rising tags. In fact, the numbers have backed this approach—at least until recently. Chanel Korea, after implementing three price increases in January, March, and August of 2024, still reported a year-on-year revenue jump of 8.3%, reaching ₩1.8446 trillion (approximately $1.4 billion). Hermès Korea recorded a 21% rise in revenue to ₩964.3 billion (around $705 million), while Louis Vuitton Korea's earnings climbed by 5.9% to ₩1.7484 trillion (about $1.3 billion).

However, the strategy may be reaching its limits. As more consumers become aware of the relatively low production costs of luxury items, the traditional value narrative begins to erode. Experts within the industry acknowledge that the pricing model depends heavily on consumer belief in brand prestige. Now that that belief is being challenged—especially through relatable, viral content—the allure may start to fade. If shoppers begin to question the justification for such high prices, they may choose to walk away, leaving luxury brands with a credibility crisis.

Storm Clouds Gather Over the Global Luxury Market

Amid the growing buzz around these videos, signs of a broader slowdown in the luxury market are emerging. Recent forecasts from international analysts paint a less-than-glamorous picture of the months ahead. Market research firm Bernstein, once optimistic about a 5% growth in luxury sales this year, has reversed its projection and now anticipates a 2% decline. This downgrade stems from growing concerns over the destabilizing impact of U.S. President Donald Trump’s tariff policies, which have introduced volatility into financial markets and contributed to an economic climate ripe for recession.

Global consulting powerhouse Bain & Company reached a similar conclusion in its latest annual report. It projects that the global personal luxury market will shrink to €363 billion (about ₩538 trillion or $390 billion)—a 2% drop from the previous year. Bain partner Federica Levato emphasized that, excluding the pandemic, this marks the first contraction of the industry since the 2008–2009 financial crisis. She also highlighted that the global luxury consumer base, which had reached 400 million at its peak, has lost 50 million buyers over the last two years alone.

Financial institutions are taking note as well. On April 9, Deutsche Bank adjusted its revenue growth forecast for the luxury sector in 2025 downward by three percentage points, reducing it to just 2%. The bank also downgraded its investment outlook for Richemont and Kering from "Buy" to "Hold," while lowering their target stock prices. Major players like LVMH, Moncler, Zegna, and Burberry also saw their target prices slashed by between 10% and 30%.

In an industry where image is currency and perception drives demand, these shifts in public narrative and market conditions represent more than just temporary turbulence. As transparency and digital storytelling reshape the landscape, the luxury market faces an uncomfortable question: can it preserve its mystique in an age when consumers are no longer willing to pay just for the name?

From ‘Temporary Impact’ to ‘Growth Slowdown’: Powell Shifts View on High Tariffs
Stagflation Warning Lights Flash — Dual Shock to Growth and Inflation Foreseen
Tariff War Casts Shadow Over Global Economy — Not Just a U.S.-China Issue

President Donald Trump’s high-stakes tariff war is sending ripples through the global economy—and now, the Federal Reserve is sounding the alarm. What began as a bold effort to bring China to the negotiating table through aggressive trade measures is increasingly being seen as a self-inflicted wound. At the center of the concern is Federal Reserve Chair Jerome Powell, who has publicly reversed his earlier position and warned that the current trajectory of trade policy could steer the U.S. economy into dangerous territory.

Once considered a temporary disruption, tariffs are now being blamed for fueling inflation, suppressing growth, and potentially ushering in a prolonged period of stagflation—a rare and painful mix of high prices and economic stagnation. As Wall Street grows increasingly anxious and consumers brace for costlier goods, Powell’s latest remarks make clear that the consequences of this trade conflict are no longer theoretical—they're unfolding in real time.

From Temporary Concern to Economic Alarm

Federal Reserve Chair Jerome Powell has significantly shifted his stance on the Trump administration’s tariff policies. Once insisting the effects would be short-lived, Powell now warns that steep tariffs are triggering a worrying combination of rising prices and slowing economic growth. His remarks, delivered during a speech at the Economic Club of Chicago on the 16th, reflect deepening concerns over the economic direction the U.S. is heading under the weight of trade tensions.

Powell noted that the level of tariff hikes imposed so far has exceeded expectations—and the economic fallout may follow suit. Higher inflation and weaker growth are now looming, he cautioned, putting the Federal Reserve’s dual mandate of price stability and maximum employment in direct conflict. “Tariffs are very likely to cause a temporary increase in inflation at the very least,” he said. In such a scenario, the Fed’s ability to fine-tune the economy through interest rate adjustments becomes compromised.

“Our tools can only effectively address one of the two mandates at any given time,” Powell explained, pointing to a dilemma: curbing inflation may come at the cost of jobs, and stimulating employment might worsen inflation. For now, he maintained that it’s too early to make any policy moves, stating that more clarity is needed before considering changes to interest rates. Still, the concern is mounting. Powell admitted that consumers could soon face higher prices, while businesses may be forced to cut back on hiring—if not reduce their workforce altogether.

U.S. Businesses Bear the Burden

The Trump administration’s high-tariff strategy, designed to force concessions from China, has brought pain to American companies. As major U.S. firms like Apple and Nike have moved manufacturing operations to low-wage countries such as China and Vietnam, the role of imports in the national economy has steadily grown—from 3.1% of GDP in 1947 to 13.9% in 2024, according to the Federal Reserve Bank of St. Louis.

Tariffs on Chinese goods have made that dependence more expensive. The prices of everyday items—smartphones, furniture, clothing—have surged, directly impacting consumers. Meanwhile, businesses are shouldering increased operational costs, and many small and medium-sized enterprises are now being forced to consider layoffs or cutbacks to survive.

The economic data only reinforce the growing unease. Nomura Securities estimates that the personal consumption expenditures (PCE) inflation rate could nearly double—from 2.5% in February to 4.7% by year’s end. One-year inflation swaps have jumped to 3.5%, the highest level in over three years, according to the Financial Times. And J.P. Morgan has slashed its U.S. growth forecast from 1.3% to -0.3%, a swing that underscores mounting fears of stagflation—the dual threat of economic stagnation and inflation.

A Global Chain Reaction with Heavy Costs

The impact of the trade war extends far beyond U.S. borders. China, whose largest export destination is the United States, faces mounting pressure as well. Already dealing with weak domestic consumption and a collapsing real estate sector, China could see its GDP growth cut by 1.5 to 2 percentage points, according to HSBC analysts, if export volumes continue to fall.

More broadly, the prolonged U.S.-China conflict risks tearing at the fabric of global supply chains and dragging down growth worldwide. Export slowdowns and investment pullbacks are already being observed in multiple countries, suggesting the damage is spreading. While the Trump administration’s combative tactics may deliver short-term leverage, many experts warn they could ultimately impose heavier costs on both the American and global economies.

A Bloomberg scenario model reveals the potential scope of these consequences: if current tariffs remain and countries retaliate at even half the scale, U.S. imports could decline by 30% by 2030. China’s exports to the U.S. could plummet by 85%, while Japan and South Korea may each experience export reductions of more than 50%.

Experts also worry about the lasting effects of redefining tariffs as national security tools. This shift, embraced by both President Trump and his advisers, risks destabilizing global trade norms and injecting persistent uncertainty into international markets. According to the Japan External Trade Organization (JETRO), global GDP could shrink by 0.6% by 2027 due to American tariffs—translating to a loss of $763 billion from a projected $127 trillion global economy. It's a staggering figure that underlines just how far-reaching the consequences of this trade war may become.

U.S. Federal Appeals Court Rejects Link Labs’ Retrial Request
Key Dispute: 'Filing Date vs. Publication Date' in Patent Priority Interpretation
Samsung Prevails Again After Appeals and Reexamination

Samsung Electronics has secured a final victory in its long-running patent dispute with U.S.-based AC-LED company Lynk Labs. The U.S. Court of Appeals for the Federal Circuit rejected Lynk Labs’ request for a full court rehearing, in which the company had sought a legal review regarding the timing of its patent filings. The court upheld the earlier decision by siding with Samsung, effectively ending a six-year legal battle. The ruling is expected to set an important precedent in determining how prior art is evaluated in relation to patent filing dates.

Federal Appeals Court Rejects Lynk Labs’ Full Rehearing Request

At the center of the case is U.S. Patent No. 10,687,400, referred to as the ‘400 Patent, which Lynk Labs claimed Samsung had infringed. However, both the Patent Trial and Appeal Board (PTAB) and the Federal Circuit found that a similar invention had been filed by another inventor 10 months earlier, making it prior art and rendering the 400 Patent invalid.

Lynk Labs argued that the patent should have been entitled to an earlier priority date based on a provisional application filed in 2003. If accepted, this would have disqualified the cited prior art. But the PTAB and the court rejected this claim, holding that the earlier invention's filing date, not its publication date, establishes its validity as prior art—a ruling that strengthens the interpretation of Section 102(e) of the U.S. Patent Act.

The PTAB sided with Samsung in September 2023, and the Federal Circuit affirmed the decision in early 2024. Lynk Labs then sought a rare en banc rehearing, arguing that the Federal Circuit’s interpretation of patent priority date law was flawed and created uncertainty across the industry. However, the court dismissed the request, emphasizing: the filing date, not the publication date, governs whether a reference qualifies as prior art; the PTAB applied an ordinary interpretation of the claim language and did not mischaracterize technical terms; and there was no exceptional legal issue warranting a full court review.

Ruling Affirms Patent Filing Date as Benchmark for Prior Art

The conflict began in 2019 when Lynk Labs demanded licensing fees from Samsung, claiming infringement of multiple LED-related patents. In 2020, the U.S. firm filed 11 infringement lawsuits against Samsung in the Western District of Texas, specifically citing technologies used in Samsung’s Galaxy S21 Ultra.

Samsung denied the allegations and countered by initiating a declaratory judgment action and filing a petition with the PTAB to invalidate the 400 Patent. In its petition, Samsung argued that prior patents and published applications disclosed similar technologies before the 400 Patent's earliest valid priority date.

Decision Sets Key Precedent in U.S. Patent Law Interpretation

Legal experts note that this ruling affirms the longstanding principle that earlier-filed but later-published applications can qualify as prior art, regardless of whether they matured into granted patents. The decision also reinforces the authority of the PTAB in invalidating patents through inter partes review (IPR) procedures, even when priority claims are disputed.

Moreover, the Federal Circuit’s rejection of the full court rehearing underscores that such petitions are granted only under extraordinary circumstances, typically involving conflicts with prior precedent or systemic legal questions. Lynk Labs' claim that this case met that threshold was firmly rejected.

The court’s final decision marks a clear and complete legal win for Samsung, ending a multi-year patent battle that reached the highest levels of U.S. patent adjudication. The ruling could now serve as a landmark precedent in future disputes over the interpretation of priority dates, prior art, and patent validity in both technology and intellectual property law.

Pursuing a strategy of high tariffs with a weak-dollar policy
100-year zero-coupon U.S. bonds sparks intense debate
"Trumpnomics" undermine the global dominance of the U.S. dollar

Following President Trump’s announcement of “reciprocal tariffs”, attention has surged around the Miran Report, authored by Stephen Miran, Chair of the White House Council of Economic Advisers. The report—first released in November and amplified through recent speeches and interviews—forms the economic backbone of Trumpnomics, which centers on high tariffs, a weaker dollar, and an aggressive strategy to cut the trade deficit and national debt. However, economists warn that this strategy combines incompatible policies and could destabilize the global market

Trade Deals, Deregulation, and Tax Cuts: The Three Pillars of Trumpnomics

Stephen Miran, President Trump’s top economic adviser, has returned to the spotlight amid escalating tariff tensions triggered by Trump’s announcement of reciprocal tariffs on April 2. In his interviews and a keynote at the Hudson Institute, Miran outlined the three pillars of Trump’s economic policy: trade negotiations, regulatory rollbacks, tax reform, and cuts. Miran claimed that tariff revenue could replace tax revenue and fund further tax cuts. He projected that the effective average tariff rate would rise by 13 percentage points, yielding hundreds of billions in new revenue without destabilizing the economy. This revenue, he argued, could be used to pay down interest on the $1.1 trillion U.S. debt (2024 fiscal year) and expand fiscal stimulus, positioning the policy as a form of self-funding economic nationalism.

Trump’s team also targets a weaker dollar, arguing that a strong dollar exacerbates the trade deficit by hurting U.S. exports. Miran promotes a policy mix where a weaker dollar fuels exports, while tariffs suppress imports.

Yet this combination is widely seen as economically contradictory: tariffs drive up import prices, risking inflation, while a weaker dollar dilutes the import-suppressing power of tariffs. Similarly, inflation typically pressures the Federal Reserve to raise interest rates Miran, however, insists the U.S. can maintain low interest rates and inflation under his plan—a claim economists like former Treasury Secretary Larry Summers dismiss as “stagflationary” and self-inflicted.

Maintaining low interest rates and low inflation amidst a weak dollar and high tariffs

Some media outlets report that the Miran Report proposes issuing 100-year, zero-interest U.S. Treasury bonds, allowing the government to raise capital without incurring interest payments. This would fund infrastructure and defense, but also risk diminishing global investor confidence in U.S. debt.

Though unconfirmed in official statements, the proposal has drawn comparisons to the 1985 Plaza Accord, where coordinated currency interventions led to the dollar’s depreciation. Critics warn that repeating such tactics now could spark financial instability.

Since the reciprocal tariffs were announced, U.S. Treasury bond prices have plunged. According to Investing.com, the 10-year yield surged from 3.83% to 4.54% between April 7 and 11—the largest two-day spike since 2001. Rising yields signal a sell-off, meaning investors are dumping Treasuries amid growing uncertainty.

This shift is highly unusual: U.S. Treasuries typically rise during global uncertainty. Instead, Trump’s erratic tariff policy has shaken faith in U.S. debt as a safe haven, prompting fears of economic slowdown and weakening Trump’s fiscal leverage heading into the midterms.

U.S. Treasury Prices Plunge Amid Whiplash from Trump’s Shifting Tariff Policy

At the core of Miran’s strategy is a rejection of the Bretton Woods framework, which has governed global finance since WWII. The “Triffin Dilemma”—named after economist Robert Triffin—argues that for the dollar to serve as the global reserve currency, the U.S. must run trade deficits to supply global liquidity. But doing so also means accumulating national debt.

Miran argues that U.S. allies should share this burden. In his report, he proposed: charging "rent" on foreign holdings of short-term Treasuries; forcing allies to buy 100-year zero-interest bonds; and threatening to withdraw U.S. military protection if they refuse. This coercive approach, while aimed at preserving dollar dominance, risks fracturing alliances, as countries may resist such terms and push back diplomatically and economically.

Trump’s Trumponomics—backed by Miran’s radical proposals—aims to upend decades of U.S. economic doctrine in favor of protectionism, monetized nationalism, and strategic decoupling. But the internal contradictions, market backlash, and potential geopolitical fallout raise serious questions about its sustainability. Whether this strategy will redefine U.S. hegemony or undermine it from within remains to be seen.

NVIDIA's H20 Chip Blocked from Export to China
Chinese Tech Firms Rapidly Grew on H20 Backbone
Now Developing Lithography Tools to Cut NVIDIA Dependency

In a bold move to curb China's growing edge in cutting-edge technology, the United States has imposed new restrictions on the export of Nvidia’s advanced H20 chip to Chinese firms. As Beijing continues to ramp up its technological capabilities, especially in the realm of artificial intelligence (AI), Washington has responded by tightening the flow of high-performance hardware that has become foundational to China's digital ambitions.

U.S. Turns Off the Tap: Full-Scale Restrictions on the H20

Nvidia revealed on April 15 that the U.S. government had notified the company earlier in the month—on April 9—that it would now need formal government authorization to export the H20 chip to China. Just days later, on April 14, Nvidia received word that these restrictions would be indefinite. U.S. officials are concerned the chip might be deployed in Chinese supercomputers, systems that could enhance the country's military and strategic computing capabilities.

The H20 is the most powerful AI chip that Nvidia can legally supply to China. With its advanced high-speed memory and efficient chip interconnectivity, it’s particularly suited for building large-scale AI systems and supercomputers. Though not as powerful as Nvidia’s latest Blackwell chip, the H20 still includes the high-bandwidth memory (HBM) found in Blackwell models, enabling it to deliver strong performance.

However, the restrictions are expected to hit Nvidia hard. The company estimates a $5.5 billion loss (approximately 7.86 trillion KRW) for the first fiscal quarter (February to April), largely due to inventory write-downs, outstanding purchase agreements, and provisioning costs. The fallout may also extend to other players in the semiconductor supply chain, particularly South Korean firms like SK Hynix, which supplies HBM for the H20 and may face long-term sales declines.

China’s AI Ambitions and the H20 Dependency

At the heart of these restrictions lies the remarkable growth of Chinese tech giants—growth that has, in part, been fueled by the H20 chip. According to tech outlet The Information, companies like Alibaba, Tencent, and ByteDance ordered H20 chips worth an estimated $16 billion (22.8 trillion KRW) in just the first quarter of 2025. Amid speculation that H20 would soon be added to Washington's export control list, these firms scrambled to stockpile the chips.

One standout example is Chinese AI startup DeepSeek, which has shaken up the market with its low-cost, high-performance AI model “R1”—a model reportedly built using Nvidia’s H20. After R1's release, a growing number of Chinese firms adopted DeepSeek’s architecture, sending H20 demand soaring and leading to a widespread shortage.

The pressure on supply chains became so severe that H3C, China’s largest server maker, issued a warning in late March about a looming H20 shortage. “The international supply chain for the H20 is facing significant uncertainty, and our current stock is nearly depleted,” H3C stated. The company cited ongoing geopolitical tensions between the U.S. and China as key drivers of instability, noting that the next batch of H20 chips wouldn’t arrive until mid-April at the earliest.

Forging Ahead: China’s Push for Chip Independence

Despite the mounting export restrictions, questions remain about their long-term impact on China. In recent months, Chinese firms have accelerated efforts to reduce their reliance on Nvidia by developing domestic alternatives. A prime example is Ant Group, an Alibaba affiliate, which is now building its new AI model “LingPlus” using chips reportedly developed by Huawei. While the specific chip hasn’t been publicly confirmed, many in the industry believe it to be Huawei’s Ascend 910—the same chip previously used in DeepSeek’s R1 model.

China is also breaking into the last stronghold of semiconductor manufacturing: lithography equipment. These machines are essential for etching microscopic circuits onto silicon wafers and are currently dominated by Dutch company ASML. While the U.S. and its allies have barred EUV (extreme ultraviolet) lithography machines from being exported to China since 2019—and are gradually expanding controls on older DUV (deep ultraviolet) models—Chinese firms are now responding with homegrown innovations.

At the Semicon China expo held in Shanghai last month, Chinese semiconductor equipment maker SiCarrier unveiled its first domestically developed DUV lithography system. Meanwhile, Huawei has taken its ambitions even further, announcing that it has built its own EUV lithography machine and plans to begin trial production by the third quarter of this year. The company has already outlined a roadmap to start mass production using this technology by next year.

If these plans materialize, China’s reliance on Nvidia’s H20 and other foreign chips could decrease dramatically. With a growing domestic ecosystem covering chip design, AI model development, and now even lithography equipment, Beijing’s path to semiconductor self-reliance appears increasingly viable. As the technology race between the U.S. and China intensifies, the global chip landscape is being reshaped before our eyes.

OpenAI Testing Its Own Social Media Platform Internally
Industry Recalls Meta’s Threads as Cautionary Example
Clear Differentiation Key to Long-Term Market Success

As OpenAI rides the wave of popularity from its AI-based image generation service, the company appears ready to test its influence in a new arena: social networking. News of OpenAI quietly developing an SNS (social networking service) platform has sparked comparisons to Meta’s Threads—a platform that once burst onto the scene with great promise. Now, industry experts are asking: can OpenAI avoid the pitfalls that nearly derailed Threads, and will it manage to carve out a distinct space in an increasingly crowded field?

The Push Behind OpenAI’s SNS Platform

According to The Verge, which cited multiple sources in an April 15 report, OpenAI is internally testing a new SNS platform centered around content generated through its immensely popular ChatGPT image generation feature. CEO Sam Altman has already sought feedback from external figures, signaling that the project is progressing. While it remains unclear whether this service will launch independently or be integrated into ChatGPT, its market debut—whatever the form—is expected to be disruptive.

At its core, the move reflects OpenAI's broader ambition to secure vital resources for advancing its AI models. By owning and operating an SNS, OpenAI can gain access to vast volumes of real-time user-generated data. This data goldmine could help refine AI models and align the company with industry practices seen at Elon Musk’s xAI, which draws on data from X (formerly Twitter) to train its chatbot Grok, and Meta’s LLaMA, which utilizes content from its own platforms. The trend is clear: data-rich environments can supercharge AI development.

Some speculate that Altman’s push into SNS is more than a strategic play—it may also be personal. His long-standing rivalry with Elon Musk, now at the helm of both X and xAI, is well known. With Musk integrating X into xAI and positioning Grok to deliver X-sourced content, OpenAI’s own SNS project could be seen as a counteroffensive in a deepening tech feud.

When Threads Took on X—and Struggled

The unveiling of OpenAI’s platform inevitably recalls the rise—and rocky journey—of Meta’s Threads. Launched in July 2023 as a direct competitor to X, Threads came with a bold vision of decentralization through the ActivityPub protocol, promising users the ability to engage across platforms like Mastodon and WordPress.

Unlike Instagram, which thrives on visuals, Threads focused on text. Posts were capped at 500 characters but supported links, photos, and short videos up to five minutes. It closely mirrored X in structure, allowing Instagram-based logins and displaying a mixed feed of followed and recommended content.

Threads made a massive splash at launch, attracting 100 million users within just five days. Tapping into Instagram’s vast user base, the app gained early momentum. Public interest soared as celebrities joined and media attention fixated on the rumored cage match between Musk and Meta CEO Mark Zuckerberg. But the hype soon met resistance.

Critics pointed to the lack of fundamental features—no DMs, no trending topics, no hashtags. Users couldn’t even edit posts or delete their accounts. Many influencers and brands, frustrated by Threads’ opaque algorithmic feed, began leaving the platform. The result: a noticeable dip in content and a corresponding drop in user engagement.

Still, Threads managed a second act. As short-form content became a cultural mainstay among Millennials and Gen Z, the platform began attracting a younger crowd. The casual, often blunt style of communication on Threads appealed to this audience, positioning the app as a text-based counterpart to TikTok-style quick consumption. By February, Threads’ monthly active users had surged to nearly 5 million—a 170% increase from the same time last year.

What OpenAI Must Do Differently

For OpenAI, the lesson from Threads is clear: success in the SNS market demands more than a headline-grabbing launch. It requires substance—a distinctive experience that not only attracts users but keeps them coming back.

Industry insiders emphasize that content quality remains the heart of any thriving social platform. In the case of Threads, it was the culture of candid, emotional expression through brief posts that turned things around. For OpenAI, a focus solely on AI-generated images or the novelty of its technology may not be enough.

As one expert put it, “To be competitive, OpenAI’s SNS must offer more than just AI wizardry. It needs a compelling hook—a reason for users to stay.”

Whether OpenAI can blend innovation with social engagement, and whether it can go beyond the initial hype to build lasting user loyalty, remains to be seen. But if the past is any indication, the SNS market rewards those who learn quickly, adapt faster, and offer users something truly unique.

Trump Slaps 145% Tariff on Chinese Imports
Beijing Gears Up with Market Diversification and Rare Earth Controls
China Expands Trade Safety Nets Amid Export Decline Concerns

The United States and China have entered a dangerous phase of economic confrontation. With President Donald Trump pushing ahead with a hardline policy to impose tariffs of up to 145% on Chinese imports, tensions between the two global powerhouses are intensifying. But in this trade clash, some observers believe China may have the upper hand—for now.

Despite its reliance on the U.S. as a major market for its manufactured goods, China is leveraging a set of powerful assets: a centralized political system, a broadly diversified export portfolio, and substantial control over rare earth resources. These strengths give Beijing critical negotiating leverage, even as it prepares to absorb the impact of Trump’s aggressive trade policies.

Trump Imposes 145% Tariff on Chinese Imports

On April 15, the Financial Times reported that the US's concerns about deepening its economic dependence are front and center. Marta Bengoa, a professor of international economics at the City University of New York, explained that the United States may be more vulnerable in this trade war than many realize. “China can more easily procure agricultural products elsewhere than the U.S. can substitute electronics and machinery,” she noted.
She also pointed out that China has already begun sourcing soybeans from Brazil—evidence of its growing strategic flexibility.

The numbers tell a compelling story. In 2024, China recorded a $300 billion trade surplus with the U.S., with approximately 15% of its total exports destined for American consumers. Trump's proposed 145% tariffs are expected to put a serious dent in this flow. Analysts at Goldman Sachs estimate that between 10 to 20 million Chinese workers are employed in sectors tied to exports to the United States. The combined effect of rising tariffs, falling export volume, and a slowing global economy could place enormous pressure on China’s labor market and broader economy.

China Prepares Countermeasures, Including Market Diversification and Control Over Rare Earth Elements

Despite the looming economic strain, China is not without defenses. A key strategic asset lies in its dominance over rare earth elements, essential components in everything from smartphones to electric vehicles and military technology. China accounts for more than two-thirds of global rare earth production and over 90% of processing capacity. Even Trump acknowledged this strategic vulnerability when he excluded key minerals from the first round of tariffs.

China has recently escalated its use of this leverage by tightening export controls on seven rare earth elements, including dysprosium and terbium, both crucial for advanced manufacturing. These restrictions provide Beijing with a powerful tool to influence key global industries and apply economic pressure in return.

At the same time, China is actively reducing its reliance on the American market. In response to earlier tariffs during Trump’s first term in 2018–2019, China began shifting manufacturing bases to countries like Vietnam and Cambodia, creating a supply chain that allows for re-export to the U.S. through regional partners. This approach, known as tariff circumvention, has proven effective. According to U.S. government data, China’s share of U.S. imports dropped from 21% in 2016 to 13.4% last year.

China’s trade and investment strategy in Southeast Asia continues to deepen. With a population nearing 698 million, the ASEAN region offers an attractive combination of demand, labor, and political stability. Ho Ee Khor, Chief Economist at the ASEAN+3 Macroeconomic Research Office (AMRO), stated that products like solar panels, electric vehicles, and batteries are increasingly well-suited for regional markets, helping both sides reduce their dependence on the U.S.

In parallel, Chinese companies are exporting raw materials to Southeast Asia and expanding operations in labor-intensive countries like Vietnam. AMRO estimates that China’s direct investment in ASEAN has doubled since the pandemic, reinforcing its long-term strategy of regional integration and economic resilience.

Amid Fears of Export Decline, China Expands Trade Buffer Mechanisms

China's efforts to shield itself from American tariffs extend beyond Asia. The country is deepening trade ties with Brazil, particularly in the agricultural sector. As the trade war disrupts traditional U.S. exports of soybeans and beef, Brazil has emerged as a vital alternative supplier.

According to the South China Morning Post, senior agricultural officials from China and Brazil are scheduled to meet in Brasília to discuss expanding agricultural exports. Topics on the table include increasing Brazilian crop production and resolving recent disputes over the approval of meat processing plants, 28 of which were rejected by China due to technical and hygiene concerns.

Brazil is rapidly positioning itself as a major beneficiary of China's pivot away from U.S. agricultural imports. However, the shift presents domestic challenges. Brazilian President Luiz Inácio Lula da Silva is under pressure to balance rising export volumes with concerns over local food prices and inflation.

The meeting will also explore China’s 10-year agricultural development plan, a national strategy to secure food self-sufficiency by 2035. The plan focuses on boosting agricultural innovation, increasing domestic grain and meat production, and improving overall productivity.

Larissa Bachholz, a researcher at Brazil’s Center for International Relations and former advisor on China relations for the Brazilian Ministry of Agriculture, underscored Brazil’s strategic role:

“Amid the tariff conflict between China and the United States, Brazil must reaffirm its role as a stable partner. This meeting is an opportunity to build trust and make clear that any future U.S.-China agreements should not come at Brazil’s expense.”

The U.S.-China trade clash is no longer just about tariffs—it is a global power struggle with lasting implications for supply chains, economic partnerships, and trade security. As China pivots toward strategic resilience and regional integration, and the U.S. doubles down on protectionism, the rest of the world is watching—and adjusting accordingly.

Laying the Groundwork for Stricter Export-Import Controls on China
Rising Import Dependence Exposes Military Vulnerabilities
Resource War Scenarios Are Rapidly Becoming Reality

U.S. Invokes Trade Expansion Act Section 232 for Strategic Minerals Amid China Tensions

On April 15 (local time), the White House announced that President Donald Trump signed an executive order authorizing a national security investigation under Section 232 of the Trade Expansion Act, titled “Ensuring National Security and Economic Resilience Through the Investigation of Processed Critical Minerals and Derivatives.” Section 232 allows the U.S. president to take emergency action if foreign imports are deemed a threat to national security.

Under the directive, Commerce Secretary Howard Lutnick must submit a preliminary report within 90 days and a final report and recommendations within 180 days. The move is widely seen as a response to China’s export controls on rare earth elements (REEs). Earlier this month, Beijing announced restrictions on exports of seven critical REEs—such as samarium, gadolinium, and terbium—in retaliation for new U.S. tariffs. NEC Director Kevin Hassett described China’s move as “very concerning” and indicated the White House is “reviewing all options” in response.

Focus on Processed Critical Minerals, Not Just Raw Ores

The investigation specifically targets processed forms of critical minerals, such as refined and high-purity REEs, rather than unprocessed ores. While the U.S. possesses domestic reserves, most processing infrastructure is located abroad, making the country heavily dependent on imports for these materials.

President Trump considers this reliance a national security threat, particularly in light of China's dominance in the sector. While the Biden administration previously pursued REE supply chain diversification through subsidies and infrastructure investment, Trump’s approach is far more aggressive, framing import reliance as a security risk to be legally curtailed.

From Tariffs to Resource Warfare: Escalating U.S.–China Conflict

Trump’s aggressive posture reflects the U.S. military’s deep reliance on REEs, which are indispensable for F-35 fighter jets, nuclear submarines, guided missile systems, radars, and night vision technology. Experts often describe REEs as the “neural network” of modern military hardware.

The crux of the problem lies in China’s overwhelming control of the global REE supply chain. About 70% of global REE mining is in China, while over 90% of REE processing and refining is also concentrated in China

Processing REEs is technologically demanding, giving China a critical edge that the rest of the world struggles to match. The U.S. Department of Defense and auditing bodies have repeatedly warned Congress that Chinese REE export bans could cripple American weapons production.

Trump is now reframing the issue from a trade dispute to a national defense crisis, enabling him to invoke Section 232 more forcefully. Emphasizing military dependence allows the administration to justify swift, high-intensity countermeasures—including tariff hikes, import bans, and designating strategic sectors under emergency provisions.

Ironically, while the U.S. has long emphasized domestic self-reliance, it still cannot produce modern weapons without accessing Chinese processing lines—a vulnerability that may weaken America’s hand even as it tries to play offense.

Toward a Post-China Global Supply Chain Strategy

Experts say Trump’s executive order is part of a broader resource war strategy years in the making. His intentions were clear during his first term, particularly in efforts to secure rare earth partnerships with Ukraine. Upon taking office, Trump signed a memorandum of understanding with Ukraine for strategic mineral cooperation, seeking to position the country as a forward base to counter China’s influence in Europe.

Ukraine held the largest known REE reserves in Europe prior to the war, and control over these resources was seen as a potential counterbalance to Beijing’s ambitions to extend its supply dominance into Europe.

The strategic core of Trump’s plan can be summarized in two pillars: achieve U.S. resource self-sufficiency, and lead a global supply chain realignment away from China

During his first term, Trump funded private mining firms for REE exploration and refining. He also reorganized the Defense Logistics Agency (DLA) to stockpile strategic minerals. Additionally, Trump has forged rare earth partnerships with allies like Australia and Canada, to secure alternative trade routes in case of a Chinese export freeze

Trump also targeted soybeans as a strategic lever against China. With low domestic protein self-sufficiency, China heavily relies on U.S. soybean imports. In 2019, Trump attempted to retaliate against China’s REE weaponization by threatening U.S. agricultural export restrictions—particularly soybeans.

However, the move fell flat when China quickly shifted soybean imports to Brazil, blunting the intended effect. Still, the episode illustrated that U.S.–China rivalry now spans not just singular commodities like REEs, but entire categories—resources, food, and logistics infrastructure—marking a “New Cold War-style trade war.”