Trump again threatens China with 100% tariffs after China pulls the mighty rare earths Ace card.
Welcome to Talking Business, a podcast produced in Melbourne Australia. The podcast is available on the Acast site, my own website, the Apple podcast store or wherever you go to get your podcasts. Or you can get it at the Business Acumen website at https://www.businessacumen.biz/
I am Leon Gettler. My job is review and monitor the week’s news in business finance and economics. I bring it all to you every week.
For the most exclusive access to leading economists and business leaders from around the world, subscribe to Talking Business from my website leongettler.com or whatever your favourite podcast platform is.
This is episode number 36 in our series for 2025 and today’s date is Friday October 17.
First, I’ll be talking to Paul Goudie, CEO of Altura Learning. We’ll discuss how Altura Learning has created high quality, media rich learning solutions for those working in or aspiring to work in the residential or home care sector.
And I’ll be talking to EY economist Cherelle Murphy about Australia’s inflation figures and when we can expect the RBA to cut interest rates
But first, let’s talk to Paul Goudie
So what’s happening in the news?
President Trump is walking a fine line with China right now. Publicly, he’s trying to cool tensions and reassure nervous markets, but behind closed doors, he’s still keeping the pressure on Beijing. It’s a tricky balancing act that’s got Wall Street watching closely. Late last week, Trump threatened to slap a 100% tariff on Chinese imports starting November 1 after Beijing announced new limits on rare-earth mineral exports. That move sent U.S. markets tumbling, and Trump even hinted that he might skip his planned meeting with Chinese leader Xi Jinping. But over the weekend, the president’s tone started to soften. Trump spoke with Treasury Secretary Scott Bessent and other top aides about sending a message that the U.S. wants to de-escalate trade tensions—at least for now. Both sides, it seems, want to turn down the heat. China wants to salvage the planned Trump–Xi summit later this month, while Trump’s team wants to stabilize the markets and keep focus on the president’s Middle East peace push, which has been overshadowed by the trade drama. Inside the administration, officials have been brainstorming tougher responses to China, from targeting Chinese stocks listed in the U.S. to tightening investment rules and sanctioning firms tied to Russia’s oil trade. But for now, Trump and Bessent have decided that calming markets takes priority over escalation. On Sunday, Trump even struck a more upbeat tone on social media, posting: “Don’t worry about China! It will all be fine.” Bessent has since met with Chinese officials, stressing that the U.S. is open to talks but fully prepared to act if Beijing doesn’t ease up. China’s response was notably muted. Its Ministry of Commerce promised to apply the new export controls in a “prudential and moderate manner,” signalling a willingness to back off without losing face. State media coverage of Trump’s tariff threat has also been minimal, another sign Beijing is trying not to inflame the situation. Still, the underlying issue—the rare-earth export limits—remains unresolved. Beijing has stopped short of reversing the policy, leaving the door open for another round of tit-for-tat measures. On Monday, a Chinese Foreign Ministry spokesman warned that if the U.S. “insists on its own way,” China would “fight to the end.” For now, U.S. businesses are just hoping both sides pull back. “The U.S. and China can choose to spur another cycle of retaliation—or they can choose de-escalation and negotiation,” said Sean Stein, president of the U.S.-China Business Council. “For the good of the economy, U.S. companies are hoping for the latter.”
The U.S. government shutdown is now deep into its third week, and the fallout is starting to hit the broader economy. With hundreds of thousands of federal workers missing paychecks and key services shuttered, the effects are spreading far beyond Washington.President Trump and Congress remain locked in a standoff. Republicans control both chambers but can’t break a Senate filibuster to reopen the government. Democrats are insisting that any funding deal must include protections for health insurance subsidies. In the meantime, the shutdown has already caused flight delays, IRS help-line closures, and snarled permitting at agencies like the EPA and Transportation Department. About 750,000 workers have been furloughed, while others—especially in national security roles—are still working without pay. Economists warn that the longer it drags on, the worse it gets. The last major shutdown, in Trump’s first term, lasted 34 days and shaved $11 billion off U.S. economic output. “When those paychecks dry up—especially for military families—that’s when the impact really starts to spread,” said G. William Hoagland of the Bipartisan Policy Center. “It’s a slow burn, but it gets worse the longer it lasts.”
In Australia, the government has finally bowed to pressure over its controversial superannuation tax plan. Treasurer Jim Chalmers confirmed that he and the prime minister have overhauled the proposal, which raises taxes on large retirement balances. The government made two key concessions. First, the $3 million threshold—at which earnings are taxed at 30%—will now be indexed to inflation, so it doesn’t capture more people over time. Second, the tax will no longer apply to unrealised capital gains. A new $10 million threshold will also be introduced, where earnings would be taxed at 40%. Around 90,000 accounts would be affected by the $3m threshold and about 8,000 by the $10m one. The policy is set to begin in July 2026, pending parliamentary approval. While the changes will raise slightly less money in the short term, they’ll raise significantly less over time due to indexation. “It’s a fairer, more sustainable version of what we promised,” Chalmers said.
Australia’s top cybersecurity official has issued a stark warning: criminals are weaponising AI—and it’s about to make hacking far harder to detect. Lieutenant General Michelle McGuinness, the National Cyber Security Coordinator, met with major banks and over a thousand businesses last week amid growing alarm about sophisticated cyberattacks. Her comments followed a devastating breach targeting Qantas, where hackers published personal data from nearly six million customers after the airline refused to pay ransom demands. The group behind the attack—known as Scattered Lapsus$ Hunters—has also targeted giants like Toyota, Disney and McDonald’s. “AI will supercharge these things,” McGuinness warned. “Scams will sound more professional, more personal, and much harder to spot.” According to the Australian Signals Directorate’s annual report, cyberattacks are now happening at an unprecedented scale, with one incident reported every six minutes last year. More than 40% of major incidents came from compromised accounts using stolen usernames and passwords.China-linked hackers are also reportedly exploiting Australians’ home internet connections and smart devices to launch global attacks. “Once access is gained,” said ASD Director-General Abigail Bradshaw, “criminals mimic legitimate users to steal data, install ransomware, and take over accounts.” The average victim of cybercrime in Australia lost $33,000 last year.
Australia’s telecom companies are under pressure after a sharp rise in complaints about service reliability. The Telecommunications Industry Ombudsman (TIO) reported nearly 58,000 complaints over the past year, with mobile issues making up almost half of them. That’s up 4% from the year before. Much of the frustration stems from Optus’s massive September outage, which disrupted over 600 Triple Zero calls and has been linked to three deaths. The outage sparked calls for a national register of telecom outages to help track reliability problems. TIO chief Cynthia Gebert said consumers are increasingly dependent on mobile service for daily life—banking, work, even accessing government support. “When it doesn’t work, people are really frustrated,” she said. “And the recent tragic events have shown what’s at stake.” While complaints against Telstra fell slightly, both Telstra and Optus remain the biggest sources of customer grievances. The industry is now under growing pressure to make networks more resilient—especially as Australia transitions fully to 4G and 5G.
ANZ chief executive Nuno Matos is facing immediate scepticism about his ambitious plan to turn the laggard major lender into one of the best performing banks in the country, with analysts and investors describing a new five-year strategy as either difficult or impossible to achieve. Matos on Monday cancelled an $800 million buyback, promised to cut $800 million in costs, accelerate the integration of the newly acquired Suncorp banking division and hire many new business and mortgage bankers. He hopes this will make ANZ operate as efficiently as Commonwealth Bank – the country’s largest bank – and significantly improve its profitability. Brokers have been left unconvinced, however. “We are sceptical that the plan can be executed in full, and believe management will face a number of challenges in execution,” said Goldman Sachs’ Brendan Sproules, who expects profits to be $1 billion below targets by 2028. Jon Mott, a veteran banking analyst now at Barrenjoey, described ANZ’s targets as “courageous”, adding, “We can’t get to those numbers.” “Quite simply, history shows that Australian banks can either take costs out or grow revenue, but never both,” Mott wrote in a note to his clients. “We have given ANZ the benefit on costs – but expect it to miss revenue.
And that’s it for this week. And next week, I’ll be talking Neil Druce, the founder of Junee Licorice and Chocolate Factory. We’ll be talking about his firm made the firms organic licorice in the southern hemisphere and how they created chocolate around that. It’s the most sprayed food we eat. And it’s the healthier than conventional chocolates being organic.
And I’ll be talking to AMP chief economist Shane Oliver about whether we can expect a Melbourne Cup rate cut, about the impact of Trump’s tariffs on our pharmaceutical industry and the impact of the US shutdown.
For the most exclusive access to leading economists and business leaders from around the world, subscribe to Talking Business from my website or whatever your favourite podcast platform is.
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Looking forward to the next episode of Talking Business next week
