China’s blow to luxury brands from the West

The owners of American and European luxury brands have recently learnt that all means are permitted in war. Due to reciprocal duties on goods, tariffs of 145% are being imposed on goods exported from China to the USA. The Middle Kingdom did not limit itself to the introduction of retaliatory tariffs. The TikTok platform, a Chinese social media app with a global reach of over 1 billion users, has developed a trend that at first glance resembles a grassroots mass initiative by Chinese citizens. Short videos are posted on TikTok that allegedly reveal the modus operandi of luxury brands such as Dior, Prada, Hermès, Chanel, Coach, Ralph Lauren, Apple, Michael Kors, Nike and many others. These companies are said to manufacture their products entirely in China, adding only logos, price tags and, of course, making sky-high profits in the official country of origin, such as America or France. The authors of the videos point out that, for example, a handbag selling for $38,000 only costs $1,300 to make, which should encourage Western customers to buy directly from the manufacturer rather than overpay at an expensive salon in Paris or New York. As you can imagine, these videos are gaining huge popularity and causing controversy. What’s surprising about the above trend?

Firstly, the videos show executives of Chinese factories and other not at all random people who probably could not make a spontaneous decision to record and publish such material on behalf of the company. Secondly, the popularity of this movement has been used by manufacturers of knockoffs to sell them even better. Thirdly, many luxury brands sign agreements with their contractors in China that oblige them to keep this collaboration secret. Fourthly, if a factory actually produces goods for a European luxury brand, how much will its sales fall if that brand ends all its co-operation with it due to the disclosure of company secrets? What will you sell and to whom?

I absolutely do not deny that many western brands use cheap Chinese production to increase their huge profits. Quality does not always go hand in hand with price, and often you only pay for the logo. However, you cannot assume that this is the case in every instance. Sometimes, for example, it is the pre-assembly of a particular product that has to be completed under completely different conditions and using different methods in a completely different country. Let’s also not forget that Chinese contractors do not bear the costs of product development (e.g. designers, electronics), which are often the highest in the entire cycle. Incidentally, experts in the luxury goods market claim that more is bought than the product itself. They talk about emotions, history, a sense of belonging, unique shopping experiences and brand philosophy. It is likely that the target group for these products will find such an argument convincing. Of course, this situation will force manufacturers to be more transparent about the supply chain, which is beneficial for consumers.

Romania has just shown the EU the middle finger

Was it not expected after all! Could it not be expected? It seems only the European Union’s self-anointed elites have trouble using their brains. As is known, they caused Romania’s 2024 presidential election to be annulled because the winning candidate Călin Georgescu was – as they are used to label such candidates – far-right, and because the candidate was supposedly backed by no less a factor than the Kremlin (via TikTok – of all the means of exerting political pressure!). Romanians took to the streets and manifested their displeasure and their anger, and how much they were upset and outraged by Brussels’ antidemocratic interference. The protests were further fuelled by the fact that Călin Georgescu was even detained by the law enforcement officers for a short time, interrogated and barred from taking part in the repeated round of the election that was to take place this May. The protests in Bucharest and elsewhere did not receive much mainstream coverage. If we did not have alternative media – who knows? – we might not have learned about the outrage the decision of the EU elites provoked at all. Those who saw the protests through alternative media had the impression that the Romanian people would rise – indeed – the way they did during the last days of Nicolae Ceausescu’s regime.

It turned out the Romanian nation proved to be far more prudent and judicious than the mentioned self-anointed EU elites, who think they know better what is the best path for all humanity to follow. Călin Georgescu was replaced by George Simion, who in the election held last Sunday (4 May) won twice as much support than Călin Georgescu: 40% of the vote as compared to the 23% gained by his party predecessor. Was it not expected after all! Could it not be expected? What did Brussels think at the time when the commissioners or God knows who of those who pull the strings behind the scenes decided to annul the previous election? Did they really believe that the Romanian nation would stand corrected and cast their vote the way it was wished by the managers of the European Union?

Now the managers of the EU are going to have another Viktor Orbán on the eastern flank of the European superstate. How about it? Think also about Slovakia’s Robert Fico and the picture begins to look grim for Brussels. The second round of Romania’s presidential election is due on May 18; on the same day the presidential election in Poland is scheduled to be held. That day will be strenuous for Brussels, indeed: Romania seems to be lost, at least for the time being, how about Poland? If Poland goes “right”, then the whole of the eastern flank of the EU – Poland, Slovakia, Hungary, and Romania – will have been somewhat hard to manage. This problem will have been compounded by the persistent and rising popularity of AfD in Germany and Marie le Pen’s party in France. Ideas of “legally” suppressing either of these political groupings might not appear a good solution, judging by the reaction of the Romanian people. If the said parties in France and Germany were to be delegalized, then who knows what might happen next. Not necessarily overnight or violently: the political change in Romania was peaceful and took almost half a year (December 2024 – May 2025), but the success of those who displeased the EU turned out to be all the more bigger, and by so much more impressive.

The EU managers feared Călin Georgescu. What if victorious George Simion (because it just does seem possible that he might lose the second round having such a powerful popular support) appoints Călin Georgescu to the post of Romania’s Prime Minister? Ursula von der Leyen and company will be forced to have dealings with the man they wanted to prevent from taking the reins of power, they will be forced to put courteous smiles on their faces in the presence of a man whom they wanted to remove from the political stage and whom they wanted to denigrate as a Russian stooge. A situation similar to the one with President Donald Trump. As we remember, many European top leaders and top politicians intensely depreciated, besmirched, maligned, and disparaged him before the election only to be compelled to smile in a courteous way afterwards while meeting with the newly elected president if only on grounds of politeness.

The EU’s managers will not dare to pull off the same “legal” trick of annulling Romania’s election. They know they might entail serious political upheaval, and they know that they would lose face altogether. Sure enough, Brussels will not come to terms with such a political verdict of the Romanian nation. Both Călin Georgescu (if again in power as Prime Minister or a minister) and George Simion will be made to feel how much they are disliked until and unless they comply with all the EU’s wishes. Călin Georgescu and George Simion will be handled like Belarus’s President Alexandr Lukashenko used to be treated at the time when he still had contacts with the EU diplomats. Such is democracy made in the EU, such are human rights (to dignity, shall we say?) in the same.

The Demise of Europe

President Donald Trump – as is known – has imposed tariffs on European and south-east Asian countries. What is peculiar about those tariffs is the fact that the United States has imposed different levels of tariffs on particular EU countries. That’s something. If there were one approach in this respect to the European Union, this uniform approach would strengthen the Union, its entirety or its – to use the fashionable word – integrity. Now since the tariffs differ from member-state to member-state, the unity is being weakened. Brussels will either have to accept this American policy as is or the EU government (known as Commission so that the gullible continue to think that there is no superstate) will have to counteract it. How? The EU government will need to implement and impose tariff agreements between particular member-states so as to distribute the tariff burden equally or at least more or less equally. Whatever policy will be adopted, the pretentious grandeur of the European Union will have received a dent. The famed tariff-free transfer of goods and services is about to be shattered.

That’s how pretentious declarations usually end. Man has always been tempted to shape future and please himself with the thought of being capable of arranging life for himself as he sees fit. In this effort man has always been unsuccessful. Why? Because vivimus non ut volumus, sed ut possumus – We live, not as we want, but as we can. The European elites have been wanting to shape life to suit their ideals that were born in their heads or the heads of the philosophers and magicians of the word who conjure up social and psychological constructs and are somehow miraculously regarded as social scientists. Reality, however, obstinately refuses to comply with human wishes. Europe is in decline and this decline is being denied. Keir Starmer and Emmanuel Macron behave like they were leaders of imperial Britain and imperial France. The fact is that today’s France is not the France of Louis XIV or Napoleon I; nor is today’s Britain the Britain of Queen Elizabeth I or Queen Victoria.

In the 19th century the United Kingdom and France had colonies around the globe; today they themselves are being colonized by the people from around the globe. In the 19th century the French and the British believed in their civilizational mission; today neither the French nor the British believe they have anything to offer to the world. Rather, they believe they ought to apologize to the once suppressed and exploited peoples and they ought to adore and worship men and women of different skin colour. In the 19th century England and France would bring culture and education to Africa and Asia; today the two nations obliterate and cancel their own historical and cultural heritage, playing down its importance and re-interpreting or de-constructing it.

Europe is becoming an unimportant corner of the world: Europe’s industry is dying, Europe’s culture is deteriorating, Europe’s political leverage is becoming irrelevant, Europe’s military proves to be weak and ineffective. The Old Continent’s industry is dying because the European elites have turned into worshippers of the Mother Earth and they themselves have deliberately destroyed the industrial potential of their own countries. Europe’s culture is deteriorating because its artists have given in to ugliness and repulsiveness, to cultural experimentation and cultural nihilism. Europe’s politicians – saturated with ambitious and inept women selected to the high posts on the basis of women empowerment quotas – have stopped playing any considerable role in world affairs. Significantly, talks over Ukraine are conducted between the United States and the Russian Federation, bypassing London, Paris and Berlin. Europe’s military is a joke: weak industry translates into little armament, while armies saturated with effeminate males, rainbow recruits, and women “soldiers” are armies in name only. Yet, industry, which is the basis for the military, is frowned upon by the advocates of green economy. The result? Some of our readers will have known that Poland, a NATO member, has bought hundreds of tanks from… Korea. Whether the decision was dictated by the fact that no European country can produce sufficient numbers of tanks anymore or by the fact that German tanks have proved to be mostly useless in Ukraine is also an interesting question.

All this havoc was wrought by ideology – pernicious ideology – that has been born in the minds of leftist intellectuals and has been reigning supreme for a few decades now and is about to reign further on in the foreseeable future. The pernicious ideology of equality and uniformity, a mutiny against reality, a satanic non serviam: I will not serve. I will not obey even the laws of nature! I’ve been born a man, but I want to be a woman, and I will! I’ve been born a woman, but I want to be a man, and I will! Nonsensical, detrimental, childish, downright foolish.

All of which is compounded by the ideology of struggle or – better put – setting one social group against another, playing off one political system against another. In the 19th century it used to be the workers and the peasants against the “owners of the means of production” and the landlords; now it is women against men, blacks against whites, homosexuals against heterosexuals, political left against political right, democracy against autocracy – you name it. It is a never-ending story. There must always be fascists and antifa, far-right and far-left, climate-change deniers and climate-change advocates, those who doubt the notorious pandemics and those who exaggerate its dangers, anti-Putin and pro-Zelensky, racists and anti-racists, misogynists or supporters of patriarchy and feminists, followers of the CNN and BBC on the one hand and followers of conspiracy theories on the other, adorers of Palestinians or adorers of Israel – the list is really endless.

Individuals identifying with one group or another hurl at their opponents labels without noticing that the labels are most of the time misleading. Why, Communist China is developing a capitalist model of economy, while the European Union, which never ceases to talk about human rights and liberties, is censoring free speech and meting out penalties to those who dare drop a word of dissent on social media or to those who dare pray in the vicinity of an abortion clinic.

The Western world is divided within itself, the Western world is denying its own identity at the ideological level (as described above) and virtually by means of saturating its populations with arrivals from non-western countries, by means of assigning individuals of non-European descent to the highest positions and by means of casting non-whites in historical typically European roles in the movies.

There are three hallmarks of the European Union: ① ethnic replacement, ② rainbow sexuality, and ③ green economy. Nominally Christian Europe is ① anti-Christian (though not anti-Muslim!), ② anti-Russian, and ③ anti political right (which is always viciously and misleadingly referred to as far-right). Europe’s identity is thus dying because it is not going to remain either Christian or white. Europe’s influence in the world is dying as well: rather than developing its industry, its is turning itself into a tourist resort. In the near future affluent visitors from China and India will spend their holidays by touring Italy and Spain, France and the United Kingdom, and admire the remnants of their past glory: castles and palaces, churches and cathedrals, old towns and 19th century factories turned into shopping malls or residential apartments. China and India will have their political and economic outposts in Europe while Europeans will look up to the Chinese and Indians the way their predecessors from the 19th and 20th centuries were looked up to by the Chinese and the Indians. What a reversal of roles! What a reversal of fortune!

It was fashionable among the 19th century gentry and aristocracy from the United Kingdom and France, from Russia and the German states to go south and visit the ruins of the Roman Empire in Italy and the ancient architectural remnants in Greece. The Isles of Greece, the Isles of Greece – wrote George Gordon Byron inspired by the sights of the glorious past of the Athenians and Spartans – where burning Sappho loved and sung, where grew the arts of war and peace, where Delos rose, and Phoebus sprung! Eternal summer gilds them yet, but all, except their sun, is set.

Ancient Greece used to be full of entrepreneurial, military, cultural and economic stamina. It was not the biggest political entity or rather a cluster of entities, but it was proud and prosperous, and it expanded, colonizing the littoral regions of the the Mediterranean and the Black Seas. When a power from outside Europe – Persia – attempted to suppress it, to subjugate it, to dominate it, proud Greeks put up a fight rather than importing the Persians to their cities, rather than squeamishly making room for newcomers under the noble pretext of helping the poor. And bear in mind: ancient Greek towns did not form a political union like the EU. Just the opposite: they waged wars among themselves. Yet, ancient Greece was at its best when it was divided, just as Europe was at its best when it was divided.

Then came decay. Comfort, deteriorating morals, and the fratricidal senseless Peloponnesian War, which lasted almost thirty years (431-404 BC), and which weakened Greece the way Europe was weakened by its fratricidal thirty-year conflict of 1914-1945. The result? Greece fell prey to Romans and then to Turks. For centuries never to regain their glory.

Nowadays, United Europe becomes weaker and weaker in a similar fashion. United Europe looks for salvation in ecology and rainbow sexuality, in censorship and ethnic replacement, in the cancellation of its identity and in feminism. Europe is sawing off the branch on which it is sitting, Europe is despising itself in that Europe is cancelling its culture and its God. Europe is finishing off what the two fratricidal wars did not manage to destroy: Europe is virtually aborting itself out of existence. In the not distant future a Chinese or an Indian Byron will come to the Old Continent and reflecting on its past glory he will write:

Cradle of culture long deceased!
Here Shakespeare wrote and Goethe sung,
here grew the arts of war and peace,
here Paris rose, and London sprung!
Eternal summer gilds thee yet,
but all, except thy sun, is set.

Warning signals from the US economy

We have previously written about Donald Trump’s desire to cause a recession in the US. The poor state of the economy, for which his predecessor and the Fed’s policies were largely responsible, will be made even worse by his policies and tariffs. Here are just a few factors that prove this:

① The property market. The bubble in the property market, which has been going on for years, means that fewer and fewer Americans can afford to buy a house. The chart below shows that acquisition costs of a home at the median price are as high as for an American’s 15-year income! We haven’t seen levels this high since 2017, and we know what happened then. The chart also shows that this price trend has already materialized. Now it’s time for an appropriate correction (the next crisis).

② Cross-Atlantic travel has always been the best source of revenue for travel agencies and airlines. But now Americans are limiting their spending on travel to Europe and Asia due to the economic situation at home, and Europeans are no longer as willing to fly to the US and spend their money there. Canadians feel they have been treated unfairly by Trump: Air Canada reports a 10% drop in flights to the US. Canadians, who accounted for 13% of property purchases by foreigners in the land of the free last year, are now selling their homes in Florida and Arizona on a massive scale.

③ Trump has also cancelled the exemption on imports of goods worth less than 800 dollars. Americans are now rushing to place orders with the Chinese platforms Temu and Shin to stockpile their purchases before 25 April (the date on which the tariffs on goods under 800 dollars come into force). A bitter pill for US giants like Amazon.

④ The sentiment index calculated by Goldman Sachs, taking into account the most important investor groups, recently proved to be fairly low, although not extreme. The path from extreme optimism to pessimism, on the other hand, was long, but it came about fairly quickly. The key question now is whether this figure has fallen and will recover fairly quickly or whether it will remain as low as it was in 2022.

The Chinese dragon behind the Russian bear

Will the war in Ukraine end soon? Not necessarily: because you always need to follow the money. Money has been flowing into Beijing’s coffers for a good three years. China is not sitting at the negotiating table because it is not interested in bringing the war to an end because the hostilities translated into China’s exports to Russia, which greatly boosted the economy of the Middle Kingdom. The negotiating table is hosted by the Saudis or Turks because they want to play the leading roles in the world of diplomacy. China will stand behind the Russian bear like a dragon and support it as long as it can.

By the way: the West’s sanctions against Russia are schizophrenic and stupid. They are designed to harm one enemy (Russia) and make the other enemy (China) even bigger and stronger.

Source: X, Robin Brooks.

Gefira 93: A big picture of purpose

When it comes to the war in Ukraine, Europe – the European Union along with the United Kingdom – is in a fight mode while the United States is not. Europe is still flaunting its so-called human and democratic values, while the United States has just reversed the course of wokeism and genderism. European leaders have shut themselves off from the outside world in their echo chambers and surround themselves with like-minded bellicose individuals, while the United States is trying to find a balance in its foreign policy. Europe is still objectifying Ukraine – the country and the nation are only viewed as a battering ram against Russia, Europe’s topmost foe, while the new American administration seems to be red-pilled to for-ever wars and has become to deal with reality on the ground as it is. European and American ways have ceased to align.

Europe has a history of aggressiveness directed towards the east, which was encapsulated by the notorious German political catchphrase Drang nach Osten or Drive to the East. Indeed, wars between the western and eastern parts of the Old Continent were invariably initiated by its western part. These were the military raids of the Teutonic Knights, these were the invasions launched by Sweden or France, by imperial Germany and the Third Reich. For all that historical record, it is Russia that is credited with aggressive intentions. Why, Europeans, including those with university degrees, are not familiar even cursorily with their own past. Schools are not there for the Europeans to let knowledge sink in; schools are for mind shaping.

Europe obsessed with Russia and Putin appears to be overlooking the worldly political and economic trends. The developing countries are slowly but steadfastly gaining economic and – what follows – political momentum. The United States has broken with globalism and is focusing on its own affairs, recognizing that its role as a global hegemon has come to an end. Not that Washington has given up on exerting leverage here and there in the world: the action to control the Panama Canal or the plans of taking control over Greenland show that the American empire is alive and kicking. Yet, the United States needs to reckon with powerful rivals and concede them some political room on the world stage. It is not only Russia, it is China as well.

Europe has let itself be pushed out of Africa, Europe has developed a guilt complex towards Africans for all the failures of the latter and Europe embarked upon letting itself be colonized. The vacuum created on the Dark Continent has attracted the attention of the Middle Kingdom. China is taking Africa over from degenerating Europe. China’s population is numerically almost a perfect match to that of Africa, while Europe’s dwindling indigenous population is on a slippery road to nothingness. While European influence in Africa is often denounced in European capitals as neo-colonialism, China’s take on its presence on the Dark Continent is framed by Beijing as Going Global. Europe, riddled with guilt and shame, cannot stand up to the Middle Kingdom with the latter’s political ambition. Europe has become irrelevant, while China is a rising star. Also on the Dark Continent.

Gefira Financial Bulletin #93 is available now

Russia – a stumbling block of nations
Greenland
Europe out, China in
The Mar-a-Lago plan

Entene Cordiale in the Balkans

It was on April 1, this year that Hungary and Serbia signed a military agreement. Hungary is a NATO member, Serbia is not. One might be tempted to think that once we have NATO in most of Europe, no other military alliance – agreement – cooperation outside NATO is possible. Lo and behold, it is. Why?

All uniting organizations – whether economic or military – sooner or later (rather sooner) begin to fall apart simply because the interests of the member states are discrepant and also simply because dominant states usually cannot restrain themselves from throwing their weight about, which naturally pushes the weaker players to look for ways out. Now Serbia is a kind of a political odd man out: it neither belongs to the European Union nor does it belong to the Atlantic military alliance. Worse, on March 18 this year in Tirana, Albania, Kosovo and Croatia signed a joint declaration of cooperation on defence, clearly a measure directed against Serbia. Hence, Belgrade needs partners. Hungary is a member of both the EU and NATO, but – as is well known – Hungary’s leadership is not compliant with the policies conducted by Brussels and was not compliant with those of Washington during the time of the Biden administration, reason enough for Budapest to feel insecure and to search for support outside the two mentioned international structures.

The military agreement between Belgrade and Budapest is open to other signatories. Since Brussels has already alienated a number of member states, they might consider joining the Serbia-Hungary bloc. Slovakia comes to mind as first. Its political leaders have repeatedly thrown the gauntlet down for the EU to take up when it comes to the latter’s belligerent policy towards Russia. That would create a vertical north-south axis, which might be further joined by Czechia and Austria if only anti-EU parties take the upper hand there, which is quite possible. We would land up with a military and political bloc uniting most members of the former Austria-Hungary (Habsburg) Dual Monarchy.

Since Serbia has good relations with China, Beijing might try to expand its influence in the Balkans and central Europe a bit further. China means not merely the Middle Kingdom, but also the BRICS countries (of which Russia is one of the more important member). Brussels’ insatiable drive for dominance and the resultant pressure that it keeps exerting on Serbia and Hungary might push those countries into the Chinese embrace. Was not Moscow pushed into the alliance with China by the collective West?

More pressure on the part of the EU on the countries of this region might translate in a loss of influence that Brussels still has here. One needs only to think about Romania and the EU’s unprecedented interference in the presidential election there. Given a victory in the May election of a candidate who is not particularly pro-European, and given the offence that the Romanian nation experienced at the hands of the EU autocrats, all scenarios are on the table.

The Western world pays little attention to such things as the agreement between Serbia and Hungary. They see through such tiny entities, and that’s where they are wrong. The collective West thought little of BRICS for that matter and today BRICS is emerging as quite a threat to both Brussels and Washington. So much so that the declaration on the defence cooperation signed between Belgrade and Hungary might also aim at involving in it Republika Srpska, an autonomous part of Bosnia and Herzegovina, which territorially adjoins Serbia. Republika Srpska is a fully artificial political creation of the managers of the world: rather than allow Serbs to live together in one state, the managers of the world have created Serbia outside Serbia, and have subdued this “outer” Serbia to yet another artificial political creation that is known as Bosnia and Herzegovina. A typical tinderbox that only waits for someone playing with matches. Yet, as we have remarked again and again, politicians are not individuals who are conversant with even the recent past to draw lessons from. Thinking about the Balkans, about Serbia proper and outer Serbia, thinking about Bosnia and Herzegovina, they should recall Sarajevo. Not the Sarajevo that became notorious during the wars that were waged in the former Yugoslavia towards the end of the twentieth century, but about the Sarajevo from the beginning of the same century. It was in that city where Gavrilo Princip, a Serb, carried out his successful assassination of Archduke Ferdinand struck the spark that ignited the whole continent. The Austria-Hungary Dual Monarchy – the predecessor of the European Union (made up of Austrians (=Germans), Hungarians, Czechs, Slovaks, Romanians, Croatians, Slovenians, Serbs, Poles and Ukrainians), after the initial military success suffered a debacle and disintegrated. It was virtually smashed to smithereens giving rise to a number of independent states which have existed ever since. Are we in for a historic repeat?