GIVING IN GRADUALLY – OVERNIGHT:   The chokehold of China gets stronger and stronger, and we seem to have little will to fight back.  When big companies with famous names have no problem identifying themselves with one of the most repressive dictatorships on Earth, we are in trouble.  From Fox Business: 

Nike CEO John Donahoe called the sportswear apparel giant a "brand of China" this week, following a fiasco it was involved in earlier this year over concerns about human rights abuses committed by the communist government.

During an earnings call this week, Donahoe explained that Nike had a long-term view of its operations in China, where it had been operating for about four decades.

"We are the largest sport brand there, and we are a brand of China and for China," Donahoe said. "And the biggest asset we have in China is the consumer equity. Consumers feel a strong, deep connection to the NIKE, Jordan and Converse brands in China. And it’s real."

Donahoe went on to say that the company intended to keep investing in its China operations as it reported better than expected revenues in its fiscal fourth quarter. Its sales in China missed Wall Street expectations.

Shares of Nike hit an all-time high during Friday's trading session, driven by its strong financial results.

Nike recently came under fire in China for a comment it made raising concerns about forced labor practices in the Xinjiang Uyghur Autonomous Region (XUAR). It reassured customers that it does not source textiles or products from the region, like cotton.

After the U.S. and other Western countries responded to the forced labor allegations with sanctions, its statement was resurfaced and resulted in calls among Chinese consumers to boycott the brand – as well as others like H&M.

The Chinese government has characterized companies' decisions to avoid using cotton sourced from the region as an effort to undermine its economy.

U.S. companies are increasingly coming under scrutiny over their operations in China, where critics wonder how far they have to bend their practices in order to satisfy the communist government.

COMMENT:  They will bend unless they are forced by American consumers and the American government not to bend. 

We've been here before.  There were plenty of companies doing business with Nazi Germany right before World War II, and of course, as we've noted here earlier, we sold scrap iron to Japan right before Pearl Harbor, and it came back to us in the form of bullets. 

My great concern right now is that China sees us as weak, especially when it looks at our border policies.  The Chinese government may get the impression that this would be a good time to try to take Taiwan, and we would then face the greatest military challenge of our time.  But no one seems interested.

June 25, 2021