trump came back from beijing after his iran diplomacy collapsed. h200 deal is approved but china is blocking it. 30 year bond yields at highest since may 2025 and markets are pricing in a hike not a cut

trump came back from beijing after his iran diplomacy collapsed. boeing got 200 jets instead of the 500 markets had been pricing in. shares fell 4 percent friday. the bigger story is nvidia h200. the US has actually approved h200 sales to about 10 chinese firms including alibaba, tencent, bytedance, jd, plus distributors lenovo and foxconn, each up to 75,000 chips. that was formalized january 2026 with a 25 percent fee per chip and a US-transit-then-re-export routing requirement. but no shipments have landed because beijing pulled chinese firms back to push domestic huawei ascend instead. trump told reporters on air force one that china "chose not to" approve the purchases.

context for the trip: trump's own envoys had spent weeks negotiating a one-page MOU with iran. iran's counter-proposal came back and trump rejected it on truth social as "totally unacceptable" and "garbage" on may 10 and 11. iran president pezeshkian said tehran will "never bow." iran's parliament started discussing weapons-grade enrichment if conflict resumes. that is the diplomatic position trump went to beijing from.

three days before the summit, anthropic published "2028: two scenarios for global AI leadership" at anthropic.com/research/2028-ai-leadership. they project a 12 to 24 month US lead is still possible if export controls tighten and distillation attacks get disrupted, with 11x compute advantage projected. huawei produces 4 percent of nvidia aggregate compute in 2026, 2 percent in 2027. the h200 saga is exactly the dynamic anthropic flagged.

meanwhile back home: CPI 3.8 percent in april (highest since may 2023). PPI 6 percent annual with wholesale gasoline up 15.6 percent in a single month. 30 year treasury yield at its highest level since may 2025, approaching territory not seen consistently since before 2008.

powell's term as fed chair expired friday may 15. kevin warsh confirmed by the senate may 13 in a 54 to 45 vote (narrowest since 1977). warsh told the senate banking committee he wants "regime change" at the fed including changing how the central bank measures inflation. warsh inherits the inflation, the bond market doing his job for him, and the cause (hormuz) outside his control. bank of america's aditya bhave forecasts no rate cuts until july 2027. jpmorgan's michael feroli forecasts the next move is a 25bp hike in Q3 2027.

the cause of the inflation is hormuz. the MOU that was supposed to fix it is dead. the summit that was supposed to be the fallback did not deliver. the h200 dynamic is now policy reality. everything else stays downstream.