Billionaire investor Stanley Druckenmiller said that the U.S. government is doing a poor job of preparing for a potential trade war with China, by protecting domestic steel and coal businesses while taking aim at Big Tech.
I am not a nationalist, but if we’re going to be in some kind of conflict, it’s going to be fought among the big tech companies, not our aluminum and steel companies, and we’re going to get rolled.
Speaking at the Economic Club on Tuesday, former hedge-fund manager Druckenmiller argued that the Chinese government remains supportive of Huawei Technologies Co. Ltd. and has eased up on restrictions around companies like Alibaba Group Holding Ltd. BABA, +2.71% and Tencent Holdings Ltd. 700, -1.92% amid escalating trade tensions between the U.S. and China. He contrasted this to the U.S. approach to regulating Big Tech, which he said amounted to “throwing sand in the gears and making their life miserable.”
See more: Why a cautious Stanley Druckenmiller piled into Treasurys and Chinese tech
The remarks come after shares of Facebook Inc. FB, +0.79% and Alphabet Inc. GOOGL, +1.05% GOOG, +1.12% took big hits in Monday trading amid reports that regulators were considering investigations into whether their businesses are anticompetitive. Apple Inc. AAPL, +2.77% and Amazon.com Inc. AMZN, +1.55% saw their stocks fall as well, to a lesser degree, after similar reports.
“If you are going to have an economic war with China and you’re looking ahead, where do you fight the war?” Druckenmiller asked. “To me you fight it with AI, you go where the future’s going.” China is “oiling their high-tech machine,” he said.
Another area of discussion between Druckenmiller and moderator Scott Bessent of Key Square Capital Management was whether China’s Xi Jinping is less likely than President Donald Trump to punish companies whose executives he personally dislikes.
Bessent said that China’s president reportedly “can’t stand the chairman of Huawei,” while Druckenmiller remarked that Huawei is China’s “champion” and now Xi is “partners” with the company. Trump, meanwhile, is “not real fond of Mr. Bezos,” Druckenmiller said. Jeff Bezos is the chief executive officer and largest shareholder of Amazon, the parent of the Washington Post, which has published reports that have been critical of Trump.
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