China has reportedly announced that it has been outdone by US technology. This implication came from the statement that it can only respond to the US “freedom of navigation” exercises by sending nuclear subs to the South China Sea. While some claim that the reports from Beijing are “exaggerated”, either scenario shows Beijing revealing its position of weakness and needing to resort to drastic measures. The report seems to have come as a response to reports of the US Navy’s use of the new electromagnetic-powered hypersonic railgun.
An international tribunal on China’s claims, activities, and islands in the South China Sea is expected in the coming weeks. China has already announced to declare the ruling illegal and will not comply. There seems to be no word on whether “contempt of court” charges against China will be included in the tribunal, in lieu of the recent comments. Elementary power brokers strive to understand the concept that, in our day, law comes from the resolve of the masses and to change the law, one must first court the masses. We’ll see.
Then, there’s money. Concern is growing over an ENRON-style ingrowth and implosion in China’s economy. While wealth management portfolios formerly focused on deriving profits from bonds (AKA real, individual people), the swelling trend is to invest in other banking investments. This is an exceptionally large problem since many banking investments now get their money from wealth management. So, Chinese banks are making more of their money by getting money from each other, and less from actual people.
Then, there’s currency. China has set the value of its currency at a five-year low. This in the shadow of recent comments from the US Fed chair. The high seas are not the only battle front irritating the international community. And, currency value isn’t either, for that matter.
There’s also trade. Not only Taiwan, but now Europe is getting cold feet in trading with China. Taiwan won’t resume cross-straight talks until it gets some laws passed to make the playing ground even. And, some in China’s circles echo similar statements from front-running US presidential candidate, Trump.
Speaking of Taiwan, the newly elected president, Tsai, visited a Taiwanese Air Force base for the first time in her new presidency. She seems less shy of talking about her own the military than Obama is of his. While China may not notice the responses of the international community, China will notice Tsai. Perhaps that is why the nuke subs are on the way.
Military
China To Send Nuclear-Armed Submarines To Pacific To Counter U.S., Beijing Claims | Forbes
South China Sea fears grow before tribunal rules on disputed islands | Guardian
Tsai visits air bases to show support | Taipei Times
Though Largely Unknown, Trump Finds Fans in China | ABC
Money
China Fixes Yuan at More Than Five-Year Low Against Dollar | WSJ
China Default Chain Reaction Threatens Products Worth 35% of GDP | Bloomberg
Show Us the Money, China | Bloomberg
Trade
EU shifts against lower trade barriers with China | Politico
President reiterates intent to join TPP in next round | Taipei Times
Cross-strait talks pending bill: minister | Taipei Times