Our perspective on global micro event and strategies.
President Joe Biden’s June 3 executive order (EO) is in my view another important milestone in the long-term deterioration of US-China bilateral relations. The order, which takes effect August 2, aims to limit US investors’ ability to fund Chinese companies seen as supporting China’s military-industrial complex. It builds on the Trump administration’s executive actions but is broader in approach, clearer in detail, and more market friendly.
Under the terms of the EO, the list of targeted Chinese companies increases from 44 to 59. As expected, the focus is on emerging or frontier technologies critical to military power, such as avionics, advanced communications, nuclear, and space. However, while this EO largely represents a continuation of Trump’s policy, it has a new focus on Chinese surveillance and human rights issues, which is consistent with the Biden administration’s general approach to…
The recent flurry of US sanctions leveled against Russia has aggravated frictions between the two nations and cast a long shadow of doubt on the Russian equity market.
Russian President Vladmir Putin more or less forced US President Biden’s hand when he deployed an EU-estimated 150,000 troops to the Ukrainian border. However, pressure had already been mounting for the US to get tougher on Russia following the country’s unprecedented SolarWinds hacking operation and its largely unsuccessful attempts to interfere in the 2020 US presidential election.
Based on these troubling incidents, it seems we have entered a “new normal” in US-Russia relations and should expect risk premiums in Russia’s equity market to…
More than two months into the Biden administration, some important contours of the post-Trump approach to US-China relations have begun to crystallize.
The president’s foreign policy team is coming together (including key positions for US-China policy), US military strategy is becoming clearer, and supply-chain management is a growing area of concern. Meanwhile, government reports released earlier this month — on artificial intelligence, trade policy, and national security priorities — have helped to better define the administration’s thinking on…
The US military defines a “complex catastrophe” as a “natural or man-made incident […] which results in cascading failures of multiple, interdependent, critical, life-sustaining infrastructure sectors and causes extraordinary levels of mass casualties, damage, or disruption severely affecting the population, environment, economy, public health, national morale, response efforts, and/or government functions.”1
Working with Wellington’s Climate Research Team, our Global Macro Team is studying the macro, market, and geopolitical implications of climate change. We see climate change as a complex catastrophe in the making, with the potential to exacerbate geopolitical instability and multiply threats to economic and national security. Governments, including the US, China, and European Union, are beginning to treat climate change as a structural peril. Under the Biden administration, climate change has…
In this 25-minute video, Geopolitical Strategist Thomas Mucha, Macro Strategist Michael Medeiros, and Multi-Asset Strategist Nanette Abuhoff Jacobson explore the investment implications of Biden’s domestic and foreign policy agenda and opine on which asset classes, factors, and industries they expect to outperform in this new environment.
Bilateral relations between the US and China have gone from bad to worse in recent months.
On 12 November 2020, President Trump issued an executive order (EO) that prohibits US investors from transacting in publicly traded securities of entities classified by the Department of Defense as “Communist Chinese military companies (CCMCs).” Slated to take effect on 11 January 2021, the EO fueled my concern that the outgoing administration would attempt to derail the US-China relationship before President-elect Biden takes office (on 20 January). I wouldn’t be surprised to see further efforts on this front before Trump leaves the White House.
So with that as a springboard, how might the fractured US-China dynamic evolve during Biden’s upcoming first term? I envision four potential paths…
Localization. Digitization. Industrial protectionism. In the wake of COVID-19, the world is eager to form more resilient supply chains. These efforts could affect a range of industries as well as fiscal and monetary policy. In this 17-minute audiocast, Geopolitical Strategist Thomas Mucha speaks with members of our Global Macro Team about the future of global supply chains.
Amid continued macro uncertainty and a reacceleration of infections in many states, Washington continues to forge a path forward, trying to keep the US economy afloat. In this 18-minute audiocast, we discuss fiscal policy options, take an early look at the election picture, and give a quick assessment of how foreign policy could shift in a Biden administration.
Given recent developments in the bad-to-worse US-China relationship, I’d like to share my latest views on what I see as the most consequential long-term geopolitical issue the world has faced in decades.