1,000
3.00
A Trump ‘abandoning’ of Taiwan doesn’t necessarily result in an invasion.
War is politics by other means. Once the US establishes that it won’t go to war over Taiwan, the political calculation for those on both sides of the straits changes. Maybe talks resume under the 1992 consensus. Maybe a 1C2S formula is seriously canvassed.
There’s an interesting spin-off market idea here of “if the USA clearly signals that it will not go to war with China over Taiwan, will China invade”.
For example, see: https://www.foreignaffairs.com/taiwan/taiwan-fallacy
I'm fairly ignorant on this matter, but saw this comment (see image) on a Steve Hsu blog post (https://infoproc.blogspot.com/2021/08/strategic-calculus-of-taiwan-invasion.html) and was wondering if you guys had any thoughts or critiques of it.
@elf Amongst other things, this comment totally butchers the Shanghai communique, in which the US merely 'acknowledges' China's position on Taiwan without definitively agreeing to it and opposing the use of violence to resolve the situation. Most Western countries have similar positions on Taiwan. If the US was totally fine with China taking Taiwan by force, we would not have had a Third Taiwan Strait Crisis in 1996 where the US sent two aircraft carriers to deter the PLA.
@elf you can test Bob's analysis by putting up some big limit orders in China-Taiwan markets and seeing if the site agrees with him😜
ASML machines have remote kill switches in case of Chinese invasion of Taiwan.
Michael Studeman, recently retired Commander of the Office of Naval Intelligence and Director of Intelligence for the US Indo-Pacific Command, wrote an article saying that
"Xi’s most critical choices reflect a march to war... All strategic war preparation indicators are brightly lit."
“Xi may not care overly much given the inescapable backsliding of his economy even in the absence of any war. In the coming years, he may conclude he has everything to gain and nothing to lose by waiting any longer.”
“…Xi’s age (70) matters. He only has ten reliable years of vitality to conduct a major operation and then lead China through the inevitable multi-year recovery from anticipated international retribution. Based on how Xi appears to be interweaving his legacy with assimilating Taiwan, it seems unlikely he would leave it up to a successor to absorb the forever glory of overseeing a long-sought unification and subsequently re-stabilizing China’s place in the world, a feat that could put Xi on par with Mao Zedong.”
This talk about motives and legacy at a dictators old age recall the same for Putin recently.
@SemioticRivalry On the flipside TSMC is probably a pretty close proxy and still trades at a similar earnings multiple to 2020 (i.e. it isn't being significantly discounted)
@CameronHolmes But that's weird. The entire rest of the semiconductor industry has risen rapidly. TSM should be trading much higher now.