Asia

Submitted by Alasdair Macleod via GoldMoney.com,

Even before he takes office, President-elect Trump is turning the world upside down.

It has become clear his attitude towards Russia and China is very different from that of his predecessors. Amazingly, he is already wresting power from the deep state, causing it great resentment, which under Obama, Clinton and the Bushes, ran geopolitical policy. From January, barring accidents the world will not be the same, the establishment up-ended.

On Saturday morning, the Pentagon was eager to announce that China would return a U.S. Navy underwater drone after its military scooped up the submersible in the South China Sea late this week and sparked a row that drew in President-elect Donald Trump. As previously reported, Pentagon spokesman Peter Cook said that “through direct engagement with Chinese authorities, we have secured an understanding that the Chinese will return the UUV to the United States."

With the Yuan at its weakest against the Dollar since May 2008, it's becoming harder and harder (and more and more expensive) for China to hide/defend its devaluation strategy (CNH down over 13% since the 'one-off' Aug 2015 devaluation).

And in its latest effort to rig the currency's value, it currently costs more to borrow yuan overnight in Hong Kong than it does to borrow it for a year.

As The Wall Street Journal reports,

In a fiery press conference on Friday, shortly before departing for his last Hawaiian vacation, president Obama accused the press of being responsible for Hillary Clinton's loss, slammed "domestic propagandists" who he said were responsible for the risk of "fake news" and assisting foreign counter-US propaganda, but more importantly Obama vowed to “send a clear message to Russia” in retaliation for its election hacking - of which the CIA still has to demonstrate evidence - as both a punishment and a deterrent.

Barron's Asia: When you look ahead to 2017, what keeps you awake at night?

 

Amando Tetangco: Short term, the Fed rate hikes -- the timing and the magnitude. Of course, this would be related to the policies that the new U.S. administration will adopt. Medium-to-long term, the retreat from multi-lateralism. That is related to the performance of the global economy - the major and various economies, and emerging markets like China.