China

Last week, in a largely "under the radar" event, one of China's wealthiest billionaires (if only on paper), Wu Ruilin, chairman of the Guangdong based telecom company Cosun Group, and whose personal fortune of 98.2 billion yuan ($14 billion) makes him wealthier than Baidu founder Robin Li who is ranked 8th on the Hurun Rich List 2016, shocked Chinese bond market watchers when he defaulted on a paltry 100 million yuan ($14 million) in bonds sold to retail investors through an Alibaba-backed online wealth management platform, citing "tight cash flow."

Two days after China demonstratively showed off a live-fire exercise involving its one and only aircraft carrier, the Liaoning, in the Yellow Sea, with the Defense Ministry hinting that the carrier would next sail to the South China Sea after announcing that "as a next step it will conduct scheduled cross-sea training and tests," Beijing did just that and as Reuters reports, a group of Chinese warships led by the country's sole aircraft carrier passed south of Taiwan on Monday, and entered the top half of the South China Sea, in what China has termed a routine exercise.

2016 was chock-full of surprises, both in markets and in politics.

As Goldman's Allison Nathan explains, the year began with a perfect storm of worries that had become all too familiar already in 2015. Oil prices plunged and fears of faltering growth and a sharp depreciation of China’s currency escalated, driving disruptive sell-offs in credit and other risk assets. Confidence in global growth faltered, particularly after an anemic US GDP report for Q1.

Data released by China's NBS early last week confirmed that the latest Chinese housing bubble continued to deflate with 70-city housing price data confirming that home price inflation slowed in most cities in November, except in a few lower tier cities where home price inflation re-accelerated. The average, seasonally adjusted property price change was in November +0.7% from October, and up +12.9% yoy. This compares to October's +1.2% mom increase and +12.7% yoy.

Average housing price growth continued to moderate in tier-1/2/3 cities.

As politicians and mainstream media blast Trump's apparently incendiary tweet regarding nuclear arms, none other than President Obama just signed legislation that, by striking a single word from longstanding US nuclear defence policy, could heighten tensions with Russia and China and launch the country on an expensive effort to build space-based defense systems.

Oh the irony... Following Trump's tweet...