China

One topic we’ve spent quite a bit of time discussing is the rise of the PLA navy. 

2015 was the year Xi reasserted China’s maritime might - and not just in the South Pacific. 

With just two days left in 2015, the main driver of overnight global stocks and US equity futures remains the most familiar one of all of 2015 - crude oil, which, after its latest torrid bounce yesterday has resumed the familiar "yoyo" mode, and again stumbled dropping below $37 on yesterday's surprising API 2.9 million crude inventory build, as well several more long-term "forecasts" by OPEC members, with Kuwait now budgeting for $30 oil, while Venezuela's Maduro said the oil price fell to $28/bbl and is "headed downward."

Two days ago, an armed Chinese ship and two other vessels entered the waters north of Kuba Island and encroached on Japanese territorial waters starting at around 9:30 a.m. Kuba is part of the Senkakus which are at the center of a longstanding dispute between Beijing and Tokyo.

2015 was the year of considerable FX drawdown as desperate EM central banks attempted to rescue themselves from reality.

As Barry Eichengreen noted,

"Intervening to support an exchange rate that’s fundamentally overvalued is a fool’s game and a no-win situation, akin to a sovereign attempting to sustain an unsustainable debt burden rather than yielding to inevitable restructuring."

The Kremlin have announced that China are to send 5,000 of its most elite military forces into the Levant War Zone to help Russia in the fight against ISIS, which has left the Obama administration and the Pentagon “horrified”.  The “Siberian Tiger” Special Forces and “Night Tiger” Special Forces Units were given authorization to be deployed by China’s People’s Congress (NPC) on Sunday, after China passed its first anti-terrorism law allowing their army to take part in anti-terror missions abroad.