Salient to Investors:

William Pesek writes:

  • China’s declaration of a vast air defense identification zone belies all the talk of its peaceful, magnanimous rise as a world power. A tiny accident or miscalculation in the skies above the disputed islands could easily spiral out of control, dragging Washington into a clash that would shake the global economy.
  • Xi may be especially willing to risk a confrontation with Japan in order to distract opponents of his proposed reforms, as well as ordinary Chinese who are growing restless over pollution, income inequality and official corruption.
  • Abe is an unapologetic revisionist who remains intent on whitewashing Japan’s WWII aggression, including the government’s role in keeping military sex slaves; flexing Japan’s muscles in Asia; and perhaps revising its pacifist constitution.
  • In addition to Japan and Korea, China’s air zone is sure to worry Brunei, Indonesia, Malaysia, the Philippines and Taiwan, all of which are embroiled in territorial disputes with Beijing.
  • China took a big hit abroad for its initial $100,000 aid offering to the typhoon-devastated Philippines, so its inflammatory new policy will only further alienate neighbors in a region it’s seeking to woo away from the US.

Read the full article at

Click here to receive free and immediate email alerts of the latest forecasts.