This week highlights from Coin Bureau’s YouTube channel focus on two critical macroeconomic issues - China and its stance on Taiwan and concerns around global oil prices. Both of these factors will be weighing on any investor’s portfolio in some way.

 

You’ll almost certainly be aware of the fact that China has long coveted Taiwan and aims to unite the two countries - by force, if necessary. This dispute has rumbled on for decades, but tensions are currently higher than they have been for a long time. As Chinese president Xi Jinping consolidates his absolute power by securing a third term in office - meaning he is effectively president for life if he so chooses - the likelihood that China will make its move is becoming uncomfortably high. 

 

In the first part of today’s episode, we look at some of the main reasons as to why China could be on the brink of invading Taiwan. As US president Joe Biden has repeatedly pledged military support for Taiwan in such an eventuality, the stakes could not be higher for all three countries and the wider world. As we’ll see, there are many reasons why China could be readying for a strike and just as many reasons why such a move would have dire consequences for the world. 

 

Next up, we take a look at why oil prices are also something we should all be concerned about (there’s not much in the way of good news this week, sadly). The Organisation of the Petroleum Exporting Countries - OPEC - the powerful international cartel that sets global oil prices, recently decided to cut production by 2 million barrels a day, meaning the price of oil is set to climb. This obviously has serious consequences for the global economy.

 

There’s also the uncomfortable fact that the US has recently tapped its Strategic Petroleum Reserve - SPR - to make up for the disruption to oil production caused by Russia’s invasion of Ukraine. This has helped to combat inflation caused by rising energy costs and insulate Americans from higher prices at the pump. But it also means that the US has decreasing amounts of oil in reserve for an emergency, such as, for instance, a war with China over Taiwan. 

 

So, find a safe spot behind the sofa and have a listen.

 

We hope you enjoy the show.

 

Producer for iHeartMedia: Noel Brown

Editor: Semir Mutapcic

Theme music composed by: Noel Brown

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