A Conflict Over Taiwan Could Lead to Massive Response by Federal Reserve.

what happened last year when Russia started its uh military operation whatever you want to call it it will make it look like a picnic the prospect of some kind of conflict between the United States and China I think it's interesting that we cover that today before I start though I like to give a shout out to my Affiliates uh precious metals uh dealer dealers Affiliates uh

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fees for the next 12 months so if you're thinking about opening a glint account this could be a good opportunity so back to Taiwan the US and China and uh over the weekend and today Secretary of State blinken traveled to China he was supposed to have gone in February but then you had this balloon incident and and uh he canceled this trip and it looks like

things are getting a little better at least people are talking to each other and that might be a good thing but uh one comparison that I will make to what's going on uh is the Munich agreement so a year before World War uh two kicked off it looked looked like things were great they met in Munich there's an agreement uh the prime minister of Britain was

there Neville Chamberlain um all the major leaders of Europe were there and then one year later the war kicked off and I'm not saying there will be a war with China vis-a-vis Taiwan but I think it's a big risk and it's not just me uh talking about this um there is a article today in the Ft talking about it uh an opinion piece of course by

Leo Lewis and he says how Hong Kong's multinationals and Global funds are preparing for the worst corporate contingency planning in the territory will be a litmus test for assessment of China risk I'm not going to go through the Yahoo article I'm going to put a link to it below in the description if you want to read it through archive.ph uh but uh this is what he

says here uh the worst case scenario that most concerns him centers on China the US uh the Ambitions of ishi Jinping the aggressively tight consensus in Washington and the fate of Taiwan things may yet calm down and Leadership Summits May defuse tensions but for now at least the hostility feels irreversible and uh the Divergence permanent an alarming combination so I don't have to tell you how

important China is for the supply chain around the world for goods and services that they produce and we saw in 2020 when there were lockdowns that there are a lot of things that uh the Chinese export to us that are used in producing final goods too really really important uh one example I'll give you is rare Earths rare earth metals I think China produces most of

it like something like 90 percent of rare earth metals is produced in China and many other things uh China is a huge producer of silver and we spoke about uh silver the other day about the fact that uh there could be a supply Crisis coming uh soon uh this of course would accelerate it what what's this well it would be a crisis um some kind of

conflict uh between the U.S and China it would be huge of course because of Taiwan and I was going through uh a Reuters article that just came out and it says blinken Wang tackle tough issues as possible she meet looms so they're talking about here the fact that it would be significant uh and a good move if Xi Jinping gives uh Anthony blinking a bit of

time to meet him if not uh yeah it's the kind of thing that gives a good impression right they're not sure yet whether blinken is going to meet uh Xi Jinping if he does does it mean the the tensions are over not one bit but we saw with the Munich agreement back in 1938 what happened and uh it says here U.S Secretary of State Anthony blinken

discussed Taiwan and other authority issues with China's top Diplomat Wang we wank Yi excuse me in Beijing on the final day of a rare visit aimed at preventing friction between the Rival powers from spiraling into conflict again I'm going to put this in the description you can read it um this is what the Chinese said here uh Wang we must take a responsible attitude toward the

people history and the world and reverse the downward spiral of U.S China relations Wang said during the meeting with blink and according to a statement released by China's foreign Ministry um and this is what he said on the issue of Taiwan China has no room for compromising concessions according to the Chinese readout so yeah um I think it could be a cover as I said for

intervention in the markets and what do I mean by that well it would be pretty much like what happened in 2020 with with lockdowns and that crisis we had back then where the central banks just like flooded the markets with uh Funny Money where rates are cut to zero where governments intervene fiscally so this could be a cover uh it could give a good reason uh

and it would be because of national security so I think uh we need to keep an eye on on this and I will keep an eye on this closely the China Taiwan us uh situation so with that let's quickly look at where the markets are this morning uh it's uh 8 30 a.m London time so we've got spot gold 1953 uh yeah it's down about four

bucks High's been 1960 and the low has been right around here in 1952 81. so we're off a little bit here this morning a spot silver is at 2404 that's down about 15 cents or 0.6 of a percent the low's been 24 and the high has been 24.27 the stock market index Futures they're pretty much unchanged so I won't go through them uh the currencies Sterling

is down slightly at 128 11 the Euro as well is down a little bit at 109.25 Dollar is unchanged versus the Yen at uh almost 142. so the Yen of course is uh headed south it's one of the worst performing fear currencies we've we've seen in the last 20 years along with uh the British pound and those are the major Fiat currencies I'm talking about uh

the dollar uh you want is uh up half a percent at uh 7 16 50. to the other currencies uh we got the uh Aussie dollar down point two of a percent 68.64. uh we got the dollar and change versus the Canadian dollar 131.88 and the Kiwi dollars down a quarter of a percent at 62.22 quickly go through the Commodities uh WTI Crude is down 7

8 of a percent at 71.40 uh Brett is down the same in percentage terms just below 76. uh Platinum is down two bucks trading around 9.85 and high grade copper is down half a percent at 387.50 we're gonna quickly go through the bond markets we start with the guilt Market well we got the two-year deal yields trading at five percent which is not a good good

sign for uh the housing market especially in the UK for mortgages uh we know that uh 1.4 million uh mortgage deals are coming due for Renewal just this year alone so yeah the we're right near the highs here in terms of yield and I think on Friday we did get above five percent so no respite for the UK guilt market and unfortunately for homeowners who have

mortgage themselves uh and uh have a problem on their hands uh US Treasury Market we've got the 10-year yield unchanged at 378. so there you go uh with that I'm gonna wish you all a very good day take care bye