July 29, 2022, 5:09 pm EDT
Dragon and Eagle Battlefield
The China red dragon and US eagle battlefield are about to intensify at the military level.
After Xi and Biden’s conference yesterday, Xi threatened Biden that “playing fire will get burned” about Nancy Pelosi’s potential visit to Taiwan. Obviously, China is in a stronger position against the US because Biden told Nancy not to go to Taiwan citing military concerns.
Although Nancy began to show uncertainty about whether she will go to Taiwan on her Asia trip, the USS Ronald Reagon carrier and group of fighting jets are ready to meet China’s group this weekend.
Either Nancy could cancel her trip to Taiwan or China back off its threat will soften the relationship. But the confrontation is already on the rise between the number 1 and number 2 countries in the world in terms of the GDP ranking.
Recently, both China and US are undergoing an economic slowdown. Russia-Ukraine wars also separate many countries to pick sides between the two groups. Currently, there is a potential list of two powers for potential World War III:
- Axis: Russia, China, North Korea, Iran
- Allied: US, Japan, Australia, India, Ukraine, Taiwan
At this moment, many major countries do not make up their mind yet (France, German, Canada, Italy, South Korea) so there are lots of uncertainties. However, if there is any military conflict occurred between US and China, then the grouping process could speed up quickly.
We think the possibility of a higher level of wars in terms of regions and intensity is coming. The world does not go toward more peaceful settings in both the domestic environment and international conflicts. After COVID-19, the inflation, food shortage, and economic hardship are piling up for a much more difficult future, in our opinion.
Thus, we are looking forward to adding more defense to our portfolio: NOC (holding), LHX, HII, LMT, etc.