GEOPOLITICAL EVENTS ARE AT THEIR WORST SINCE WW2
Where do we start? Tense geopolitical situations, food crisis, rising international crude coupled with a very high level of uncertainty in the future. War in Ukraine hasn’t Come any close to any peace deal and now the world is preparing for another invasion of a sovereign nation Taiwan by China
While in the US soaring gas prices, food prices and even baby formula has been increasingly difficult to find in US stores.
In Tokyo, Joe Biden met the newly elected leader of Japan. While Addressing the media, When Joe was precisely asked by a journalist “ would you militarily get involved if china invades Taiwan “ Joe Biden replied, “yes, that’s it has been our policy and we are committed to it “. Getting militarily involved with china means US soldiers stepping foot on Taiwanese soil, which according to the regime in Beijing (CCP) is an integral part of China.
There are some key point points that we can take from the ongoing economic crisis.
1. When covid spread all over the world, leading to the shutdown of numerous manufacturing jobs but to keep the liquidity in the market. Fed poured in trillions of dollars which resulted in very quick recovery in the Market but this time things are a bit different. Due to soaring high prices in crude as EU to somewhat and the united state has cut off their reliability on Russian oil. Will the demand in US domestic market will remain high which lead to inflation , tempting fed to be too aggressive with interest rate hikes to control the inflation now it seems it might backfire which would be a catastrophic event for the economy all over the world
2. When America sneezes, the world catches a cold. Tension is growing and it is making the market nervous, while in the short term there may be some recovery in the market in the long term, there seems to be little to no light at the end of the tunnel considering the current geopolitical event