China Prepares for War, You Should Too

Jennifer's World 曾錚的世界:War Mobilization Meeting of the Southern War Zone of the PLA: Guangdong Province in The State of War

According to the spirit of the instructions from above, combined with the actual situation in our province, it is recommended that in accordance with the principle of a rapid and orderly Normal to War status transition, military planning, and mobilization, we will focus on the following three tasks.

First, the construction of a national defense mobilization command system

Second, the implementation of a wartime work mechanism

Third, wartime control preparation

Next, please discuss and make speeches.

First, we need to strengthen the protection in the political field. Look at the recent several regional wars, especially the Russian-Ukrainian conflict war situation. If you look at the big picture, the United States and the West will try everything to slander us, smear us, in an attempt to confuse right and wrong, to shake our will to win a just and decisive battle. We must give full play to public opinion, legal struggle, psychological war, and militia teams to strengthen the guidance of public opinion and psychological protection, and cohesion of patriotic support for the positive energy of the military front.

Second, give full play to the advantages of the people's war, fully learn from the experience of epidemic prevention and control in previous years, fully mobilize grass-roots organizations, widely mobilize cadres and masses, organize military, police, and civilian forces, launch grid control, create an atmosphere of national preparedness, improve the people's ability to withstand war and disaster, so that the enemies and spies have no place to hide.

War is coming, probably within 12 to 18 months if it's going to happen.

How Long Until Taiwan is Sacrificed to Isolate China

China might be smart enough to avoid the bait, but China might also be strong enough to take the bait and break the isolation, delivering a fatal blow to the USG's hegemony. If they wait, they will win. Therefore, USG must incite Taiwan to war. Let's see what USG goes via-a-vis Taiwan next. Escalation or deescalation?

How to Buy a House in Taiwan After Reunification

QQ: 统一后，去台湾省买房怎么选

After reunification, how to buy a house in Taiwan Province?

I heard that after reunification, Taiwan's fiscal revenue can be used to improve people's livelihood. That is indeed a big plus!

It happened that Uncle Kai studied the real estate market in Taiwan Province last year, and today I take this opportunity to share with you: "How to buy a house in Taiwan Province after reunification?"

01

Status Quo of Urban Development in Taiwan Province

Because Uncle Kai always likes to take precautions, he always likes to take a step in advance, and he always subconsciously predicts and prepares for obvious investment opportunities in advance, in case of sudden calls.

Therefore, regarding Taiwan's real estate investment, I communicated with my former colleague (Taiwanese) in 2017, and roughly had a preliminary judgment on the development prospects of cities in Taiwan after the reunification of Taiwan in the future.

Today, Uncle Kai is in a good mood, so I will share it with you for free, maybe you will be able to use it soon.

Taiwan Province, currently 36,000 square kilometers, will have a GDP of 4.58 trillion in 2020 and a population of 23.6 million .

In recent years, the Internet has been filled with all kinds of comments mocking the frogs at the bottom of the well on the island. It seems that Taiwan is relatively backward in the eyes of netizens.

But in fact, when we compare the data of Taiwan Province with the cities in mainland China, we will find that Taiwan Province is still the leading region in China's economy.

Although it is called Taiwan Province, it is only 36,000 square kilometers, which is 43% of the area of ​​Chongqing, and 2/3 of the region is hilly and mountainous, so we can compare Taiwan Province as a city, which can be compared with Chongqing and Shanghai .

Chongqing has a population of 31.01 million, an area of ​​82,400 square kilometers, and a GDP of 2.5 trillion;

Shanghai has a population of 24.9 million, an area of ​​6,340 square kilometers, and a GDP of 3.9 trillion;

Taiwan Province has a population of 23.6 million, an area of ​​36,000 square kilometers, and a GDP of 4.58 trillion.

Taiwan's total GDP and per capita GDP are both higher than Shanghai!

But the question is which city should we choose to buy in?

Then it needs to be analyzed specifically for the city.

The topography of Taiwan Province is very unique. Two-thirds of the island's area is hilly and mountainous. The eastern part is occupied by the central mountain range, so the population can only be concentrated in the western plain.

In the west, there are currently six important cities in Taiwan, namely, New Taipei, Taipei, Taoyuan, Taichung, Kaohsiung, and Tainan.

From an economic point of view, these 6 cities are the core cities of Taiwan Province. If we want to buy a house, we should be able to choose from these 6 cities.

In terms of population, New Taipei City is the most populous city with a population of 4 million. Economically, New Taipei City is also number one in Taiwan Province. So the economy and population are both first. After reunification, should we first buy New Taipei City?

I don’t think we can make a conclusion based solely on population and economy. Our investment is about growth. Uncle Kai thinks that we have to consider future growth space. We can’t look at the current situation of Taiwan Province, because after reunification, population growth will be a problem. , It should be full of changes.

Of course, looking at the property market in Taiwan in the past two years, the above six cities are indeed the best performers. Oh, and Hsinchu must be added because Hsinchu is a high-tech industry and the base camp of TSMC.

New Taipei, Taipei, Taoyuan, Taichung, Kaohsiung, Tainan, Hsinchu , these 7 cities can be included in our self-selected target cities.

02

The current status of Taiwan's property market

(New house prices in major cities in Taiwan Province in 2021)

According to the performance of Taiwan's property market in 2021, it is still quite impressive.

Second-hand housing in Taipei has been rising continuously, with an increase of about 7% compared with last year, and it currently reaches 63,000. The latest average price of new houses has reached 76,000 per square meter.

The above seven target cities all rose across the board, and Hsinchu performed well, with individual new projects exceeding 38,000 per square meter.

According to the above chart, Taipei's housing prices are the most expensive. From an average price perspective, they are more expensive than Shanghai. However, considering the future reunification, we will not allow Taipei to continue to increase housing prices. Believe that buying real estate in Taipei is risky.

03

Which one is worth buying?

Uncle Kai personally will exclude Taipei first. In addition to the above, the housing prices in Taipei are currently too high. After reunification in the future, they should be regulated. There is another important reason, that is, there is no more space in Taipei.

Geographically, Taipei happens to be located in the northern basin, surrounded by mountains. At present, 272 square kilometers have been fully constructed, and there is no surplus open space for development.

If you want to re-develop, you must demolish and update, but I think that after the reunification, it is not realistic in the short term. After all, the demolition has always been too difficult, so there is no space, it is difficult to demolish, and the housing price is already too high. These three reasons are sufficient, so I don't recommend it. Buy real estate in Taipei.

(Difficult to dismantle old and shabby)

Looking at Xinbei again, Xinbei is actually the original Taipei County. It just surrounds Taipei City. In theory, Xinbei and Taipei can be regarded as one city.

New Taipei has 2052 square kilometers, coupled with the largest population and the largest economy in the province, so New Taipei is indeed a good investment area.

After reunification in the future, it is very likely to increase the development of New Taipei City, because after all, it is relatively close to Keelung Port and has good freight conditions.

But compared with the current unit price of more than 30,000, I feel that there is space, but it is not particularly large. The main reason is that the area of ​​the Taipei Basin is not large, with an area of ​​only 243 square kilometers. On the surface, the area of ​​New Taipei is large, but there are not many areas that are really suitable for construction. I personally think that it can be invested, but it is not the best choice.

In fact, if we spread out the map of Taiwan Province, we will find that Taiwan Province can be roughly divided into three economic circles, namely, the Taipei Economic Circle, the Taichung Economic Circle, and the Tainan Economic Circle.

These three economic circles can be said to be one-third of the world. They all have their own ports, namely, Taipei Keelung Port, Taichung Port, and Tainan Kaohsiung Port.

Although the Taipei Economic Circle is strong, its hinterland is small and housing prices are too high. From an investment perspective, I can only say that it is not the first choice.

As for the Tainan region, Kaohsiung is the economic center of southern Taiwan Province , with a GDP of about 450 billion, ranking third in the province with a strong population.

But I don’t recommend Kaohsiung from an investment perspective, the main reason is

1. Kaohsiung was built relatively early, and the city interface is relatively old, and it is difficult to demolish and relocate now;

2. Tainan is a deep green base camp, which is very unfriendly to the mainland. After reunification, it is inevitable that there will be a psychological distance;

3. Kaohsiung is the farthest of the three major economic circles from the mainland. The cost of building a cross-sea bridge is too high, and it will not be directly connected in the future;

4. The industry is old and backward. Compared with Taichung and Taipei's high-tech industries, Kaohsiung is a low-end manufacturing industry.

Finally , I will talk about Taichung. After the reunification, I personally like Taichung the most. The reasons for being optimistic about Taichung are as follows:

1. The Taichung Basin is relatively large, with an area of ​​about 400 square kilometers. It is the largest basin in Taiwan Province. The geographical position is very superior. There is Taichung Port directly facing Quanzhou in the mainland, and it is in the heart of Taiwan Province. To Taipei, to Tainan is not far away, and you can control the entire Taiwan by controlling here;

2. Taichung was built the latest, with the most open space, and the city interface is also the latest. If you want to develop a new big city after unification, only Taichung has enough wasteland for development, and the resistance to demolition is the least;

3. Taichung's current housing prices are relatively low. The average price of new houses this year is only about 24,000. Once the development is focused in the future, there will be more room for improvement;

4. After reunification, if the mainland builds a high-speed rail to Taiwan, there can be three routes connecting Taipei, Taichung, and Tainan. The least difficult to construct is the Taichung route, with a total length of 128 kilometers. This line has a shallower water depth and is least affected by typhoons. ；

5. Net inflow of population, the province’s population is the second largest, GDP is the third in the province, the industry is high, there are many universities, and the scientific research strength is strong.

Although the housing prices in Taiwan Province have been rising this year, this is mainly due to the release of global currency. In fact, the population and economic situation in Taiwan Province are not optimistic. The population has declined significantly, wages have not risen for many years, and the economy has been growing at a low speed for a long time.

If compared with other cities, the rate of return is actually not high from an investment perspective.

However, the environment we assume is a post-unification situation, and the situation will be different by then. Taiwan Province may have a rare wave of investment opportunities.

Based on the reaction of Taiwan's housing prices to past historical events, we can roughly estimate how Taiwan's property market will perform once reunification occurs.

Let us take Taipei as an example. In 1996, housing prices in Taipei dropped by about 12% in a short period of time.

So if the reunification begins, we have reason to believe that Taiwan's house prices will fall by far more than 12%, which should surpass the 1998 financial crisis, and a 50% decline can be estimated.

In that case, the average price in Taichung will be around 12,000, so for a city with a superior location and huge development space, I think this price will be very worth buying.

Now the question is coming. We have the investment goal and the investment prospects are already very clear. But how do we buy at the right time?

Uncle Kai thought of two tricks

1. You can join the army. Once the reunification begins, bravely participate and buy a house in Taichung afterwards. In terms of areas, it is recommended to choose Beitun District and Xitun District, because these two areas are similar to the Optics Valley of Wuhan, especially Beitun District, which has an open space. There are a lot of heavy planning, that is, rezoning, the future will be the most beautiful urban construction area in Taichung;

Unfortunately, Uncle Kai has no chance, age is not allowed, sorry!

2. You can only find a wife in Taiwan Province first, and start a small business in Taichung, such as selling tea eggs, and when the time of reunification comes, you can buy a few more suites immediately and just wait to get rich.

It's a pity that Uncle Kai has a wife, so marrying another one would be life-threatening, and this will not work.

The opportunity belongs to you!

Taiwan Trouble

I don't see how the U.S. will defend Taiwan when a solid chunk of the country wants to reunite with China in some way. I do not see the DPP sacrificing the amount of blood that would be necessary to win since it could descend into an all out civil war. Whereas I suspect both the Chinese army and the KMT would be willing to spill as much blood as possible to win, even if it means depopulating Taiwan.

SCS Tensions Rising

SCMP: Risk of military conflict between US and China higher than ever, experts say

Wu Shicun, the president of the National Institute for South China Sea Studies, said that with Beijing and Washington locked in a rivalry on multiple fronts, the political distrust that had built up between them had led to hundreds of “track one” intergovernmental communication channels shutting down.

According to a report about US military presence in the Asia-Pacific region released by the institute on Tuesday, communication between the US and Chinese armies has been in sharp decline since 2018.

...But as the tension between Beijing and Washington has grown, so have been the fears of a new Cold War. For the first time since the actual Cold War, three 100,000-tonne US Navy aircraft carriers are now patrolling in the Pacific Ocean, while the US Pacific Fleet said last month that all of its forward-deployed submarines were conducting operations in the western Pacific.

...Zhu Feng, a professor of international relations at Nanjing University, said the existing mechanisms might not be sufficient to keep every encounter under control, and the two sides should come up with a more effective way to manage possible crises.

“I am quite concerned as the encounters of the two armies in the South China Sea and Taiwan Strait appear not to be incidental but intentional, both at sea and in the air,” he said.

Nationalism Rising in China: Take Taiwan By Force

SCMP: Push to absorb Taiwan ‘is growing’ on mainland

Li Yihu, dean of Peking University’s Taiwan Studies Institute, said the mainland side saw Taiwan’s Tsai Ing-wen administration as trying to promote independence through tactical approaches, including culture and education and the appointment of pro-independence judges in 2019 to initiate constitutional interpretations.

“All those pro-independence moves will stimulate the mainland to take coercive steps to respond,” said Li, a deputy to the National People’s Congress.

...He stressed that Beijing had no “timetable for reunification”, but wanted “a route chart” of meet President Xi Jinping’s goal of reunifying with Taiwan as early as 2021, the 100th anniversary of the Communist Party’s founding.

China and Taiwan have diverging education systems teaching two separate nationalist agendas. In the near-term of the next few decades, Taiwan and China will become more nationalistic. The odds of Taiwan falling fully within China's orbit over the very long-run are high, but the long-run might be a century or two. If Chinese leaders want reunification in the short-term, they may need a military solution. Then they'll have to contend with a nationalistic Japan. The U.S. might want to sit out a war over Taiwan, but the U.S. might also like the opportunity to do what England did to Germany twice.

Identity Politics Rises in Hong Kong and Taiwan

SCMP: More young Hongkongers back independence and are less supportive of peaceful protest, poll shows

Asked if the “one country, two systems” principle should be extended after 2047 – the end date of Beijing’s promise of 50 years without change after the 1997 handover – 69.6 per cent of poll respondents said yes, while six per cent said no.

As for whether the city should become independent, 17.4 said yes while 57.6 per cent said no.

Another 13.8 per cent said Hong Kong should be ruled directly under Beijing, while 59.2 per cent opposed that idea.

Among respondents aged 15 to 24, supporters of independence formed the majority as 39.2 per cent said they supported the idea, compared to 26 per cent who opposed it.

Wapo: Taiwanese President Tsai Ing-wen: Beijing must respect our democratic will

Q: You represent many of the youth who think of themselves as being Taiwanese, not Chinese. They are more pro-independence than the older generation. As president, you want to maintain cross-strait relations for stability, but at the same time, you must keep your followers happy. How do you balance these factors?

A: Different generations and people of different ethnic origins have different views on China. But they all agree on one thing. That is democracy.

FP: Taiwan’s Kids Are Not All Right

Tsai’s rhetoric is not nearly as bold as some of her supporters. Her cautious approach served her well in academia, and may yet help deflect confrontations with Beijing. She does not use the term “independence” in her speeches. Instead, she emphasizes Taiwanese identity. This balancing act was evident in a measured statement at her victory rally. “The results of today’s election prove to the world that the Taiwanese are a free people; the Taiwanese are a democratic people,” Tsai told the assembled throngs. “As long as I’m president, I will work to make sure that not one of my citizens ever has to apologize for their [national] recognition.” The line earned perhaps the loudest cheer of the night, a subtle signal that Tsai, like her supporters, sees Taiwan as a distinct and internally coherent entity. In such a giddy setting, it was enough. But the forces that brought Tsai to power do not share her subtlety. They may end up sweeping her along, or aside, no matter what her careful plans.

Cautious or not, identity politics continues to rise around the world.

The Nationalization of the Yuan

The China Post: Yuan deposits fall for 4th consecutive month

Chinese yuan-denominated deposits held by Taiwan-based banks were down for the fourth consecutive month in May after banks cut their time deposit rates on the Chinese currency, according to the central bank.
Caution over the yuan's future direction also prompted investors to move their funds out of the yuan at a time when economic growth in China, the second largest economy in the world, has showed signs of moderating, the central bank said.

Yuan deposits, including negotiable certificates of deposit (NCDs), held by banks in Taiwan as of the end of May totaled 308.34 billion yuan (US$46.72 billion), down 2.483 billion yuan, or 0.8 percent, from a month earlier, according to central bank figures.

The end-of-May figure was the lowest since December 2014, when Taiwanese banks had yuan deposits of 302.27 billion yuan, the figures showed.

The trend is the same in Hong Kong, where time deposits are falling.

Identity Politics in Taiwan

Taipei Times: Tsai’s reform aims focus on future

Thus, even though Tsai also emphasizes the nation’s problems of youth unemployment, educational rigidity, growing disparities of income and wealth, an aging population, environmental pollution and loss of trust in the judicial system, she does so within a context of identity politics that points toward ultimate success in development potential, internationalism and openness to new ideas and technologies, a spirit of adventure and a willingness to sacrifice the misadventures of the recent past for the potential of the near future.

However, of even greater significance, the address makes it clear that the issue of national identity is now to involve a dual emphasis and interrelationship of policies toward Aborigines and policies toward China.

Rather than indigenous affairs being an ad hoc and marginal feature of social or cultural policy, it is to move center stage, as Tsai’s key notions of “the entire nation” and fairness require that policy should better monitor and improve the social and economic relations between Aborigines and a majority Chinese population.

Policy toward Aborigines can no longer be presumed as cultural protection of outsiders who are within Taiwan. Aboriginal policy must now be central to a political economy that has a firm identity, and it can only be a political bonus that Aboriginal ethnicity cannot be defined in any way as Chinese in origin.

Again, the “Straits question,” or relations with China, can no longer be seen as purely mechanistic, economic or political, but deeply embedded culturally in the developing crisis of identity among Taiwanese of many backgrounds, ethnic or otherwise. It can no longer be dismissed in artificial appeals to “the concensus” or other spurious formulae designed to hide abiding contradictions.

The same political dynamics are underway all across the world. Although it expresses its form in many different ways, the victory of Tsai in Taiwan is ultimately driven by the same forces propelling Trump in the United States. The friction within and between nations is being driven by culture and identity.

China May Use Offshore Banking to Secure South China Seas

China considers killing two birds with one stone, turning Yongxing Island (Woody Island) into an offshore financial center. Aside from the economic benefits, it would secure China's political claim on the South China Sea.

21st CBH: 南海岛礁能成为百慕大式离岸注册地吗?

Two of the country this year, the South China Sea once again become the focus of the parties. NPC press conference, spokesman Fu Ying was asked three times to the South China Sea. There are also proposals for motions involving the South China Sea. Two of the most notable of the CPPCC National Committee, deputy director of the Foreign Affairs Committee, submitted Han Fangming "Yongxing Island will build a Bermuda registered offshore" proposal.

Registered offshore, through low-tax policy or tax-free, loose financial regulation and open management program, set up to attract foreign companies registered offshore companies. Proposal suggested that the central and Hainan through policy and legal support, allowing the Xisha Yongxing Island, the development of offshore financial services, and thus promote the development of the South China Sea and the central economic zone in the South China Sea strategic layout.

I believe that, and regardless of the specific content of proposals, one on its own logic - the economic development of the island as a means of distribution of the South China Sea should be able to provide new ideas for breaking the increasing complexity of the South China Sea game.

In fact, economic development has become the main means to safeguard the sovereignty of the South China Sea. From the initial joint development of South China Sea oil and fishery resources initiatives, to the exploration of deepwater oil and gas fields, economic instruments are to highlight its significance. The difference is that the role of fisheries and oil and gas development is mainly reflected in the sovereign sea waters especially controversial declaration, and the development of offshore financial sector would help to strengthen the management of the actual controlled islands.

Although China has already realized over the Paracel Islands and administrative development, its economic function has often been watered down. A real problem is that China's legitimate military and civilian deployment in these reefs, likely to cause unnecessary tension in neighboring countries, and become some of the United States, Japan and other countries outside the South China Sea issue of multilateral excuse. In this context, clearly some of the reefs controlled economic development function, can also be regarded as reducing misjudgment, an effective means of reducing external intervention.

I doubt outside parties will be mollified by China securing its interests, but it undoubtedly strengthens China's claims.

There are drawbacks though. Foreign investors will be wary of China's claim on the islands and China's legal system is unable to deal with offshore banking at this time:

Security Capital is also an important factor. The vast majority of offshore centers away from geopolitical disputes, and maintaining political stability through effective government. In contrast, the South China Sea tensions in the South China Sea islands and reefs will hinder the development of the financial industry has brought. This is why a lot of people are not optimistic about Yongxing Island Offshore Financial reasons development. Of course, this view underestimates the Chinese South China Sea as a "real master" determination to maintain peace and stability on the South China Sea. However, for Yongxing Island as an international financial capital registration, we also need to make some effort to highlight Yongxing Island demilitarization of use and so on.

In addition, the legal system, now known global offshore centers use the Law Department. This system was considered for a higher degree of financial innovation tolerance, and ease of integration with Western multinationals legal system. And China, as in civil law countries, the ability to "compatible" an offshore centers?

In short, the Yongxing Island, the reality limited by a variety of conditions, even if the island's offshore area can be entered substantive stage of development, it is difficult to attract transnational capital in the short term. However, we could have based on their own business, and then through a series of innovative laws, the financial system, reducing barriers on legal convergence.

Of course, both can develop from the Yongxing Island offshore financial business, the South China Sea policies are ultimately in order to safeguard China's sovereignty and territorial integrity. Under this theme, we might open my mind, bold innovation, and explore more effective path of development and rehabilitation of the South China Sea.

Yuan Shorting By Proxy

Bloomberg: How Hedge Funds Are Getting Around the PBOC's Market Meddling

Hedge funds with a bearish view on China’s currency are increasingly betting against yuan proxies instead, after the central bank stepped up efforts to stabilize the exchange rate.

Crescat Capital in Colorado is shorting U.S. exchange-traded funds that track Chinese and South Korean stocks, while Hong Kong-based Bright Stream Capital Management favors the Korean won and Taiwan’s dollar. The exchange rates tend to decline on negative China sentiment because the nation is their biggest export market.

Bloomberg: Taiwan Dollar Rises for Sixth Day on Inflows Amid Emerging Rally

Taiwan’s dollar strengthened for a sixth day, the longest run in almost a year, as the central bank appeared more tolerant of gains amid stock inflows and a rally in emerging-market assets.

Taiwan Going Nationalist Too

In Taiwan, the DPP is a left-wing party under standard political measures of the past 50 years, but in the new world of identity politics, they are far-right nationalists poised to win a landslide victory on January 16.

Toronto Star: China warns of ‘complex changes’ with Taiwan’s upcoming presidential election

China on Thursday warned of a serious disruption of ties with Taiwan as the island’s voters appear set to elect a new president with a far more skeptical view of dealings with Beijing.

The underlying shift is caused by Taiwanese nationalist education. Just as China began indoctrinating students with nationalism in the 1990s, Taiwan began replacing Chinese history and identity with Taiwan history and identity in the 2000s. A whole generation raised under the new identity is beginning to vote.

The Diplomat: Taiwanese Students Occupy Education Ministry Over Textbook Controversy

Dozens of Taiwanese students briefly occupied the Ministry of Education (MOE) in Taipei last night to protest a series of “minor” adjustments (課綱微調) to school textbooks which activists and academics claim are Sino-centric and whitewash the authoritarian period in Taiwan’s history.

Taiwanese politics are more subtle for obvious reasons, but the underlying shift in Taiwan is not fundamentally different than in Germany or Holland or the United States. Facts on the ground vary, but the political shift is in many ways similar. Identity is the core issue in politics now.

Chinese Trade Figures Preview

Taiwan exports plummet again as China demand weakens

U.S. May Scuttle Free Trade Deal And Send Ships To South China Sea

The failure of the TPP may mark the high water mark in this era of globalization. The next step will be an anti-China economic policies designed to cut China's military expansion. Community and identity have supplanted economics in most domestic Western politics. Sovereignty will rise above economics in international relations, as laid out in The Rise of China vs. the Logic of Strategy.

U.S. Military Proposes Challenge to China Sea Claims

The U.S. military is considering using aircraft and Navy ships to directly contest Chinese territorial claims to a chain of rapidly expanding artificial islands, U.S. officials said, in a move that would raise the stakes in a regional showdown over who controls disputed waters in the South China Sea.

Senate Democrats gang up to delay fast-track trade bill

U.S. Senate Democrats delivered a major blow to President Barack Obama's trade agenda on Tuesday, blocking debate on a bill that would have smoothed the path for a Pacific trade pact.

...The failure to garner the necessary votes came after pro-trade Democrats, including Senator Ron Wyden of Oregon, insisted that fast track be bundled together with three other trade bills, including one that would impose import duties on countries that manipulate their currencies for unfair trade advantage.

Who's that?

Taiwan ETF Closes At New All-Time High

Taiwan actually isn't so much a China story as a Nasdaq story. The technology heavy Taiwan index is at a new all-time high on the same day the Nasdaq broke its 2000 high.

Hong Kongers and Taiwanese Increasingly Independent

New polls show Hong Kongers and Taiwanese increasingly consider themselves separate from Chinese in China. Unlike what the media may report, this is not due to Chinese policies. Instead, it is a reflection of social mood. The same trends at work in Europe, the UK and the United States are at work in Asia. Here's Nigel Farage explaining it:

...but the key argument today isn't the battle between free markets and state control, the key battle today is about community and identity, who are we as nations? Who are we as communities? How do we want to live? And this stuff has all been threatened by excessive immigration, and by things like our small businesses being closed down and our communities changing. The politics of the future, the politics of the next decade is about community and identity.

Losing Hearts And Minds

Anti-mainland sentiments still run high. A poll in October by Chinese University of Hong Kong found just 8.9% of respondents identifying themselves solely as “Chinese”, the lowest figure recorded in the survey—and way down on 32.1% in 1997, the year of Hong Kong’s handover. Nearly two-thirds identified themselves as a combination of Hong Konger and Chinese, but another 26.8% said they were just Hong Kongers, the highest share since 1998.

Polling tells a similar story in Taiwan. In a survey in June by National Chengchi University, 60.4% of respondents said they identified as Taiwanese, a record high and up from less than 50% when Mr Ma was first elected in 2008. Only 32.7% identified themselves as “both Taiwanese and Chinese”, a new low.

Economic weakness, which can be a subset of social mood if you believe in "strong" socionomics, will further fuel non-economic issues such as language, culture and identity.

Tensions Set to Ratchet Up in Pacific

Voters punish KMT with landslide defeat in Taiwan's local election

Hit hard by a series of protests against a services trade pact signed with Beijing, a food safety scare, missteps in education reform and worries over class and income inequality in the past year, the KMT faced a tough challenge from the main opposition Democratic Progressive Party.

Campaigning on a pledge to punish the KMT for its poor performance, the DPP, which already held the southern municipalities of Tainan and Kaohsiung, made two big gains - Taoyuan and the more important central city of Taichung.

The DPP was keen to secure Taichung because it would allow the pro-independence party to expand its influence from central Taiwan to the island's north, boosting its chances in 2016.

The DPP also captured nine other cities and counties in what was viewed as its best result since its founding in 1986.

Latest on Yuan and Taiwan; Chinese Netizens Reflect on Crimea

Falling Yuan Curbs Cash Entering China

Foreign money entering China fell to a five-month low of $21.1 billion in February, according to central-bank data released this week. The total compares with $72.3 billion in January.

If you believe the move lower (at least initially) was orchestrated by the PBOC, then, it worked.

Another worry has been financial derivative products that allow companies to profit from yuan appreciation but turn sour if the currency drops. Analysts say that some companies are already losing money as the yuan falls and that the losses could mount rapidly if the yuan weakens to 6.20 to the dollar in the offshore market.

"These structured FX products have been sold by banks to—usually—SMEs in China and Taiwan," with the latter betting on continued gains in the offshore yuan, Dariusz Kowalczyk, a senior economist and strategist at Crédit Agricole, said Tuesday, referring to small and medium-size enterprises.

"For most of the structures, banks no longer make payments to corporates at [offshore yuan versus U.S. dollar] levels above 6.15, where we are right now, and clients are exposed to unlimited, leveraged losses north of 6.20," he said.

That happened today.

That the Chinese themselves are betting on yuan appreciation adds yet another pro-cyclical element in China's Volatility Machine. China is leveraged to itself.

As for Taiwan. The youth are pro-independence, with the pro-China KMT demographic aging.

Hundreds of students occupy Taiwan's Legislature to protest China pact

Hundreds of students remained barricaded in Taiwan's Legislature early Wednesday in protest of the ruling party's push for a trade pact with China, which demonstrators claim will hurt the island.

The protesters, mostly university students, entered the main assembly hall inside the Legislative Yuan in Taipei on Tuesday night and blocked the entrances with chairs, according to images and accounts filed from the scene with CNN iReport.

Police responded but had not dispersed the protesters, who also filled the streets around the Legislature in the center of Taipei.

The students said they plan to occupy the Legislature until Friday's session, when the pact was to be deliberated.

Taiwan's state news agency reported that 38 police officers were injured when more than 400 protesters took over the Legislature.

....."The trade agreement was not supervised by the people of Taiwan, and benefits only big companies and harnesses our jobs," Chang wrote. "But I do agree we need to open Taiwan to the world, even China too. But NOT this way, not by signing an agreement that is not fair to us and was negotiated by people who have no profession in these territories. We must rewrite the agreement and make it work for the both of us, towards a peaceful future between the strait of Taiwan."

This will become a source of tension in the coming years, perhaps soon if the DPP return to power in 2016.

Netizens Compare Lost Chinese Territory to Crimea Crisis

But sadly, the sound of cannons in the October Revolution brought Marxism to China, along with the Soviet Red Army. In 1921, the Soviet Red Army under the guise of pursuing White Russian forces, forcefully entered Tannu Uriankhai, while the White Russian army was destroyed, so was our “Tannu Uriankhai”.

In March of 1921, under the intervention and manipulation of the Soviet Red Army, Tannu Uriankhai held a “pseudo-referendum”, the result predictable, and in 1921 August, Tannu Uriankhai declared independence. In December, it changed its name to Tannu Tuva and later in 1926 it changed its name to the “Tuvan People’s Republic”. Although the Soviet Union repeatedly promised it would not make the “Tuvan People’s Republic” their own territory, in 1944 August 17, the “Tuvan People’s Republic” asked the Soviet Union to take control of Tannu Uriankhai, which made it no longer a problem, because it was not Soviet Russia that wanted to take them but “them” voluntarily delivering themselves [to Russia]. The Soviet Union naturally accepted the “request”. On the 13th of October, the “Tuvan People’s Republic” officially became the “Tuvan Autonomous Soviet Socialist Republic”, and to this day it remain an “inseparable part of Russian territory”, its name now: “The Tyva Republic under the Russian Federation”.

More Tensions in the South China Sea

Beijing Shows Resolve in South China Sea Claims

In a broadening campaign to enforce its territorial claims, China says it's beefing up its police powers in the disputed South China Sea and requiring foreign fishermen to ask Beijing's permission to operate within most of the vast, strategic waterway.

The move, which took effect this month, comes on the heels of the late November announcement of a new air defense zone requiring foreign planes to notify Beijing of flights over a huge swath of the East China Sea, where China is locked in a bitter territorial dispute with Japan.

The steps are prompting concerns that President Xi Jinping's push to assert China's role as a regional power could spark a confrontation with neighbors.

Taiwan rejects China's new South China Sea fishing rules

Ministry spokeswoman Anna Kao said the four archipelagos in the South China Sea are the inherent territory of the Republic of China -- the official name of Taiwan -- in terms of history, geography and international law.

"The Republic of China government does not recognize any unilateral move taken or statement issued by any country," she said.

China has ordered foreign vessels fishing or surveying in waters of its Hainan administration zone in the South China Sea to obtain approval from Chinese authorities.

Violators could face severe punishments, including having their catch or boats confiscated or their crew prosecuted under Chinese law.

Hainan's New Fishing Rules: A Preliminary Analysis

To start, the new measures do not contain any new language regarding foreign fishing vessels in waters that China claims. In fact, the Hainan rules simply repeat almost verbatim Section Two, Article 8 of China’s 2004 fisheries law, which states that foreign fishing vessels operating in sea areas administered by China should receive approval from relevant State Council departments. That is, the new Hainan rules affirmed the application of the 2004 national law to Hainan’s waters (which were already covered by the 2004 law). Importantly, the recent Hainan rules do not outline or articulate a new policy position regarding foreign fishing vessels in Chinese claimed waters.

In addition, the 2013 rules do not mark the first time that Hainan has sought to regulate the activities of foreign fishing vessels in its waters. In previous editions of the implementing measures issued for China’s national fisheries law in 1993 and 1998, Hainan’s legislature also required that foreign fishing vessels receive permission to operate in the province’s waters.

Likewise, apart from Article 35, the other forty articles in the newly issued rules discuss rather mundane fishing issues and not the policing of Hainan’s waters. Various topics include fish-farming, fishing methods, the protection of fish stocks and so forth. One rule, for example, sets the minimum length for the catch of various species (e.g., 18 centimeters for lobsters). In other words, the main purpose of the implementing measures appears to be strengthening the regulation of fishing for an island province with a large fishing industry, not further bolstering China’s claims to fishing rights in the South China Sea.

Finally, the 2013 Hainan implementing measures do not state how the province intends to regulate the presence of foreign fishing vessels.

Asian and European social mood deterioriates

The Philippine strafing of a Taiwanese fishing vessel is spiraling into a larger confrontation.

Taiwan threatens Philippines with sanctions

Taiwan has demanded Manila apologise and compensate the victim's family or face a freeze on the hiring of its nationals.

It also asked the Philippines to bring to justice the coastguards responsible and start negotiating a fisheries agreement.

Taiwan threatens to hold naval drill near Philippines

Taiwan stepped up pressure on Manila Tuesday, saying it would conduct a naval drill in waters near the Philippines if Manila did not officially apologize for the killing of a Taiwanese fisherman.
Taiwan has demanded the Philippines apologize by midnight Tuesday (1600 GMT) over the killing of the 65-year-old fisherman by coastguards last week or face a potential freeze in sending workers to the island.

Meanwhile in Europe as Social Mood Darkens in Europe, Especially France, as Eurozone Economy in Freefall

A PEW study on European Attitudes shows social mood is darkening in the Eurozone, but especially in France.

In America, political scandal is beginning, but relative to Asia and Europe the mood is this: