22 December 2020

1) Taiwan is building a state-of-the-art fleet of submarines as a means to counter any potential Chinese plans to invade the island or conduct a naval blockade. Construction of the first of eight submarines began last month the first expected to begin sea trials in 2025. This is just another sign of nations in the pacific realm with growing fears of China’s power. China claims full sovereignty over Taiwan, despite the fact that the two countries have had separate governments for more than seven decades. For several months, China’s People’s Liberation Army has been increasing military pressure on the island, but any PLA invasion flotilla must cross the Taiwan Strait, the relatively narrow body of water separating Taiwan from the mainland. Taiwan’s new submarine fleet could make a big difference in repulsing such a move.

2) Congressional leaders are nearing completion of end-of-the-year stimulus package to provide another round of checks to middle-class Americans and extend unemployment. The $900 billion dollar deal now has provision for a $600 payment to individuals, with checks promised to be sent out within a week of the bill being signed. On top of that, states, schools and local governments are clamoring for a federal bailout, facing massive budget gaps in 2021, but reports are, there are no such provisions in the 5,500 page bill.

3) The company Semiconductor Manufacturing International Corp., which is China’s largest chipmaker, is included on a U.S. blacklist calculated to have a major adverse impact on the development of advanced technology. The research and development of 10-nanometer chips and more sophisticated technologies will be affected, however the blacklist isn’t expected to have significant impact on SMIC’s operations and finances in the short term. The blacklists has more than 60 Chinese firms, in addition to SMIC included, because of national security and human rights violations, while China threatens countermeasures against these U.S. sanctions. SMIC joins the likes of Huawei Technologies Co. where the list denies them access to U.S. technology from software to circuitry.

4) Stock market closings for – 21 DEC 20:

Dow 30,216.45 up by 37.40
Nasdaq 12,742.52 down by 13.12
S&P 500 3,694.92 down by 14.49

10 Year Yield: down at .94%

Oil: down at $47.86

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