Helping Investors
The Securities and Exchange Commission is dedicated to helping investors, called the Office of Investor Education and Advocacy. As a service to investors, Investor Alerts talk about recent investment scams and frauds, and Investor Bulletins speak about current events, such as recent actions by the Commission. They are neither statements of SEC policy nor interpretations of the law. If you have questions about what law or rule means or how to use it, you should talk to an attorney specializing in securities law.
As green journalists, we hear a lot of terms like “eco-anxiety,” “climate doom,” and “existential dread” used. We also often feel these things ourselves. There are many things to worry about regarding climate and natural crises, but when a sense of hopelessness takes over, apathy starts to set in.
Positive environmental stories
A new idea from engineers in the U.S. could give wind turbines a beautiful second life. They made a new kind of resin, which is the material that covers the blades of turbines. This resin could make countertops, car tail lights, power tools, diapers, and even gummy bears.
Chemical engineers at the University of Michigan made the discovery that could help solve one of the biggest problems with wind power: how to reuse turbine blades.
China and the U.S. will fight in the military:
China’s military had changed significantly since the mid-1990s when a crisis started because Taiwan’s president went to the U.S., which made Beijing angry.
Former Obama administration undersecretary of defense for policy Michele Flournoy said, “It’s a very different situation now. It’s a much more dangerous and contested place for our forces to be.”
During the crisis of 1995-1996, which was similar to the current situation, China held live-fire military drills, gave Taipei harsh warnings, and fired missiles into the water near Taiwan.
But the U.S. military sent many ships to the area, including two groups of aircraft carriers, in the biggest show of force since the Vietnam War. That is because the Chinese army can stop the U.S. from deploying warships or aircraft without fear or even operating safely from bases in the area.
China is angry about House Speaker Nancy Pelosi’s trip to Taiwan this week, so it has started large-scale, live-fire military exercises, including the launch of ballistic missiles. These exercises are bigger and more dangerous than the ones done during the standoff in 1995 and 1996. The activities are in the waters north, east, and south of Taiwan. Some of the drills are less than 10 miles from Taiwan’s coast. Experts say that China used not to be able to exercise extensively in the waters east of Taiwan.
The U.S. government hasn’t said anything about warships moving through the Taiwan Strait this time. In 1995, they weren’t able to do that.
How could China take over Taiwan without launching a full-scale invasion?
China’s Foreign Ministry and Defense Ministry each said in a separate statement that the military actions were needed to “resolutely defend national sovereignty and territorial integrity.”
One worry, though, is that the fast-paced situation might lead to a chance meeting that could get out of hand. It’s still unclear if and how Taiwan and the U.S. will react to what China is doing. If a minor accident happens, the lack of trust between the two sides of the strait and the fact that they haven’t dealt with crises before are likely to make things worse and cause problems that can’t be fixed. There was a difference of opinion about how to understand China’s cyber, influence, and disinformation operations against the people of Taiwan.
Generally, officials and experts in Taiwan’s international relations were more likely to call China’s attacks “cognitive warfare.” They tried to show that China’s attempts to change public and political attitudes in Taiwan were a dangerous part of China’s plan to shift Taiwan from the inside. People in charge of or who researched Taiwan’s media and political debates were more likely to make fun of China’s inability to influence Taiwan’s internal discussions. They were impressed by how Taiwan’s diverse and democratic society had made it robust against Beijing’s interference. They talked about how Taiwan is getting smarter about media and how many of Beijing’s cyber and influence operations don’t work. They also warned that exaggerating the effects of Beijing’s actions could cause anxiety, scare the markets, and cause money to leave the country.
After taking over Hong Kong, Xi has his eyes on Taiwan:
Since 1949, when Mao Zedong won, and his Nationalist enemies fled to Taiwan, Communist Party leaders have shown that they have the right to rule by bringing rebellious parts of China’s vast border under control.
There, cadres took over Buddhist monasteries and built a railway that ensured garrisons of troops across the Himalayan plateau were well-supplied. He also took back Xinjiang in the far West. Xinjiang is a Muslim desert area the size of Iran where Silk Road traders used to meet Uighurs, who now makes up only about 30% of the population of their own country because so many Chinese moved there.
After Mao’s death, Deng Xiaoping did more to restore China’s glory after the so-called “century of humiliation.” He did this by negotiating with colonial powers to get back two cities that China had lost. In 1997, the U.K. gave Hong Kong back to China, and two years later, Portugal did the same with Macao.
Since he took power in 2012, Xi Jinping has strengthened Beijing’s hold on reefs in the South China Sea that China and other countries are fighting over. Most notably, he set up many police states in Xinjiang and sent a lot of Muslims to reeducation camps. More recently, in July, he passed a wide-ranging national security law in Hong Kong intending to end dissent in a city many people in the West hoped would push China to become more democratic.
America and China will fight over Taiwan, and China might win.
A new report from the Council on Foreign Relations is a strong warning about Biden’s first foreign policy crisis, which is coming soon. Taiwan is becoming the world’s most dangerous hot spot. Things that happen in and around the small democracy could start a war that pulls in the U.S., China, Japan, and maybe even more countries. The government of President Joe Biden should come up with a more credible U.S. plan to stop a war like this.
It changed Taiwan’s politics in favor of a president that China considers being a separatist. Taiwan has started a significant rearmament program with a seriousness that hasn’t been seen in a generation. The United States is helping Taiwan with this program, but it will take a long time to be effective.
China is acting like a country would if it was getting ready for war. From a political point of view, it is preparing and conditioning its people for the possibility of a fight. On the military side, it is doing a lot of exercises and other preparations that prepare its armed forces for a wide range of situations on land, in the air, in cyberspace, and in space. As was the case when Israel tried to figure out what Egypt would do before the 1973 war, this operational activity also made it hard for foreign intelligence agencies to tell the difference between ominous signals and background noise.
At the start of 2021, the people in charge of President Donald Trump’s government left a case that was getting more and more dangerous. The government talked much louder as the danger grew but still carried the same old stick.
The United States needs to make a better stick right away. Instead, it should rely more on detailed, coordinated planning to scare China away and help Taiwan defend itself.
Since our notice came out, some people have thought that we agree with the way things are or want Washington to stop caring about what happens to Taiwan. Neither one of these ideas is true.
China’s plans in Asia
A top U.S. defense official strongly warned about China’s plans in Asia and beyond. The official said that Beijing’s growing military power has made it more likely to go to war with a neighboring country, especially Taiwan.
Adm. Studeman said it would be a mistake to wait to act until intelligence agencies report that China is getting ready to launch a land-and-sea attack on Taiwan, an island nation that China’s Communist leaders have vowed to unite with the mainland.
In the past few months, China has gotten into fights with India, Australia, Japan, Taiwan, and other countries around the South China Sea. Analysts say this is a sign that Beijing is becoming more aggressive. In the past, the leaders of China’s ruling Communist Party tried to avoid getting involved in too many conflicts with China’s neighbors. The new assertiveness signifies China’s growing military power and confidence.
Concerning Taiwan, China has been in a low-level war with the island, which has made the 100-mile-wide Taiwan Strait a more dangerous place. Adm. Studeman said that the campaign used information operations and economic pressure.
“There’s already a fight going on,” he said. “It’s unclear whether the Chinese will use military force. We don’t think it’s a matter of ‘if’ but of ‘when’ because if you understand the problem, you know that economic, informational, and diplomatic pressure won’t be enough to bring Taiwan down.
The admiral echoed what the former and current heads of the Indo-Pacific Command had said earlier this year when they testified before Congress. Adm. Studeman explained that the U.S. needed to fight China in the same way it opposed the Soviet Union during the Cold War.
Where to Put a Million Dollars Right Now
Trying to make sense of the market noise is very hard for investors. Rapidly rising inflation makes people worry that raising interest rates could lead to a worldwide recession if central banks raise interest rates. The S&P 500 is down more than 20% from its high point, and the price of U.S. Treasury bonds is falling. All of this is happening while the war in Ukraine and the threat from Covid are going on worldwide.
It’s enough to make you wish you had cash if you didn’t know that inflation would make some money less valuable over time.
Bloomberg talked to six professional investors to find out where they thought people with $1 million should put their money right now. You can choose from municipal bonds, the block chain, or uranium miners, among other things.
The experts also talked about what they would do with $1 million if they could spend it on personal interest. Their ideas ranged from clean water technologies to horse farms and real estate in Portugal.
Stephanie Larosiliere
The best thing about municipal bonds, especially this year, is how stable they are and how much money has come from the federal government in the form of Covid relief and another stimulus. By 2024, it will add up to $1.6 trillion. Honestly, that’s probably a bit more than what was needed. We want the golden decade of municipal credit to keep going because of this.
Kim Forrest
I like U.S. stocks because they are easy to buy and sell, and I want companies with a market cap of more than a billion dollars because their management tends to be a little stronger than small-cap companies. Most of the time, if you have a market cap of $1 billion, you don’t make all of your money in the U.S. Instead, your income comes from a broader range of places.
Even though I want super-solid balance sheets, I need to see companies showing they can do what they do for at least one or two product lines.
Claire Madden
Between fundraising rounds, fast-growing tech companies often need cash, like from seed investors who have been in for a long time. We’ve put money into a fund manager focusing on this area, especially in the U.K. and Europe. Often, you can buy into a company for less than what they raised in their last round of funding. Because of the tech selloff, many companies must postpone their next fundraising round because it’s hard to get money. That means the number of things you can do and the discounts you can get in this area have grown.
Even when the stock market is terrible, it can be a good investment time:
In the past few years, they have had to spend more on inventory and wages, which has put even more strain on their finances. That was because they were being squeezed by rising labor and raw materials costs, or, in the worst case, they faced having to close their businesses. Sure, the pandemic didn’t hurt every small business’s ability to plan for retirement. But that’s less than the 44% who said they weren’t confident about their ability to save for retirement two years ago.
