Last year, I wrote a memo saying that Warren Buffett will do poorly with his investment in $OXY and $TSM. So far, Buffett has dumped his entire stake in TSMC back in May and he continues to buy Occidental today. From the S&P to commodities ratio perspective, I'm starting to think that maybe Occidental will give him handsome returns and that he should also start accumulating stakes in miners like $BBL $RIO and $GOLD.

With the recent APEC conference completed, I've become more concerned with Taiwan's safety. In the conference, dictator Xi said he had no plans to invade Taiwan in the coming years. This is contrary to what's happening in China, where the PLA (People's Liberation Army) continues to move military assets into the Fujian Province, ferries make unusual trips to ports in Chinese cities closest to Taiwan, and where the country continues to produce a dizzying amount of weapons. On top of that, we are seeing their fishing and coast guard fleets behave more boldly in Philippine territory. Headlines like the one you're seeing below may assuage concerns over the PLA's behaviors since Pelosi's visit last summer however, when you look back at history, we should assume Xi is lying.

Back in 2015, when China's man-made island development issue in the South China Sea was a major issue, dictator Xi told President Obama that he will no militarize those man-made islands. As we've seen since, those islands now hold runways and house PLAN (People's Liberation Army Navy) assets. The islands issue is a bigger issue with the Philippines since most of the naval encroachment is happening near the Philippines. Some of the sand that is used to build those islands were dug up by sand dredgers around Taiwan.

Knowing how Russian equities performed in the wake of Russia's invasion of Ukraine, we can predict how Chinese equities will perform when China does decide to invade Taiwan. The academic think tankers will disagree and say China will not attempt to invade Taiwan because it has seen what Russia endured as a consequence for invading Ukraine. Looking back at the pre-invasion times, those same academics thought Russia wouldn't invade Ukraine. Al Jazeera noted this:

"A closer examination of Russia’s geopolitical behaviour in the past two decades, however, demonstrates that its officials might not necessarily be trying to deceive the international community. A full-scale war in Ukraine does not really fit into how the Kremlin has used hard power in its geopolitical games. The examples of Georgia, Syria, Libya, and (so far) Ukraine, show that it pursues a cost-efficient policy."

Don't forget, the Atlantic Council, a major think tank, thought that threats of a barrage of sanctions would deter Russia from invading Ukraine. Others thought that the upcoming spring and summer weather would deter Russia from ever starting a war soon as the mud would make it difficult for them to fight the Ukrainian forces. Clearly, the think tanks, no matter how much time they spent studying Russia, were wrong when they thought Russia won't invade Ukraine. The media, even if the signs were obvious that Russia will invade Ukraine, gaslight themselves into thinking that the war won't happen. As we know today, the war has happened and it's still ongoing.

Focusing back on China and Taiwan, even if the media continues to write articles displaying signs of an impending invasion, the media continues to disbelieve that China will invade Taiwan. No different than how the media treated the Russian military buildup along the Ukrainian border. For those of you that either forgot the major signs of intent from China to invade Taiwan or aren't aware, I'll tell you what these signs are:

The New Yorker talked about the growing military presence in the Fujian prince in an article Taiwan, but the commentary they wrote afterward shows that they're gaslighting themselves into thinking that China won't invade Taiwan. See the screenshot of the excerpt below:

President Tsai Ing-Wen has decried rumors about the risks involved with investing in Taiwan's semiconductor industry. In her view, the concerns about China invading Taiwan will hurt her economy. This favor is similar to what Zelensky said on January 28:

"Ukraine's President Volodymyr Zelensky has called on the West not to create panic amid the build-up of Russian troops on his country's borders.

He told reporters that warnings of an imminent invasion were putting Ukraine's economy at risk."

Shortly before the Russian invasion, on Feburary 21, 2022, only 20% of Ukrainians surveyed thought the war was going to come to their country. Despite the war in Ukraine, the majority of Taiwanese people are doing their part to step up their preparation for a Chinese invasion, but they still think that Beijing is continuing to do the empty threats that they've been doing for a long time. Meanwhile in China, the clock is ticking for China's rulers to fulfill their promise of invading Taiwan. For decades, when times got tough in China, Chinese leaders would talk about invading Taiwan as a means of boosting approval ratings and nationalism simultaneously. All that talk will require action at some point. Now, China's leaders have put themselves in a tight corner that they can't escape. If they continue to tout their plans of invasion, they'll face a legitimacy crisis. If they do invade Taiwan, then the Chinese citizens will have restored faith and trust in their leaders' words and will be nationalistic on levels unlike anything we've seen before. With a severe economic crisis, war is the only thing that can preserve the popularity of the CCP because the Party has already tarnished its reputation with the outside world.

Unlike Ukraine, where Russia could invade at any time, with Taiwan, China only gets two windows of opportunity each year: April and October. Amphibious assaults require perfect weather conditions in order to have a chance of success. Not having the perfect weather will turn an amphibious assault into an automatic failure. I believe that weather will be a lesser concern for the PLA because it's likely that they'll choose to invade the ports instead of the beaches. It doesn't matter what month of the year it is, ships dock and leave Taiwan's ports on a daily basis. The ferries, which will carry most of the PLA fighting force, will need to dock at the ports. Like we've seen with Russia and Ukraine where Russia chose to invade right when the mud season begun, we could see China invade Taiwan even as the weather may be unideal to launch an amphibious assault.

Pay attention to Taiwan.