from Now:
China launched two days of military drills around Taiwan on Thursday after Taiwan's new president pledged to defend its sovereignty, saying it was “severe punishment” for its opponents on the self-ruled island.
Map from the article:
The following is the deployment status of the U.S. Navy as of approximately May 20, 2024.
source: U.S. Naval Academy Fleet Trackeraccessed 23-May-24.
Caldara and Iacoviello Taiwan Monthly GPR Index (as of April):
source: Caldara and Iacoviello (2022) Index.
The presidential election is held in January. May not be included in estimates.
BlackRock has its own index, but it was last published a month ago.
source: BlackRock, April 25, 2024.
Assess the market impact of higher risks:
source: BlackRock, April 25, 2024.
Unfortunately, due to the lack of high-frequency ground penetrating radar (as we have for the whole world, from Caldara and Iacoviello) we will have to wait until next month to find out the impact on the risk of measurement .
As discussed in this article postala blockade is more likely than an outright invasion (at least in the near future), while still achieving the goal of causing huge economic damage.
