Trump says TSMC would face 100% tax if it doesn't build in U.S.
Trump's Warning to TSMC: President Trump stated that he warned Taiwan Semiconductor Manufacturing Company (TSMC) of a potential 100% tax if they did not establish factories in the U.S., criticizing the Biden administration for providing a $6.6 billion subsidy for TSMC's operations in Arizona.
Taiwan's Response to Tariffs: Taiwan is seeking a resolution to the 32% tariffs imposed by the U.S. and has proposed zero tariffs along with increased investments and purchases from the U.S.
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India and Brazil: The Anti-AI Trade Markets Poised for Growth.
- Impact on U.S. Stocks: Rising fears over artificial intelligence have negatively affected U.S. stock markets this week.
- Emerging Markets Response: Concerns about AI have also influenced emerging markets that have benefited from U.S. corporate spending on AI.
- Potential Hedge: Certain segments of emerging markets may provide a hedge against the overall market weakness caused by AI fears.
- Broader Market Implications: The situation highlights the interconnectedness of U.S. corporate spending and global market dynamics in the context of AI developments.
Boeing and Other Defense Stocks Affected by China Sanctions
- Boeing Sanctions: Boeing is one of the U.S. defense companies that faced sanctions imposed by China.
- Response to U.S. Actions: The sanctions are a reaction to the Trump administration's decision to sell weapons to Taiwan.
Taiwan Reveals $40 Billion Defense Budget for U.S. Arms and T-Dome in Response to China Threat
Taiwan's Defense Budget Announcement: Taiwan's President Lai Ching-te has proposed a $40 billion defense budget over the next eight years to enhance military capabilities in response to U.S. pressure and China's military threats.
Focus on Asymmetrical Defense: The budget will fund significant arms acquisitions from the U.S. and develop the 'T-Dome' defense system to protect against various military threats from China.
Increased Defense Spending: Taiwan's defense spending is projected to rise to 3.3% of GDP by next year, with a commitment to increase it to 5% by 2030, reflecting the urgency of the security situation.
U.S. Support and China's Opposition: The U.S. State Department has welcomed Taiwan's budget as a demonstration of resolve, while China has condemned the military ties between the U.S. and Taiwan, asserting that Taiwan's military buildup will not prevent reunification.
International Markets Surpass US Performance Year-to-Date; Chinese Enthusiasm Drives Purchases
Overseas Market Performance: Overseas markets, particularly South Korea, Vietnam, and Mexico, have significantly outperformed the S&P 500 year-to-date, highlighting the importance of diversifying investments beyond U.S. borders.
U.S.-China Trade Deal Impact: Positive market sentiment is driven by the anticipated U.S.-China trade deal, with aggressive buying in major stocks and ETFs, while rare earth stocks face selling pressure due to speculation about China's market actions post-deal.
Argentina's Political Shift: Javier Milei's election victory in Argentina, supported by U.S. financial backing, is seen as a win for President Trump and reflects a global shift towards right-leaning politics, resulting in a surge in Argentine stocks.
Investment Strategies and Market Trends: Investors are advised to maintain long-term positions while considering protective measures like cash or short-term trades, and to focus on high-quality bonds in a traditional 60/40 portfolio strategy amidst current market conditions.
Taiwan and Japan Suspend Small Package Deliveries to U.S. Following Expiration of Duty-Free Exemption
Taiwan's Postal Service Suspension: Taiwan’s postal service, Chunghwa Post, has halted shipments of small parcels to the U.S. due to the Trump administration's decision to eliminate the "de minimis" duty exemption for low-value imports.
Impact on Global Postal System: The suspension is attributed to the lack of a global postal system that allows senders to prepay customs duties, alongside announcements from contracted carriers regarding the cessation of merchandise mail deliveries.
Japan Post's Similar Action: Japan Post Co. is also suspending shipments of certain small packages to the U.S. in response to new tariffs imposed by the U.S. government.
Executive Order Effects: An executive order issued on July 30 will end duty-free treatment for personal use mail starting August 29, leading to increased costs and reduced shipments for retailers and logistics firms involved in cross-border commerce.
Taiwan to Increase Defense Spending in Response to China Threats and Trump’s Demands
Taiwan's Defense Spending Proposal: Taiwan plans to increase its defense budget to NT$949.5 billion ($31.2 billion) for 2026, aiming to strengthen its military capabilities amid rising tensions with China.
Response to U.S. Pressure: The proposed budget increase is partly in response to President Donald Trump's call for Taiwan to take more responsibility for its own defense.
Significant Budget Increase: The new budget represents a nearly 23% increase from the previous year and will allocate funds for the Coast Guard and veteran pensions for the first time.
Economic Impact: The defense spending would account for 3.32% of Taiwan's economic output, surpassing the previously set target of 3%.
India and Brazil: The Anti-AI Trade Markets Poised for Growth.
- Impact on U.S. Stocks: Rising fears over artificial intelligence have negatively affected U.S. stock markets this week.
- Emerging Markets Response: Concerns about AI have also influenced emerging markets that have benefited from U.S. corporate spending on AI.
- Potential Hedge: Certain segments of emerging markets may provide a hedge against the overall market weakness caused by AI fears.
- Broader Market Implications: The situation highlights the interconnectedness of U.S. corporate spending and global market dynamics in the context of AI developments.
Boeing and Other Defense Stocks Affected by China Sanctions
- Boeing Sanctions: Boeing is one of the U.S. defense companies that faced sanctions imposed by China.
- Response to U.S. Actions: The sanctions are a reaction to the Trump administration's decision to sell weapons to Taiwan.
Taiwan Reveals $40 Billion Defense Budget for U.S. Arms and T-Dome in Response to China Threat
Taiwan's Defense Budget Announcement: Taiwan's President Lai Ching-te has proposed a $40 billion defense budget over the next eight years to enhance military capabilities in response to U.S. pressure and China's military threats.
Focus on Asymmetrical Defense: The budget will fund significant arms acquisitions from the U.S. and develop the 'T-Dome' defense system to protect against various military threats from China.
Increased Defense Spending: Taiwan's defense spending is projected to rise to 3.3% of GDP by next year, with a commitment to increase it to 5% by 2030, reflecting the urgency of the security situation.
U.S. Support and China's Opposition: The U.S. State Department has welcomed Taiwan's budget as a demonstration of resolve, while China has condemned the military ties between the U.S. and Taiwan, asserting that Taiwan's military buildup will not prevent reunification.
International Markets Surpass US Performance Year-to-Date; Chinese Enthusiasm Drives Purchases
Overseas Market Performance: Overseas markets, particularly South Korea, Vietnam, and Mexico, have significantly outperformed the S&P 500 year-to-date, highlighting the importance of diversifying investments beyond U.S. borders.
U.S.-China Trade Deal Impact: Positive market sentiment is driven by the anticipated U.S.-China trade deal, with aggressive buying in major stocks and ETFs, while rare earth stocks face selling pressure due to speculation about China's market actions post-deal.
Argentina's Political Shift: Javier Milei's election victory in Argentina, supported by U.S. financial backing, is seen as a win for President Trump and reflects a global shift towards right-leaning politics, resulting in a surge in Argentine stocks.
Investment Strategies and Market Trends: Investors are advised to maintain long-term positions while considering protective measures like cash or short-term trades, and to focus on high-quality bonds in a traditional 60/40 portfolio strategy amidst current market conditions.
Taiwan and Japan Suspend Small Package Deliveries to U.S. Following Expiration of Duty-Free Exemption
Taiwan's Postal Service Suspension: Taiwan’s postal service, Chunghwa Post, has halted shipments of small parcels to the U.S. due to the Trump administration's decision to eliminate the "de minimis" duty exemption for low-value imports.
Impact on Global Postal System: The suspension is attributed to the lack of a global postal system that allows senders to prepay customs duties, alongside announcements from contracted carriers regarding the cessation of merchandise mail deliveries.
Japan Post's Similar Action: Japan Post Co. is also suspending shipments of certain small packages to the U.S. in response to new tariffs imposed by the U.S. government.
Executive Order Effects: An executive order issued on July 30 will end duty-free treatment for personal use mail starting August 29, leading to increased costs and reduced shipments for retailers and logistics firms involved in cross-border commerce.
Taiwan to Increase Defense Spending in Response to China Threats and Trump’s Demands
Taiwan's Defense Spending Proposal: Taiwan plans to increase its defense budget to NT$949.5 billion ($31.2 billion) for 2026, aiming to strengthen its military capabilities amid rising tensions with China.
Response to U.S. Pressure: The proposed budget increase is partly in response to President Donald Trump's call for Taiwan to take more responsibility for its own defense.
Significant Budget Increase: The new budget represents a nearly 23% increase from the previous year and will allocate funds for the Coast Guard and veteran pensions for the first time.
Economic Impact: The defense spending would account for 3.32% of Taiwan's economic output, surpassing the previously set target of 3%.
