A Chinese invasion of Taiwan is now certain, according to a prominent international market analyst.
Chris MacIntosh, who manages hedge fund Glenorchy Capital and newsletter Capitalist Exploits, says the tipping point was the United States’ decision to place export controls on China’s semiconductor industry.
“This move just assured an invasion of Taiwain,” MacIntosh said.
“(That’s) because the only way China can now restore its chip manufacturing is by going to the largest chip manufacturing plant in the world: Taiwan.”
The Taiwan Semiconductor Manufacturing Company (TSMC) is the world’s most valuable chip manufacturer, reportedly accounting for more than 56% of global market share.
“With that much dominance in a market that most electronic devices and parts rely on, Taiwan could help China have more power,” MacIntosh said.
Xi Jinping’s ‘ominous’ statement
Chris MacIntosh says he’s unsure why the world’s mainstream media isn’t speaking more about comments made by Xi Jinping at the Chinese Communist Party conference.
“He opened with the statement that the control of Hong Kong is now ‘complete’ and that ‘Taiwan is next,'” MacIntosh said.
“I am pretty stunned that there is — at least as of my writing this — no comment in Western media on this,” he said.
America’s ‘dumb’ response
In the wake of those comments from Xi Jinping, MacIntosh says United States President made a “dumb” decision to announce the export controls on China’s chip industry.
“To put it simply, (Joe Biden) has forced all Americans working in China to choose between quitting their jobs and losing their American citizenship,” MacIntosh said.
“As a result, pretty much every American executive and engineer working in China’s semiconductor manufacturing industry resigned this last week, paralyzing Chinese manufacturing overnight.
“As of right now, every advanced node semiconductor company is currently facing comprehensive supply cut-off, resignations from all American staff, and immediate operations paralysis.
“This is a financial war. When do they just start the shooting?” he asked.
Chip giant stops providing support to mainland China
MacIntosh has highlighted a letter from chip giant ASML to its employees, which gives firm orders.
“As you may have heard, on Friday, October 7, the US government issued a new set of regulations prohibiting support of certain fabs in China by US persons,” the letter said.
“As a result, ASML US employees – including US citizens, green card holders, and foreign nationals who live in the US – are prohibited from providing certain services to advanced fabs in China.
“Effective at midnight tonight, ASML US employees must refrain – either directly or indirectly – from servicing, shipping, or providing support to any customers in China until further notice.”
How should investors prepare?
Chris MacIntosh says it’s important investors prepare for the conflict that is coming.
The veteran analyst encourages readers to subscribe to his ‘Our World Today’ newsletter, which can be mailed directly to your inbox every week.
While for more serious investors, MacIntosh runs Capitalist Exploits ‘Insider’, which provides a ‘follow-along’ investment service for an annual fee. Find out more HERE.