Synchronized global expansion remains a dream for now; inhibiting more optimism than guidance. The hints of relief that China might 'handle' Evergrande, is a sign of how focused global markets, not just Asian, are on the intertwined nature of the world's economies, whether they like to admit it or not. Behind the scenes the settling of the Huawei CFO's 'arrest' with her release might be a big deal; and depending how far-reaching, imply things for Semiconductors. (Her release caps a dramatic week; and if Xi & Biden came together on it, not just PM Trudeau of Canada to secure his citizens held hostage, it matters.)

(So much is 'not' reported in the U.S.; this should be a big story that she got out and flew back to China. Likewise the La Palma volcanic eruption is news; but they don't point-out sulfur dioxide gas risks to airplanes and agriculture as the clouds of volcanic ash and dust are making it over Southern Europe now.)

And by all means please keep in mind that as Beijing 'crushes' wealthy people in the near future, the way they want to crush Hong Kong and later Taiwan; it's going to cause another reassessment by our stock and bond markets too. For sure my view has been that the CCP wants to protect the CCP; and doesn't in a narrow sense of its self-preservation and elitist status (yes those accusing a lot of others of elitism, are often the most sanctimonious hypocrites) consider the rights of 'shareholders' or even continuity of a company without benefit to the CCP. They might be in their 'Mao-retro' mood on this; so remain careful.

(Recall how Xi had the Chairman of a group that had stakes in 3 airlines; 4 or 5 hotels, was the largest shareholder in Hilton, almost beat Marriott when the bidding or Starwood occurred.. and so on... corrupt sure; billions unaccounted for... and married to Deng Xioping’s granddaughter - wrong faction it seems - a note he was likely a crook; but Xi's secret police simply 'took him away' .. they don't arrest, they take away. Big difference; no due process. How about lovely little internet princess that spent years building following; 'taken away'. Dare not make inquiries or you might 'go missing' too. China: own worst enemy. In a way they say we're unstable politically; well, divided. But not 'gone missing'.)

It will only take another flip-flop by President Xi to upend our S&P; hence risk immediately flares up, regardless of S&P's tenuous climb over the 50-DMA. I am just pointing this out; as the S&P did hold reasonable gains; but a tenuous expected rebound, within the ongoing time-frame that remains a minefield.

Certainly the move toward making the U.S. more independent of 'contractors' in foreign countries for technology and pharmaceuticals are especially critical areas. But generally the majority of 'growth-in-growth' of multinational big-cap firms over the last 20 years or more, has been international; so it matters; it's all disruptive; and now with Xi's nationalism and threats to most neighbors in Asia, the perception of becoming more self-sufficient transcends both Covid's sobering effect; as well as correcting the insane outsourcing we railed against for the last 40 years or a bit longer.

This won't be entirely unwound, and if it were to be attempted (to wit; dividing the world into true power spheres and economic systems more than it is now) it might be viewed as 'in the National interest' of either China or the USA; but in-reality that itself would be a flock of 'black swans' for banks and companies to adjust to. It's one reason I presume leaders know this; hence much is noise or one should hope so. But like pre-World War 2 beliefs economic ties would deny things escalating; you never know how leaders 'stumble' into chaos.

If China's 'belt & road' initiative was/is their variation on Japan's 'Co-East-Asia co-prosperity sphere' (I think that was the moniker) then the threat made by a CCP spokesman on the Australian interview this week on nuclear submarines (not weapons) making the Aussies a legitimate nuclear 'strike' target for China was incredibly arrogant; a kind of bellicosity that hearkens back to the 1930's. That's why I brought it up; it is not at all what one would expect diplomatically.

The big story Friday was China cracking down on crypto; while it's amusing to hear Bitcoin or other proponents pretending there was nothing new from the Chinese. Oddly just yesterday I had 'railed' against speculating in crypto with a comment that the U.S. or China could 'crush Bitcoin and other cryptos' with one statement or digital currency.

Today China made using any cryptocurrency illegal effectively now. Again, I pointed out its value is unstable, cumbersome, and unless tied to a currency is unable to have nominal swings 'only' in terms of value or an exchange rate. This matters because 'stable coins' will be backed-up by governments; but it's not likely just yet given the cross-border tensions that exist. Also divergences are great between countries and digital payment systems.

Sweden sort of has one (digital payment system) now; we almost do with near instant money shifting (a good example is how most people journal funds between a brokerage or bank account); and that supports those who say Bitcoin etc. have no purpose. For sure Blockchain as underlying technology does (hence our adding IBM as a leader long ago); but intrinsically Bitcoin etc. is used for illicit activities; capital flight (especially out of China); and illegal and corrupt practices elsewhere. Oh yes there's the legitimate (naive at times) American investor perception as just digital future currency; but overseas they want Dollars or use crypto precisely for the reasons China just declared it illegal.

The primary tech stock of the last couple years for us (as for the bigger caps) was of course AMD; our 2019 pick of the year (around 17 and now refuses to drop under 100 so far). A couple others like Apple (long ago at 57 and never really sold, but like AMD not mentioned too often, as they - along with Texas Instruments that we originally got in at 11 and sold some at 90) are pricey; known by everyone, and no longer the speculative 'bets' they once were).

Friday was a decent consolidation; and sets up another try to stabilize things in the new trading week.