Is war ahead?

Very difficult to say when and where, but don't neglect this possibility in your thinking about the future.

Consider: Just this week it was revealed that two Chinese Sukhoi-27 fighter jets "pursued" a US U-2 reconnaissance plane, reportedly crossing into Taiwan's airspace in late June. According to the Taiwanese Defence ministry, this was the first time that Chinese jets have breached its airspace since 1999. Two Taiwanese F-16 fighters intercepted the Chinese jets near the central line across the 113-mile wide Taiwan Strait, and the Chinese then desisted. The public position of the Taiwanese is that the incident was an "accident". However, China has long objected to US reconnaissance of its coastline, especially since a US plane crashed into a People's Liberation Army jet in 2001 near Hainan island, killing the Chinese pilot. The crew of the US plane was detained for 11 days, creating a diplomatic row. Admiral Mike Mullen, the chairman of the US joint chiefs of staff, told reporters in Washington that the US would "not be deterred from flying in international airspace... These reconnaissance flights are important". Later, it was "clarified" he was not referring to the alleged incident, but to the general principle of the US flying surveillance planes in the region.

So what is there to consider? Well, the game of shadow-boxing (what happened? what is its significance?) goes on all the time, and not only in relation to superpowers. So why has the incident been announced by the Taiwanese somewhere between a month and two months after it occured? My guess is that they did not want to report the incident immediately because it would have increased the temperature to do so. However, they want the world to be aware of the incident, and of their response, so they announced it late enough for it not to have the effect of increasing the tension, but not so late that no one pays the announcement any attention.

Further, US reconnaisance planes listen in to Chinese communications from international air space, just as Chinese and Russian (and other) airplanes do. For the Chinese to chase
a reconnaisance 'plane is unusual, and shows that they have the confidence to do so, and feel the need to do so.

Expect the Chinese to do more and more of this sort of thing. And other nations. Each nation is positioning itself for or against the possibility of war, and these are "necessary posturings".

However, such posturings are dangerous. It only requires one party to do something stupid for war to break out, specially given economic tensions caused by the competitive devaluation of currencies - which is the last thing that nations can do in defence of their economies before resorting to economic protectionism and/or war.

War may or may not be a long way off but, unless the Chinese and the Americans can come to their senses, we are now on the road to it.

So don't ignore such stray reports as the Taiwanese have released. Pay attention. Follow the rise and fall of international tension, because your investments and indeed your life will be impacted. Sphere: Related Content