On January 27, Air Force Air Mobility Command Commander, Four-Star General Michael A. Minihan, sent a memo giving orders to prepare for war with China within the next two years. Read the memo here. The memo was dated February 1, but copies of the memo started circulating on social media on January 27. Minihan argues that Taiwan and U.S. will be distracted by the elections in 2024, which will be an opportunity for China to attack Taiwan. Over the next eight months, Minihan will send monthly directives about how his forces should train to defeat China. The General is solely responsible for the charge.
“You need to know I alone own the pen on these orders. My expectations are high, and these orders are not up for negotiation. Follow them. I will be tough, fair, and loving in my approach to secure victory.”
The General’s memo comes when tensions are unusually high. Predictably, the USAF distanced themselves from the General's memo. "These comments [referring to the memo] are not representative of the department's view on China," a defense official told Air and Space Forces Magazine on January 28. The memo surfaced days before Secretary of Defense Lloyd J. Austin was scheduled to fly to South Korea and the Philippines to discuss countering Chinese influence in the region. Also, Secretary of State Anthony Blinken will be in China in early February to ease growing tensions.
Three days after the memo, Chinese Foreign Minister Qin Gang calls for stronger economic, technological, and strategic ties with Saudi Arabia. Gang called his Saudi Arabia counterpart, Prince Faisal bin Farhan Al Saud to suggest China and Saudi Arabia set up a China-Gulf free trade zone, “as soon as possible.” Prince Faisal expressed Saudi Arabia’s commitment to the One China policy, which involves Chinese sovereignty over Taiwan. Hopefully, only a coincidence, Russian President Vladimir Putin called Saudi Arabia's Crown Prince Mohammed bin Salman on the same day to discuss how to develop more bilateral relations and “issues of common concern.”
The phone call’s timing and tone are unusual. Less than six weeks ago, China and Saudi Arabia signed more than 40 agreements totaling over $50 billion of new energy, security, technology, and investment agreements. Six weeks prior, China and Saudi Arabia issued a joint statement about stabilizing the oil trade, responding to President Biden promising consequences for Saudi Arabia for not waiting until after the U.S. election to slow oil production. China completed the most extensive cross-border CBDC test with UAE in November. Economic and strategic summits between China and Saudi Arabia happen every two years. Strong economic ties are already being developed quickly. The Chinese Foreign Minister called his Saudi counterpart to speed things up should raise the question of why.
Strategy or tactics?
China and the U.S. have distinct methodologies and mindsets in preparing for a potential war. The U.S. is preparing with tactical military exercises for the most destruction. China is preparing by securing strategic supply lines to preserve its economic survival. The difference is strategy and tactics. Strategy is the overall philosophy of a desired outcome, and tactics are flexible techniques to achieve the strategy. Nation-states should have higher goals connected to their way of life and philosophical principles.
The two approaches teach wisdom. People diversify their portfolios. Diversification is a strategy to protect and grow wealth. The tactics to achieve diversification would be the assets chosen in different asset classes. The U.S. is hyper-focused on the tactics of fighting, which begs the question about its strategy. What is the strategy of the U.S.? Surely the strategy isn’t just being the best fighters, because that is the strategy of mercenaries. Being the best fighter would be a tactic to achieve a higher strategy. China is engaged in military battle drills to prepare to invade Taiwan. Still, the invasion of Taiwan is a tactic to achieve their strategy.
China’s strategy seems obvious. If you measure its actions, China's strategy is preparing for war by taking deliberate steps to control its destiny. Its tactics are to create sustainable economics by securing oil and creating international trade outside of the Dollar. Consider the following to determine if China has a different mindset than the U.S. as it prepares for war. China has been negotiating to trade oil in Yuan and strengthening ties with Russia , Saudi Arabia and the BRICS. Also, China is one of the largest gold buyers.
Is there a lesson?
There is an investing axiom that may shed light. The most successful investors look at the long term. The U.S. is focused on winning battles. China is focused on building an empire. The U.S. has the wrong mindset for this type of fight. The U.S. is concerned about tactics more than strategy. If the U.S. had long-term plans for wealth preservation, the government would only create policies and relationships with energy independence as the outcome. Energy independence and uninterrupted supply have not been a high priority for the U.S. and have become a vulnerability.
Set loyalties aside for a second. In the event of war, who would control the most strategic assets? Without question, the U.S. has the biggest, baddest, fiercest military on earth. Is American muscle enough? China has three times the population of the U.S. and holds around $1 trillion of U.S. Treasuries. In the event of war, China could flood the market with its Treasuries at a discount, effectively cutting off the U.S. ability to borrow. The U.S. could only print, tax, or confiscate to fund its war efforts. China would have open lines of credit because it is securing free trade agreements with OPEC and the BRICS. All OPEC and BRICS countries would benefit from the oil trade not being in Dollars, which is why the BRICS are trying to overthrow the Dollar’s hegemony.
Nearly 65-70% of all Dollars exist outside the U.S., so the wealth of the Dollar is illusionary. The Dollar only stays strong if it remains intact in the global economic infrastructure. Since the U.S. prefers the appearance of paper wealth more than the tangible wealth of natural resources, China can defeat the U.S. without having to fire any bullets.
If the oil trade were to happen in Yuan, the excess Dollars would repatriate to the U.S. The U.S. would experience hyperinflation, collapsing the currency. Since the U.S. has essentially halted its oil production, it would have oil supply challenges to drop bombs on China.
The lesson is not to mistake debt or paper for wealth. If the U.S. held tangible assets and was energy independent, it would be a completely different calculus before either nation would resort to violence. If you don’t want to be in a precarious economic situation, don't give away your leverage.
Have a strategy to protect and grow all your wealth into a bastion of freedom. Precious metals are your tactic to get it done.
We will help you do it right. Call today.