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Economy

Global Markets Drop After 'Fiscal Cliff' Talks Collapse In Washington

WALL STREET JOURNAL, CNN (USA), REUTERS

Worldcrunch

European stocks and U.S. stock futures fell Friday after Republican House members canceled a vote on a tax bill intended to avert a massive budget crisis, reports the Wall Street Journal.

Republican lawmakers have rejected party leader John Boehner's proposal designed to win concessions from President Barack Obama in the "fiscal cliff" talks, explains Reuters.

[rebelmouse-image 27086111 alt="""" original_size="320x213" expand=1] Obama and Boehner at a happier moment, at 2011 State of the Union (White House)

Oil and gold prices slumped while German government bonds moved higher as investors grew concerned that time was running out for U.S. lawmakers to come to an agreement on a plan to avoid tax increases and spending cuts scheduled to take effect at the start of 2013, writes the Wall Street Journal.

Asian shares suffered their worst losses in five weeks, while the yen strengthened .

The FTSE 100 was down 0.7%, the DAX was down 0.4% and the CAC-40 was down 0.4%.

Congress now plans not to vote on budget issues until after Christmas, according to CNN.

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Geopolitics

China's Military Intentions Are Clear — And Arming Taiwan Is The Only Deterrence

China is spending more money on weapons and defense than ever. The reason is evident: Xi Jinping wants to take Taiwan. Europe should follow the U.S. and support Taipei militarily as the only way to deter Beijing from war.

Photo of Military drills in Taiwan amid rising China-U.S. Tensions

Taiwanese soldiers stand guard at a base during a military drill simulating defense operations against a possible Chinese PLA intrusion

Gregor Schwung

-OpEd-

BERLIN — Fear is never the best advisor.

It is, however, an understandable emotion when China announces the biggest increase in its defense budget in memory. And when Beijing does so after siding with Russia in the Ukraine war with its supposed "peace plan" and justifying the increase with an alleged "escalating oppression" of China in the world.

The budget plan unveiled by outgoing Premier Li Keqiang calls for a 7.2% increase in defense spending. That's more than in previous years — and just the official figure.

Experts estimate the true spending is much higher, as Beijing finances its military through numerous shadow budgets.

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