- Eastern European stock markets are booming –
US President Donald Trump took action and increased import tariffs from China by 10%, whereupon China responded with counter-tariffs of 15% on US oil and gas imports, some agricultural products and US cars. This was followed by tariffs of 25% on steel and aluminium for all countries worldwide. Does this mark the beginning of a new trade war between the US and China, which could later even lead to a war in Taiwan? Trump also wants to increase tariffs by 100% for all BRICS countries if they want to introduce a new BRICS currency. The battle for the new world order is also a battle for raw materials. More than 90% of rare earths come from the BRICS countries, along with many other important raw materials. Raw materials could therefore become scarce selectively this year. Gold has already reached a new all-time high and has already risen by more than 40% in one year. In this respect, it is now also worth taking a closer look at the commodity ETC from BNP Paribas, which can be easily done via the link https://bnpp.lk/ETC. In addition to gold, oil and copper could also be quite promising this year, at least temporarily.
Trump wants to take over the Gaza Strip and turn it into a holiday paradise. But he also wants to resettle 2 million people from Palestine to Jordan and Egypt, although Jordan and Egypt reject this. Trump also approved the shipment of the infamous GBU34B bombs, the so-called MOAB bombs, to Israel, which can destroy Iran’s nuclear facilities. Trump is threatening to wipe out Iran if the Iranian Revolutionary Guard carries out or plans attacks against him. Does this threaten a new Israel/Iran war and thus an escalation in the Middle East instead of peace? Trump also wants to end the war in Ukraine in the first half of 2025. His proposals for a peace solution are to be presented by US Special Envoy Keith Kellogg at the Munich Security Conference from 16 to 18 February 2025. If Trump succeeds in bringing about peace between Ukraine and Russia, equities from Ukraine in particular should benefit, which would then be the Trump Trade 2.0. Already, equities in Ukraine rose by 51% in the UTX index and in Poland by 19% in the PTX index, far more than the DAX with +11%.
But the KTX Local Index for stocks from Kazakhstan has already risen by more than 30% last year and by 4% this year. Stocks from Kazakhstan are a good alternative to Russian stocks, which could come up again after the end of the war in Ukraine and, above all, the end of US sanctions. Risk-seeking investors can purchase shares from Kazakhstan directly online from the broker Freedom Finance (Freedom Broker) in Cyprus, provided that they open an account there first, which is easily done via the following link: https://freedom24.com/invite_from/2952896.
Andreas Männicke also gives his assessments of the new opportunities in Eastern Europe in his stock market letter EAST STOCK TRENDS (www.eaststock.de) and in his new EastStockTV video, episode 246, but now also in the new BRICS-TV, episode 2 at www.YouTube.com. You can also register for the new BRICS TV channel on YouTube for free and order the new stock market letter BRICS Trends by emailing: info@eaststock.de. You can watch the first BRICS TV video here: https://www.youtube.com/watch?v=FEKI72GKCzs&t=315 s. Please also register if you are interested in receiving the new BRICS newsletter. You can also read an introduction to the BRICS topic in VTAD News No. 42. Here is the link to the new BRICS analysis from December 2020: https://www.vtad.de/wp-content/uploads/2024/11/vtad-news-42.pdf
Will a trade war between the US and China later become a Taiwan war?
The new US President Donald Trump has increased tariffs on China by 10%. China responded immediately by increasing tariffs on the US by 15%. In addition, tariffs on steel and aluminium have now been increased by 25% for all countries. Is this the beginning of a new US-China trade war? If Trump pushes it to the limit, a trade war could even turn into a Taiwan war this year. Chinese President Xi has often warned the US not to interfere in China’s internal affairs, and Xi regards Taiwan as belonging to China and thus as ‘internal affairs’.
If Xi does what he has been threatening to do for a long time, namely to take control of Taiwan, it could be a ‘black swan’ (black swan) on the global financial markets, as the entire Western IT and AI world, which is still on cloud nine, would be destroyed almost overnight.
But the battle for a new world order will also be about the battle for raw materials, which has been raging for a long time. It is not without reason that Trump wants to buy up Greenland and is demanding that Ukraine repay the billions in loans in the form of rare earths. The BRICS countries have significantly more raw materials than the West and will therefore have the upper hand in the long term. On 7 January, Indonesia officially joined the BRICS, and on 17 January, Nigeria became a partner state of the BRICS, but not yet a full member. Indonesia is one of the largest nickel producers in the world and the fourth most populous country in the world.
More than 90% of rare earths come from the BRICS countries. It is quite possible that commodities will temporarily become a bottleneck factor, especially in the event of trade wars and even more so in the event of real wars. This could drive up prices, as it did in 2022 during the war in Ukraine, when the prices of gas, nickel and palladium temporarily skyrocketed. This could happen again this year if there is a war in Iran or Taiwan. Gold is already chasing from one all-time high to the next. Investors can take advantage of this with the commodity ETC from BNP Paribas. For more information, see: https://bnpp.lk/ETC
Will a trade war become a currency war?
A trade war can also become a currency war. The yuan is likely to be further devalued, as are many emerging market currencies, such as the Mexican peso and Brazilian real. The big question now is whether the BRICS countries will actually succeed in bringing their own BRICS currency into circulation, even if only as a unit of account. This would be problematic, as most of these currencies are non-convertible and all are at risk of devaluation against the US dollar. But if a new BRICS currency were to emerge, Trump would threaten to increase tariffs by as much as 100 per cent for all parties involved. This is not the only reason why a new BRICS currency will not be introduced any time soon. It would also be complicated because it is largely a combination of non-convertible currencies. So far, however, bilateral trade transactions are no longer to be settled on the basis of the US dollar, as was previously the case, but on the basis of bilateral currencies.
Will Trump’s peace mission in Israel result in a new Middle East conflict?
After the Panama Canal, Trump now wants to take over the Gaza Strip to ensure lasting peace there. He wants to turn the Gaza Strip into a new holiday paradise. The 2 million people living there are to be resettled in Jordan and Egypt, although Egypt and Jordan have already rejected this. But Trump has authorised the shipment of the dreaded GBU34B bombs, the so-called MOAB, to Israel, which can destroy Iran’s nuclear facilities. 11 tons of bombs are to be sent to Israel. Trump has threatened to wipe out Iran if the Iranian Revolutionary Guard plans or carries out an assassination attempt on Trump. Does this mean that Trump is threatening a new Israel/Iran war through Israel that will take on a larger scale than next year? This would then be the second black swan risk for the world’s stock markets.
Trump wants to end the war in Ukraine in the first half of 2025
Initially, however, Trump could trigger a good mood on the world’s stock markets if he actually succeeds in bringing about a ceasefire and peace in Ukraine. Trump’s peace plan will possibly be presented by the US special envoy Keith Kellogg at the security conference in Munich on 16-18 February. Trump demands that Ukraine pay back the US money and weapons deliveries with raw materials, in particular rare earths, because Trump knows that over 90% of rare earths come from the BRICS countries. The war in Ukraine is therefore also a struggle for raw materials. That is why Trump would also like to buy Greenland, because the BRICS countries are ahead when it comes to raw materials.
However, this will not be as easy as Trump imagines, because Putin also has very specific ideas and conditions for how the war can be ended quickly. Incidentally, both Trump and Putin are pressing Zelensky to hold presidential elections in the near future, because Putin does not currently recognise Zelensky as the legitimately elected president. Formally, Zelensky’s term of office expired on 20 May 2024. But because of the war, Zelenskyi has not allowed presidential elections to take place. There are already demonstrations in some cities in Ukraine calling on Zelenskyi to negotiate with Putin because they want the war to end.
Have billions in aid money been embezzled in Ukraine?
The question is where the $100 billion in US aid has gone. Of the $177 billion approved by the US Congress, only $76 billion has actually reached Zelenskyi in Ukraine, according to him. Has the money been embezzled in Ukraine, which would be a scandal? Who is responsible for controlling the funds for the abundant aid money that has flowed into Ukraine from the US, the EU and also from the Federal Republic of Germany?
Ukraine is known to be one of the most corrupt countries in the world. If the money is indeed untraceable, it would be a case for a committee of inquiry in both the US and Germany. But it should also be investigated more closely who blew up the Nord Stream pipeline from Russia, which was also a terrorist attack against the Federal Republic of Germany.
Now comes the Trump Trade 2.0
If Trump actually succeeds in ending the war in Ukraine in the near future, you should now focus primarily on stocks from Ukraine and Poland. The UTX index for Ukrainian equities has already risen by 51% and the PTX index for Polish equities by 19%. That would be the so-called Trump Trade 2.0. The pre-bets on it are already running. Both indices performed far better than the DAX, which gained 1%, reaching a new all-time high of over 22,100 index points for the first time.
Inform first, then invest
Find out now in detail about the background and development of the Ukraine/Russia crisis, but also the future recovery potential of undervalued equities from Eastern Europe. There are also new opportunities in the Baltic States, Southeastern Europe and the CIS republics (Kazakhstan, Georgia), with the respective stock indices all in positive territory in 2023. In 2023, 12 stock exchanges from Eastern Europe were among the 30 best-performing stock markets in the world, with 5 clearly outperforming the DAX. In 2024, 9 stock exchanges in Eastern Europe have already outperformed with a strong plus. And at the beginning of the year, 6 stock exchanges in Eastern Europe were already clearly outperforming the DAX. So it’s still worth taking a look at Eastern Europe.
So order a trial subscription now (3 issues by email for just €15) of the monthly market letter EAST STOCK TRENDS (EST) with another Ukraine/Kazakhstan special and a dividend special, as well as lots of background information and new investment suggestions such as the ‘share of the month’ and lucrative certificates at www.eaststock. de, there under Börsenbrief. The last EST was published on 31 January 2025.
TV/radio references: On 5 February 2024, Andreas Männicke was interviewed by Carola Ferstl on Money Talk about gold, commodities and the new opportunities in Eastern Europe. On 5 December 2024, Andreas Männicke was interviewed by Heinrich Leben on Börsenradio Networks about the new opportunities in Eastern Europe, particularly in Ukraine after the end of the war. All radio and TV interviews can be downloaded from the video archive at www.eaststock.de, including the last video in EastStockTV, episode 246. By the way: have you already subscribed to the new YouTube channel BRICS-TV in addition to the YouTube channel EastStockTV? Here is the link to the second BRICS TV video: https://www.youtube.com/watch?v=_zN-qTv0xz4
Reading tip: the new issue of VTAD-News No. 42 contains a detailed report by Andreas Männicke about the BRICS as a new investment opportunity. Here is the link to the article: https://www.vtad.de/wp-content/uploads/2024/11/vtad-news-42.pdf
Seminar note: If you are interested in new Eastern Exchange seminars ‘Go East’ or a BRICS seminar in Frankfurt/M or other cities, please contact the EST editorial team (www.eaststock.de). If you are interested in Eastern Exchange webinars and BRICS webinars, please also contact us.
You can now also subscribe to Andreas Männicke’s free newsletter with the latest news on the world and emerging stock markets and on the BRICS at www.eaststock.de. Please also register at info@eaststock.de if you are interested in a new BRICS newsletter from Andreas Männicke.