Dear Reader,
This is Dylan Jovine with Behind the Markets.
Happy Friday.
Today is Friday, March 6th. TGIF.
It is also one week since we started our war with Iran.
Look, we study geopolitics here.
We've made it our business at Behind the Markets to really understand what's going on.
How great powers help themselves, how they protect themselves… That is of prime importance to me as both a historian and an investor.
This week I had lunch with Bill Huizenga, Vice Chair of the House Financial Services Committee and on the House Foreign Affairs Committee. I also had dinner with Brett Guthrie, Chairman of the Energy and Commerce Committee. Two of the most plugged-in Republicans on Capitol Hill.
I asked both of them the same question: what's the one thing that keeps you up at night? Neither one hesitated. China.
I want to use that as a jumping-off point. Because I think a lot of people are misreading what's happening in Iran right now. And it's incumbent upon me to help you understand it.
This isn't one war.
Most people think about Middle East conflicts the way we always have. Operation Iraqi Freedom. The Gulf War in 1991. Isolated events with a beginning, a middle, and an end.
This is different. There are actually two chess boards in play right now.
The first is the regional board. Israel, Saudi Arabia, Iran, the Gulf states.
Iran funding the Houthis in Yemen to attack Saudi Arabia. Iran funding Hezbollah in Lebanon to attack Israel. Israel and the Arab world pushing back against Iranian proxies, their drones, their ballistic missiles, their nuclear ambitions.
That's the game most people are watching.
But there's a second chess board. And it's much, much bigger.
On this board there are only two players that really matter: the United States and China.
The central question of the next 30 years is being worked out on this board, right now, in real time, right before our very eyes. Whether America leads the global order for the next 30 years — or whether China takes our spot.
Every foreign policy decision you're seeing right now — tariffs, Venezuela, Greenland, Cuba, Iran — is a move on that second board.
Make no mistake about it: America is fighting Iran because of China.
Iran is China's most significant forward operating base outside of East Asia. Just a few weeks ago, reports began to leak that China and Iran were finalizing a deal to supply Iran with supersonic anti-ship cruise missiles — capable of exceeding Mach 3 — engineered specifically to evade the defense systems on American carrier groups.
Think about that. China was building Iran into a weapon aimed directly at us.
Here's why that matters. If China ever moves on Taiwan, the first thing it needs is to cut off America's ability to control the oil supply in the Middle East. Iran was going to be the hand on that tap.
And we cannot let China have Taiwan.
90% of the semiconductors that make AI possible come out of Taiwan.
Taiwanese semiconductors are the modern-day equivalent of oil.
To let China have it is to let them own the future — AI, quantum computing, all of it.
If China took that spot, the value of your portfolio would be down 30%. Your IRA, your 401k, your house. All of it. Because being the global power is what allows us to sell our software into Europe, our cars around the world. That money flows back to us. Lose that spot and it flows to Beijing instead.
You can't wage war without oil. We learned that in World War II. That's why FDR struck a deal with Saudi Arabia and gave them an American security guarantee. Because when we started choking off Hitler's oil supply, we stopped the German war machine cold. Control the oil, control the war.
Winston Churchill called this the Great Game.
Great power competition playing out across every corner of the world. Venezuela, Iran — it's all the same board.
I'll admit it, I think knocking Iran out of China's toolkit is a win. Not a pretty one. These things never are. And I suspect it gets uglier before it gets better.
But in the long game — the one that determines whether our kids and grandkids grow up in a better world than we inherited — this matters.
Now, I wrote an entire book about what's coming next.
It's called Midnight in America.
And it lays out the five biggest cracks forming underneath the American economy right now — including the China/Taiwan threat — and the exact four steps you need to take to protect yourself and position your portfolio before the bottom falls out.
If everything I've laid out in this email worries you even a little, I urge you to read it.
The good news is it's FREE for all Takeover Targets subscribers, which if you're not yet, I'll give you a chance to try it risk-free for 30 days.
Click here to claim your free copy of Midnight in America here.
Anyway, that's all I have for you today. Have a great weekend.
I'll see you Monday.
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