Markets and Business News Review

Materials are the worst performer in the S&P 500 this year. What 2025 holds for this beaten-down sector.

Isabel Wang — Mon, 23 Dec 2024 09:07:00 -0500

There might be a bullish story underway for materials stocks in 2025 — but watch out for this wild card.

Two-year slump among U.S. manufacturers shows little sign of ending

Jeffry Bartash — Mon, 23 Dec 2024 09:03:00 -0500

American manufacturers might be more optimistic about ending a two-year slump after a business friendly Trump administration takes over in 2025, but they are ending the current year on a sour note.

Honda and Nissan Aim to Merge as Global Competition Bears Down

River Akira Davis — Mon, 23 Dec 2024 08:57:26 -0500

Japan’s second- and third-largest automakers hope the $50 billion deal would help them catch up with Tesla and China’s BYD in electric vehicles and advanced software.

SCHD vs VIG: Which Dividend ETF Should Retirees Buy?

John Seetoo — Mon, 23 Dec 2024 08:51:20 -0500

This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive
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24/7 Wall Street Key Points

Schwab U.S. Dividend Equity ETF (NYSE: SCHD) and Vanguard Dividend Appreciation Index Fund ETF (NYSE: VIG) are both geared towards investors seeking a combination of dividend income and sufficient growth to maintain the basic principle size of the nest egg for the duration.
The aforementioned ETFs have different index benchmarks and investment focus, despite being allocated to the same category.
Individual investment considerations and preference for higher income or better long-term capital appreciation are greater determinants of suitability, once the other criteria is evaluated.
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Exchange Traded Funds (ETF) predicated on tracking a particular index are normally passively managed and closely follow their benchmark. Retirees seeking a consistent level of income while notching enough growth to keep the size of their nest egg from eroding may choose ETFs over individual stocks. This can be due to intimidation over the notion of managing their own portfolios, the comparative ease with which ETFs reduce risk through diversification, and the relatively low expense ratios, which means that the bulk of the invested funds are going into the investment itself, rather than irrecoverable fees.

In general, the dividend ETF sector has underperformed the S&P 500 over the past few years, but since the Dow Jones Industrial Average has dropped as much as 2,600 points in the month of December, 2024 at the time of this writing, that trend may be seeing a reversal on the horizon.

Schwab U.S. Dividend Equity ETF

The Schwab U.S. Dividend Equity ETF uses the Dow Jones US. Dividend Index as its benchmark.

Best known for being the 800 lb. gorilla of the discount broker field, Charles Schwab in-house products cover a wide range of areas in the ETF and mutual fund arenas. The Schwab U.S. Dividend Equity ETF uses the Dow Jones US. Dividend Index as its benchmark. Its yield is 3.50%. SCHD’s Beta is 0.77 and its expense ratio is 0.06%. The fund’s primary objective is solid income from large cap companies that have capital appreciation history over the long haul.

Stock Requirements for SCHD to join its 103 stock listing roster include:

Minimum of 10 consecutive years of dividend payments.
$2 million minimum 3-month trading volume average.
Market cap minimum of $500 million.

As of mid-December, SCHD’s most heavily weighted sector exposures are in Financials (20.13%), Healthcare (14.68%), and Consumer Defensive (13.24%). Its top 10 holdings in descending portfolio weight are:

1) Cisco Systems, Inc. 2) Bristol-Myers Squibb Co. 3) Home Depot Inc. 4) BlackRock, 5) Chevron Corp. 6) Verizon Communications, Inc. 7) Altria Group Inc. 8) Texas Instruments, Inc. 9) United Parcel Service Inc. Class B 10) AbbVie Inc.

SCHD has Morningstar’s Gold Standard rating. Its market volatility risk is decidedly low, although its performance has been undermined by its weightings in consumer defensive and healthcare, which have both been weak this past year.

Vanguard Dividend Appreciation Index Fund ETF

The Vanguard Dividend Appreciation Index Fund ETF uses the S&P Dividend Growers Index for its benchmark.

As one of the largest mutual fund and ETF companies in the industry, Vanguard has a long history in growing its $9.9 trillion in net assets for satisfied customers around the globe. Citing the S&P U.S. Dividend Growers Index for its benchmark, the Vanguard Dividend Appreciation Index Fund ETF strives for a mix of capital appreciation and income from dividend king companies, i.e. those with a history of dividend increases accompanying growth. Its yield is 1.67% with Beta of 0.81 and a 0.06% expense ratio. The dividend increases have to be consistent for a minimum of 10 years. Surprisingly, the top 25% of companies with the highest yields are excluded from the 330+ stocks on the VIG roster. VIG has a Morningstar gold ETF ranking.

VIG’s market sector exposure weightings have given it a better comparison to the S&P 500, as its primary focus is in Technology (24.41%), Financial Services (21.5%), and Healthcare (14.65%). Its top 10 holdings are:

1) Apple, Inc. 2) Broadcom Inc. 3) JP Morgan Chase & Co. 4) Microsoft 5) UnitedHealth Group 6) Exxon Mobil 7) Visa Inc. 8) MasterCard 9) Costco Wholesale 10) Home Depot.

SCHD and VIG Head to Head Matchup

In a head-to-head matchup, SCHD and VIG both earn an average consensus “Moderate Buy” rating, culled from hundreds of Wall Street analysts.

Neither SCHD or VIG is likely to be a runaway leader in the dividend ETF sector, due to their index based nature and conservative, low volatility Beta. From a dividend perspective, excluding high-yield REIT and BDC companies from their respective portfolios relegates their dividend yields to the under 5% zone unless extenuating market circumstances dictate otherwise.

Based on consensus ratings from 101 Wall Street analysts, 55 rate SCHD a Buy, 39 rate it a Hold, and 7 have Sell ratings, so the average rating is “Moderate Buy”. The average 12-month consensus price target is $31.24. Over the past 1-3 years and adjusted for a 3-for1 split in October, the ETF has stayed in a roughly 4-point trading zone. Over the past 10 years, SCHD has appreciated by about 130%, so it’s certainly not a high-flyer by any market standard.

Out of 340 Wall Street analysts, VIG has 230 Buy ratings, 101 Hold ratings and 9 Sell ratings for an average “Moderate Buy” consensus rating. Its 12-month average consensus target price is $225.78.

Retiree Requirement Bottom Line

The Schwab US Dividend ETF is often referenced as a choice ETF for retirees, including in past 24/7 Wall Street articles. The Vanguard Dividend Appreciation ETF has also seen previous coverage, with the emphasis on annual dividend “raises” being its main attraction over a higher yield provided from the outset.

The crux of the difference between VIG and SCHD for retirees essentially comes down to retirement emphasis. Retirees using an ETF as one component of an overall strategy where a higher dividend and principal stability is deemed the most important factor will lean more towards the Schwab US Dividend ETF. Its yield is double that of VIG’s, and retirees focused on income will prefer it.

Conversely, other retirees who are more concerned with growing their nest egg while getting a smaller income from an ETF will favor the Vanguard Dividend Appreciation Index Fund. The vast majority of dividend king companies that can afford to annually raise their dividends do so because their growth rate is generating excess profits that can be remitted to shareholders. The resulting combination of capital appreciation upside and increasing income, albeit from a smaller starting point than with SCHD, can deliver a peace of mind to retirees concerned about principal erosion of their nest eggs.

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The post SCHD vs VIG: Which Dividend ETF Should Retirees Buy? appeared first on 24/7 Wall St..

The US Military Will Join the Fight if Any of These Countries Go to War

Kellianne Matthews — Mon, 23 Dec 2024 08:44:07 -0500

We’ve consulted the U.S. State Department for a full list of the country’s current military treaty obligations and provided some analysis from 24/7 Wall St.’s geopolitical specialist with 20 years of teaching experience on the subject.

Whether you think the United States is overcommitted or under-committed abroad, this article will give you food for thought. See if you agree with America’s alliance commitments — what countries would you add or subtract from the list?

Practical Uses for This Information

Countries the U.S. is allied with can be safer choices for overseas travel.

The information in this article can help you engage in political discussions armed with more insight into what countries we are allied with and why. It can also help you identify countries that are more friendly to the U.S. and might be good choices for travel, business investment, or living abroad. You might also be able to better appreciate the tremendous sacrifices of previous generations that have turned so many previous American enemies into allies.

The Paradox of American Alliances

American alliance commitments span most of South America, Europe, and Oceania.

From its inception, the United States has had a paradoxical attitude toward the rest of the world. On the one hand, we see ourselves as a “City on a Hill” — a land of liberty that stands as an example to the rest of the world. On the other hand, we have had an aversion to getting involved in “entangling alliances.”

For much of our history, the vast Atlantic and Pacific Oceans afforded the United States blissful isolation from the troubles of the Old World. This ended when World War I and II showed us that non-involvement can let foreign threats get so out of control they can threaten the American homeland. So, through a system of alliances, the United States maintains a deep defensive perimeter for our West coast in Asia and our East coast in Europe. We work with our allies to deter major power rivals and to develop strategies to counter emerging threats.

NATO

NATO was established at the beginning of the Cold War to contain Soviet expansionism.

The United States’ most vital alliance is the North Atlantic Treaty Organization. It was founded in 1949 to counter the expansionist Soviet Union and continues to oppose Russian expansionism today. NATO has helped provide unprecedented peace, stability, and prosperity to Europe. The unity of the alliance outlasted its East European rival, the communist Warsaw Pact, and eventually absorbed most of its members.

NATO Member Nations

Rocked by an unprovoked Russian invasion, Ukraine is eager to come under the protection of NATO.

NATO’s members today include: Albania, Belgium, Bulgaria, Canada, Croatia, Czechia, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, Latvia, Lithuania, Luxembourg, Montenegro, the Netherlands, North Macedonia, Norway, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden, Türkiye, the United Kingdom, and the United States.

Three other countries have announced their intention to join NATO: Bosnia and Herzegovina, Georgia, and Ukraine. Bosnia’s membership is somewhat problematic because of its deep ethnic divisions that threaten the country’s peace and stability. Georgia is not fully in control of its territory because of prior intervention by Russia in disputed regions. And Ukraine is currently involved in a full-scale war with Russia. Until peace settlements with Russia are reached, the latter two countries are unlikely to attain full NATO membership.

The One Time NATO Defended a Member

AWACS planes like these, manned by European and Canadian pilots, patrolled American skies for 7 months after 9-11 to monitor the airspace for threats.

In Article 5 of the NATO treaty, member nations commit themselves to consider an attack on any one of them an attack on all. The first and only time this treaty has ever been invoked was when the United States was attacked on September 11, 2001. The other NATO allies agreed this was an attack on them all and came to the defense of the United States.

In a practical expression of this collective defense, NATO dispatched 7 Airborne Early Warning and Control Systems Aircraft (AWACS) from Europe to the U.S. mainland to patrol the skies and prevent further attacks. Named Operation Eagle Assist, this mission lasted 7-months. 830 crew members from 13 different NATO countries defended American skies for 4,300 hours in over 360 operational sorties.

The Rio Treaty

Through the Rio Treaty the United States is allied with Brazil, the largest country in Latin America.

Ever since the Monroe Doctrine of 1823, the United States has forbidden European countries from starting new colonies in the Americas. When the Cold War with the Soviet Union began after World War II, the U.S. sought to shore up its hegemony in the New World with the 1947 Inter-American Treaty of Reciprocal Assistance. Because the name is so clunky, it is commonly called the Rio Treaty or the Rio Pact because it was signed in Rio de Janeiro.

The treaty is a collective defense agreement between the United States and over a dozen Latin American countries by which an attack on one is considered an attack on all. However, numerous American interventions in the Caribbean and Central America, as well as its support for the United Kingdom during the Falkland Islands War with Argentina, have damaged the treaty’s reputation with some of the region’s countries.

Rio Treaty Members

American support for the United Kingdom in the Falkland Islands War in 1982 compromised Latin American support for the Rio Treaty.

The current members of the Rio Treaty are Argentina, the Bahamas, Brazil, Chile, Colombia, Costa Rica, the Dominican Republic, El Salvador, Guatemala, Haiti, Honduras, Panama, Paraguay, Peru, Trinidad and Tobago, the United States, Uruguay, and (maybe) Venezuela. Venezuela’s membership status is unclear because its government has sent conflicting messages about its intentions.

Former Rio Treaty Members

As a result of the Cuban Missile Crisis, Rio Treaty members expelled Cuba from the alliance.

Cuba was suspended from the treaty in 1962 due to its alliance with the Soviet Union and involvement in the Cuban Missile Crisis. Additionally, many Latin American countries were disappointed when the United States supported Britain in its war with Argentina over the Falkland Islands. This, and concerns about U.S. involvement in wars in the Middle East, led Mexico to withdraw from the treaty in 2002. Over the next 15 years, Bolivia, Ecuador, and Nicaragua also left to start a new alliance of their own.

The ANZUS Treaty

Australia and the United States are close strategic partners in the South Pacific region.

The full name of the ANZUS treaty is the Australia, New Zealand, and United States Security Treaty. This collective security pact started in 1951 to formalize cooperation between these English-speaking countries to maintain security in the South Pacific. Australia and New Zealand were concerned about the spread of communism in Southeast Asia and felt that the United Kingdom was too preoccupied with European affairs to offer adequate assistance, so they looked to the United States as a partner. Australia and New Zealand sent forces to support the United States in the Vietnam War.

Expanding and Contracting ANZUS

New Zealand in effect broke its defense commitments to ANZUS by closing its ports to U.S. nuclear submarines.

Although no new countries actually joined ANZUS besides the original three, from 1954 to 1977 they all joined a new treaty organization: SEATO (the Southeast Asia Treaty Organization, also known as the Manila Pact). This included Australia, France, New Zealand, Pakistan, the Philippines, Thailand, the United Kingdom, and the United States. Pakistan left SEATO when the alliance failed to support it in its war with India. When the Vietnam War ended in 1975, the organization lost its main purpose and disbanded a couple of years later.

ANZUS has not been disbanded, but in 1984 New Zealand declared itself a nuclear-free zone and refused to allow U.S. nuclear-powered submarines to visit its ports. Two years later the United States announced it was suspending its treaty obligations to New Zealand.

Bilateral Defense Treaties

Thousands of American troops in South Korea help deter an attack from heavily-armed North Korea, a nuclear power.

The United States has signed mutual defense treaties with some countries that are not part of a wider security alliance. These include the Philippines (1951), Korea (1953), and Japan (1960). All three are on the Pacific rim of Asia, and all three are countries where American veterans have fought in the past for freedom, including during World War II and the Korean War. Our alliances with these countries maintain freedom of the seas and contain the influence and expansionism of our regional adversaries: Russia, North Korea, and China.

Major Non-NATO Allies

Major Non-NATO Allies have access to some American military technology, advanced weaponry, and surplus equipment and supplies.

In the modern era, it is not always advantageous to enter a formal alliance with another country, especially if the United States wants to maintain good relationships with both that country and its local rivals. However, in 1987, Congress passed legislation allowing the U.S. to enter cooperative relationships with significant non-NATO friends of the United States.

The status of “Major Non-NATO Ally” allows these countries to receive U.S. military training, purchase depleted uranium anti-tank rounds, receive American military surplus equipment and supplies, house American War Reserve Stocks of U.S.-owned equipment, participate in cooperative research and development, gain access to space technology, receive American financing to purchase or lease defense equipment, and other benefits.

Current Major Non-NATO Allies

The United States maintains a large air base and prepositioned supplies in Qatar to deter Iranian aggression in the region.

The current nations with MNNA status are Argentina, Australia, Bahrain, Brazil, Colombia, Egypt, Israel, Japan, Jordan, Kuwait, Qatar, Morocco, New Zealand, Pakistan, Philippines, Singapore, South Korea, Thailand, and Tunisia. Taiwan does not have formal MNNA status to avoid provoking China, but Congress has mandated that it be given all the same privileges.

MNNA status does not mean the United States is treaty-bound to defend these countries. However, the U.S. does have bilateral defense treaties with some of them as described earlier in this article. The most controversial country in this category is Pakistan. Motions have been made in Congress several times to remove its MNNA status because of its lackluster participation in anti-terrorism efforts.

Possible Future Major Non-NATO Allies

A residential building was destroyed by an explosion as a result of Russia's war against Ukraine. A residential building damaged burned down from the consequences of the fighting in Mariupol.

Novo Nordisk’s 27% drop was market overreaction, analysts say

Louis Goss — Mon, 23 Dec 2024 06:14:00 -0500

Trials of semaglutide in patients with Alzheimer’s and CagriSema in obese patients diabetes could give investors reason to be optimistic, Intron Health’s analysts said

Netflix broadens live-sports footprint with Women’s World Cup. Bigger subscriber base and ad reach foreseen.

Weston Blasi — Mon, 23 Dec 2024 06:10:00 -0500

Netflix now has soccer, the NFL, WWE and boxing as part of its live sports portfolio.

Why bigger is not always better in biotech

Mon, 23 Dec 2024 06:00:49 -0500

Appetite will pick up as interest rates fall, but uneven distribution of funding and rewards looks set to persist

DoJ’s Kanter does not see a ‘complete U-turn on antitrust’ under Trump

Mon, 23 Dec 2024 06:00:49 -0500

Top Biden enforcer predicts public demand will keep his successor from completely abandoning his tough approach

The simple secret behind the UK’s best performing council pension fund

Mon, 23 Dec 2024 06:00:49 -0500

Banker driving Kensington and Chelsea’s stellar returns explains why he fears the chancellor’s ‘megafunds’

Foreign brands are back in China. But the economy has cooled and domestic competition is dug-in.

Tanner Brown — Mon, 23 Dec 2024 05:50:00 -0500

Experts told MarketWatch the key to connecting with Chinese customers is being willing to depart from home-market strategies and embracing local tastes.

‘I’ve always been very good with money’: Should I put my wife on the title of our family home, investment property and my late father’s house?

Quentin Fottrell — Mon, 23 Dec 2024 05:18:00 -0500

“If I die and she sells the properties, would she have to pay a lot of capital-gains taxes, especially on the houses we don’t live in?”

Teddy Blanks, the Typography Maestro Getting Calls From Greta Gerwig and Robert Eggers

Alex Vadukul — Mon, 23 Dec 2024 05:03:10 -0500

Teddy Blanks, the designer behind the memorable movie titles for films like “Nosferatu” and “Barbie,” has quietly become Hollywood’s go-to guy.

As ‘Squid Game’ Returns for Season 2, Netflix Hopes to Recapture the Magic

Nicole Sperling and Jin Yu Young — Mon, 23 Dec 2024 05:02:03 -0500

The success of the show’s first season surprised Netflix executives, reaffirming the company’s global strategy.

U.S. Takes Aim at China’s Production of Essential Chips

Ana Swanson and Paul Mozur — Mon, 23 Dec 2024 05:01:08 -0500

The older-style chips are crucial for a wide array of appliances and other machinery, including weaponry.

The latest victim in a string of break-ins at athletes’ mansions: Boston Celtics star Jaylen Brown

Mon, 23 Dec 2024 05:01:00 -0500

Jaylen Brown has become the latest athlete to be targeted in a string of robberies that have taken place at the homes of high-profile sports stars.

Robert F. Kennedy Jr. Wants to Ban Drug Ads on TV. It Wouldn’t Be Easy.

Rebecca Robbins — Mon, 23 Dec 2024 05:00:29 -0500

Attempts to restrict pharmaceutical advertisements have failed many times over the years, often on First Amendment grounds.

How to Pack Formal Clothing

Stephanie Rosenbloom — Mon, 23 Dec 2024 05:00:11 -0500

Make sure your dresses and suits arrive in tip-top shape with these packing tips from the pros.

‘I just like to have the lights up’: Nicole Kidman admits to big holiday decor no-no

Mon, 23 Dec 2024 04:59:00 -0500

Kidman confessed to her divisive habit, and has actually “apologized to all the neighbors” for her over-the-top decor.

How Netflix’s ‘Culinary Class Wars’ Made Chef Anh Sung-jae a Star

Daisuke Wakabayashi — Mon, 23 Dec 2024 04:11:39 -0500

Anh Sung-jae went to America as a 13-year-old, joined the Army, went to culinary school and opened a top restaurant in San Francisco. Now back home in South Korea, he’s a Netflix star.

Wall Street’s ‘Santa Claus rally’ window is about to open with the Dow down in December

Christine Idzelis — Mon, 23 Dec 2024 04:03:00 -0500

Stocks have struggled ahead of the holidays despite Friday’s rally.

Former Olympus CEO pleads guilty to illegal drug charges

Mon, 23 Dec 2024 01:57:01 -0500

Asset Management: the year that was

Mon, 23 Dec 2024 01:00:49 -0500

A look back at the five themes that dominated in 2024 — and our top scoops, interviews and longer reads

Biden crackdown brings sharp fall in Permian methane pollution

Mon, 23 Dec 2024 00:00:49 -0500

Green groups say Donald Trump’s vow to scrap environmental rules could undo progress

Year in a word: Memecoin

Mon, 23 Dec 2024 00:00:49 -0500

The crypto craze celebrates the silliness of digital assets linked to the ephemera of social media

Questions raised over business model of Goldman’s ETF Accelerator

Mon, 23 Dec 2024 00:00:49 -0500

The platform secured its first client last year but the bank is now assessing long-term options

Why BlackRock is shelling out $12bn for private credit shop HPS

Mon, 23 Dec 2024 00:00:49 -0500

World’s biggest fund manager seeks to elbow its way into industry dominated by the likes of Apollo and Blackstone

Party City Stores to Close by February, Company Says

Aimee Ortiz, Melina Delkic and Hank Sanders — Sun, 22 Dec 2024 22:26:18 -0500

In an internal letter, the company said inflation and changes in consumer spending had forced it to shut its more than 700 stores.

The Simmering Conflicts That Could Erupt Under Trump

Michael Muir — Sun, 22 Dec 2024 22:20:45 -0500

There are 53 active conflicts worldwide today. Some are long-running, low-intensity wars, while others have seen thousands perish. The unfolding situations in Ukraine, Israel, and Syria garner the most attention, but other simmering disputes could quickly turn into wider wars. This article will examine the most pressing conflicts that could erupt in the next four years.

Why This Matters

In November 2024, American voters backed a presidential candidate who espouses a transactional, non-interventionist foreign policy. Donald Trump will nevertheless enter office during heightened global tensions, when a laissez-faire approach may not be viable. Trump’s America-first outlook needn’t mean staying aloof from pressing diplomatic situations.

Armenia – Azerbaijan

Russia’s special military operation in Ukraine not only shattered the peace in Eastern Europe, but it could also have a knock-on effect on the Caucasus. Armenia and Azerbaijan have been at odds over the Nagorno-Karabakh region for decades. First established as an autonomous oblast in 1923, Nagorno-Karabakh is an Armenian enclave within Azerbaijan. The two former Soviet republics have been at odds over the area for decades.

Russia brokered a fragile peace in 1994 to end the first Nagorno-Karabakh War, but intermittent violent clashes have continued since. A second war broke out in 2020, with Azerbaijan regaining most of the territory lost in the 1990s. Russia once again mediated peace talks and established a peacekeeping force to monitor the Lachin Corridor, which linked Armenia to Nagorno-Karabakh.

With Russian attention focused elsewhere, Azerbaijan launched a surprise offensive in 2023 to seize Nagorno-Karabakh and force most of the Armenian population to flee. Turkey is another key player in the region but has no formal ties with Armenia owing to a bitter shared history. Neither Russia nor Turkey seem to have the influence needed to broker a lasting peace treaty between Armenia and Azerbaijan. Indeed, both governments have rejected overtures by third parties to mediate the dispute.

The current situation is an uneasy peace that could so easily devolve back into violence.

Eritrea – Ethiopia

With a population exceeding 126 million, Ethiopia is the largest landlocked country in the world. Only a narrow corridor of land held by Eritrea separates Ethiopia from the Red Sea. Eritrea gained independence from Ethiopia in 1993, and the two have been at odds ever since. In 1998, border skirmishes escalated into a devastating two-year conflict neither nation could afford. The two former enemies fought on the same side in the devastating Tigray War, an Ethiopian Civil War fought in the north.

In 2023, Ethiopian Prime Minister Abiy Ahmed stoked tensions by suggesting his country’s survival depended on direct access to the sea. Though he publicly insisted his quest for a port would be achieved peacefully, private comments to business leaders suggest force may be an option. Assab, once part of Ethiopia, would be the most likely target of an Ethiopian offensive. However, other options may be viable in neighboring Somalia or Djibouti. Given the proximity to the world’s busiest trade routes, the situation must be monitored carefully.

Myanmar

The ongoing civil war in Myanmar is reaching a crucial point. Three years after the 2021 coup, the military is struggling to retain control over the wide swathes of the country. Over 200 towns, bases, and other territorial assets have been seized from the military in 2024. Because of the dire shortage of military personnel, the junta passed sweeping conscription laws in February 2024 to bolster the ranks. The leader of the Kachin Independence Army, General Guan Maw, ominously predicted the move represented the “end of the end.”

China may take a more active role in supporting the junta in 2025, but that may not be sufficient given the regime’s losses. One of the greatest risks for the beleaguered country is the lengths the failing junta may go to to survive. The multifaceted conflict may be nearing its end, but lasting peace may still be a long way off.

North Korea – South Korea

North and South Korea are still technically at war. However, despite several border clashes, the uneasy armistice has held for decades. Though South Korea’s military is quite simply cut above North Korea’s numerous but poorly-equipped armed forces, Seoul would suffer immensely in a renewed conflict. The South Korean capital is within artillery range of the north.

That threat is ever-present but has become heightened in recent years as North Korean leader Kim Jong-Un’s rhetoric has taken an alarming shift. For decades, Pyongyang maintained that peaceful reunification is the ultimate goal. However, the North Korean leader’s public statements have altered the landscape. North Korea’s constitution now views South Korea as a “hostile state” and the regime’s main enemy.

In October 2024, North Korea detonated rail links with the South. North Korea’s new ties with Russia and possible combat experience in Ukraine could lead to a more aggressive posture toward its neighbor. In December 2024, South Korean President Yun Seok Yeol attempted a coup, drawing on rising tensions to justify imposing martial law. All-out war may still be a remote possibility, but it has seldom been closer since the 1950s.

The Sahel – Burkina Faso, Mali, and Niger

The Sahel is a vast area in Africa that separates the Saharan north from the tropical south. It crosses several African nations, from Senegal in the west to Eritrea in the east. The Sahel is one of the most troubled regions in the world and an epicenter for extremist violence. It also faces serious potential ecological problems from climate change.

The current situation in Mali is spiraling out of control after the failure of a French-led intervention and the withdrawal of UN peacekeeping forces. Armed rebel groups doubled their territory in northern Mali in 2023. In September 2024, a group linked to Al-Qaeda attacked Bamako, leaving dozens dead and injured.

Neighboring Burkina Faso is also experiencing extremism and political instability. In 2022, the government was toppled twice, and Ibrahim Traoré seized power in a coup in September. Traoré severed ties with France in 2023 and is looking to deepen ties with Russia to weather the current crisis.

Like Burkina Faso and Mali, Niger is ruled by a military junta that seized power by force. Niger was the ninth attempted coup in three years in West and Central Africa. Niger was a key US ally in counterterrorist operations in the region. However, at the behest of the junta, US troops fully withdrew from Niger in September 2024. With limited international support and rising extremism, the outlook for this troubled area is bleak.

Sudan

Sudan has lurched from one catastrophe to another since the 1950s. The first Sudanese Civil War lasted almost 17 years, from 1955-72. The war erupted as Sudan was about to break free from British rule. The vast country had a major cultural divide between the Muslim north and the Christian and animist south. Up to one million people perished in the conflict. The Addis Ababa Agreement ended the fighting, albeit temporarily. The Second Sudanese Civil War broke out in 1983 and lasted 21 years with an estimated 1-2 million fatalities.

Omar al-Bashir seized power in a coup in 1989 and ruled as a dictator for 30 years before he was toppled in 2019. Osama bin Laden and other terrorist leaders lived in Sudan in the 1990s; this caused the United States to sever ties with Sudan in 1996 and impose sanctions.

Over 200,000 people were systematically killed in the Darfur region between 2003-05 by the Janjaweed militia and the Sudanese government. After al-Bashir was removed from power in a 2019 uprising, the new government was toppled again by a coup led by the Sudanese Armed Forces (SAF) and the Rapid Support Forces (RSF) in 2021. The RSF was formed from the Janjaweed militia that carried out the Darfur genocide.

The third Sudanese civil war broke out in April 2023 over a power struggle between the SAF and RSF. Some eight million people were displaced by the fighting. As the war rages, there are serious warnings that another genocide could be carried out in Darfur.

Taiwan

The long-standing US policy toward China and Taiwan of strategic ambiguity could be put to the test in the next four years. In 1979, The United States formally recognized the People’s Republic of China as the “real” China at the expense of the Republic of China (Taiwan). However, the United States didn’t wholly abandon Taiwan and maintained unofficial ties with Taipei. Under the terms of the Taiwan Relations Act, the United States pledges to:

make available to Taiwan such defense articles and defense services in such quantity as may be necessary to enable Taiwan to maintain a sufficient self-defense capacity

The Biden administration began sending direct military aid to Taiwan, and the outgoing president authorized a $571 million package in December 2024. The sense of urgency behind the move comes from fear that Beijing may soon be ready to press its claim on Taiwan by force.

According to a May 2024 Congressional report, Chinese premier Xi Jinping instructed the People’s Liberation Army to be ready to invade by 2027. This, of course, does not mean an invasion is a certainty. An amphibious invasion of Taiwan would be immensely difficult and present a huge risk. On the other hand, China’s impending demographic implosion means there is a rather narrow window of opportunity for success.

This may be a problem for Trump’s successor, but the incoming administration will have to monitor the situation closely.

Conclusion

The American electorate chose a presidential candidate with a non-interventionist outlook, but that does not the United States will remain aloof from foreign affairs. Donald Trump showed in his first term that he did not feel bound by precedent, and that may well continue into his second term. Events in Syria, Ukraine, and Israel will garner the most attention in the incoming president’s first weeks in office, but the conflicts detailed here will likely require action sooner rather than later.

The dispute between Armenia and Azerbaijan remains on a knife-edge. While both governments have indicated a peaceful solution is at hand, recent history shows how precarious optimism in the Caucasus can be. Similarly, trouble is never far from the Horn of Africa, and Ethiopia’s need for its own port could lead to the region’s latest catastrophe. The end of Myanmar’s civil war may be in sight, but the junta’s last gasps may ignite a wider conflict.

The armistice between North and South Korea has held for decades, but recent tensions could shatter that fragile ceasefire. The first phase of the Korean War claimed two million lives; the second phase could be worse still. The Sahel region in Africa is a hotbed for Jihadist extremism, and the military juntas that rule Burkina Faso, Mali, and Niger are on shaky ground. Sudan’s latest civil war threatens to be its worst yet.

Finally, and most pressingly for the United States, the Taiwan question may soon require a definitive answer. Strategic ambiguity allowed the United States to have it both ways with China, but a new approach may be needed if Beijing means to press its territorial claims by force. Many challenges await the next administration.

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