Trump duly nominates a Secretary of State, Rex Tillerson, chief executive of ExxonMobil, who was awarded the Russian Order of Friendship by Vladimir Putin in 2013 and is reportedly "close" to ex-KGB officer Igor Sechin, the head of Russian state oil company Rosneft and "the de facto second most powerful figure inside the Kremlin". Tillerson has criticised the imposition of sanctions on Russia, which froze a 2011 deal between ExxonMobil and Rosneft to explore Russia's Arctic, by president Obama following Putin's invasion of Crimea.

Secret payments

Coincidentally, Trump's national security adviser, Michael Flynn, also accepted Russian money to attend a dinner in Moscow sitting near Putin, and a pro-Russian political party in the Ukraine made an astonishing $12.7 million in secret payments to Trump's former campaign manager Paul Manafort.

Naturally Trump describes the CIA and the FBI's finding that Russia hacked and stole confidential Democrat emails to help his campaign as "ridiculous", with aides advising media that Trump thinks the CIA wants to destabilise him. "No, I don't believe it at all," Trump told a US television network.

This was in response to a report quoting CIA director John Brennan, who informed the CIA's staff that he had "met separately with FBI [director] James Comey and DNI [director of national intelligence] Jim Clapper, and there is strong consensus among us on the scope, nature, and intent of Russian interference in our presidential election".

Clinton says she believes Russia's cyber-attacks are attributable to a "personal beef" with Putin deriving from comments she made as secretary of state that Russia's 2011 elections were rigged. "Putin publicly blamed me for the outpouring of outrage by his own people, and that is the direct line between what he said back then and what he did in this election," Clinton opined.

In a televised interview, incumbent president Obama declares that America will respond to Russia's cyber-attacks with its own formidable cyber-weapons, much like it did when North Korea sabotaged Sony Pictures' Hollywood film, The Interview. After an identical Obama threat, US cyber-soldiers shut down the entire North Korean internet. "I think there is no doubt that when any foreign government tries to impact the integrity of our elections…we need to take action," Obama warned. "And we will – at a time and place of our own choosing."

The avowedly business-friendly Trump has proven to be a Molotov cocktail in the geo-political domain. He broke decades of US policy by fielding a post-election call from Taiwan's leader Tsai Ing-wen, which no president has done since Nixon agreed to Beijing's "One China" policy in 1978.


Drone theft

China upped the ante during the week by stealing a US navy drone operating in international waters in the South China Sea, which Trump tweeted was an "unpresidented [sic] act". Concurrently the Asia Maritime Transparency Initiative released satellite images showing China had installed military weapons on the artificial islands it has erected as forward operating bases in the South China Sea in violation of international law.

On Tuesday we learn that Russia's ambassador to Turkey has been assassinated by a Syrian rebel protesting its military operations in Syria defending embattled dictator Bashar al-Assad. A few days prior, a prescient investor had asked me what the financial market impact of a Russian invasion of Turkey would be.

For years this column has repeatedly warned about rising geo-political risks, focusing on China, Russia and the US, and the likelihood of escalating cyber and kinetic conflicts as the once dominant global hegemon struggles to maintain international order in the face of a new non-democratic rival in the form of the Middle Kingdom allied with other recalcitrants like Russia.

The portfolio prescriptions are simple: avoid blindly diversifying into Asian and European exposures; try to embed "positive skew" or catastrophe insurance that profits from volatility spikes; and maintain ample cash to capitalise on any chaos.

Christopher Joye is a director and shareholder in Smarter Money Investments, which manages fixed-income investment portfolios.