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What is MDEF™ Investing? Strategy before tactics. Strategic investments dictate tactical actions in the Metals, Defense, Energy & Food sectors.

- Jeffrey C. Borneman

China's "Carrier-Killer" Missile Threat Addressed?

Jeffrey C. Borneman | August 29, 2014

One of the biggest threats facing the U.S. Navy today was the new Chinese anti-ship ballistic missile designated the "DF-21D" - what US war planners referred to here as the Carrier-Killer.

After a seven year development period, Raytheon held a ceremony yesterday to commemorate the first delivery of a new version of the Rolling Airframe Missile (RAM) to the U.S. Navy. It is essentially a very fast and maneuverable dart meant to counter China's DF-21D massive 15 ton, two-stage, solid fuel missile.

The new RAM missile is designated "Block 2" and Raytheon plans to sell it to all NATO allies who deployed the Block 2 predecessor (the Block 1), including: Egypt, Greece, Japan, the Republic of Korea, Turkey and the United Arab Emirates. Germany placed the largest order to-date for 445 Block 2's. 

The question with any new Defense hardware is reliability in combat conditions. The "will it work" question seems to have been answered:

"After succeeding in 21 of 22 tests over seven years — including going eight-for-eight in the latest testing — the future is bright for the RAM, said Capt. John Keegan, RAM program manager for the Navy," reported BuzzFeed.

The deployment date for the US Navy is March 2015 which should give the US admirals great relief as we place more and more naval assets in the Far East and within range of China's ability to strike.  

Investors should recognize the pattern of DEMAND for Defense as it is still escalating at a fevered pace regardless of the shattered budgets of most the world's governments.  

If you want to know more about how the MDEF™ Investing strategy is positioned in this, or other geopolitical possibilities, please contact us directly.

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