Settled Science - Defense Is The Best Business Model
Jeffrey C. Borneman | September 8, 2014
"Brazil and South Africa may merge their defence research bases to jointly conquer world markets," is the headline from DefenseWorld.net. Just like Germany announced (here) in late June, the manufacturing of Defense is huge business and will be sought.
Investors will see that world-wide DEMAND for Defense is insatiable. Every technologically advanced country is demonstrating its eagerness to participate in this arena, why? I remind investors daily that the adage "money makes the world go 'round" is untrue - it is DEMAND that drives capital. Capital chases DEMAND and, as the world's economies crumble, being prepared to sell into one of the only viable markets kills two birds with one stone: Cash for a readily marketable product while simultaneously preparing to defend themselves.
While I am unaware that anyone is preparing to invade either Brazil or South Africa, the melding of the two countries Defense industries seems to confirm that the market is for Defense is large enough to accommodate even late-comers and is a sound business model while general DEMAND falls.