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- Jeffrey C. Borneman

US Army Now Openly Militarizing Space In Arms Race With China & Russia

Jeffrey C. Borneman | August 25, 2014

The above title could also be "Poking the Panda Into War" ... The second test of the US Hypersonic Weapon launched from Alaska has failed. But it portends an arms race that is off most investor's radar screens (pardon the pun). 

"The Advanced Hypersonic Weapon is a joint effort of the Army Space and Missile Defense Command and Army Forces Strategic Command as part of the Pentagon’s Prompt Global Strike program,” said The Washington Free Beacon, quoting a Pentagon official. 

For investors unsure of whether any new arms race is ongoing or who the major players are, it's quite simple: Follow the testing of the Advanced Hypersonic Weapon systems taking place in the US, Russia and China. There is a perceived need to deliver conventional or nuclear ordnance (military supplies) to any spot on the globe within half an hour. This is a remarkable showcase of DEMAND for Defense.

The Washington Free Beacon further reports, "The (US) flight test, the second for the new weapon, took place less than three weeks after China conducted a second flight test of its new Wu-14 hypersonic glide vehicle, a similar weapon system.” Note, however, the Pentagon makes a distinction regarding China's version of the weapons system: 

"The Wu-14 test is part of a system that U.S. intelligence agencies say will be used to deliver nuclear weapons (emphasis mine) and possibly conventional long-range strikes against ships.” The US declares its version will be limited to conventional warheads and such benign targets as “terrorists or storage or development areas used for weapons of mass destruction and missiles that are discovered and must be struck quickly,” said the Pentagon. Don't buy that line. The US would not limit itself to conventional arms if the Chinese version were capable of nuclear delivery.

Let's be frank: China has not just successfully tested its own ICBM system capable of hitting the US with multiple warheads as discussed here; the new Advanced Hypersonic Weapon travels at twice the speed of the US version. The Chinese version, aka the 'carrier-killer,' pushed the US into an unsuccessful test coming weeks after China's test (also a failure). 

Indeed, tensions are so high with China over the recent P-8 surveillance incident that the US is sending a second aircraft carrier strike group to the Asia Pacific region. The strike group, led by the USS Carl Vinson, departed San Diego for the Pacific on Friday and is characterized by the Navy as a “planned deployment,” according to Investment Watch. Let’s not forget Russia in our calculation of Demand: Lt. Gen. David L. Mann, commander of the Army Space and Missile Defense command, said "Russia also is 'heavily involved in looking at this kind of capability.' ”

NOTE: This is a very visible arms race to those who care to look. Speed and height (Space) are the goals which deliver the means to strike any spot on the planet within minutes. This race is also requiring capital that is ‘off the radar,' but rest assured it is satisfying the DEMAND for Defense as the US pokes both the Russian Bear and Panda Bear ...

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

Timothy A. Walton, a defense consultant at the Alios Consulting Group, said in a recent blog post that the Army hypersonic weapon has advanced significantly and is needed to counter and deter China’s hypersonic missiles.

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