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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

US Defense - Fighting For Climate Security?

Jeffrey C. Borneman | October 14, 2014

ISIS is consolidating power around Baghdad; the Kurds and Iraqis are begging for US weapons;  the US is threatening Russia with more sanctions; it was revealed that Russia has been preparing for WW4 since 2003; Russia has more nuclear missiles than the US; Germany admits its War machine is 'impotent'; China tests new ICBM, US to shrink fighting force further; US marines 'fighting' Ebloa; India desperate for submarines, and; US military to fight climate change.

The above stories speak to hundreds of billions of dollars of current and pent-up DEMAND for Defense. I've been away so, missed addressing the these topics - each deserves serious consideration as each headline reflects future DEMAND for Defense (spending) and potential conflict (War) - but none of them are more startling than the US military preparing to fight climate change. 

Secretary of Defense Chuck Hagel said in Arequipa, Peru last week that "One of those emerging challenges, environmental security (emphasis mine), is a major theme of this week’s conference, and it provides us with an opportunity to discuss the security implications of climate change," quoting Hagel's prepared speech from the US Department of Defense.

"Saving the planet" takes on an entirely new meaning when you make it a Defense issue. Think through the ramifications of adding environmental security (climate change) to the list of real and potential US enemies commanding the time and attention of military leadership and a budget of $601 billion. This is a staggering development as Defense dollars are diverted to social issues and the threat of cutting the standing army (yet again) from 490,000 troops to 420,000. 

Hagel continued, "Climate change is a “threat multiplier”…because it has the potential to exacerbate many of the challenges we already confront today – from infectious disease to armed insurgencies – and to produce new challenges in the future."  

Savvy investors understand DEMAND for Defense never sleeps as Defense is the fulcrum of much of world trade. The US just added the most nebulous of enemies to a long list of real ones that does not respond to intimidation, air power boots on the ground. It will be interesting to see how the Defense budget grows, as well as NATO's, based on Hagel's declaration. 

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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