Defense Picks for a new Cold War
12/01/2016 7:00 am EST
When the Soviet Union came to an end in 1991, so did the Cold War – and the whole world breathed a sigh of relief, recalls Jim Powell, editor of Global Changes & Opportunities Report.
For the first time since the 1950s, it appeared that we wouldn’t all be incinerated in a nuclear war. Now another Cold War is starting. This time both Russia and China are involved.
Not only are the two governments individually becoming threats to the US, they are also creating a military alliance that’s strong enough to challenge American forces anywhere in the world.
There are several global hotspots where Washington is at odds with Moscow or Beijing. In some places the antagonists are in such close proximity, I fear the Cold War could turn hot in an instant.
Syria is especially troubling. Outside powers are conducting aerial attacks that are often less than a mile apart. If one side shoots down another’s aircraft – even by mistake – the conflict could quickly spread.
The US and Russia are also at odds over Crimea and Ukraine. The Russians took over the former without an overt military invasion that might have triggered a response by NATO. If Putin tries to repeat the gambit in eastern Ukraine, the outcome may be quite different.
Equally troubling is China’s territorial expansion in the South China Sea where it is occupying several islands claimed by other countries in the region.
A tribunal at The Hague that deals with territorial disputes, ruled that the islands must be vacated. China immediately dismissed the order.
To back up the tribunal’s decision, Washington is continuing to send naval vessels into the area. A mistake on either side could have terrible consequences.
If you want to own only one defense contractor in your portfolio, I think it should be Lockheed Martin (LMT).
By Jim Powell, Editor of Global Changes & Opportunities Report