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NATO Is Getting Put on Notice, and Everyone Should Start Looking at Defense Stocks (LMT, GD, RTX)
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[00:00:00] Douglas McIntyre: So we have an interesting situation now. We don’t know if the war in Ukraine is going to continue. We don’t know if the war in the Middle East is going to continue. There may be more war around Syria, one of the things that I think is going to help the defense industry and the big public company contractors is this, that the people who the NATO nations are now thinking of taking.
[00:00:26] Douglas McIntyre: The GDP expenditure for, for weapons and defense from 2 percent to 3%. And the reason that they, the reason they’ve been encouraged to do this is the United States is I think president Trump is going to say, not our problem. We’ve been solving this problem for you for years. We’ve been spending the money.
[00:00:46] Douglas McIntyre: We got the troops in there. there’s peace Ukraine, you guys are going to have to have to police it, also you’ve got to defend yourselves if Russia wants to come spend some time with you. And,
[00:01:00] Lee Jackson: Yes, they do.
[00:01:02] Douglas McIntyre: but to me, Lockheed, Northrop, Boeing (NYSE: BA), General Dynamics (NYSE: GD), something is about to happen for them.
[00:01:12] Lee Jackson: Yeah, and I,
[00:01:13] Douglas McIntyre: orders
[00:01:13] Lee Jackson: yeah,
[00:01:14] Douglas McIntyre: but there are a bunch of others they’ve got to replace armaments the United States has sent to
[00:01:21] Lee Jackson: Ukraine.
[00:01:22] Lee Jackson: And, and we’re at a point, I was reading that, you know, we had these two gigantic exchanges of drones and ICBMs, intercontinental type missiles, and apparently the Raytheon one that they were using, Raytheon makes like 15 a year or so, some incredibly small amount, and they’ve whittled down What we have to the point where in many cases it would be difficult for us to fight to protect ourselves.
[00:01:53] Lee Jackson: And yeah, when, when they get to the point where everybody’s going to have to up their production, it could be huge for the defense industry.
[00:01:59] Douglas McIntyre: Yeah, so I like Lockheed Martin, I like Northrop Grumman, General Dynamics, Raytheon (NYSE: RTX), I think everybody should look at those stocks as a replace weapons, add weapons play, replacing weapons the United States sent over, buying weapons, the, the Europeans having to pretty much buy them. go on a buying spree if they want to go from 2 percent to 3 percent of GDP in terms of defense. And the last thing is, is that, you know, Japan is beefing up its military a lot because there’s conversations about having an Asian NATO to, to counter the Chinese. So
[00:02:40] Lee Jackson: Absolutely. They’re going to have to.
[00:02:42] Douglas McIntyre: That means that, you know, you’re going to need more weapons in South Korea, Japan, Philippines. So anyway, I love the defense company play.
[00:02:50] Douglas McIntyre: I love it.
[00:02:51] Lee Jackson: Well, and the thing is, the good thing for Trump here is that, that with the mandates from NATO via the EU, these defense companies are going to have to, they’re going to have to bring in more workers, they’re going to have to up their production because, because ours stocks are low, you know, from all the, weapons and stuff.
[00:03:14] Lee Jackson: We’ve been selling into these two wars. Well, so we have to not only cover the orders from Europe and from Asia, but we’ll have to fill up our own stockpiles. So it could be a huge boon to the economy. If, like you said, those big companies like Lockheed, which is the biggest, contractor to the government from a defense standpoint, what if they start to, you know, up their employment by 10, 20%?
[00:03:41] Lee Jackson: That’s going to be a huge economic boom.
[00:03:43] Douglas McIntyre: Yeah, well, if you’re looking for something that is a play on the new administration’s foreign policy slash defense department, plans, look these blocks.
[00:03:57] Lee Jackson: Yeah. And, and some of them are, I mean, they’ve all had a big run over the last couple of years, but these are the stocks that can go higher. They all play a decent dividend. It’s the kind of investment you can always look at, always look at. So I think you’re right.
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