Every few years a document lands on my desk that actually changes how I think about allocating capital for the next decade. This week it happened again.
Last Friday night I was scrolling through the usual weekend reading list when a new National Security Strategy dropped. I almost skipped it, most of these things are 60 pages of bureaucratic mush, but the opening line stopped me cold: “After the end of the Cold War, American foreign policy elites convinced themselves that permanent American domination of the entire world was in the best interests of our country.” That is not normal diplomatic language. That is a declaration of war on the post-1991 consensus.
By the time I finished the 48-page document at 2 a.m., one thought kept circling in my head: this reads less like a strategy paper and more like an investment memo written by a very aggressive macro hedge fund. And if even half of it gets implemented, entire sectors are going to 10× while others quietly disappear.
Welcome Back to Great-Power Competition
The core message is brutally simple: the era of trying to run the entire planet is over. America is pivoting to a sphere-of-influence model that would make Kissinger blush and Mao nod in recognition.
For the first time in my career, an official U.S. government document explicitly resurrects the Monroe Doctrine, but with a twist they’re calling the “Trump Corollary.” The Western Hemisphere isn’t just off-limits to hostile powers; it’s about to become Washington’s exclusive economic zone.
“We want a Hemisphere whose governments cooperate with us against narco-terrorists, cartels, and other transnational criminal organizations… free of hostile foreign incursion or ownership of key assets.”
2025 National Security Strategy
Translation: Chinese ports in Mexico, rare-earth mines in Peru, 5G networks in Brazil built by Huawei? Those days are numbered. I’ve already started hearing whispers about “voluntary” divestments and new financing packages that come with very American strings attached.
The End of Forever Wars, The Return of Hard Power
Perhaps the most interesting section, and the one that made me sit bolt upright, was the Middle East paragraph. It manages to say in two sentences what neocons spent twenty years and eight trillion dollars failing to achieve:
“We want to prevent an adversarial power from dominating the Middle East, its oil and gas supplies, and the chokepoints through which they pass while avoiding the ‘forever wars’ that bogged us down.”
They’re openly admitting the Iraq/Afghanistan era was a catastrophic waste, but they’re not going isolationist. Instead, expect offshore balancing on steroids: carrier groups in the Eastern Mediterranean, quiet basing deals with Gulf partners, and probably a lot more drone strikes that nobody will ever hear about. Energy keeps flowing, Iran stays contained, but no more nation-building fantasies.
For markets, this means Middle East risk premium just dropped dramatically. Oil volatility should trend lower over time, which paradoxically makes the Permian Basin even more dominant. I’ve been adding to domestic energy infrastructure names that most people wrote off as “Trump trades” in 2017.
Europe Gets a Very Public Reality Check
The document’s treatment of Europe is… spicy. It essentially calls the EU a stagnant, over-regulated, demographically challenged mess that’s lost its “civilizational self-confidence.” I’ve never seen an official U.S. strategy document this blunt about allies.
The practical implications are massive. NATO burden-sharing debates are over, Europe lost. The new line is basically “figure out your own defense or become a Chinese tributary state.” Expect U.S. troops in Europe to continue drawing down while European defense stocks, particularly in Poland, Sweden, and Finland, go parabolic.
I was on a call with a Scandinavian defense CEO last week who literally laughed when I read him the relevant passage. “We’ve been waiting twenty years for America to say this out loud,” he told me. His order book is apparently full through 2032.
Industrial Policy, Beijing Style
Here’s where it gets really interesting for investors. The NSS openly calls for massive deregulation and direct government-private sector coordination to maintain advantages in:
- Undersea warfare
- Space systems
- Nuclear technology
- Artificial intelligence
- Quantum computing
- Autonomous systems
They’re literally admitting they want to copy the Chinese model of civil-military fusion, but do it better because we have freer markets and (for now) better universities.
This isn’t CHIPS Act theater anymore. This is “whatever it takes” territory. I’ve been doing deep dives on companies that make the picks-and-shovels for these exact domains, particularly smaller players that haven’t yet attracted attention from the big defense primes.
The New Red Lines Everybody Missed
Buried on page 37 is a paragraph that should terrify anyone long Chinese tech:
“Improving these capabilities will also require considerable deregulation to further improve our competitiveness, spur innovation, and increase access to America’s natural resources.”
They’re openly telegraphing that environmental reviews, endangered species protections, and mining restrictions are about to get bulldozed in service of national security. The same administration that once tried to drain the swamp now wants to drain actual swamps if they contain rare earths.
My lithium and copper names in Nevada and Arizona have been quietly ripping for months. Now I understand why.
What This Means For Your Portfolio
After letting this document marinate for a week, here’s how I’m repositioning:
- Domestic critical materials – lithium, copper, rare earths, uranium – are the new oil
- Defense tech that actually works – think Anduril, Palantir, SpaceX ecosystem, not legacy primes
- Energy independence plays – Permian infrastructure, LNG export facilities, nuclear renaissance
- Short anything dependent on Chinese supply chains – especially semiconductors and batteries
- Long the dollar – this strategy only works with a strong currency to fund it
The most dangerous thing in markets is when the government and investors want the same assets at the same time. That’s happening right now in about a dozen narrow pockets of the market.
I’ve been doing this long enough to know that when a U.S. administration publishes a strategy document this coherent and this ruthless, markets eventually price it in. The only question is whether you get there before or after everyone else wakes up.
The Cold War never really ended. It just went into hibernation while we were busy exporting our industrial base and fighting optional wars. This document announces that nap time is over.
Position accordingly.
