Defense Stock Whiplash: Trump vs. Contractors, Then a $1.5 Trillion Shock
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I got bloody whiplash from following the defense industry from yesterday. My Lord, people, various different directions. Looks like it’s gonna go in one direction, pulls it back in the other direction. And the reality of the situation is we’re gonna end up paying. Anyway, so the day starts off, the Trump administration, Donald Trump comes out, he makes a couple of truth social posts, see, in particular, going after
defense contractor Raytheon Basically, he went after well, basically all weapons manufacturers announcing new restrictions on executive pay and stock buybacks While also threatening to cancel contracts that was with with Raytheon now from an outsider’s point of view like damn straight we’re always hearing about you know, $100,000 toilets and $50,000 wrenches, the stories. I’ve those things since I was a kid for crying out loud. And we all know it, the Pentagon hasn’t ever passed an audit for crying out loud. So yeah, this is great, this is fantastic. Super, we’re going after them, basically saying that they’re gonna limit executive pay to $5 million. I actually put that in a Truth Social post that wasn’t in as an executive order.
And he forbid defense contractors from buying back their stock, buying back their stock unless they were actually delivering on these various different contracts on time. Either the company and I quote, steps up and starts investing in more upfront investment like plants and equipment, or they will no longer be doing business with the Pentagon. Now, that’s all well and good. And on the surface,
He likes that, right? That you wanna see that. You don’t wanna get ripped off as taxpayers. Now, this is an executive order. Executive orders, they’re almost to some degree, almost like a strongly worded letter from the UN. Trump doesn’t have the legal authority. This won’t hold up in court, even though, again, I like the idea.
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I’m frustrated with these defense contractors. I’m frustrated with cost overruns. But one of the problems is, and this is where this all came from, is we allowed for all of these mega mergers between various different defense contractors. Now, they can talk a big game. They can talk a big game. was always Pete Hegseth yesterday came out saying, they better deliver on these things or we’re gonna be, we’re gonna.
We’re gonna be doing business with somebody else. They don’t deliver weapons on time for those who can’t adapt, who are too comfortable with the old, slow ways of doing business. We wish them well in their other future endeavors. Where else are you going to go?
There’s just a few major defense contractors out there. They’re the ones that have developed these various different technologies. They know this. They’re well aware of this. They’re well aware of the fact that, you’ve got developmental costs and we the taxpayers pay on these ridiculous weapons systems. Now, one of the things, and I understand why Trump is frustrated, so we should all be frustrated with this. Many different weapons,
systems that we have that we’re still spending money on that we’re going to continue to spend money on in today’s day and age are how shall I put it stupid? They’re outdated. I take a look at the type of technology and what they can do with drones, everything should be headed in that direction. But it’s not why well,
Certain representatives certain member of Congress Senate, whatever it may be has got a factory in his district and Jumps up and down when again, they try to do away with something I was it was story we covered here on the program several years ago about all these aging planes Just sitting in the desert. They are rusting away that we have to I don’t know pay to maintain for whatever reason it may be No reason actually except again
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It’s in someone’s district and they want to keep those contracts going. Part of the problem. Now here comes a whiplash comes in when it comes to this story. After this happened yesterday, you had stocks from the defense contractors sell off. Sell off based upon this truth social posts and executive order. But then later on in the day, you get another post from Donald Trump.
After long and difficult negotiations with senators, congressmen, secretaries, and other political representatives, I have determined that for the good of our country, especially in these very troubled and dangerous times, our military budget for the year 2027 should not be $1 trillion, but rather $1.5 trillion. This will allow us to build the dream military
that we have long been entitled to, and more importantly, that will keep us safe and secure, regardless of foe.
If it weren’t for the tremendous numbers being produced by tariffs from other countries, many of which in the past have ripped us off, the United States of levels never seen before, I would stay at the $1 trillion number. But because of tariffs and the tremendous income that they bring and amounts being generated, that would have been unthinkable in the past. Especially just one year ago. And I gotta go solve for Biden and whatnot is saying that.
were able to easily hit the $1.5 trillion number while at the same time producing unparalleled military force and paying down the debt.
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You have to be really, really dumb. I’m sorry. Okay. And I don’t mean to insult anybody, but come on, wake up. If you think that we’re going to spend $1.5 trillion on our military and be able to pay down our debt. We’re running massive deficits for $38 trillion plus in debt and you want to increase our military budget by 50 %?
And then every year after that has automatic increases built in. You got to be kidding, man. I mean, it’s it’s obscene. I got the thought in my mind of Dr. Evil. All I asked for sharks with freaking laser beams attached to their heads. What are you doing, I say, cost should be coming down. Cost should be coming down based upon the type of technology.
that is available today. Think about this. This is obscene. Again, I don’t know. I’m gonna give you, I think that they’re worried tomorrow, possibly. There’s going to be a ruling on the tariffs from the Supreme Court. And again, this is gonna allow Trump to go out and,
Basically politic on this and say, you know, the Supreme Court took away our ability to increase our defense. It’s hampering my ability as commander in chief. I can see some of this kind of read between the lines. Again, our Pentagon has never passed an audit. They’ve never passed an audit. We spend more than what is the next nine, 10 countries below us on our military every
single year based upon those numbers which have been going on for decades now and compounding it shouldn’t even be close at this point time and what we’re capable of doing compared to anybody else increasing our military budget by 50 percent
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I’m going to give you a and I think it’s a bit of a bluster. You’re no way know how you’re going to get this through Congress. I just I don’t see it happening. I really don’t. Economic reality, we can’t afford this. As a country, we just can’t. Going after defense contractors, again, I’ve said this before, the best way you can go ahead and do that is to break them up, allow more competition
within that industry. You’ve got these colossal companies out there that are getting too big to fail. In essence, you can threaten you can put out a post whatever it may be. Where else you going to go? Where else is the Pentagon going to go? I gotta start buying weapons from Europe. I don’t think so. I don’t think so. Anyway, watchdog on wallstreet.com.
