More than $2.2 trillion…
That’s how much the planet spent on defense last year.
That’s the largest amount spent since the end of the Cold War — even when adjusted for inflation.
And 2023 will register an even higher figure… as will 2024, 2025, and so on.
That is the direction defense spending is going, and when you look at what’s happening in Eastern Europe (Ukraine), the Middle East (Israel), and the Pacific (China), there’s no mystery as to why.
It’s a trend you see reflected in the U.S. defense budget, which topped out at a record $858 billion for the current fiscal year — and which is on track to hit $1 trillion itself before long.
But you can also see it in America’s arms sales to the rest of the world.
Remember, America is the largest arms dealer in the world, and it’s not even close.
The U.S. accounts for 45% of global arms sales, which is magnitudes more than any other country and up from 30% a decade ago.
Last year, government-to-government foreign military sales totaled $52 billion.
Additionally, direct sales between foreign countries and American military contractors were nearly triple that — $154 billion.
And in just the first nine months of 2023, foreign military sales topped $90.5 billion, which puts it on track to double last year’s total. Join Wealth Daily today for FREE. We’ll keep you on top of all the hottest investment ideas before they hit Wall Street. Become a member today, and get our latest free report: “Dividend Royals: The 7 Best Dividend Aristocrats to Hold Forever”
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Again, you can really see that tailwind from weapons sales to Ukraine and other allies in Europe who are now suddenly extremely worried by Russia’s belligerence.
Former Soviet satellite states, in particular, are (rightfully) lining up for American firepower.
We’re talking about countries like Latvia, Lithuania, Czechia, and especially Poland, which has pledged to devote 4% of its GDP to defense — double NATO’s 2% guidance.
Poland has been cleared to buy $41.7 billion in weapons from the United States so far this year, doling out $10 billion for Lockheed Martin’s HIMARS and Hellfire missile systems, $12 billion for Apache helicopters made by Boeing, and $15 billion for RTX’s Integrated Air and Missile Defense system.
Poland has made other big-ticket purchases as well in recent years, including orders for Abrams tanks and F-35 fighter jets.
Countries like Poland have been demanding so much weaponry, in fact, that American defense contractors haven’t been able to keep up.
Between supply chain issues, an industrial base that’s shrunk since the Cold War, and the sheer volume of demand, America’s arms manufacturers just can’t fill orders fast enough.
That’s driven billions of dollars of overflow demand to other foreign suppliers like South Korea, Turkey, and France.
As a result the Pentagon has made a concerted effort to expedite foreign military sales by cutting red tape and working with contractors to expand production facilities.
The Pentagon even created a special “Tiger Team” to streamline the FMS process. That team delivered a full report in June and more reviews are currently underway in every branch of the military.
That could carve out an even larger share of the $2.2 trillion global defense market for the United States.
Especially since, the gains we’ve made over the past decade have come at the expense of Russia and China, which have seen their share of the global arms market recede.
This is good for the United States economically and politically, as it enhances diplomatic relations and takes money from the pockets of our adversaries.
Indonesia is one example of that.
The Pacific nation has traditionally relied on Russia for its military purchases, but is now reorienting more toward the United States in Europe.
After backing out of a deal to buy Russian Sukhoi Su-35S fighter jets, Indonesia went on to strike deals with the United States for F-15s and Black Hawk helicopters.
Again, this strengthens the U.S. foothold in the Asia Pacific region both diplomatically and militarily.
Similarly, the $164 billion in arms sales the United States has struck with Saudi Arabia over the past several decades has made the Middle Eastern oil magnate more amenable to U.S. policy concerns and military cooperation in the region.
Finally, and obviously, this massive trend has been a boon to the defense contractors and technology suppliers I’ve long covered at Secret Stock Files and elsewhere.
I even just released a new report about AI aircraft that are now taking to the skies. These robot wingmen are being deployed to safeguard and even enhance our manned fighters — and ultimately will one day replace them.
So check that out here if you haven’t already. Fight on, Jason Simpkins Simpkins is the founder and editor of Secret Stock Files, an investment service that focuses on companies with assets — tangible resources and products that can hold and appreciate in value. He covers mining companies, energy companies, defense contractors, dividend payers, commodities, staples, legacies and more… In 2023 he joined The Wealth Advisory team as a defense market analyst where he reviews and recommends new military and government opportunities that come across his radar, especially those that spin-off healthy, growing income streams. For more on Jason, check out his editor’s page. Be sure to visit our Angel Investment Research channel on YouTube and tune into Jason’s podcasts. Want to hear more from Jason? Sign up to receive emails directly from him ranging from market commentaries to opportunities that he has his eye on. 
