I'm Not Worried About the Market — I'm Worried About THIS

In my line of work, we tend to fixate on numbers, line charts, and tables.

So much so that it often distracts from the life around us. 

That's made this past week pretty difficult. 

Stocks have been getting hammered, and crypto is taking it even harder. 

But last night, when I got off work, I went axe-throwing. I'm in a league and it was the playoffs. (This is a real thing, I swear.) 

I lost, but it was good to get away from the stress of the market. And it was even more fun to go to a bar afterwards.

There, I overheard the bartender (Dean) talking to another patron about crypto. 

You know what he said?

"Sounds like buying time to me."

I loved it. That's what I've been telling people, too. 

Not just about crypto, but stocks, as well.

Then the conversation shifted. 

The NHL playoffs were on and a Russian player got in a fight with a Finnish one. 

"Ah, I bet Putin told him to do that," someone said. 

We all laughed, but would it really surprise anyone if that were true?

Just this week Finland's president, Sauli Niinistö, and its Prime Minister, Sanna Marin, released a joint statement affirming that the country would apply for NATO membership. 

"As a member of NATO, Finland would strengthen the entire defense alliance," they said. "Finland must apply for NATO membership without delay. We hope that the national steps still needed to make this decision will be taken rapidly within the next few days."

Sweden is considering joining the alliance, as well. And NATO Secretary General Jens Stoltenberg has already said the group would welcome Finland and Sweden with open arms.

Personally, I think this is a positive development overall. But I'd be lying if I said I wasn't a little concerned, too. 

After all, Ukraine didn't even come close to applying for NATO membership. All it took was the idea that maybe, one day, it might join NATO for Russia to invade.

That war isn't going the way Putin thought it would, either. 

It's actually crazy to think about how, when the war first broke out, everyone thought Russia would march right to victory. 

In fact, when the first Russian soldiers broke through the Ukrainian border they packed parade uniforms to don in a celebratory march through Kyiv. 

And do you remember when U.S. intelligence services offered to smuggle President Zelensky out of the country? The prevailing belief was that he'd have to rule from exile, if he wasn't killed first.

Now, Russia's been forced to retreat from Kyiv entirely, falling back to the eastern regions they'd already occupied.

And the goal posts for the West have shifted far beyond salvaging whatever is left of Ukraine and mitigating the invasion to delivering a full-blown defeat to Russia — and potentially, regime change.

"We want to see Russia weakened to the degree that it can't do the kinds of things that it has done in invading Ukraine," said Defense Secretary Lloyd Austin. "We believe that we can win — they can win if they have the right equipment, the right support."

To that end, the House of Representatives just cleared another $40 billion in aid, after Congress approved $13.6 billion in funding just a few weeks ago.

And while the sanctions haven't devastated Russia the way policymakers had hoped, they're still hurting. Yachts are being confiscated and the Russian military is being forced to use parts and computer chips from dishwashers and refrigerators. 

Some of the success has even bordered on boastful, as U.S. officials openly bragged about our intelligence facilitating the destruction of the Russian flagship Moskva. 

Of course, all of these things — the humiliating losses, the lethal and financial support being provided by the West, the sanctions, and a new round of NATO expansion — raise a whole new level of risk. 

You have to start to wonder if a guy like Vladimir Putin is capable of accepting defeat. 

The Russian foreign ministry has already called Finland's ascending into NATO "a radical change in the country’s foreign policy" and pledged to "take retaliatory steps, both of a military-technical and other nature, in order to stop threats to its national security arising."

And former Russian president, current chairman of Russia's security council, and close Putin ally Dmitry Medvedev has been clear that the steps taken by the West risk escalating the conflict to a point of nuclear confrontation. 

"NATO countries pumping weapons into Ukraine, training troops to use Western equipment, sending in mercenaries and the exercises of Alliance countries near our borders increase the likelihood of a direct and open conflict between NATO and Russia," Medvedev said. "Such a conflict always has the risk of turning into a full-fledged nuclear war."

I know that threat sounds so disastrous that it's almost unthinkable. 

Russia wouldn't really do that... Would it?

I don't know. Maybe it will. 

We can't know. All we can do is hope for the best but prepare for the worst. 

And that's why I recently launched a trading service that focuses almost exclusively on military technology.

There, I cover companies that have already tapped into shadow streams of government funding both on and off the books. 

You should check it out if you haven't already. Because even if Russia is cowed and things don't escalate to the worst possible point, global defense spending is surging with no end in sight. 

So give it a look if you get a chance.

Fight on,

Jason Simpkins

@OCSimpkins on Twitter

Jason Simpkins is Assistant Managing Editor of the Outsider Club and Investment Director of Wall Street's Proving Ground, a financial advisory focused on security companies and defense contractors. For more on Jason, check out his editor's page. 

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