Proof China Is Preparing for War

Last week, Chinese President Xi Jinping met with Russian President Vladimir Putin in Moscow. 

The visit reaffirmed China’s support for Russia and its ongoing war crimes, and promised closer relations going forward.

It ended on an ominous note, as Xi left Putin with the following words:

“Change is coming that hasn't happened in 100 years.”

He’s not kidding. 

Both Xi and Putin share a vision for the world — and it’s not one that’s democratic or free. 

It’s one where authoritarian states and their respective dictators are free to do as they please — not just domestically, but on a global scale. 

Because, you see, once you’ve conquered your own country, the way Xi and Putin have, the only logical next step is to conquer someone else’s.

This is how totalitarian states evolve. Their leaders can never have enough control. 

They won’t be cowed by external forces. Conquest and expansion must be allowed. The strong must dominate the weak. 

That’s what Russia and China — and their smaller companions Iran and North Korea — want. They want carte blanche to impose their will. 

But unfortunately for them, there’s one thing standing in their way… 

The United States.

Since the end of World War II, the United States has been the chief guarantor of global security — a guardian of democracy, a champion of freedom, a custodian of order.

It’s not always perfect. We’ve made mistakes. But at the end of the day, it’s America that’s kept a lid on global conflict and political chaos for the past seven decades. 

And that’s what Xi Jinping means when he says change is coming... change that hasn’t been seen in a century.

He aims to topple the United States, abolish the system, and create a new China-centric world order.

He wants the world to serve at China’s whim.

And he knows deep down that that kind of change isn’t going to come without a fight... 

So he’s preparing for one.

China’s defense budget has doubled over the past decade and was raised 7.2% in just the last year. It now officially stands at roughly $225 billion. 

Unofficially, most experts believe the real figure is closer to $300 billion, which exceeds the combined defense spending of Australia, Japan, the Philippines, South Korea, and Thailand.

That’s still just a third of what the United State spends, but we have far more bases and international obligations — troops stationed from Europe to the Pacific — and we have a massive fleet of traditional weapons platforms to maintain.

So maintenance and sustainability account for a lot of America’s military budget, whereas China’s defense spending is being funneled heavily into arms development (like we’ve seen with its hypersonic missiles).

That’s not the only sign of a looming confrontation, though. 

Over the past few months, Beijing has rolled out a litany of new laws, procedures, and mandates to improve its army’s combat readiness. 

In December, the government put forth a law that enables the People’s Liberation Army to more easily activate its reserve forces and replenish combat troops in the event of war. (China's clearly been learning from Russia’s stumbles in Ukraine.)

And in February, China’s National People's Congress adopted a new law that gives the military broad new legal powers, which, according to the state-run People's Daily, includes “jurisdiction, defense and representation, compulsory measures, case filings, investigation, prosecution, trial, and the implementation of sentences.” 

That’s a mass of legal power that could be used to crack down on dissidents or activists in the event of a war — again similar to the way Moscow overwhelms its political opposition with mass detention and propaganda.

The military could also use it to claim legal jurisdiction over territory that China claims as its own like Taiwan or the South China Sea.

China is also building new recruitment centers across the country, as well as air raid shelters and military hospitals in Fujian, the province adjacent to the Taiwan Strait.

In fact, earlier this month, the Fujian province began barring overseas IP addresses from accessing government websites.

Another plan that’s been floated (and praised by Xi himself) would create a blacklist of pro-Taiwan activists and political leaders so they could be targeted for assassination.

This isn’t just showmanship, nor is it a contingency plan. It’s building up to something. 

It’s preparing for war — a once-in-a-century war.

It’s going to be the kind of conflict that completely rocks the global economy. 

And the best thing investors can do to prepare, come out ahead, and even aid in America’s war effort is to invest in the companies that are driving our military’s technological advancement. 

If that sounds good to you, make sure to check out Secret Stock Files, where I have a portfolio full of companies that do just that. 

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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