Leslie Kingsbury

"We are much more into might makes right into a heavy transactionalism... moving into a period where there isn't an alternative order, where alliances aren't going to be permanent." The breakdown of the US-led rules-based order and the unreliability of permanent alliances force individual nations (especially "middle powers" and European states) to drastically increase their sovereign defense budgets to ensure their own security. US defense prime contractors are the primary beneficiaries of this global rearmament cycle. LONG LMT / RTX / GD to capitalize on the secular, global increase in defense procurement driven by geopolitical fragmentation. Significant cuts to the US defense budget or a surprise global peace summit that resets international security norms.

"We are much more into might makes right into a heavy transactionalism... moving into a period where there isn't an alternative order, where alliances aren't going to be permanent." The breakdown of the US-led rules-based order and the unreliability of permanent alliances force individual nations (especially "middle powers" and European states) to drastically increase their sovereign defense budgets to ensure their own security. US defense prime contractors are the primary beneficiaries of this global rearmament cycle. LONG LMT / RTX / GD to capitalize on the secular, global increase in defense procurement driven by geopolitical fragmentation. Significant cuts to the US defense budget or a surprise global peace summit that resets international security norms.

"They will be impacted much more by gas than by the U.S... coming at a time when they're squeezed at home." With Europe facing an acute natural gas squeeze and the US lifting sanctions on Russian oil (but not necessarily solving Europe's gas deficit), European nations will be forced to secure reliable, non-Russian, non-Middle Eastern energy. US Liquefied Natural Gas (LNG) exporters will see massive, sustained demand and long-term contracting power. LONG LNG / SRE as US natural gas infrastructure companies become the critical energy lifeline for Europe. Regulatory pauses on new US LNG export terminal approvals or a rapid European transition to domestic renewables.

"We are much more into might makes right into a heavy transactionalism... moving into a period where there isn't an alternative order, where alliances aren't going to be permanent." The breakdown of the US-led rules-based order and the unreliability of permanent alliances force individual nations (especially "middle powers" and European states) to drastically increase their sovereign defense budgets to ensure their own security. US defense prime contractors are the primary beneficiaries of this global rearmament cycle. LONG LMT / RTX / GD to capitalize on the secular, global increase in defense procurement driven by geopolitical fragmentation. Significant cuts to the US defense budget or a surprise global peace summit that resets international security norms.

"They will be impacted much more by gas than by the U.S... coming at a time when they're squeezed at home." With Europe facing an acute natural gas squeeze and the US lifting sanctions on Russian oil (but not necessarily solving Europe's gas deficit), European nations will be forced to secure reliable, non-Russian, non-Middle Eastern energy. US Liquefied Natural Gas (LNG) exporters will see massive, sustained demand and long-term contracting power. LONG LNG / SRE as US natural gas infrastructure companies become the critical energy lifeline for Europe. Regulatory pauses on new US LNG export terminal approvals or a rapid European transition to domestic renewables.

"If you look at what Iran is doing and the Persian Gulf in the Strait of Hormuz... hadn't planned for the possibility that Iran might close the Strait of Hormuz." The Strait of Hormuz is the world's most critical chokepoint for global oil transit. Any asymmetric warfare or outright closure by Iran will severely restrict global crude supply, creating an immediate and violent upside shock to oil prices. LONG USO to capture the direct commodity price appreciation resulting from Middle East supply chain disruptions. The US successfully secures the strait with naval escorts, preventing supply disruptions, or a rapid diplomatic de-escalation occurs.

"They will be impacted much more by gas than by the U.S. as we know it, gas prices. But it really is coming at a time when they're squeezed at home, when, you know, the war with Ukraine continues." Europe's economy is highly sensitive to imported energy costs. A dual-front geopolitical crisis (Middle East and Ukraine) driving up natural gas prices will crush European industrial profit margins and severely pressure the European consumer, leading to regional economic underperformance relative to the US. SHORT VGK as European equities face severe macroeconomic headwinds from structural energy deficits. A warmer-than-expected winter, massive government subsidies for European industrials, or a sudden collapse in global energy prices.