The recent events out of Israel have caused quite a commotion on X — with people sniping at one another — one side calling for an end to Israeli occupation and the other calling for a complete “wiping out” of the terrorists who reside in Gaza and the West Bank. I am not properly educated on the history of this Biblical feud, so I’ll refrain from offering amateur “expert advice.”
What I will say to you now is to expect for natural laws to be demonstrated widely and aspersions cast without guard-rails — war on an industrial scale will continue and expand. The events in Ukraine coupled with the new conflagration in Israel and the insatiable demand for blood by people on the right and the left — all but cement future eventualities will entail escalation.
Your opinions no longer matter and the die has been cast. Western powers must mobilize and expand their industrial heft in order to supply both Ukraine and Israel. You might not like it — but both parties support this initiative and the people are, once again, in a post 9/11 fervor — clamoring for war and spoils, the natural order of things since man invented the spear.
As for markets — the reaction is rather inconsequential — with large gains in military defense contractors and oils — minor drawdowns in airlines, retail and healthcare.
I closed out my hedges and now am long — up 18bps — in possession of a 61% cash position — carefully allocating — mindful of the times I’m living in — cognizant that emotions are running hot. At the end of the day, I am a professional of the highest order and will maintain equanimity whilst the world churns and burns around me.
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