Chart of the Day: The Military-Industrial Complex is Not Worried

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Via Tyler Cowen, here’s a chart from Sober Look that tracks the price of a basket of defense stocks—the iShares defense industry ETF—since the beginning of the year. The index underperformed the market for a bit during February, but it’s fully caught up since then. “Just like the public at large,” says SL, “investors now believe the sequester law will be reversed in short order. US aerospace and defense shares have rallied to outperform the S&P500.”

This is a bit mysterious though. It’s obviously true that investors are sanguine, but I’m sure not seeing any reason for it, at least not in the short term. The defense cuts might be reversed during the next budget cycle, but there seems little chance of the sequester being renegotiated for FY2013. Is this all that investors care about? Or am I missing something?

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DEMOCRACY DOES NOT EXIST...

without free and fair elections, a vigorous free press, and engaged citizens to reclaim power from those who abuse it.

In this election year unlike any other—against a backdrop of a pandemic, an economic crisis, racial reckoning, and so much daily bluster—Mother Jones' journalism is driven by one simple question: Will America move closer to, or further from, justice and equity in the years to come?

If you're able to, please join us in this mission with a donation today. Our reporting right now is focused on voting rights and election security, corruption, disinformation, racial and gender equity, and the climate crisis. We can’t do it without the support of readers like you, and we need to give it everything we've got between now and November. Thank you.

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