The Prosec trade drives domestic reshoring
The guest argued that national security concerns are driving a holistic 'production for security' (Prosec) trade across electricity, chip manufacturing, and critical minerals.
The argument
The speaker noted that supply chain vulnerabilities highlighted by recent global conflicts are forcing a shift toward domestic resilience. While defense is a key component, the trend also heavily favors electricity generation, domestic semiconductor manufacturing, and eventually biotech.
The thesis, stress-tested
✓ What validates it
- ✓New government subsidies or contracts awarded to domestic chip foundries
- ✓Stabilization and upward movement in rare earth commodity prices
▸ Risks discussed
- ▸Short-term price volatility in rare earth metals
- ▸High execution risk for domestic semiconductor manufacturing
Hear it yourself
"Prosec is short for production for security, AKA the sectors essential to reshoring in national security. COVID in The Ukraine and the Iran wars have woken up the countries of the world to the importance of supply chain resilience and home defense. In theory, the Prosec trade seems made for the times that we now find ourselves in. But in practice, how's it been performing? To find out, we're fortunate to welcome back to the program Peter Chur, head of macro strategy at Academy Securities. Peter, thanks so much for joining us today. Thanks a lot for having me."
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