Don’t Bet on the War
There's a story I keep coming back to, one I've been meaning to put in the book for a while now. It happened early in my career, when I was a banker at a branch in one of those towns where the zip code does a lot of the talking. The kind of place where people had real money, managed it carefully, and generally knew better than to chase rumors.
Or so I thought.
This was the early 2010s. The Iraq War was winding down, the news cycle was relentless, and for several months I had a version of the same conversation at least a few times a week. A client would sit down across from me, already convinced, and ask about exchanging dollars for Iraqi dinars.
They weren't reckless people. They were doctors, retirees, small business owners. Ordinary people who'd read something online, heard something from a friend, and became convinced they'd spotted an angle everyone else had missed. Iraq had massive oil reserves. The war was ending. The currency would "revalue." The logic, if you followed it quickly enough, almost made sense.
I processed the requests. I smiled. I didn't say much, because at that point in my career I wasn't sure it was my place to. But I watched it happen, over and over, and something about it stayed with me long after I left that branch.
* * *
Here's what actually happened to the Iraqi dinar: it went the wrong direction. What cost 1,166 dinars to buy a dollar in 2010 costs about 1,310 dinars today. The revaluation never came. Several states issued fraud warnings about dinar dealers. Some of those dealers were charging transaction fees of 20% just to let people in the door. The people who sat across from me, who thought they were getting ahead of the market, were actually paying a premium to stand still.
And $10,000 sitting quietly in an S&P 500 index fund that same January 2010? It would be worth somewhere around $65,000 to $70,000 today, without them doing a single thing.
I'm not telling this story to make anyone feel bad. I'm telling it because the psychology behind those dinar purchases never went away. It just found new clothes.
* * *
Open any financial news feed today and you'll find the same instinct running, updated for 2025. Which defense contractor is best positioned for AI spending? Which drone company lands the next Pentagon contract? Which chipmaker supplies the military build-up?
The thesis feels logical, the headlines are loud, and there's real money flowing. But here's the problem with trying to profit from conflict: by the time a story is that visible, that discussed, that everywhere, the trade is already over. The analysts got there first. The funds got there first. You're not early. You're just paying a premium for a narrative that's already been priced in, and somewhere underneath that trade is a dark assumption, that things have to keep getting worse for the bet to pay off. That's not a financial strategy. That's anxiety in a brokerage account.
* * *
The better question, the one that's actually made people wealthy across every period of conflict in modern history, isn't who wins. It's what gets built under pressure that the whole world ends up using later.
Think about what came out of World War II. Radar technology, developed frantically to detect enemy aircraft, became the microwave oven when an engineer at Raytheon noticed a candy bar melting in his pocket while standing near active radar equipment. GPS was a military navigation system before it became the thing that tells you to turn left in 400 feet. The internet began as ARPANET, a Defense Department project designed to keep communication alive after a nuclear strike. Penicillin was mass-produced to save soldiers on the battlefield before it was available at every pharmacy. Nylon, the modern computer, duct tape, the jet engine. Essentially an entire civilian economy, built from the wreckage of conflict.
None of those inventions became transformative because the wars continued. They became transformative because the wars ended, and the underlying technology turned out to be so useful it found a new life in ordinary hands.
That's the lens worth carrying into today's noise. The AI capabilities being stress-tested right now in defense settings, autonomous decision-making, real-time synthesis of messy information, systems that work under severe constraints, will eventually leave those contexts. The question worth asking isn't which company has the best contract this quarter. It's which of these capabilities has mass adoption written all over it in 10 or 15 years. What becomes the next microwave? What ends up in every hospital, every classroom, every small business that doesn't even know yet that it needs it?
That's a very different portfolio conversation, and a much more interesting one.
* * *
The people who sat across from me at that branch weren't foolish. They were human. They saw chaos in the world, felt the urgency of it, and went looking for a way to turn that anxiety into action. The investor who bought the index fund that same month wasn't smarter or braver. They were just asking a different question, not what's going wrong today, but what could go right over time.
One question left people holding currency worth less than when they started. The other built quiet, lasting wealth.
The world will always give you something to worry about. Your portfolio doesn't have to be built around it.