The Managed Friction equilibrium.
Most geopolitical analysis tells you what happened. Most macro analysis tells you what to buy. The Kengly Letter does the part neither does — names the players, names the incentives, finds the equilibrium, then says what the equilibrium implies for a portfolio.
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Latest issues
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Xi's Export-Control Ladder — The NdPr Runway
long ex-China rare earth refining basket — MP Materials (NYSE:MP via TradingView), Lynas Corporation (ASX:LYC via TradingView), VanEck Rare Earth/Strategic Metals ETF (AMEX:REMX via TradingView) — over 12-24 months on the duration mismatch between Western policy urgency and equity-market commissioni
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Neither side can exit — the tariff equilibrium is a Nash steady state and the routing trade is live
long ASEAN manufacturing arbitrage (Vietnam ETF VNM via TradingView, Mexico nearshoring exposure EWW via TradingView) over 12-18 months; skepticism on US-China reunion bellwethers priced for tariff removal (names with majority China supply-chain or revenue dependence); long USD import inflation pers
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The defense industrial mobilisation has a ceiling — and the market is on the wrong side of it
long European mid-cap defense primes (BAE, Rheinmetall, Saab, Leonardo, Thales) over US large-cap primes (Lockheed, RTX, Northrop, GD) on a 12-month forward window; long South Korean defense exporters (Hanwha, KAI, LIG Nex1); short the trade that prices NATO industrial-base mobilisation as either de
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Chokepoints are not vulnerabilities — they are bargaining leverage
long maritime-rerouting durability (Cape of Good Hope freight, Singapore reload capacity, mid-stream tanker insurers); long subsea-cable repair vessel operators; short the assumption that any Bab-el-Mandeb / Hormuz / Baltic-cable equilibrium is reverting to the pre-2022 baseline; carry trade is shor
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The shadow fleet is not the story — Managed Friction is
long structural absorption capacity (intermediary-hub logistics, mid-size tanker operators, Chinese state-owned banks with hedged dollar-clearing exposure); short trades that price in either full-enforcement-victory or full-evasion-victory of the G7 sanctions regime