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Gold Boom, AI Bubble and Black Swans: Where is the Risk?

A mounting artificial intelligence (AI) bubble, overvalued markets and resource nationalism are among the issues experts at the 51st New Orleans Investment Conference flagged for investors heading into 2026.

With the ongoing precious metals bull market sending gold and silver prices to fresh all-time highs this year, the wide array of panelists and speakers cautioned investors to be prepared for anything.

During the Mining Share panel, moderator Rick Rule, proprietor of Rule Investment Media, asked participants which black swan is most likely on the horizon, acknowledging that these events are inherently impossible to predict.

Nick Hodge, publisher at Digest Publishing, said disproportionate market growth is keeping him up at night.

“The overvaluation of the S&P 500 (INDEXSP:.INX) and the tech stocks could lead to some sort of stock crash that takes down the valuations of all the equities, including the precious and industrial metals. I think it’s long overdue,” he said.

Hodge also noted that the US has largely avoided a recession in recent years, and that economic growth is “okay,’ but warned that equity valuations, particularly in tech, quantum computing and robotics, have run ahead of fundamentals.

Jordan Roy-Byrne, editor and publisher of the Daily Gold, went a different route, saying gold and silver prices could go vertical ‘sooner than people think,’ and suggested that investors aren’t ready for that to happen.

Roy-Byrne argued that fears rooted in the 2008 financial crisis still distort market thinking, even though bonds are now in a secular bear market and stock crashes tend to look very different.

If the S&P enters a downturn in the next couple of years, he said the setup could resemble the mid-1970s, when equities slumped, but precious metals soared — a scenario many investors aren’t prepared for.

Strategic investor Jeff Phillips sided with Hodge, saying that the ripple effects of a tech-related bubble are his paramount concern at the moment. He noted that the resource sector’s bull markets are often sparked by broader financial corrections, because investors tend to retreat to hard assets when liquidity dries up.

Resource markets are thinly traded, Phillips explained, so momentum can shift quickly.

After three major resource bull cycles in his 30 year career, he’s seen the same pattern repeat: when speculative themes fade — whether that be the internet in the early 2000s or today’s AI boom — investors eventually recognize that most of the companies in these sectors won’t deliver, and capital flows back to tangible assets.

“So what keeps me up at night is not necessarily the resource sector, but a liquidity event that causes people to have to sell things,” Phillips said. “But I don’t know what the black swan is, because that’s what a black swan is.”

Taking a different approach, Jennifer Shaigec, principal at Sandpiper Trading, underscored growing tensions with China around trade, as well as supply chain imbalances that are materializing in the resource sector.

“I’m going to go with something very dark — nationalization of mines,” she said.

“I think we’re headed for a conflict with China. We’re seeing this huge push to secure domestic supply chains, and the wartime controls that were from World War I and II (are still in place). Seeing the government starting to take these bigger stakes in some of these projects is a little bit scary for me,’ Shaigec explained.

For Brien Lundin, conference host and editor of Gold Newsletter, all the hypotheses have merit. He explained that a major liquidity crisis is almost unavoidable, but said it would also create one of the biggest opportunities in years.

Since 2008, markets of all kinds have become dependent on rapid central bank intervention, he noted.

So while a shock could deliver a brief period of real pain, Lundin expects policymakers to respond quickly with a surge of liquidity, just as they did after the financial crisis and during COVID-19.

That kind of rescue typically sends gold, commodities and other risk assets sharply higher.

‘What we don’t know is what the black swan is, where is it going to come from? It usually comes out of left field in some area nobody’s really predicted,” said Lundin.

AI euphoria may be outpacing reality

At the Booms, Bubbles and Busts panel, fear that the AI bubble is reaching critical mass was the prominent theme.

Moderator Albert Lu, founder and president of Luma Financial, started the discussion by polling the panelists about whether the AI market is in a bubble right now.

“Yeah, we’re in a bubble. But in the 1990s we were in a bubble in the internet. So the question is, what stage of the bubble are we at?” responded economist and professor Peter St. Onge.

He recalled buying Yahoo in 1996 — when friends thought he was reckless — only to watch it soar. Today’s tech boom, he argued, is “without a doubt” a bubble, potentially 10 times bigger than the dot-com era.

In his view, the cycle will eventually break, but before a steep correction, he suggested there may still be room for tech markets to multiply, perhaps doubling or even surging eightfold, before an inevitable 75 percent wipeout.

Jim Iuorio, managing director of TJM Institutional Services, cautioned that while “it’s not that valuable … to say we’re in a bubble,” he believes markets are somewhere in bubble territory — but trying to pinpoint the exact stage is “foolish.’

He warned that many high-flying tech names could face a 30 percent correction within 18 to 24 months.

What’s convinced him most about this has been the frenzy around OpenAI-related announcements.

“Anytime they mentioned any partnership with anyone — just the mania that happened with those stocks — to me that means we’re in some sort of odd realm that I’m not comfortable with,’ he said.

Still, he isn’t exiting yet — Iuorio said he’s keeping his positions hedged and flexible while acknowledging “there is a very distinct possibility that one day you’re going to open up your portfolio and things will change quite a bit.’

For his part, Jim Bianco, president and macro strategist at Bianco Research, said he resists using the word “bubble” because “I don’t know exactly what it means.’ He noted that people often invoke it only when they think the cycle is ending, and aligned with St. Onge in arguing that the endpoint may not be near right now.

Bianco stressed that AI technology is “very real” and likely “more transformative than the internet,’ comparing the hype to late-1990s optimism about the web, which may have seemed exaggerated, but largely proved true.

Still, he cautioned that transformative technology doesn’t guarantee immediate investment success: buying into the internet boom meant enduring the dot-com crash and the long slog through the Great Recession before breaking even.

Securities Disclosure: I, Georgia Williams, hold no direct investment interest in any company mentioned in this article.

This post appeared first on investingnews.com

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InMed Pharmaceuticals

Investor Insight

InMed is a pharmaceutical drug development company advancing proprietary small-molecule drugs in Alzheimer’s and ophthalmology, backed by a revenue-generating manufacturing subsidiary. The company is an undervalued opportunity with cash exceeding market capitalization and multiple upcoming catalysts.

Overview

InMed Pharmaceuticals (NASDAQ:INM) is a biopharmaceutical company with a differentiated business model: advancing innovative therapeutic programs in Alzheimer’s, ophthalmology and dermatology, while generating recurring revenue through its BayMedica manufacturing division. This structure offers investors exposure to pharmaceutical innovation with mitigated financing risk, a rare combination among small-cap biotech firms.

The company’s lead drug candidate, INM-901, takes a new and broader approach to treating Alzheimer’s disease. Instead of focusing on just one suspected cause – a protein in the brain called amyloid beta – this drug is designed to act on several key processes that drive the disease. In preclinical studies, INM-901 has shown that it can protect brain cells, reduce inflammation, clear harmful protein buildup, and help new nerve connections form. These results led to improvements in both brain health and behavior in research models. This “multi-pathway” approach reflects the latest thinking in Alzheimer’s research, where major pharmaceutical companies are moving toward treatments that target the disease from multiple angles.

InMed’s BayMedica subsidiary manufactures rare cannabinoids via chemical synthesis, rather than plant extraction, ensuring purity, consistency and scalability. The business generates approximately $5 million in annual revenue and ~40 percent gross margins, selling to the global health and wellness ingredient markets. This dual business model gives InMed a cash flow-supported R&D engine, enhancing sustainability and valuation resilience.

Key Business Segments

Pharmaceuticals

InMed’s pharmaceutical programs are focused on developing new, small molecule medicines that address serious diseases where current treatments fall short. These drug candidates are designed to work on multiple disease pathways, offering a more comprehensive approach than traditional single-target drugs. The company’s current programs target Alzheimer’s disease, dry age-related macular degeneration (AMD), and a rare skin disorder called epidermolysis bullosa (EB). Each program is supported by strong preclinical or clinical data and aims to move into the next stage of development in the near term.

Highlights

  • INM-901 (Alzheimer’s disease): INM-901 is being developed as a potential new treatment for Alzheimer’s disease, a condition that currently has no cure. Unlike many past approaches that focused only on a single cause, INM-901 targets several key processes that contribute to Alzheimer’s, including protecting brain cells, reducing inflammation, lowering harmful protein buildup, and supporting the growth of new nerve connections. In animal studies, the drug has shown improvements in brain inflammation and memory-related behavior, suggesting a broad protective effect. The program is now advancing IND-enabling activities, an important stage in translating INM-901’s scientific promise into clinical evaluation.
  • INM-089 (Dry AMD): New drug being developed to help slow or prevent vision loss in people with dry age-related macular degeneration, one of the leading causes of blindness in older adults. The drug is designed to protect nerve cells in the eye and reduce inflammation, helping to keep the retina healthy. Laboratory studies have shown its ability to maintain vision-related function and protect retinal tissue. The company has developed a safe and effective eye-injection (intravitreal) formulation, which delivers the drug directly to where it’s needed in the eye. INM-089 is now moving toward the final preclinical studies required before starting human trials.
  • INM-755 (Dermatology / Epidermolysis Bullosa): A topical cream that has completed a Phase 2 clinical trial in patients with epidermolysis bullosa (EB), a rare genetic skin disorder that causes fragile, blistering skin. The study showed the cream was safe, well-tolerated and helped reduce itching, which is a major symptom for EB patients. The company plans to advance this program through partnerships or licensing agreements.

Manufacturing (BayMedica)

InMed’s BayMedica division provides a steady source of revenue and a strong commercial foundation that supports the company’s drug development work. BayMedica specializes in making rare, non-intoxicating cannabinoids, natural compounds originally found in the cannabis plant, but without using the plant itself. Instead, these compounds are produced through biosynthesis and chemical synthesis, highly controlled processes that ensure every batch is pure, consistent and scalable for commercial production.

BayMedica’s ingredients are sold to health, wellness and consumer brands that use them in products such as supplements and topicals. Each cannabinoid has its own unique properties, and BayMedica is helping customers explore their benefits safely and reliably. The division is recognized as a global leader in rare cannabinoid manufacturing, particularly for cannabichromene (CBC), where it is among the largest producers in the world.

Product Portfolio: BayMedica produces several rare cannabinoids, including CBC, THCV, CBT and CBDV, which are known for their unique biological effects.

Financial Performance: In fiscal year 2025, BayMedica generated approximately $4.9 million in revenue, growing by 8 percent year over year, with around 40 percent gross margins and positive net income. These results help fund InMed’s pharmaceutical programs and reduce the need for frequent financing, a major advantage for a small-cap biotech.

Management Team

Eric Adams – Chief Executive Officer and President

Eric Adams has led a comprehensive transformation of InMed Pharmaceuticals’ leadership team and governance structure, reconstituting the board of directors and executive management while raising more than $35 million in capital to support operations and growth. With more than 25 years of experience in the biopharmaceutical industry, Adams brings extensive expertise in corporate development, capital formation, global market expansion, mergers and acquisitions, licensing and corporate governance.

Michael Woudenberg – Chief Operating Officer

Michael Woudenberg brings deep expertise in the development, technology transfer and commercialization of active pharmaceutical ingredients (APIs) and drug products. Before joining InMed in 2018, Woudenberg held senior roles at 3M, Cardiome Pharma and Arbutus Biopharma, and most recently served as managing director of Phyton Biotech. His extensive experience spans process and formulation development from laboratory and pre-clinical stages through all phases of clinical development, leading to validated, approved, and commercially manufactured APIs and drug products.

Netta Jagpal – Chief Financial Officer

Netta Jagpal brings over 20 years of financial leadership experience, primarily in the biotechnology sector. Before joining InMed, she served as vice-president, financial reporting and compliance at D-Wave Systems (NYSE:QBTS), where she led the finance team through its initial public offering. Jagpal spent 11 years at Zymeworks (NYSE:ZYME) in progressive finance roles, including senior director, finance and corporate controller, and also held positions at Angiotech Pharmaceuticals and Ernst & Young. She is a chartered professional accountant and holds a Bachelor of Business Administration in Accounting and Organizational Behaviour from Simon Fraser University.

Eric Hsu – Senior Vice-president, Pre-Clinical Research & Development

Dr. Eric Hsu brings more than 18 years of scientific leadership experience in gene therapy and biotechnology. Before joining InMed, he held senior roles at enGene, including vice-president of research and vice-president of scientific affairs and operations. His expertise spans gene transfer and expression systems, formulation and process development, intellectual property management, and research partnerships. Hsu has extensive experience leading R&D programs, expanding product pipelines, and overseeing research budgets and timelines.

Colin Clancy – Vice-president, Investor Relations and Corporate Communications

Colin Clancy is an experienced corporate finance and investor relations executive with over 18 years of experience across the pharmaceutical, cannabis, mining and financial services sectors. At InMed Pharmaceuticals, he leads the company’s capital markets engagement and communications strategy. Before joining InMed, Clancy served as vice-president of investor relations at Harvest One Cannabis.

This post appeared first on investingnews.com

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Graphite One Confirms Rare Earth Elements at Alaska Deposit

Graphite One (TSXV:GPH,OTCQX:GPHOF) announced on November 13 that it has identified rare earth elements (REEs) at its Graphite Creek deposit, located north of Nome, Alaska.

“The presence of two Defense Production Act Title III materials — graphite and REEs — in a single deposit further underscores Graphite Creek’s position as a truly generational deposit,” said President Anthony Houston.

“Given the robust economics of our planned complete graphite materials supply chain, the presence of Rare Earths at Graphite Creek suggests that recovery as a by-product to our graphite production will maximize the value.”

Geochemical analysis of drillcore samples reveals elevated levels of heavy rare earths and all five principal permanent magnet REEs: neodymium, praseodymium, dysprosium, terbium and samarium.

Testwork is ongoing at the University of Alaska Fairbanks’ Advanced Instrumentation Laboratory, and at Activation Laboratories. Graphite One is also collaborating with a US Department of Energy national lab on REE extraction.

REEs are essential to modern technologies, from permanent magnets in wind turbines and electric vehicles, to high-performance fiber optics, lasers and defense systems.

China, which dominates global production of both magnet REEs and graphite, imposed export limits last year and has continued to expand these restrictions in 2025.

Graphite One is advancing a US-based graphite supply chain, including transport from Nome to an advanced graphite and battery materials plant in Warren, Ohio, with a co-located recycling facility to reclaim graphite and other materials.

Graphite Creek has received support through a US$37.5 million Defense Production Act Title III grant, as well as non-binding letters of interest totaling US$895 million from EXIM Bank.

Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.

This post appeared first on investingnews.com

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Living Plants Offer New Path to Rare Earths Supply, Study Shows

Researchers have documented the first known recovery of naturally formed nanoscale monazite from a living plant, potentially opening up new paths to recover in-demand rare earth materials.

The study, published this month in Environmental Science & Technology, identifies nanoscale monazite crystals inside Blechnum orientale, an evergreen fern known to accumulate rare earths at unusually high concentrations.

The work was carried out by researchers at the Guangzhou Institute of Geochemistry under the Chinese Academy of Sciences, in collaboration with a geoscientist at Virginia Tech in the US.

In the paper, the authors write that the discovery “opens new possibilities for the direct recovery of functional rare earth element (REE) materials,” adding, “To our knowledge, this is the earliest reported occurrence of rare earth elements crystallising into a mineral phase within a hyperaccumulator.”

The method, known as phytomining, relies on certain plants that naturally pull unusual amounts of metals from the ground. In this case, the fern absorbed rare earths so efficiently that tiny mineral crystals formed inside its tissues.

The mineral identified — monazite — is normally created deep underground under intense heat and pressure.

The team’s analysis shows that the fern somehow produced nanoscale versions of it under normal surface conditions, with the highest concentrations found in its leaflets and roots. In this state, the plant appears to lock the metals outside its cells as a way of protecting itself, with the process enabling the mineral to crystallize.

Monazite is prized for uses ranging from lasers to electronics to materials that withstand high heat and radiation, so finding it naturally produced inside a plant could open up a new, lower-impact source of rare earths.

REEs take priority in global supply race

REEs, a group of metals used in permanent magnets, lasers, consumer electronics and advanced defense systems, are receiving renewed international scrutiny as governments race to reduce dependence on concentrated supply chains.

Earlier this month, the US Department of the Interior published its final 2025 list of critical minerals, naming 60 minerals deemed vital to the American economy and exposed to supply risk.

The list emphasizes the importance of rare earths, which the US imports heavily, and highlights neodymium, scandium and dysprosium as metals where supply disruptions would impose the “highest cost” on the US economy.

Washington has moved in parallel to strengthen access to rare earths through domestic production, expanded mapping of US deposits and agreements with partners in Australia, Japan, Malaysia and Thailand.

In addition to these efforts, US officials continue to signal confidence that Beijing will adhere to commitments under a rare earths framework outlined last month.

Secretary of the Treasury Scott Bessent said in a recent interview that a deal with China will “hopefully” be done by Thanksgiving, while also rejecting a report suggesting that Beijing is planning new restrictions on US companies.

Are plants a viable source of rare earths?

The use of ferns for mineral extraction remains at an early stage, and the researchers emphasize that phytomining is not a replacement for conventional production.

But finding mineralized rare earths in a living organism offers a proof of concept that could broaden how countries approach resource development at a time when REEs remain strategically critical for major economies.

As the US, China and other nations look for secure supply routes, the possibility that plants themselves may contribute to the pipeline adds a new dimension to a field dominated by mining companies.

Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.

This post appeared first on investingnews.com

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East Star and Endeavour Mining to Collaborate on Kazakhstan Gold Assets

East Star Resources (LSE:EST) and Endeavour Exploration announced they have entered into a binding earn-in and joint venture (JV) agreement to advance gold exploration in Kazakhstan.

Endeavour Exploration, a subsidiary of top gold producer Endeavour Mining (LSE:EDV,TSX:EDV,OTCQX:EDVMF), will have the right to earn up to an 80 percent interest in a new JV company via staged investments.

Stage 1 includes a US$5 million payment within two years, equivalent to a 51 percent interest. If an additional US$20 million is given over three years, its interest will increase to 70 percent.

The last 10 percent will be given to Endeavour if it funds and completes a prefeasibility study.

During the initial phase, East Star will act as manager of the JV.

The area of interest for the partnership includes two proven, underexplored mineral belts.

‘This agreement with Endeavour is a transformational milestone for East Star that validates the quality of our exploration programme and provides a clear pathway to unlock the full potential of our gold exploration strategy,” said East Star Resources CEO Alex Walker in a November 13 press release.

While the JV will focus on gold, East Star is also pursuing copper in Kazakhstan.

Its assets include a volcanogenic massive sulfide deposit with a JORC-compliant resource estimate of 20.3 million metric tons at 1.16 percent copper, 1.54 percent zinc and 0.27 percent lead.

An investor webcast is scheduled for Tuesday (November 18) to discuss the terms of the JV.

Both parties will fund the JV company in proportion to their ownership share after the earn-in period.

Securities Disclosure: I, Gabrielle de la Cruz, hold no direct investment interest in any company mentioned in this article.

This post appeared first on investingnews.com

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Rio Tinto and Calix to Partner on Zero Emissions Steel Technology Plant

Rio Tinto (ASX:RIO,NYSE:RIO,LSE:RIO) said on Monday (November 17) that it has signed a joint development agreement with environmental technology company Calix (NYSE:CALX,ASX:CXL) to develop Calix’s Zero Emissions Steel Technology (Zesty) green iron demonstration plant in Western Australia.

If approved, the plant will be built at a site in Kwinana, south of Perth, that was previously earmarked for Rio Tinto’s BioIron research and development facility and associated pilot plant.

Under the deal with Calix, Rio Tinto will invest more than AU$35 million, pending project milestones. Funding from the mining giant will include both in-kind and financial contributions.

The plant received AU$44.9 million in Australian Renewable Energy Agency support in July.

Rio Tinto’s work will include helping Calix reach a final investment decision through technical support, engineering services and advocacy. Subject to a final investment decision and successful project construction, Rio Tinto will provide up to 10,000 tonnes of various Pilbara iron ores for plant commissioning and the initial testing phase.

The miner will also provide introductions to potential customers for downstream use of the Zesty product.

“The world needs low-emissions steel if it is going to decarbonise, and we continue to look at a range of ways Pilbara iron ores can help to do this as new technologies emerge,” said Rio Tinto Iron Ore Chief Executive Matthew Holcz.

He added that Rio Tinto will keep progressing BioIron with its partners, the University of Nottingham and Metso. However, the company has decided that the current furnace design requires additional development.

“Both projects are part of our work to reduce emissions and support the future of iron ore in Australia and the communities that depend on it,’ Holcz added, referring to Zesty and BioIron.

Securities Disclosure: I, Gabrielle de la Cruz, hold no direct investment interest in any company mentioned in this article.

This post appeared first on investingnews.com

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Longtime Walmart CEO to step down in January

Walmart announced Friday that longtime CEO Doug McMillon will retire at the end of January — which came as a surprise to some given the company’s success in a rapidly evolving retail landscape.

John Furner, Walmart’s U.S. CEO, will assume the role of overall CEO on Feb. 1, the company said. McMillon will continue to serve in an executive and advisory role through January 2027. Furner, 51, began his career at Walmart as an hourly associate.

McMillon, 59, has held the top job since 2014 and is only the fifth person to lead the storied company in its 63-year history.

McMillon has overseen a radical transformation of Walmart’s image in a little over a decade.

In 2014, Walmart had a reputation as a budget retail option and was accused of underpaying its associates. Today, it draws more well-to-do shoppers and has earned credit for adopting innovative personnel policies.

McMillon also built up Walmart’s e-commerce operation into the country’s second-largest, behind only Amazon. Over the course of McMillon’s tenure, the value of Walmart’s shares has increased some 300%.

“Serving as Walmart’s CEO has been a great honor and I’m thankful to our Board and the Walton family for the opportunity,” McMillon said in a statement. “I’ve worked with John for more than 20 years. … He’s uniquely capable of leading the company through this next AI-driven transformation.”

America’s retail landscape continues to rapidly evolve, as consumer spending habits increasingly bifurcate between wealthier households and everyone else.

However, Walmart’s quarterly results have held steady — and the company has been justly rewarded by investors. Just this year, Walmart shares have climbed around 13%. Over the course of McMillon’s tenure, the retailer’s stock price is up some 300%.

On Walmart’s most recent earnings call in August, McMillon indicated the company has been able to withstand the broader pressures facing consumers. Its shoppers’ “behavior has been generally consistent,” he said. “We aren’t seeing dramatic shifts.”

Other retailers have not been so fortunate.

Target’s shares have lost about one-third of their value this year, as the chain works to regain its footing in a more value-conscious environment. In August, longtime CEO Brian Cornell announced plans to step down.

Amazon, meanwhile, has fared slightly better as consumers continue to prioritize the convenience of online shopping. But it recently announced thousands of layoffs affecting corporate employees. Amazon’s share price has climbed about 8% this year.

McMillon has also steered Walmart through a volatile period in U.S. politics, during which elected officials have engaged directly with companies and consumers have proven willing to boycott corporate giants over social issues.

Walmart found itself in President Donald Trump’s crosshairs in May, after it signaled plans to increase some prices in response to his tariffs.

“Walmart should STOP trying to blame Tariffs as the reason for raising prices throughout the chain,” Trump wrote on his Truth Social platform. “Between Walmart and China they should, as is said, ‘EAT THE TARIFFS,’ and not charge valued customers ANYTHING. I’ll be watching, and so will your customers!!!”

While subsequent reports indicated that Walmart had indeed increased prices on some items, McMillon said in August that the changes were gradual enough that consumer habits shifted only modestly.

Six months after Trump singled Walmart out over tariffs, he did so again — but for a very different reason.

In recent weeks, the Trump White House has repeatedly touted Walmart’s 2025 Thanksgiving menu package — which costs less overall than the retailer’s similar menu did last year — as a sign that the president’s economic policies have helped drive down grocery prices for consumers.

But there is a flaw in that rationale. This year’s Walmart Thanksgiving menu contains fewer items than last year’s menu did.

This post appeared first on NBC NEWS

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Skies at stake: Inside the U.S.–China race for air dominance

From new stealth bombers to AI-enabled drones, the U.S. and China are reshaping airpower for a Pacific showdown — each betting its technology can keep the other out of the skies.

The U.S. is charging ahead with its next-generation F-47 fighter, while China scrambles to catch up with jets designed to match the F-35 and F-22.

After a brief program pause in 2024, the Air Force awarded Boeing the contract in March for the F-47, a manned sixth-generation fighter meant to anchor America’s next air superiority fleet. The first flight is expected in 2028.

At the same time, the B-21 Raider, the stealth successor to the B-2, is deep into testing at Edwards Air Force Base. The Air Force plans to buy at least 100 Raiders — each built to survive inside heavily defended Chinese airspace.

The Pentagon is also betting on Collaborative Combat Aircraft, or CCAs — drones designed to fly alongside fighters as ‘loyal wingmen.’ Prototypes from Anduril and General Atomics are already in the air. Officials say CCAs will let one pilot control several drones at once.

China outpaces the rest of the world in the commercial drone market, but that doesn’t necessarily give it the advantage from a military perspective. 

‘I’m not sure that’s really true. In terms of high-end military drones that are really important to this fight, the U.S. still has a pretty significant edge.’ said Eric Heginbotham, a research scientist at MIT’s Center for International Studies. 

He pointed to the Air Force’s stealth reconnaissance platforms — the RQ-170 and RQ-180 — and upcoming ‘loyal wingman’ drones designed to fly with fighters as proof that the U.S. still leads in advanced integration and stealth technology.

China’s leap forward

China’s airpower modernization has accelerated as the U.S. reshapes its force. Beijing has zeroed in on three priorities — stealth, engines, and carriers — the areas that long held its military back.

The Chengdu J-20, China’s flagship stealth fighter, is being fitted with the new WS-15 engine, a home-built powerplant meant to rival U.S. engines.

‘It took them a while to get out of the blocks on fifth generation, especially to get performance anywhere near where U.S. fifth gen was,’ Heginbotham said. ‘The J-20 really does not have a lot of the performance features that even the F-22 does, and we’ve had the F-22 for a long time.’

Meanwhile, China’s third aircraft carrier, the Fujian, was commissioned this fall — the first with electromagnetic catapults similar to U.S. Ford-class carriers. The move signals Beijing’s ambition to launch stealth jets from sea and project power well beyond its coast.

Together, the J-20, the carrier-based J-35, and the Fujian give China a layered airpower network — stealth jets on land and at sea backed by growing missile coverage.

Chinese military writings identify airfields as critical vulnerabilities. PLA campaign manuals call for striking runways early in a conflict to paralyze enemy air operations before they can begin. Analysts believe a few days of concentrated missile fire could cripple U.S. bases across Japan, Okinawa, and Guam.

‘The U.S. bases that are forward deployed—particularly on Okinawa, but also on the Japanese mainland and on Guam—are exposed to Chinese missile attack,’ said Mark Cancian, a retired Marine colonel and senior advisor at the Center for Strategic and International Studies. ‘In our war games, the Chinese would periodically sweep these air bases with missiles and destroy dozens, in some cases even hundreds, of U.S. aircraft.’

Heginbotham said that missile-heavy strategy grew directly out of China’s early airpower weakness.

‘They didn’t think that they could gain air superiority in a straight-up air-to-air fight,’ he said. ‘So you need another way to get missiles out — and that another way is by building a lot of ground launchers.’

Different strategies, same goal

The two militaries are taking different paths to the same target: air dominance over the Pacific.

The U.S. approach relies on smaller numbers of highly advanced aircraft linked by sensors and artificial intelligence. The goal: strike first, from long range, and survive in contested skies.

China’s model depends on volume — mass-producing fighters, missiles, and carrier sorties to overwhelm U.S. defenses and logistics.

‘U.S. fighter aircraft—F-35s, F-15s, F-22s—are relatively short-legged, so they have to get close to Taiwan if they’re going to be part of the fight,’ Cancian said. ‘They can’t fight from Guam, and they certainly can’t fight from further away. So if they’re going to fight, they have to be inside that Chinese defensive bubble.’

Both sides face the same challenge: surviving inside that bubble. China’s expanding missile range is pushing U.S. aircraft farther from the fight, while American bombers and drones are designed to break back in.

The fight to survive

Heginbotham said survivability — not dogfighting — will define the next decade of air competition.

‘We keep talking about aircraft as if it’s going to be like World War II — they go up, they fight each other. That’s not really our problem,’ he said. ‘Our problem is the air bases themselves and the fact that aircraft can be destroyed on the air base.’

China, he warned, is preparing for that reality while the U.S. is not.

‘They practice runway strikes in exercises, they’re modeling this stuff constantly,’ Heginbotham said. ‘Unlike the United States, China is hardening its air bases. The U.S. is criminally negligent in its refusal to harden its air bases.’

Cancian’s war-game findings echo that vulnerability. He said U.S. surface ships and aircraft would likely have to fall back under missile fire in the opening days of a conflict.

‘At the initial stages of a conflict, China would have a distinct advantage,’ Cancian said. ‘Now, over time, the U.S. would be able to reinforce its forces, and that would change.’

Looking ahead

The Pentagon’s fiscal 2026–27 budget will determine how fast the U.S. can build out its F-47s, B-21s, and CCAs — systems that will shape American airpower through the 2030s.

China’s rapid modernization is closing what was once a wide gap, but the U.S. still holds advantages in stealth integration, combat experience, and autonomous systems.

‘The ability to protect our aircraft, whatever form those aircraft take, on the ground is going to be central to our ability to fight in the Asia theater,’ Heginbotham said.

‘Survivability is going to be key … The ability to protect and disperse your firepower is going to be central to whether we can really stay in this game.’

For decades, U.S. air dominance was taken for granted. In the Pacific, that advantage is no longer guaranteed. 

This post appeared first on FOX NEWS

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