What's up guys and welcome back to wall street millennial on this channel, we cover everything related to stocks and investing more than one month into russia's invasion of ukraine. Putin's so-called special military operation has not gone according to plan. Ukrainian resistance has been far stronger than expected, and the russians have seemingly given up on taking over the capital city of kiev, as the war is dragged on, putin has sent an estimated 1 000 highly experienced mercenaries from the wagner group. The wagner group is a private military contractor often referred to as putin's private army, but russia is not the only country that turns to private mercenaries during times of need.

The us, saudi arabia and even for-profit corporations are increasingly using private contractors to carry out special military operations. The private, mercenary business is booming, with the top mughals reaching billionaire status with security concerns around the globe. Increasing this industry will only become more important going forward in this video. We'll explain the lucrative big business of guns for hire for as long as wars have been fought, which is all of human history.

Governments have hired mercenaries to gain an advantage on the battlefield. If you were a king fighting a war in the 1700s and found that your existing troops were outnumbered, you had two options: you can conscript your own citizens and turn them into soldiers. The problem is these new conscripts will be inexperienced and will take many months to train it's usually a lot more efficient to hire foreign mercenaries, who are already battle hardened. For example, during the american revolutionary war, king george iii saw that his imperial military was failing to suppress the rebellion, so he hired thousands of experienced mercenaries from what is now germany, while they ended up losing the war.

Anyway, these mercenaries made up a significant part of the british war machine in almost every major war. Mercenaries have played an important role in world war ii. Both sides used guns for hire nazi germany hired thousands of danish mercenaries to fight against soviet forces. On the eastern front, the republic of china hired private american advisers to help fight the japanese before the us officially entered the war.

There is a perception that mercenaries are a thing of the past, but since the end of the cold war, their use has been increasing steadily around the world. One of the most notorious private, mercenary companies is a wagner group based in russia. The wagner group is a private company founded by a former russian military commander. While the kremlin denies any direct ties to the company, they are believed to train at a russian military base and the substantial majority of their estimated 6 000 members are former russian military and intelligence personnel.

Russia has more than one million active duty military personnel up until their recent performance in ukraine. They were considered to be one of the top three militaries in the world, so why would they ever need a private contractor with only 6 000 mercenaries? There are a few reasons: russia primarily sends the wagner group to conduct covert and unconventional military operations in various countries around the world, they've been confirmed to operate in ukraine, syria, the central african republic, venezuela and mozambique. Perhaps the most significant of their ventures has been their long-standing involvement in ukraine in 2014. There is a popular uprising against viktor yanukovych, the pro-russian president of ukraine.

His government was toppled and replaced by the current pro-western regime. Ever since then, pro-russian separatists in the eastern donbass region have been fighting against the ukrainian military. It is widely believed that putin sent in the wagner group to give weapons and training to the separatist rebels. The rebels had advanced weapons and engage in sophisticated maneuvers.

That would be almost impossible for untrained amateurs. This is the purpose of the wagner group. They can be stealthily deployed anywhere in the world to assist various factions in regional conflicts. In this way, they can help moscow achieve strategic objectives without technically getting the russian military involved.

This adds one layer of separation and allows russia to deny any involvement as they claim that vagner functions independently and this degree of separation can be extremely valuable. During the syrian civil war, russia provided significant military aid to president bashar al-assad to help him suppress popular uprisings. Thousands of wagner mercenaries went into syria to help train syrian government forces and in some cases they even took part in military operations directly. It's unclear whether it was the russian or syrian government who paid for these services.

In 2017, a group of 500 wagner mercenaries directly engaged u.s troops who were supporting the rebels if u.s and russian soldiers directly shot at each other. This would be extremely dangerous as it could escalate into a full-scale war between the two superpowers, but because the kremlin officially denies any influence over the wagner group. They have a much smaller obligation to escalate if a few mercenaries are killed. While the wagner group undoubtedly has ties to the russian military, it's important to remember that it's a for-profit organization, their primary objective is making money and their clientele extend far beyond the russian government.

They've also been hired by various russian oligarchs to help them in commercial endeavors. For example, during the syrian civil war, the prominent russian businessman yevgeny pierogin allegedly hired the vanner group to help protect oil fields controlled by the assad regime. In return, assad gave yevgeny's oil company rights to 25 of the fields, production which could be worth billions of dollars. Russia is not the only country that employs private mercenaries guns for hire are utilized by countries around the world and increasingly even multinational corporations.

The most notorious private military company outside of russia is the american firm. Blackwater blackwater was founded in the 1990s by the former navy seal eric prince. They started off by producing target practice systems which they sold to the american military as well as law enforcement agencies, but prince's ambitions extended far beyond that. He used the profits from the target systems business to build a massive 7 000 acre training facility in north carolina.

He used this compound to train a private army consisting primarily of former u.s military and cia operatives. America's 2003 invasion of iraq gave blackwater their first real opportunity to display their capabilities. The war was far longer and more bloody than many had. First predicted the us state department's, existing security teams were stretched too thin and they were unable to adequately protect diplomatic buildings, so they paid blackwater 320 million dollars over the course of a five-year period to provide protection to u.s state department personnel.

By this point, blackwater was a full-fledged paramilitary organization. They were heavily armed and even developed their own armored personnel carriers, which are resistant to the improvised explosive devices commonly used by iraqi insurgents. The government was impressed by the firm's capabilities and awarded them additional contracts to train iraqi security forces and even participate in anti-narcotics operations in afghanistan. The decades-long wars in both iraq and afghanistan were massive windfall for blackwater and they were awarded billions of dollars in contracts from the u.s department of defense.

Today, founder eric prince has an estimated net worth of 2 billion, perhaps making him the first ever billionaire mercenary. But not all this money came from the domestic sources. There are many oil-rich middle eastern countries that have serious security needs, but their own armed forces are too small and inexperienced to deal with them effectively. The united arab emirates is one of the richest countries in the region and is home to the metropolis of dubai, but they have a relatively small military of only 60 000 active duty personnel.

Yemen has been experiencing a bloody civil war since 2014, which, coincidentally, is the same year that a ukrainian civil war began. Stability in yemen is a key priority for both saudi arabia and the uae. Given yemen's close proximity to both countries, iran is supporting the rebels, while saudi arabia and the uae are supporting the yemeni government. The uae's military is too small to be decisive in the war, but one thing they have no shortage of is money, so they called up eric prince with a proposal.

Some of the most experienced fighters in the world are police and military personnel from colombia, el salvador and other south american countries they've been fighting against well-funded drug cartels for decades. These cartels are heavily armed and often function as paramilitary organizations. The uae paid blackwater to recruit and train over a thousand latin american mercenaries and deploy them against iranian-backed rebels. In yemen, saudi arabia had a similar setup to import foreign mercenaries from a company called vanell, which is now owned by the us defense giant northrup grumman with the war industry becoming increasingly privatized.

It's not just nation states employing mercenaries. In recent years, the american mining giant freeport mcmurran hired triple canopy a private defense company that later merged with blackwater triple canopy's mercenaries provided security for one of the company's indonesian mines. While the country was experiencing a terrorist insurgency during the sudanese civil war, petrochina hired private mercenaries to defend their oil fields in south sudan, almost by definition, private mercenaries, don't care who they work for as long as they're getting paid pretty much any corporation or even a High net worth individual could have the services of a well-trained private army at their disposal if they so desired. This could fundamentally change the nature of war, as it means that sovereign nation states no longer have a monopoly on military power in 2019.

Eric prince went to then president donald trump, with a bold proposition. He said that, with just 5 000 men blackwater could overthrow venezuelan dictator nicolas maduro and replace him with the pro-american opposition leader, juan guido. That may have been an optimistic assumption and the trump administration never took him up on the offer, but if prince's projections are correct, this brings up some interesting possibilities. Venezuela has the largest proven oil reserves in the world with over 300 billion barrels, but due to international sanctions against the country they're inaccessible to the multinational oil majors.

Theoretically, a large oil company has more than enough resources to pay blackwater a billion dollars or so to assemble a 5 000 strong private army and take over the country. They could install a pro-western leader to take maduro's place and, in return, get valuable oil drilling rights which could more than make up for their investment. Alright guys that wraps it up for this video. What do you think about the rise of for-profit mercenaries? Let us know, in the comments section below also don't forget, to open an account with moomoo and get up to five free stocks, valued at up to seventeen thousand dollars, use the link in the description below, as always.

Thank you so much for watching and we'll see in the next one wall, street millennial signing out.