Let me introduce my Yankee Doodle Dandy portfolio, a compilation of red, white and blue stocks for investors to consider as they celebrate our nation's independence.

Regardless of your views on the Iraq war, there's no denying that defense stocks including Lockheed Martin Corp. (NYSE: LMT), Northrop Grumman Co. (NYSE: NOC), Raytheon Co. (NYSE: RTN) and General Dynamics Corp. (NYSE: GD) are reasonably valued. This is especially noteworthy considering that defense spending will need to be maintained at pretty high levels for years to come in order to replace equipment that's been worn out from combat. President Bush is proposing to spend a record $439 billion in fiscal 2007 on defense and another $42.7 billion on homeland security.

Lockheed, the maker of the F-16, seems especially cheap, trading at a forward multiple of 14.6. Its shares have only gained 4.6% this year even though the company reported better-than-expected first-quarter results and raised earnings guidance. Missile and defense electronics company Raytheon, up less than 3%, is in the same situation.

Investors often overlook the huge businesses that Lockheed and Raytheon have in areas outside of defense, including computer systems and air-traffic control. The managements of both companies also have vastly improved over the past few years. Northrop and General Dynamics have always been pretty well run.

Boeing Co. (NYSE:BA), notably the second-largest defense contractor, also looks worth snapping up. Its stock is up less than 3% this year, which is surprising considering how well it's rebounded against European rival Airbus. The company trades at a forward multiple of 17.7.

Halliburton Co.'s (NYSE:HAL) decision to move corporate headquarters from Houston to Dubai has outraged Congressional Democrats who are planning to hold hearings.

A Halliburton spokeswoman told The New York Times that the company expects to get no tax benefits from the move and will continue to be incorporated in Delaware. That explanation won't satisfy the company's many critics, who view it as a symbol of everything that's wrong about the Iraq war and the Bush administration. That's understandable considering that Halliburton's performance in Iraq has been roundly criticized and that Vice President Dick Cheney used to be its CEO.

Steve Miller's classic anthem "Go on take the money and run" came to mind after the story broke. I referenced it in my earlier post as did Sheldon Liber in his post. A reader named Steve responded with a clever parody. It's reprinted below with his permission:

This heres a story about Haly-B and K B Root
Two war profiteers with nothin better to do
Just sit around with the VP, get high, and count the loot
And here is what happened when they decided to cut loose

They headed on over to, old Babylon
Thats where they sprouted a huge hard on
KBR burglarized soldiers and sodomized taxpayers
Haly-B took the money and run

Go on take the money and run
Go on take the money and run
Go on take the money and run
Go on take the money and run

Average Joe is an apathetic citizen
You know he's clueless just exactly what the facts is
He's pretty much gonna let those two escape justice
He gets his info from fox news and Limbaugh faxes

KBR, whoa, whoa, he slipped away
Haly-B caught up to him the very next day
They got the money, hey
You know they got away
They headed on over to Dubai and theyre still laughing today
Singin go on take the money and run
Go on take the money and run
Go on take the money and run
Go on take the money and run
Go on take the money and run
Go on take the money and run
Go on take the money and run
Go on take the money and run