Pete Hegseth out as Secretary of Defense by December 31?

**Secretary Pete Hegseth continues to lead the Department of Defense amid ongoing implementation of administration priorities, including force posture reviews in Europe, NATO spending pressure, and management of operations tied to the Iran conflict.** Despite Democratic criticism over civilian protection lapses and some Republican senators voicing frustration with his leadership style and micromanagement, no formal moves toward replacement have surfaced from the White House. Hegseth remains active in public events, budget advocacy, and strategy announcements through mid-2026, consistent with sustained presidential backing. Traders assign the 79% probability to “No” because historical patterns show cabinet secretaries in aligned administrations rarely depart mid-term absent major scandals or policy ruptures, and current reporting shows none sufficient to trigger an exit by year-end.

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