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This Is The Most Affordable Way To Get Into Bitcoin

A method known as “dollar-cost averaging” is the most popular amongst HODLers to maximize their bitcoin stack.

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A method known as “dollar-cost averaging” is the most popular amongst HODLers to maximize their bitcoin stack.

How To Save Bitcoin: DCA Is The Way

Saving money used to be a simple and standard practice - park your cash in a bank account and watch it grow. The 1926 book “The Richest Man in Babylon” famously advocates putting aside just 10% of your income to start building wealth. For a variety of reasons, the wisdom of saving is slipping away from our culture.

For one, saving doesn’t feel like the path to success anymore. Teenagers looking at college tuition costs watch their peers use TikTok to shoot from penniless to multi-millionaire status. Corporate employees fighting for a raise see online chat startups claiming $1 billion valuations before their app even releases publicly. Kids who skipped the playground to buy pictures of penguins suddenly find themselves richer than their parents. In this world, what good is saving and diligently deploying 10% of my income for a healthy return? It sure seems like life is a lottery these days, not a fair uphill climb.

Second, spending receives praise from every angle. Decades of overwhelming advertising and economics education also bombard us with the message that spending is good, not just for our own well-being but for society as a whole. Spending keeps the economic engine running, they tell us — and every penny counts.

Finally, the younger generations just have less to save. According to Pew Research, millennials have less wealth than prior generations did at equivalent ages and also carry much more student debt, dragging on their ability to save even when wages are nominally rising. Even with wages rising, most of that is only seen by the college educated, with those not holding a degree having lower income than past generations - going back to the early boomers.

Saving behavior saw one “saving grace” in recent times: the COVID pandemic and government reactions. Forced lockdowns and business closures coincided with a massive spike in the personal savings rate, unprecedented in recent times.

Massive increase and volatility in the personal savings rate starting in 2020. Source: FRED

While this is likely to be temporary (nod to Jerome Powell), this extra cash has left many Americans wondering - what should I do with this cash?

We used to have a clear choice.

The Appeal Of The Savings Account

After the last major world crisis — marked by two back-to-back world wars and a deep economic depression in between — stability was a highly-sought luxury. Booming populations of workers wanted to raise families, build businesses, and ensure the security of their futures.

The humble savings account provided a safe place to store wealth and a simple means to grow it steadily over one’s working years. People could focus on their career or business, and not have to worry about where to put their money - it could go right in the savings account.

In countries with strong and stable institutions, like the United States, savings account “yields” (growth on the dollars in the account) generally trended up from the 1950s until the 1980s, then slowly back down.

The Federal Funds Rate represents the rate banks pay to borrow from other banks. Savings account yields are essentially the rate banks pay to borrow from you. Source: FRED

Banks played a productive role in the economy, powering growth as a middleman between savers with cash who lacked investment experience and entrepreneurs with business acumen and ideas who needed cash.

The savings account during these decades was a humble vehicle for earning nearly-guaranteed returns with a high degree of safety. FDIC insurance protected balances (to a degree) and depositors didn’t have to be their own investment advisors to earn a decent return. A normal middle-class worker could put in their eight hours of honest work, stash away 10% of their earnings in a savings account, and feel secure in their financial future.

The situation we find ourselves in today, with meager returns for the humble savings account, was precipitated in the 1970s. Many will point to the OPEC oil embargo and the ensuing rampant stagflation, but with more clear hindsight we can see that Nixon’s “temporary” disconnection of the U.S. dollar from gold played a large role. The market reckoned with this reality by running from the dollar and buying up other assets, like commodities, deemed scarcer. Prices for goods across the economy soared, forcing the Federal Reserve to raise interest rates in order to bring confidence back to the dollar and to “break the back of inflation.”

Paul Volcker, the Fed Chairman credited with raising rates and “breaking the back of inflation” in the 1970s. Source: Vox

From that period of reckoning forward, interest rates steadily dropped as the new normal of constant monetary inflation took hold. Today, we are living in the end state of that move to “fiat” money, no longer backed by any hard assets - with savers earning 0% yield, and in some areas actually paying to save money.

In the United States, banks can borrow cash from the Federal Reserve for a tiny 0.25% - so why would they pay you any more on your savings - which allows them to borrow your cash? They currently pay a paltry 0.04% on average.

The rate banks pay on deposits, as calculated by the FDIC, since 2010. Source: FRED

As yields fell to laughably low levels, the entire concept of a savings account quietly disappeared into the bushes. Bank accounts now focus on convenience - online banking, debit cards, instant payments to your friends - not yields.

There’s no reason to maintain a savings account anymore, collecting tiny fractions of a penny on the dollar every year. The Federal Reserve forced interest rates too low for too long - lighting a fire under everyone’s cash.

These actions eliminated the savings account as a simple vehicle for growing wealth over time.

So what are we to do with our cash now?

Everyone Is A Professional Investor

The disappearance of savings accounts as a viable option for growing wealth (or just retaining savings!) left us with a new frontman for the savings movement: the stock market.

Passive investing in equities - through index funds or otherwise - seems to promise similar returns to the old savings account. However, this path comes with a lot less assurances and far more risks.

Funny enough, this is by design: part of the accepted economic rationale for lowering interest rates is to drive spending and investment in riskier projects, which is thought to drive growth. This works in the short term. However, just like that fifth coffee does a lot less than the first, simply taking another hit of economic stimulus in the form of lower rates only pushes growth so far, and the effect of each hit diminishes as the economy gets used to the adjustment. At some point, you’ll need to stop working and reset. Economies need a rest too.

Source: Sketchplantations.com

In today’s zero (and still descending!) interest rate environment, making any return at all means taking on larger and larger risks. Savings accounts no longer make a return, so everyone needs to play stocks. Index funds have proven to be a popular option, but even those are being led by a handful of volatile tech stocks. Just five companies now make up 23% of the S&P500, up from 19% just last year. These few stocks are where all the returns come from, but they also carry heavier volatility! Returns are concentrating, and riskier.

To get a decent return on your savings as a middle-class worker, you now need a second job: professional investor. Parking your money in a savings account won’t cut it. You need to study stocks, pick your winners, deal with volatility and evolve your allocations as times change.

But there is one other staple of the American dream that might provide a simpler option… buying a home. Let’s look at that.

Chasing The American Dream

The fifth “cure” for a “lean purse” in “The Richest Man in Babylon” is to own your principal residence and make it an investment. The conventional wisdom goes something like this: land is scarce and everyone needs a home, so owning one of your own will serve you well as an investment over your lifetime.

Unfortunately, that dream is driving away faster from each passing generation than we can run to catch it. Home prices hovered around the level of 4.5 years of median income from 1960 until 2000, then spiked massively going into the housing bubble. In 2021, we are back to housing bubble levels, with a house costing almost 7 years of the median income in the U.S.

Home prices are out of whack with income levels, making housing unaffordable for many. Source: LongTermTrends.net 

Working for 30 years to pay off a mortgage on a house is a dangerous game to play, especially when home prices previously cratered from the 7-year home price to median-income ratio.

Taking a step back from charts and taking a look outside doesn’t offer much more security in the home-as-savings approach. Nearly one in five millennials have simply given up on owning a home, citing affordability as their main reason. Lifestyle changes are also precipitating a move away from permanent residency, meaning single-family homes are not what they used to be. The American dream for younger generations includes far more travel and flexibility than a single, owned residence can afford.

With home prices where they are today, a consistent 30% of income spent on mortgage payments means truly owning a home will take 23 years. Many aren’t willing to take that bet and the commitment that comes with it.

So what do we have left, in a world where cash is free and no investment is safe?

We must follow the signals of our overlord bankers - embracing the risk they want us to take while simultaneously spurning the system they’ve foisted upon us.

Bitcoin Dollar-Cost Averaging As The New Savings Account

Similar to a savings account 50 years ago, bitcoin offers a safe place to store wealth and a simple means to grow it steadily over one’s working years.

That statement might jar you at first - pundits and politicians love to rail on bitcoin as volatile. How could it possibly serve as a savings account?

For one, bitcoin is safe from confiscation - a real threat when living under oppressive regimes and even in the bastion of the free world.

However, many point to bitcoin’s volatile price as the reason it’s “unsafe” as an investment. To better understand this situation, consider the fact that when people call bitcoin volatile, they are referring to a price quoted in fiat currency, like the U.S. dollar. There are two assets at play when we call bitcoin volatile - BTC and the dollar.

Let’s say we have 100 apples and 100 oranges, and through bargaining we find the price of an apple is one orange. An orange grove is discovered, and now there are 5,000 oranges. The market adjusts, and an apple is now selling for 50 oranges. Which should we call “volatile” - the apple or the orange?

When we look at the bitcoin price, we have to consider - while governments are printing cash with reckless abandon to bail out everyone from banks to cruise ship operators, bitcoin continues emitting exactly the amount intended at regular intervals since its creation in 2009 day after day. Which is the volatile asset here?

The fundamentals of the Bitcoin network are what makes it a suitable substitute for the savings account. While the fiat monetary system wreaks havoc on prices across the economy, changing incentives for producers and consumers, bitcoin continues executing as expected - as if nothing is happening at all.

The Bitcoin network represents stability and predictability, something we are sorely lacking in every investment option today.

And while in the short term, the price of bitcoin in terms of fiat currency looks absolutely absurd, over longer stretches of time people are realizing the worth of such a stable asset - causing the price to prefer going up. That’s exactly what we want out of a savings account.

Unfortunately, the damage central banks have done to our monetary system means there are no stable, constant growth investment options anymore - the kind that tick up 5% each year with incredible safety assurances, like a savings account. Those options that are stable - like government bonds - carry historically low or even negative yields. Negative yields mean people and institutions are being charged to save money!

Dollar-cost averaging into Bitcoin is what makes this asset most similar to a savings account. Simply putting aside a small amount of income regularly as your savings, and storing it in bitcoin, takes no mental effort at all and seems to work pretty well over most time scales.

Here’s what happens if you save just 10% of your income and start investing weekly just after tax time into either bitcoin or the S&P 500. You’ll notice that it’s never too late to start.

Putting just 10% of your annual income away into BTC, with weekly purchases, is historically a good bet - no matter when you start. With the median income in the U.S. of around $60,000, starting your DCA after 2018’s tax year would lead you to save up $110,000 - using just $20,000 saved. Source: Author and Google Sheets

Bitcoin dollar-cost averaging doesn’t give you a savings account that climbs up in a steady, straight line day by day like a savings account. However, no investment does that in this day and age.

What bitcoin does offer is a fundamental stability that is unmatched not just in investments today, but in investments throughout known history. No system has operated as predictably and precisely as bitcoin for so long, and with so much value at stake.

Bitcoin also offers incredible security assurances, since you can hold your own bitcoin on a hardware device or with a password in your head. Some dollar-cost-averaging tools will even allow you to deposit your automatic purchases directly to that hardware “wallet.”

If you want to get started buying bitcoin regularly, check out a simple option like Swan Bitcoin.

Welcome to your new savings bank - we’re happy to have you.

This is a guest post by Captain Sidd. Opinions expressed are entirely their own and do not necessarily reflect those of BTC, Inc. or Bitcoin Magazine.

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Net Zero, The Digital Panopticon, & The Future Of Food

Net Zero, The Digital Panopticon, & The Future Of Food

Authored by Colin Todhunter via Off-Guardian.org,

The food transition, the energy…

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Net Zero, The Digital Panopticon, & The Future Of Food

Authored by Colin Todhunter via Off-Guardian.org,

The food transition, the energy transition, net-zero ideology, programmable central bank digital currencies, the censorship of free speech and clampdowns on protest. What’s it all about? To understand these processes, we need to first locate what is essentially a social and economic reset within the context of a collapsing financial system.

Writer Ted Reece notes that the general rate of profit has trended downwards from an estimated 43% in the 1870s to 17% in the 2000s. By late 2019, many companies could not generate enough profit. Falling turnover, squeezed margins, limited cashflows and highly leveraged balance sheets were prevalent.

Professor Fabio Vighi of Cardiff University has described how closing down the global economy in early 2020 under the guise of fighting a supposedly new and novel pathogen allowed the US Federal Reserve to flood collapsing financial markets (COVID relief) with freshly printed money without causing hyperinflation. Lockdowns curtailed economic activity, thereby removing demand for the newly printed money (credit) in the physical economy and preventing ‘contagion’.

According to investigative journalist Michael Byrant, €1.5 trillion was needed to deal with the crisis in Europe alone. The financial collapse staring European central bankers in the face came to a head in 2019. The appearance of a ‘novel virus’ provided a convenient cover story.

The European Central Bank agreed to a €1.31 trillion bailout of banks followed by the EU agreeing to a €750 billion recovery fund for European states and corporations. This package of long-term, ultra-cheap credit to hundreds of banks was sold to the public as a necessary programme to cushion the impact of the pandemic on businesses and workers.

In response to a collapsing neoliberalism, we are now seeing the rollout of an authoritarian great reset — an agenda that intends to reshape the economy and change how we live.

SHIFT TO AUTHORITARIANISM

The new economy is to be dominated by a handful of tech giants, global conglomerates and e-commerce platforms, and new markets will also be created through the financialisation of nature, which is to be colonised, commodified and traded under the notion of protecting the environment.

In recent years, we have witnessed an overaccumulation of capital, and the creation of such markets will provide fresh investment opportunities (including dodgy carbon offsetting Ponzi schemes)  for the super-rich to park their wealth and prosper.

This great reset envisages a transformation of Western societies, resulting in permanent restrictions on fundamental liberties and mass surveillance. Being rolled out under the benign term of a ‘Fourth Industrial Revolution’, the World Economic Forum (WEF) says the public will eventually ‘rent’ everything they require (remember the WEF video ‘you will own nothing and be happy’?): stripping the right of ownership under the guise of a ‘green economy’ and underpinned by the rhetoric of ‘sustainable consumption’ and ‘climate emergency’.

Climate alarmism and the mantra of sustainability are about promoting money-making schemes. But they also serve another purpose: social control.

Neoliberalism has run its course, resulting in the impoverishment of large sections of the population. But to dampen dissent and lower expectations, the levels of personal freedom we have been used to will not be tolerated. This means that the wider population will be subjected to the discipline of an emerging surveillance state.

To push back against any dissent, ordinary people are being told that they must sacrifice personal liberty in order to protect public health, societal security (those terrible Russians, Islamic extremists or that Sunak-designated bogeyman George Galloway) or the climate. Unlike in the old normal of neoliberalism, an ideological shift is occurring whereby personal freedoms are increasingly depicted as being dangerous because they run counter to the collective good.

The real reason for this ideological shift is to ensure that the masses get used to lower living standards and accept them. Consider, for instance, the Bank of England’s chief economist Huw Pill saying that people should ‘accept’ being poorer. And then there is Rob Kapito of the world’s biggest asset management firm BlackRock, who says that a “very entitled” generation must deal with scarcity for the first time in their lives.

At the same time, to muddy the waters, the message is that lower living standards are the result of the conflict in Ukraine and supply shocks that both the war and ‘the virus’ have caused.

The net-zero carbon emissions agenda will help legitimise lower living standards (reducing your carbon footprint) while reinforcing the notion that our rights must be sacrificed for the greater good. You will own nothing, not because the rich and their neoliberal agenda made you poor but because you will be instructed to stop being irresponsible and must act to protect the planet.

NET-ZERO AGENDA

But what of this shift towards net-zero greenhouse gas emissions and the plan to slash our carbon footprints? Is it even feasible or necessary?

Gordon Hughes, a former World Bank economist and current professor of economics at the University of Edinburgh, says in a new report that current UK and European net-zero policies will likely lead to further economic ruin.

Apparently, the only viable way to raise the cash for sufficient new capital expenditure (on wind and solar infrastructure) would be a two decades-long reduction in private consumption of up to 10 per cent. Such a shock has never occurred in the last century outside war; even then, never for more than a decade.

But this agenda will also cause serious environmental degradation. So says Andrew Nikiforuk in the article The Rising Chorus of Renewable Energy Skeptics, which outlines how the green techno-dream is vastly destructive.

He lists the devastating environmental impacts of an even more mineral-intensive system based on renewables and warns:

“The whole process of replacing a declining system with a more complex mining-based enterprise is now supposed to take place with a fragile banking system, dysfunctional democracies, broken supply chains, critical mineral shortages and hostile geopolitics.”

All of this assumes that global warming is real and anthropogenic. Not everyone agrees. In the article Global warming and the confrontation between the West and the rest of the world, journalist Thierry Meyssan argues that net zero is based on political ideology rather than science. But to state such things has become heresy in the Western countries and shouted down with accusations of ‘climate science denial’.

Regardless of such concerns, the march towards net zero continues, and key to this is the United Nations Agenda 2030 for Sustainable Development Goals.

Today, almost every business or corporate report, website or brochure includes a multitude of references to ‘carbon footprints’, ‘sustainability’, ‘net zero’ or ‘climate neutrality’ and how a company or organisation intends to achieve its sustainability targets. Green profiling, green bonds and green investments go hand in hand with displaying ‘green’ credentials and ambitions wherever and whenever possible.

It seems anyone and everyone in business is planting their corporate flag on the summit of sustainability. Take Sainsbury’s, for instance. It is one of the ‘big six’ food retail supermarkets in the UK and has a vision for the future of food that it published in 2019.

Here’s a quote from it:

“Personalised Optimisation is a trend that could see people chipped and connected like never before. A significant step on from wearable tech used today, the advent of personal microchips and neural laces has the potential to see all of our genetic, health and situational data recorded, stored and analysed by algorithms which could work out exactly what we need to support us at a particular time in our life. Retailers, such as Sainsbury’s could play a critical role to support this, arranging delivery of the needed food within thirty minutes — perhaps by drone.”

Tracked, traced and chipped — for your own benefit. Corporations accessing all of our personal data, right down to our DNA. The report is littered with references to sustainability and the climate or environment, and it is difficult not to get the impression that it is written so as to leave the reader awestruck by the technological possibilities.

However, the promotion of a brave new world of technological innovation that has nothing to say about power — who determines policies that have led to massive inequalities, poverty, malnutrition, food insecurity and hunger and who is responsible for the degradation of the environment in the first place — is nothing new.

The essence of power is conveniently glossed over, not least because those behind the prevailing food regime are also shaping the techno-utopian fairytale where everyone lives happily ever after eating bugs and synthetic food while living in a digital panopticon.

FAKE GREEN

The type of ‘green’ agenda being pushed is a multi-trillion market opportunity for lining the pockets of rich investors and subsidy-sucking green infrastructure firms and also part of a strategy required to secure compliance required for the ‘new normal’.

It is, furthermore, a type of green that plans to cover much of the countryside with wind farms and solar panels with most farmers no longer farming. A recipe for food insecurity.

Those investing in the ‘green’ agenda care first and foremost about profit. The supremely influential BlackRock invests in the current food system that is responsible for polluted waterways, degraded soils, the displacement of smallholder farmers, a spiralling public health crisis, malnutrition and much more.

It also invests in healthcare — an industry that thrives on the illnesses and conditions created by eating the substandard food that the current system produces. Did Larry Fink, the top man at BlackRock, suddenly develop a conscience and become an environmentalist who cares about the planet and ordinary people? Of course not.

Any serious deliberations on the future of food would surely consider issues like food sovereignty, the role of agroecology and the strengthening of family farms — the backbone of current global food production.

The aforementioned article by Andrew Nikiforuk concludes that, if we are really serious about our impacts on the environment, we must scale back our needs and simplify society.

In terms of food, the solution rests on a low-input approach that strengthens rural communities and local markets and prioritises smallholder farms and small independent enterprises and retailers, localised democratic food systems and a concept of food sovereignty based on self-sufficiency, agroecological principles and regenerative agriculture.

It would involve facilitating the right to culturally appropriate food that is nutritionally dense due to diverse cropping patterns and free from toxic chemicals while ensuring local ownership and stewardship of common resources like land, water, soil and seeds.

That’s where genuine environmentalism and the future of food begins.

Tyler Durden Thu, 03/14/2024 - 02:00

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Five Aerospace Investments to Buy as Wars Worsen Copy

Five aerospace investments to buy as wars worsen give investors a chance to acquire shares of companies focused on fortifying national defense. The five…

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Five aerospace investments to buy as wars worsen give investors a chance to acquire shares of companies focused on fortifying national defense.

The five aerospace investments to buy provide military products to help protect freedom amid Russia’s ongoing onslaught against Ukraine that began in February 2022, as well as supply arms in the Middle East used after Hamas militants attacked and murdered civilians in Israel on Oct. 7. Even though the S&P 500 recently reached all-time highs, these five aerospace investments have remained reasonably priced and rated as recommendations by seasoned analysts and a pension fund chairman.

State television broadcasts in Russia show the country’s soldiers advancing further into Ukrainian territory, but protests have occurred involving family members of those serving in perilous conditions in the invasion of their neighboring nation to be brought home. Even though hundreds of thousands of Russians also have fled to other countries to avoid compulsory military service, the aggressor’s President Vladimir Putin has vowed to continue to send additional soldiers into the fierce fighting.

While Russia’s land-grab of Crimea and other parts of Ukraine show no end in sight, Israel’s war with Hamas likely will last for at least additional months, according to the latest reports. United Nations’ leaders expressed alarm on Dec. 26 about intensifying Israeli attacks that killed more than 100 Palestinians over two days in part of the Gaza Strip, when 15 members of the Israel Defense Force (IDF) also lost their lives.

Five Aerospace Investments to Buy as Wars Worsen: General Dynamics

One of the five aerospace investments to buy as wars worsen is General Dynamics (NYSE: GD), a Reston, Virginia-based aerospace company with more than 100,000 employees in 70-plus countries. A key business unit of General Dynamics is Gulfstream Aerospace Corporation, a manufacturer of business aircraft. Other segments of General Dynamics focus on making military products such as Abrams tanks, Stryker fighting vehicles, ASCOD fighting vehicles like the Spanish PIZARRO and British AJAX, LAV-25 Light Armored Vehicles and Flyer-60 lightweight tactical vehicles.

For the U.S. Navy and other allied armed forces, General Dynamics builds Virginia-class attack submarines, Columbia-class ballistic missile submarines, Arleigh Burke-class guided missile destroyers, Expeditionary Sea Base ships, fleet logistics ships, commercial cargo ships, aircraft and naval gun systems, Hydra-70 rockets, military radios and command and control systems. In addition, the company provides radio and optical telescopes, secure mobile phones, PIRANHA and PANDUR wheeled armored vehicles and mobile bridge systems.

Chicago-based investment firm William Blair & Co. is among those recommending General Dynamics. The Chicago firm gave an “outperform” rating to General Dynamics in a Dec. 21 research note.

Gulfstream is seeking G700 FAA certification by the end of 2023, suggesting potentially positive news in the next 10 days, William Blair wrote in its recent research note. The investment firm projected that General Dynamics would trade upward upward upon the G700’s certification.

“General Dynamics’ 2023 aircraft delivery guidance of approximately 134 planes assumes that 19 G700s are delivered in the fourth quarter,” wrote William Blair’s aerospace and defense analyst Louie DiPalma. “Even if deliveries fall short of this target, we believe investors will take a glass-half-full approach upon receipt of the certification.”

Chart courtesy of www.stockcharts.com.

Five Aerospace Investments to Buy as Wars Worsen: GD Outlook

The G700 is a major focus area for investors because it is Gulfstream’s most significant aircraft introduction since the iconic G650 in 2012, DiPalma wrote. Gulfstream has the highest market share in the long-range jet segment of the private aircraft market, the highest profit margin of aircraft peers and the most premium business aviation brand, he added.

“The aircraft remains immensely popular today with corporations and high-net-worth individuals,” Di Palma wrote. “Elon Musk has reportedly placed an order for a G700 to go along with his existing G650. Qatar Airways announced at the Paris Air Show that 10 G700 aircraft will become part of its fleet.”

G700 deliveries and subsequent G800 deliveries are expected to be the cornerstone of Gulfstream’s growth and margin expansion for the next decade, DiPalma wrote. This should lead to a rebound in the stock price as the margins for the G700 and G800 are very attractive, he added.

Management’s guidance is for the aerospace operating margin to increase from about 13.2% in 2022 to roughly 14.0% in 2023 and 15.8% in 2024. Longer term, a high-teens profit margin appears within reach, DiPalma projected.

In other General Dynamics business segments, William Blair expects several yet-unannounced large contract awards for General Dynamics IT, to go along with C$1.7 billion, or US$1.29 billion, in General Dynamics Mission Systems contracts announced on Dec. 20 for the Canadian Army. General Dynamics shares are poised to have a strong 2024, William Blair wrote.

Five Aerospace Investments to Buy as Wars Worsen: VSE Corporation

Alexandria, Virginia-based VSE Corporation’s (NASDAQ: VSEC) price-to-earnings (P/E) valuation multiple of 22 received support when AAR Corp. (NYSE: AIR), a Wood Dale, Illinois, provider of aviation services, announced on Dec. 21 that it would acquire the product support business of Triumph Group (NYSE: TGI), a Berwyn, Pennsylvania, supplier of aerospace services, structures and systems. AAR’s purchase price of $725 million reflects confidence in a continued post-pandemic aerospace rebound.

VSE, a provider of aftermarket distribution and repair services for land, sea and air transportation assets used by government and commercial markets, is rated “outperform” by William Blair. The company’s core services include maintenance, repair and operations (MRO), parts distribution, supply chain management and logistics, engineering support, as well as consulting and training for global commercial, federal, military and defense customers.

“Robust consumer travel demand and aging aircraft fleets have driven elevated maintenance visits,” William Blair’s DiPalma wrote in a Dec. 21 research note. “The AAR–Triumph deal is valued at a premium 13-times 2024 EBITDA multiple, which was in line with the valuation multiple that Heico (NYSE: HEI) paid for Wencor over the summer.”

VSE currently trades at a discounted 9.5 times consensus 2024 earnings before interest, taxes, depreciation and amortization (EBITDA) estimates, as well as 11.6 times consensus 2023 EBITDA.

Five Aerospace Investments to Buy as Wars Worsen: VSE Undervalued?

“We expect that VSE shares will trend higher as investors process this deal,” DiPalma wrote. “VSE shares trade at 9.5 times consensus 2024 adjusted EBITDA, compared with peers and M&A comps in the 10-to-14-times range. We think that VSE’s multiple will expand as it closes the divestiture of its federal and defense business and makes strategic acquisitions. We see consistent 15% annual upside for shares as VSE continues to take share in the $110 billion aviation aftermarket industry.”

William Blair reaffirmed its “outperform” rating for VSE on Dec. 21. The main risk to VSE shares is lumpiness associated with its aviation services margins, Di Palma wrote. However, he raised 2024 estimates to further reflect commentary from VSE’s analysts’ day in November.

Chart courtesy of www.stockcharts.com.

Five Aerospace Investments to Buy as Wars Worsen: HEICO Corporation

HEICO Corporation (NYSEL: HEI), is a Hollywood, Florida-based technology-driven aerospace, industrial, defense and electronics company that also is ranked as an “outperform” investment by William Blair’s DiPalma. The aerospace aftermarket parts provider recently reported fourth-quarter financials above consensus analysts’ estimates, driven by 20% organic growth in HEICO’s flight support group.

HEICO’s management indicated that the performance of recently acquired Wencor is exceeding expectations. However, HEICO leaders offered color on 2024 organic growth and margin expectations that forecast reduced gains. Even though consensus estimates already assumed slowing growth, it is still not a positive for HEICO, DiPalma wrote.

William Blair forecasts 15% annual upside to HEICO’s shares, based on EBITDA growth. HEICO’s management cited a host of reasons for its quarterly outperformance, highlighted by the continued commercial air travel recovery. The company also referenced new product introductions and efficiency initiatives.

HEICO’s defense product sales increased by 26% sequentially, marking the third consecutive sequential increase in defense product revenue. The company’s leaders conveyed that defense in general is moving in the right direction to enhance financial performance.

Chart courtesy of www.stockcharts.com.

Five Dividend-paying Defense and Aerospace Investments to Purchase: XAR

A fourth way to obtain exposure to defense and aerospace investments is through SPDR S&P Aerospace and Defense ETF (XAR). That exchange-traded fund  tracks the S&P Aerospace & Defense Select Industry Index. The fund is overweight in industrials and underweight in technology and consumer cyclicals, said Bob Carlson, a pension fund chairman who heads the Retirement Watch investment newsletter.

Bob Carlson, who heads Retirement Watch, answers questions from Paul Dykewicz.

XAR has 34 securities, and 44.2% of the fund is in the 10 largest positions. The fund is up 25.82% in the last 12 months, 22.03% in the past three months and 7.92% for the last month. Its dividend yield recently measured 0.38%.

The largest positions in the fund recently were Axon Enterprise (NASDAQ: AXON), Boeing (NYSE: BA), L3Harris Technologies (NYSE: LHX), Spirit Aerosystems (NYSE: SPR) and Virgin Galactic (NYSE: SPCE).

Chart courtesy of www.stockcharts.com

Five Dividend-paying Defense and Aerospace Investments to Purchase: PPA

The second fund recommended by Carlson is Invesco Aerospace & Defense ETF (PPA), which tracks the SPADE Defense Index. It has the same underweighting and overweighting as XAR, he said.

PPA recently held 52 securities and 53.2% of the fund was in its 10 largest positions. With so many holdings, the fund offers much reduced risk compared to buying individual stocks. The largest positions in the fund recently were Boeing (NYSE: BA), RTX Corp. (NYSE: RTX), Lockheed Martin (NYSE: LMT), Northrop Grumman (NYSE: NOC) and General Electric (NYSE:GE).

The fund is up 19.07% for the past year, 50.34% in the last three months and 5.30% during the past month. The dividend yield recently touched 0.69%.

Chart courtesy of www.stockcharts.com

Other Fans of Aerospace

Two fans of aerospace stocks are Mark Skousen, PhD, and seasoned stock picker Jim Woods. The pair team up to head the Fast Money Alert advisory service They already are profitable in their recent recommendation of Lockheed Martin (NYSE: LMT) in Fast Money Alert.

Mark Skousen, a scion of Ben Franklin, meets with Paul Dykewicz.


Jim Woods, a former U.S. Army paratrooper, co-heads Fast Money Alert.

Bryan Perry, who heads the Cash Machine investment newsletter and the Micro-Cap Stock Trader advisory service, recommends satellite services provider Globalstar (NYSE American: GSAT), of Covington, Louisiana, that has jumped 50.00% since he advised buying it two months ago. Perry is averaging a dividend yield of 11.14% in his Cash Machine newsletter but is breaking out with the red-hot recommendation of Globalstar in his Micro-Cap Stock Trader advisory service.


Bryan Perry heads Cash Machine, averaging an 11.14% dividend yield.

Military Equipment Demand Soars amid Multiple Wars

The U.S. military faces an acute need to adopt innovation, to expedite implementation of technological gains, to tap into the talents of people in various industries and to step-up collaboration with private industry and international partners to enhance effectiveness, U.S. Joint Chiefs of Staff Gen. Charles Q. Brown Jr. told attendees on Nov 16 at a national security conference. Prime examples of the need are showed by multiple raging wars, including the Middle East and Ukraine. A cold war involves China and its increasingly strained relationships with Taiwan and other Asian nations.

The shocking Oct. 7 attack by Hamas on Israel touched off an ongoing war in the Middle East, coupled with Russia’s February 2022 invasion and continuing assault of neighboring Ukraine. Those brutal military conflicts show the fragility of peace when determined aggressors are willing to use any means necessary to achieve their goals. To fend off such attacks, rapid and effective response is required.

“The Department of Defense is doing more than ever before to deter, defend, and, if necessary, defeat aggression,” Gen. Brown said at the National Security Innovation Forum at the Johns Hopkins University Bloomberg Center in Washington, D.C.

One of Russia’s war ships, the 360-foot-long Novocherkassk, was damaged on Dec. 26 by a Ukrainian attack on the Black Sea port of Feodosia in Crimea. This video of an explosion at the port that reportedly shows a section of the ship hit by aircraft-guided missiles.


Chairman Joint Chiefs of Staff Gen. Charles Q. Brown, Jr.
Photo By: Benjamin Applebaum

National security threats can compel immediate action, Gen. Brown said he quickly learned since taking his post on Oct. 1.

 

“We may not have much warning when the next fight begins,” Gen. Brown said. “We need to be ready.”

 

In a pre-recorded speech at the national security conference, Michael R. Bloomberg, founder of Bloomberg LP, told the John Hopkins national security conference attendees about the critical need for collaboration between government and industry.

 

“Building enduring technological advances for the U.S. military will help our service members and allies defend freedom across the globe,” Bloomberg said.

 

The “horrific terrorist attacks” against Israel and civilians living there on Oct. 7 underscore the importance of that mission, Bloomberg added.

Paul Dykewicz, www.pauldykewicz.com, is an accomplished, award-winning journalist who has written for Dow Jones, the Wall Street JournalInvestor’s Business DailyUSA Today, the Journal of Commerce, Seeking Alpha, Guru Focus and other publications and websites. Attention Holiday Gift Buyers! Consider purchasing Paul’s inspirational book, “Holy Smokes! Golden Guidance from Notre Dame’s Championship Chaplain,” with a foreword by former national championship-winning football coach Lou Holtz. The uplifting book is great gift and is endorsed by Joe Montana, Joe Theismann, Ara Parseghian, “Rocket” Ismail, Reggie Brooks, Dick Vitale and many othersCall 202-677-4457 for special pricing on multiple-book purchases or autographed copies! Follow Paul on Twitter @PaulDykewicz. He is the editor of StockInvestor.com and DividendInvestor.com, a writer for both websites and a columnist. He further is editorial director of Eagle Financial Publications in Washington, D.C., where he edits monthly investment newsletters, time-sensitive trading alerts, free e-letters and other investment reports. Paul previously served as business editor of Baltimore’s Daily Record newspaper, after writing for the Baltimore Business Journal and Crain Communications.

The post Five Aerospace Investments to Buy as Wars Worsen Copy appeared first on Stock Investor.

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Health Officials: Man Dies From Bubonic Plague In New Mexico

Health Officials: Man Dies From Bubonic Plague In New Mexico

Authored by Jack Phillips via The Epoch Times (emphasis ours),

Officials in…

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Health Officials: Man Dies From Bubonic Plague In New Mexico

Authored by Jack Phillips via The Epoch Times (emphasis ours),

Officials in New Mexico confirmed that a resident died from the plague in the United States’ first fatal case in several years.

A bubonic plague smear, prepared from a lymph removed from an adenopathic lymph node, or bubo, of a plague patient, demonstrates the presence of the Yersinia pestis bacteria that causes the plague in this undated photo. (Centers for Disease Control and Prevention/Getty Images)

The New Mexico Department of Health, in a statement, said that a man in Lincoln County “succumbed to the plague.” The man, who was not identified, was hospitalized before his death, officials said.

They further noted that it is the first human case of plague in New Mexico since 2021 and also the first death since 2020, according to the statement. No other details were provided, including how the disease spread to the man.

The agency is now doing outreach in Lincoln County, while “an environmental assessment will also be conducted in the community to look for ongoing risk,” the statement continued.

This tragic incident serves as a clear reminder of the threat posed by this ancient disease and emphasizes the need for heightened community awareness and proactive measures to prevent its spread,” the agency said.

A bacterial disease that spreads via rodents, it is generally spread to people through the bites of infected fleas. The plague, known as the black death or the bubonic plague, can spread by contact with infected animals such as rodents, pets, or wildlife.

The New Mexico Health Department statement said that pets such as dogs and cats that roam and hunt can bring infected fleas back into homes and put residents at risk.

Officials warned people in the area to “avoid sick or dead rodents and rabbits, and their nests and burrows” and to “prevent pets from roaming and hunting.”

“Talk to your veterinarian about using an appropriate flea control product on your pets as not all products are safe for cats, dogs or your children” and “have sick pets examined promptly by a veterinarian,” it added.

“See your doctor about any unexplained illness involving a sudden and severe fever, the statement continued, adding that locals should clean areas around their home that could house rodents like wood piles, junk piles, old vehicles, and brush piles.

The plague, which is spread by the bacteria Yersinia pestis, famously caused the deaths of an estimated hundreds of millions of Europeans in the 14th and 15th centuries following the Mongol invasions. In that pandemic, the bacteria spread via fleas on black rats, which historians say was not known by the people at the time.

Other outbreaks of the plague, such as the Plague of Justinian in the 6th century, are also believed to have killed about one-fifth of the population of the Byzantine Empire, according to historical records and accounts. In 2013, researchers said the Justinian plague was also caused by the Yersinia pestis bacteria.

But in the United States, it is considered a rare disease and usually occurs only in several countries worldwide. Generally, according to the Mayo Clinic, the bacteria affects only a few people in U.S. rural areas in Western states.

Recent cases have occurred mainly in Africa, Asia, and Latin America. Countries with frequent plague cases include Madagascar, the Democratic Republic of Congo, and Peru, the clinic says. There were multiple cases of plague reported in Inner Mongolia, China, in recent years, too.

Symptoms

Symptoms of a bubonic plague infection include headache, chills, fever, and weakness. Health officials say it can usually cause a painful swelling of lymph nodes in the groin, armpit, or neck areas. The swelling usually occurs within about two to eight days.

The disease can generally be treated with antibiotics, but it is usually deadly when not treated, the Mayo Clinic website says.

“Plague is considered a potential bioweapon. The U.S. government has plans and treatments in place if the disease is used as a weapon,” the website also says.

According to data from the U.S. Centers for Disease Control and Prevention, the last time that plague deaths were reported in the United States was in 2020 when two people died.

Tyler Durden Wed, 03/13/2024 - 21:40

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