In today’s Exponential Investor

  • The red stamp of QA
  • Elon moves the market (again)
  • Holding the beef to ransom

This afternoon I’m off to my first pregnancy scan.

This isn’t a sequel to the movie Junior, I’m not the pregnant one. My wife is though. And she’s due in roughly four weeks.

That means we’re on the home straight. Hooray (for her)!

But now eight months in, it’s only the first time I’m actually allowed to attend the scan with her. Up until now, I’ve had to patiently sit in the bloody car in the carpark at the hospital while she goes through all the appointments on her own.

You know the reason. Ridiculous restrictions imposed on us for now around 18 months. But only now have things got a little looser so that people can experience life again.

Well, almost.

There’s a condition for me going to the scan with her. I have to provide a negative lateral flow test taken at least 24 hours before attending.

Great.

I jumped on to the government site this week to get some of the tests. So far, as expected. Then the tests arrived. Again, all as expected… except for two things.

Rather than tell you about them, let me show you…

Source: editor’s own photos

Now, I would have thought, expected, that testing kits would have been something the UK could manufacture themselves. Considering the dubious nature of the origins of the Covid-19 pandemic, I find great humour in this.

These are the testing kits supposed to allow us to return to freedom, made in China and with what appears to be the red communist stamp of quality assurance.

Well, I can’t say I’m glad that what could have easily been a domestic run supply has been handballed off to China. In fact, I’m incensed.

Nonetheless, it does also remind us that whether you like it or not, China is a crucial market for the economic success of Western economies. Even if it comes to light the pandemic was lab-made, or lab-leaked from Wuhan, that won’t put the kibosh on the British dealing with China.

It’s far too big a market, far too much money flowing there to ignore. You will read about all the political grandstanding; you will hear how nationalism becomes a renewed focus for economies. But you also must remember to watch what they do, not what they say.

That’s how you find success in the market, and in global finance, follow the money, not the rhetoric.

Doge moons again (thanks Elon!)

I also took great humour on Wednesday morning when I was getting warmed up for work. A quick flick through Twitter saw the controversial Elon Musk, with actually quite a funny tweet.

Typically I don’t find him all that funny. Watch the episode of Saturday Night Live he hosted from a few weeks ago for proof of that.

But this tweet was good.

Here’s what it said…

Source: @elonmusk, Twitter

Now, if you’re unaware of the humour here, that dog is the Shiba Inu, the meme dog that is the face of Dogecoin cryptocurrency. And it’s Dogecoin that Elon has taken a particular fondness for over the last year or so… or more… we don’t really know.

Nonetheless, Elon is also known as the “Dogefather” – the official, unofficial leader of Dogecoin. Hence the picture of him as a kid (as the Doge) is funny… at least in crypto circles.

Now this tweet also coincided with Dogecoin being listed on one of the world’s biggest cryptocurrency exchanges, Coinbase.

These powers combined, Dogecoin skyrocketed over 30% in 24-hour trading on Wednesday.

Some say it was Elon’s doing, some say it was Coinbase listing. Whichever it was, doesn’t really matter. What matters is that Dogecoin isn’t going away. After around seven years as a “meme” crypto, Doge has never been stronger.

It now has the support of all of Elon’s supporters. And it’s also attracting new fans every day it gathers headlines, and the mainstream covers it.

The reality is there’s very little going on with Dogecoin compared to other crypto networks and projects. Sure, Elon has taken a liking to it, and may put funds towards its development. That’s fine. That’s good.

If people’s first introduction to crypto is now Doge instead of perhaps bitcoin or Ethereum, that’s ok. The key is they’re getting interested in crypto at all. Once you start down that rabbit hole, you don’t leave.

I know of no one (except pure tribal “maxis”) devoted to only one crypto. Those who only see one way, I think are just ignorant. It would be like solely focusing on one stock and nothing else. Like focusing only on cash and nothing else. Focusing on only gold and nothing else.

Focusing on one thing at the expense of all others is a silly way to approach anything. It’s arrogant, ignorant, and not a smart way to go about things. But each to their own, I guess.

Nonetheless, Doge “mooned” thanks to Elon, and Coinbase, and it’s here to stay seven years after it started. I guess that makes it the overnight success that was seven years in the making.

No beef here

What does ransomware (a form of cyber-attack) have in common with the steak on your BBQ this weekend?

Well, one of them means the other doesn’t happen.

You may have heard in the past of cyber-attacks on software companies, big tech, data centres, even infrastructure like electricity supply and even gas pipelines.

But cyber-attacks on meat producers? That’s new. But not all that surprising.

This week a major US meat producer, JBS, was hit with a ransomware attack. That effectively shut down its beef and pork processing facilities according to The Wall Street Journal.

Due to the size of JBS, this actually pushed the prices of meat higher, and threw the meat supply chain in the US, Canada and Australia into a frenzied chaos.

The seriousness of this cannot be underestimated. And the importance of effective cyber protection cannot be ignored either.

Cyber-attacks are always hard to relate to as an investor. They’re not typically something you ever get to see, experience, or suffer from. It’s rare that cyber attackers really go after individuals with great importance.

Scammers, yes, but full-blown cyber-attack, it’s rarer.

But big attacks on major infrastructure such as energy networks, financial networks of food and agriculture supply chains is a very real and present danger.

The problem is also only going to get more complex and powerful as we get more complex and powerful technology to run these attacks. In a highly connected world, there are many advantages but also increasing numbers of risks – namely the threat of nefarious remote control over critical infrastructure.

The opportunity this presents however for investors is in the companies that are able to deliver the high-level protection needed to thwart these attacks.

It’s an area that people don’t really understand, know about in great detail, or get to touch, feel and experience.

The world of cyber-attack and defence is a mysterious industry but may prove to be one of the most lucrative ones for investors willing to step into the unknown.

Sam Volkering
Editor, Exponential Investor

PS While on the subject of things “mooning” one of the world’s great companies that’s heading moon-ward is Virgin Galactic. However, did you know that before Virgin Galactic listed on the market as Virgin Galactic it was something else? It was a weirdly named company that had no business plan, no revenues and certainly no ambition to go to the moon. What you need to know is there are hundreds of these weird named companies on the market, right now, with no business, no revenue but the potential to be as exciting as Virgin Galactic. Frankly if you aren’t clued-up on this mega-trend, then I believe you’re missing something truly extraordinary… and Ive prepared a special briefing to tell you all about it here.