May 2021

May 2021 Issue

1

In This Issue:

• The Crypto Pump-and-Dump

• Our Latest Recommendation

• Earnings Roundup: LMT, GRBK, DEA, MAXR, JUSHF

• Perpetua Update

• Conclusion

The Crypto Pump-and-DumpI’ll admit I’ve never been a fan of Elon Musk.

Where some see a visionary, I see a cocky charlatan — an insecure, self-serving image curator who clouds himself with hype like a smokescreen.

Of course, that’s just my opinion.

A lot of other people out there disagree. Elon Musk has amassed himself a fortune, and with it a coterie of diehard groupies.

Normally, I’d ignore that kind of thing but Elon Musk, like other charlatans, makes himself impossible to ignore.

And in fact, what’s even harder to ignore are the waves he makes in the market.

The reality is that people do pay attention to him. He does have influence. And he’s not afraid to leverage that influence.

You may recall, Musk was sued by the SEC in 2018 after he said he had secured the funding required to take Tesla private.

Both parties reached a settlement, under which he had to step down as the chairman of Tesla’s board of directors for three years and pay a $20 million fine.

May 2021 Issue

2

It was around that time Musk appeared on Joe Rogan’s podcast, smoked a joint, and floated his idea for underground commuter pods.

So not a great track record for reliability here.

Nevertheless, his fans took the bait on cryptocurrency — specifically Bitcoin and Dogecoin.

Back in February, Tesla announced a $1.5 billion investment in Bitcoin, and said it would start accepting the cryptocurrency as payment.

Around the same time, Musk took to Twitter to hype up Dogecoin...

May 2021 Issue

3

May 2021 Issue

4

Both of these endorsements led to massive spikes as Elon’s acolytes rushed to ride his coattails.

And then it all backfired.

Musk appeared on Saturday Night Live and “jokingly” called Dogecoin a “hustle.”

The cryptocurrency, which has surged more than 16,000% in the past year, crashed in real time as a result.

A couple weeks later, Musk and Tesla backtracked on Bitcoin, saying the company wouldn’t be accepting the currency after all, due to climate concerns.

And then Musk went even further by implying that Tesla might sell its Bitcoin holdings if it hadn’t already.

May 2021 Issue

5

Now, none of this is to say you shouldn’t invest in cryptocurrency.

It’s just to say that one needs to be careful when doing so.

Don’t run around chasing breadcrumbs dropped by eccentric billionaires.

If you want to get involved, you should know going in that cryptos are volatile and murky. So pick your spots and be ready to hold on for dear life.

Now might not be a bad time to buy in, either.

In fact, now that prices have tumbled, I’m honing in on what I believe to be a safer, less volatile crypto recommendation that could offer significant upside.

I’ll have more on that in the weeks ahead.

But in the meantime, let’s revisit my latest recommendation, Holicity...

May 2021 Issue

6

Our Latest Recommendation: Holicity (NASDAQ: HOL)

On April 26, we followed up on the rapidly evolving space investment trend with a new recommendation — a SPAC that’s now known as Holicity (NASDAQ: HOL) but will soon become Astra (NASDAQ: ASTR).

To be clear, Holicity is a special purpose acquisition company (SPAC).

I’ll tell you exactly what that means in a moment, but what’s most important upfront is that you know a SPAC exists solely as a vehicle to take start-ups public, circumventing the traditional IPO process.

To that end, Holicity is poised to transform into Astra in a matter of months, if not weeks. (The official guidance is the rather murky — “second quarter.”)

I know that might sound confusing, which is why I’ll go into more detail later.

First, though, I want to...

A) Revisit the fast-growing space economy. And,

B) Explain how Astra fits in.

Once we’ve done that we can get into the nitty-gritty of SPACs and how they work.

So buckle up. We’re about to blast off.

May 2021 Issue

7

Space, Satellites, and ConstellationsLet’s start by revisiting the broader space market — a $366 billion industry that will more than double in the next 10 years to $805 billion and triple in the next two decades to more than $1 trillion.

Now, if you want to know what that will look like, Morgan Stanley provides this visualization...

The important thing to note about this comparison is that red band on the 2040 chart. It represents internet satellites.

And while it’s completely absent in the 2016 layout on the left, it just about dominates the 2040 chart on the right.

This is where the bulk of space industry growth will occur, ultimately generating an estimated $412 billion.

Note that at more than $400 billion, that internet segment alone would eclipse the entire value of the broader space market right now ($366 billion).

May 2021 Issue

8

How is that possible?

It’s because the nature of satellites and satellite launches is changing — and changing rapidly.

They are getting smaller and cheaper. They are getting easier to make and faster to deploy.

And that’s because there is a race among a small group of innovators to blanket the earth with a layer of communications satellites that are low enough to sustain internet connections.

These are called “low-earth orbit” satellites. Some weigh as little as one gram and hundreds can be deployed on a single rocket.

In fact, that’s just what SpaceX did in January, when it deployed 143 low-earth orbit satellites in a single launch.

The deployment was so massive, it can be seen from earth (something the company is trying to remedy with a new dark coating).

May 2021 Issue

9

With that level of coverage, these constellations can provide faster, more consistent access to the internet and other satellite services like broadband cable and digital communication — not just for SpaceX but for competitors like Jeff Bezos’s Blue Origin, internet service providers like Comcast, and telecom companies like AT&T and Verizon.

Forget cable. Forget fiber optics. The future of data infrastructure is literally swirling above your head.

It’s low-earth orbit satellite constellations.

It’s the dawn of a new space race.

And it’s going to culminate in the launch of thousands of satellites over the next few years — figures that up until recently would have been considered fantastic.

According to Euroconsult, 8,500 satellites will be launched from 2019–2028. That’d be more than the 8,378 satellites that were launched into space in the six decades prior.

With this vast increase in launch activity, there could be more than 12,000 satellites in orbit by 2028 — up from roughly 3,000 now.

Thus, the Morgan Stanley projection that internet space spending will blossom from nothing in 2016 to more than $400 billion in 2040.

Similarly, consumer broadband satellites will approach $100 billion from their nascent beginnings, and spending on digital cable satellites will just about double from $98 billion to $181 billion in that time.

So yes, space tourism, space mining, space exploration, data collection, and other forms of spending will contribute to the overall growth of the space market over the next few decades.

But more than anything else it will be low-earth orbit satellites and satellite constellations that will lead the way. That’s the market to key in on.

And that’s what brings us to Astra.

May 2021 Issue

10

Astra: Space PioneersAstra aims to conduct dozens if not hundreds of small satellite launches each year, ultimately performing them on behalf of clients daily.

You see, currently, if a company wants to launch a small satellite into space, it has to share a ride on a larger rocket with other satellite launchers, paying a fee proportionate to the weight and volume their unit takes up.

Sharing a ride with a larger satellite means they have no say in when the launch is commenced or where their satellites are placed in orbit. These outsized launch missions also take longer to set up and execute, which can mean months or even years of waiting for their satellites to be deployed.

“That’s the current state of the industry, and it sucks,” said Astra CEO Chris Kemp. “It’s like putting a FedEx truck on a plane and flying it to New York and then driving it back to Los Angeles, and then driving the truck off a cliff.”

Indeed, that’s the inefficiency Astra wants to do away with by offering small, targeted launches from a wide variety of locations.

May 2021 Issue

11

Kemp (who was formerly the chief technology officer at NASA) plans to conduct three launches in 2021 and establish the ability to launch rockets on a monthly basis by year’s end. This would put the company on track for 15 launches in 2022, with the company targeting a weekly launch rate in 2023. That would mean 55 launches bringing in $206 million in revenue.

Astra then aims to triple that rate in 2024, with 165 launches and rockets going up twice a week. And by 2025, Astra wants to be launching almost daily.

May 2021 Issue

12

This ambitious plan centers around Astra’s low-cost production and rapid-launch capabilities.

Kemp says you don’t need the equivalent of a Ferrari to carry a small payload to orbit, so his company isn’t building one.

“Honestly, we’re building a pretty boring rocket,” says Astra Co-Founder and Chief Technology Officer Adam London. “This is not about making the best, most sexy rocket. We want to make the simplest, most manufacturable rocket.”

So rather than rely on costly 3D printing or labor-intensive composites, Astra uses cheaper raw materials. For example, making the rocket’s fairing out of aluminum, instead of carbon fiber, reduces production time and cuts the cost of the fairing from $250,000 to just $2,500.

And whereas space rocket production has traditionally been complex, Astra is pursuing a revolutionary manufacturing process that relies heavily on automation.

“We’re going to automate the factory itself, so that we can get a consistent output of rockets,” Kemp said.

May 2021 Issue

13

That effort is being led by Pablo Gonzalez, Astra’s senior vice president of factory engineering. Gonzalez previously led development of all of the equipment and automation lines in Tesla’s California and New York factories.

Now he’s doing the same for Astra as the company builds out its headquarters at what was once the Alameda Naval Air Station in California.

Over the past three years, Astra has developed the Bay Area site into the world’s first fully-integrated rocket development, manufacturing, and test facility. The 20-acre campus with two indoor rocket engine test stands gives Astra’s team control over every part of the rocket-building process from design to testing.

It’s a proving ground in its own right, where the company can perfect its product and process.

Within its tightly controlled confines, Astra builds 95% of its rockets in-house using raw materials, manufacturing parts that would cost hundreds of dollars from a supplier for just $5 a piece.

Additionally, the company has developed its own software for everything from manufacturing to the launch systems.

The first stage of the facility is just about finished, but Astra will commence work on phase two of the facility next year. That work won’t be completed until early 2024, but once it’s done Astra hopes to realize its goal of producing rockets and conducting launches on a daily basis.

On that note, when it comes to the launch itself, that too is neatly streamlined and compact.

The company’s entire launch system can fit into four standard shipping containers, allowing it to be transported anywhere in the world within 24 hours. And it requires just six employees to operate the launch site.

May 2021 Issue

14

In fact, in one demonstration for DARPA, Astra moved its entire rocket and launch infrastructure from their facilities in Alameda, California, to Kodiak, Alaska. It then set up all the equipment required to launch a rocket on a simple concrete launchpad and integrate a previously undisclosed set of payloads.

“All I need is a license from the FAA, we put a fence around a gravel pad, and we launch from there in five days with five people,” Kemp says.

With such threadbare requirements, the company should easily be able to scale out. It’s already identified more than 10 potential launch sites around the globe, all of which can be constructed in about six months.

To put that in context, such launch pads typically take between 18 months to five years to construct, but because Astra is working on such a small scale, it requires far less planning and infrastructure.

The availability of serviceable launch sites, short construction time, and streamlined process should make rapid expansion relatively easy.

Furthermore, this across-the-board cost-cutting and inherent efficiency will drastically reduce the cost of satellite launches — making them more economical through higher volume — and allow Astra to underbid its competitors.

Currently charging $2.5 million per launch, Astra is eyeing an even leaner $1 million per launch price point. By comparison, Rocket Lab, a close competitor, charges $7.5 million per launch.

Size, scale, adaptation, innovation.

Astra is moving fast.

Founded in October 2016, the company took just over four years to put their first rocket to space — a feat that took SpaceX three years more with five times the staff.

May 2021 Issue

15

The company’s trademark expediency also applies to its customer base where it’s attracted double-digit customers, lined up more than 50 launches, and racked up $150 million in revenue.

And now, it’s speeding to market via SPAC.

Astra’s merger with Holicity provided the company with an implied value of $2.1 billion.

This value includes $300 million held by Holicity from their IPO, an additional $200 million raised via a PIPE investment led by BlackRock at the SPAC IPO price of $10 per share, and a Series C funding round.

Said Kemp: “We convinced BlackRock, and a whole bunch of other conservative long-only investors, that the economics when you start manufacturing small rockets at scale pretty much cancel out what you get with a giant rocket. You get the same economics when you start making hundreds of rockets every year out of a factory.”

Current shareholders of Astra will maintain ownership of 78% of the company through common stock, assuming no redemptions. Astra founders will maintain interest in the company after the merger via 10:1 super-voting common stock.

The company expects that it will require $450 million to achieve its initial buildout, which is less than what they’ve already raised from the SPAC merger.

May 2021 Issue

16

Astra’s factory is already fully funded through to completion, meaning the company doesn’t have to rely on its operations to fund it.

And while delays and unexpected problems could eat into the company’s spare budget, there’s a fair amount of legroom (roughly $50 million) to work with.

Astra’s merger value of $2.1 billion represents a 1.4x multiple to their projected 2025 revenue, which is miniscule when compared to the broader industry.

Below is the company’s projected launch/revenue estimates from now until 2025.

Astra forecasts that it will conduct three launches this year, netting $4 million in revenue; 15 launches in 2022, generating $47 million; 55 in 2023, generating $206 million; 165 in 2024 for $619 million and turning cash flow positive; and 300 in 2025, topping $1 billion.

With the growth we’re seeing in the low-earth orbit satellite market that’s more than plausible.

May 2021 Issue

17

And if Astra can master the efficiency it aspires to, and reach its technological goals, it will far outpace those numbers.

It’s a somewhat risky bet in a technologically challenging and highly competitive industry but it’s one I’m willing to take.

That’s why I’ve got Holicity (NASDAQ: HOL), soon-to-be Astra (NASDAQ: ASTR), rated as a buy under $11.

The closer you can get it to $10 a share the better.

May 2021 Issue

18

Sidenote: So What Is a SPAC?A SPAC, or a special purpose acquisitions company, is essentially a shell company set up by investors with the sole purpose of raising money to acquire another company.

A SPAC has no commercial operations or assets — just a pot of money that it raises from an IPO.

Once the IPO raises capital that money goes into an interest-bearing trust account until the SPAC’s management team finds a private company looking to go public through an acquisition.

If SPAC shareholders vote to approve the deal, the SPAC’s investors can either swap their shares for shares of the merged company or redeem their SPAC shares to get back their original investment, plus the interest accrued while that money was in trust.

SPAC sponsors typically get about a 20% stake in the final, merged company.

These vehicles have actually been around for decades but have suddenly gotten a lot more popular over the past few years.

This is because a SPAC merger allows a company to go public more quickly, and often with less volatility than it would with a conventional IPO.

Again, this is because in a SPAC merger, the target company can negotiate its own fixed valuation with the SPAC sponsors.

Of course, that doesn’t make them immune to volatility and Astra could see its share during the transition.

Nevertheless, I’m on board, given the long-term potential.

May 2021 Issue

19

Earnings Roundup

Green Brick Partners (NASDAQ: GRBK) Breaks a Record

When the Census Bureau unveiled its latest data last month, the state of Texas won two more seats in the House of Representatives due to its population growth.

Indeed, the Lone Star State leads the nation by that metric with 15.9% growth over the past decade.

It’s followed by Colorado, Florida, and Georgia — all states where Green Brick Partners is active.

These are the growth trends Green Brick aims to exploit.

To that end the company announced record results for its first quarter ended March 31.

• Net new home orders rose 71% from 632 to 1,082.

• Revenue rose 10% to $234.5 million.

• Net income surged 63% to $26 million.

• And the company’s backlog more than doubled, jumping 133% to nearly $1 billion.

May 2021 Issue

20

Green Brick also acquired 5,600 homesites, expanding its total lots owned and controlled by 118% over the past year.

That increase was achieved while starting a record number of homes and maintaining a debt to capital ratio of 26.4% — one of the lowest among the public homebuilders. And it achieved a record number of home starts (1,039) in the quarter, despite the devastating snowstorm that knocked out power across the state and hindered construction schedules.

Furthermore, with demand booming, Green Brick has been able raise its prices faster than its costs driving gross margin to 25.4%, which is substantially higher than the peer average of 21.9%.

And the company’s debt-to-capital ratio is 26.4%, lower than the industry average of 38.3%.

Just a thoroughly strong report for a company that continues to rapidly expand.

May 2021 Issue

21

Lockheed Martin (NYSE: LMT)

Lockheed Martin’s first quarter was stable if uninspiring.

Still, that’s good news for the defense giant that many analysts assumed would struggle under Democratic government.

Fears that the Biden administration would come in cutting defense spending proved unfounded.

And while some in the government continue to bemoan the cost of the F-35, neither the jet nor Lockheed are in any real danger.

To the contrary, Lockheed is building on the success of the F-35 program, piling on more revenue from its hypersonic missile development (a huge priority for the Pentagon) and classified contracts.

In January, Lockheed projected hypersonic weapon sales would hit $1.5 billion this year and then double to $3 billion by 2025. That’s up from an estimated $1 billion in 2020 and $600 million in 2019.

The company is also a major player and likely choice to become the prime contractor for the Air Force’s new classified sixth generation fighter jet, which is part of the service’s Next Generation Air Dominance (NGAD) program.

And its F-16 Fighting Falcon fighter jet continues to provide a strong income stream as well.

“Net sales increased by approximately $135 million on classified contracts due to higher volume and about $20 million for the F-16 program due to increased volume on production contracts that was partially offset by decreased volume on sustainment contracts,” Lockheed said in its earnings release.

The company’s aeronautics division saw a 3% increase in operating profit in the first quarter, rising to $21 million. Operating profit increased approximately $15 million for the F-16 program.

May 2021 Issue

22

The Missile and Fire Control segment saw net sales surge $130 million, or 5%, over 2020, with operating profit staying even.

Rotary and Mission Systems generated a 10% increase in net sales, and earnings from the Space division rose 3%.

On the whole, Lockheed reported an 8% increase in earnings per share, which rose to $6.56. Revenue climbed 4% to $16.26 billion.

May 2021 Issue

23

Easterly Government Properties (NYSE: DEA)

Easterly Government Properties, Uncle Sam’s landlord and a high-yielding cash cow, also reported first quarter results.

Here are the highlights:

• Net income of $7.9 million, or $0.09 per share.

• Funds From Operations (FFO) of $30.2 million, or $0.33 per share.

• Adjusted FFO of $28.3 million, or $0.31 per share.

Easterly also expanded its portfolio, acquiring a 176,550-square-foot FBI field office in Knoxville, Tennessee, a U.S. Attorney’s office facility in Louisville, Kentucky, and an Immigration and Customs Enforcement (ICE) office in Louisville, Kentucky.

That brings Easterly’s entire portfolio to 82 operating properties in the United States, encompassing approximately 7.5 million leased square feet. All but two of those properties are leased to U.S. government agencies.

In all, Easterly has now grown its net income by 33% over the past five years, greatly outpacing the broader REIT industry. And it continues to churn out a dividend that runs in excess of 5%.

May 2021 Issue

24

Maxar Disappoints, But Growth Is Evident

Maxar Technologies (NYSE: MAXR), which we added to our portfolio last month, suffered a setback with its earnings report on Tuesday.

The company announced a bigger-than-expected quarterly loss of $1.30 per share. However, that loss was largely the result of a one-time incident regarding a satellite the company built for SiriusXM.

And if you’re able to look past that failure, you can see Maxar actually improved in some key metrics and showed good foundational growth in terms of revenue and cash flow.

So let’s take a closer look, and I’ll show you what I mean.

The biggest setback in Maxar’s first quarter was that the company had to take a $28 million charge due to the failure of a new satellite the company built for SiriusXM and launched in December.

Maxar and SiriusXM revealed in January that the 15,000-pound satellite (SXM-7) reached orbit from its launch aboard a SpaceX rocket but was damaged and malfunctioning.

“During in-orbit testing of SXM-7, events occurred which have caused failures of certain SXM-7 payload units,” SiriusXM said in a Jan. 27 report. “An evaluation of SXM-7 is underway. The full extent of the damage to SXM-7 is not yet known.”

And in Maxar’s quarterly report, the company acknowledged that it exhausted efforts to fully recover the satellite in April.

This is unfortunate, but not unheard of. Maxar is not the first or last company to have a satellite fail for one reason or another.

These are complicated machines and they’re being launched into space. It’s actually more amazing that these kinds of setbacks don’t occur more often.

Nevertheless, it’s a black eye and no one’s going to dispute that.

May 2021 Issue

25

But investing long-term means looking past these short-term issues and evaluating long-term potential. And if you strip out the $28 million charge, Maxar performed in-line with expectations.

Leaving out the $28 million SiriusXM charge, total company revenues and adjusted EBITDA totaled $420 million and $95 million, respectively.

And with respect to the company’s Space Infrastructure segment, the SiriusXM charge was the difference between losing money and swinging to profitability — a loss of $12 million, compared to a gain of $16 million.

May 2021 Issue

26

Heck, even with the charge, Maxar’s Space Infrastructure unit demonstrated stronger revenue, earnings, and margins across the board...

“Putting it in context, I’m really encouraged with the underlying growth we generated across both the Intelligence and Space segment this quarter,” CEO Daniel Jablonsky noted. “Excluding the XM7 charge, we’ve increased the outlook for cash flow, maintained it for adjusted EBITDA, and modestly decreased it for revenue. Overall, a pretty good quarter and start to the year but for the charges on the SiriusXM satellite program.”

Indeed, cash flow turning positive again, reaching $27 million, is a big step forward for a company that was drowning in debt a short time ago.

Plus, Maxar will have a chance to redeem itself in short order with the SXM-8 — a twin of its failed predecessor, which has cleared final testing and been delivered for launch later this year.

We’ll just have to see how that goes.

For now, though, I’m giving the company the benefit of the doubt and viewing this week’s dip as a buying opportunity.

May 2021 Issue

27

Jushi Holdings (OTC: JUSHF)

And finally, cannabis company Jushi has announced its unaudited fourth quarter and 2020 earnings report.

Highlights for the quarter:

• Total revenue increased 30% to $32.3 million.

• Gross profit increased 44% to $17.6 million.

• Income from operations totaled $0.4 million — a $9.6 million improvement as compared to the fourth quarter of 2019.

And for the full year:

• Total revenue rose 690% to $80.8 million.

• Gross profit rose 760% to $41.5 million.

• Operational losses totaled $10.5 million — a $23.7 million improvement as compared to 2019.

• And the company had $168 million of cash, cash equivalents, and short-term investments on the balance sheet as of March 31, 2021.

You can see the company’s investments and expansion strategy are starting to pay off. And that’s going to continue as the cannabis industry is still a fledgling.

What’s really important, though, is that Jushi continues to cement its foothold and build its lead in targeted markets.

To that end, Jushi opened three new retail dispensaries in the fourth quarter and exercised an option to purchase an additional three dispensaries (two of which were operational).

Furthermore, Jushi has now also entered the Massachusetts cannabis market with the acquisition of Nature’s Remedy — a vertically integrated operator with two adult-use retail dispensaries and a 50,000-square-foot cultivation and processing facility.

May 2021 Issue

28

Nature’s Remedy can produce 6,800 pounds of cannabis annually at its Lakeville, Mass. facility. Additional expansion during the second half of 2021 will bring that figure to 11,000 pounds, based on 31,000 square feet of canopy.

It also owns 10 acres of land in Grafton, Mass., a site that could eventually accommodate 18,000 square feet of canopy inside a nearly 40,000-square-foot facility.

The cash-and-stock transaction is valued at $110 million, and includes a $40 million cash payment, $55 million in stock, and a $5 million promissory note.

An additional $10 million in stock-based milestone payments is also up for grabs once the deal closes during the second half of 2021.

“This acquisition will enable us to rapidly build scale in an important, maturing adult-use market with a defensible retail position and a solid cultivation footprint with significant opportunities to expand,” said Jushi CEO Jim Cacioppo.

In a video accompanying the announcement, Cacioppo said he expects Nature’s Remedy’s EBITDA to approach $24 million in 2021, and $38 million in 2022.

With the acquisition, Jushi now has operations in seven states, including three where it is vertically integrated.

May 2021 Issue

29

Perpetua Resources Antimony UpdateWhile Perpetua Resources (NASDAQ: PPTA) continues its laborious effort to get the Stibnite Gold Project off the ground, it’s important to remember that this isn’t strictly a gold play.

What gives the company a decisive advantage is that it also hosts antimony deposits.

And antimony is an important metal that’s widely used in electric cars, solar panels, hydro turbines, phones, spaceships, plastics, chemicals, and flame retardants. However, there is currently no active domestic source of the metal.

Instead China and, to a lesser extent, Russia have cornered the market.

That won’t do for a metal that is one of 35 federally designated critical minerals for its use in the national defense, technology, and green energy sectors.

However, the Stibnite Gold Project could supply approximately 35% of the American demand for antimony in the first six years of production, according to Perpetua’s feasibility study.

And that brings us to the latest news, which is that Perpetua has signed a collaboration agreement with United States Antimony Corporation (NYSE: UAMY) to study the potential for processing the Stibnite Gold Project’s antimony concentrate at USAC’s processing facilities.

The agreement outlines a plan for Perpetua to send samples of Stibnite’s antimony concentrate to the facilities owned by USAC to study the viability of entering into a long-term partnership to secure the antimony’s domestic sourcing.

May 2021 Issue

30

“Critical minerals are the building blocks of a strong domestic supply chain and play a key role in our transition to a greener economy,” Perpetua CEO Laurel Sayer said. “America has the brainpower, spirit of innovation, and work ethic to continue to solve some of the world’s toughest problems. However, we lack the minerals and materials we need to bring those solutions to life. Perpetua Resources can play a key role in re-establishing domestic antimony production and protecting America’s energy, technology, and defense future.”

ConclusionAt the time of this writing, the May market has largely been defined by a 4% drop that occurred from May 7 to May 12.

It seems like the jobs data and inflation numbers caught some people by surprise.

Regardless, I wouldn’t expect the Fed to change course.

They’ve really backed themselves into a corner with their dismissive attitude toward inflation.

So the question continues to be: How bad will it get?

Will the public and the investment community keep cool in the face of rising prices, or will they start to panic?

It’s hard to say.

All I know is I’m not panicking.

I never panic.

When the coronavirus hit and the market collapsed, I told my Wealth Warrior subscribers not to sell, but rather to buy back in and lower their entry prices for our portfolio positions.

Those that listened saw outstanding returns.

May 2021 Issue

31

I’ll say the same thing if we experience another correction.

Again, though, that kind of talk is premature. This could just be some of your standard “Sell in May and go away” fare.

We’ll just have to see.

In the meantime, I’ll keep adding new positions hoping to take advantage of the lower market prices.

So stay tuned.

Fight on,

Jason SimpkinsEditor, Wall Street’s Proving Ground

31

Wall Street’s Proving Ground © Outsider Club 2021, 3 E Read Street, Baltimore, MD 21202. All rights reserved. No statement or expression of opinion, or any other matter herein, directly or indirectly, is an offer or the solicitation of an offer to buy or sell the securities or financial instruments mentioned. While we believe the sources of information to be reliable, we in no way represent or guarantee the accuracy of the statements made herein. Wall Street’s Underground Profits and Outsider Club do not provide individual investment counseling, act as an investment advisor, or individually advocate the purchase or sale of any security or investment. Neither the publisher nor the editors are registered investment advisors. Subscribers should not view this publication as offering personalized legal or investment counseling. Investments recommended in this publication should be made only after consulting with your investment advisor and only after reviewing the prospectus or financial statements of the company in question. Unauthorized reproduction of this newsletter or its contents by Xerography, facsimile, or any other means is illegal and punishable by law.