Happy Memorial Day

Dear Outsider,

On this Memorial Day, I want to write a few words to remember those who made the ultimate sacrifice. Without them, we wouldn’t have the privilege of living in the greatest country in the world. And to all the military families and veterans out there, we thank you.

I come from a military family (go Navy!). My great-grandfather left Princeton to drive ambulances for the French army in World War I and then fought in the American trenches. Two more of my great-grandfathers fought in the British trenches. Several of my great uncles fought in World War II (for the British and Americans), including one in the Special Air Service (SAS) who landed on D-Day and one who was shot down over the Pacific but luckily parachuted to safety. My grandfather served during the Korean War, and two more great uncles were in Vietnam. My father and uncle are retired Navy, and one cousin is currently in the Army. My ancestors even fought in the Revolutionary War; one was a general.

So I’m indebted to the hard work, dedication, and sacrifice of those in the armed forces. Let’s all be safe and enjoy ourselves on this hard-earned day off.

And it goes without saying that we all wish for the violence to come to an end in Ukraine and other parts of the world that don’t get enough media coverage.

The Cracks Are Forming

Last week, reports came out that two pro-Ukrainian Russian military groups pushed their way into Russian soil. It’s being called the Belgorod border raid.

The groups want to overthrow the Putin regime from the inside.

This poses a massive problem for the U.S. because the fighters reportedly used American armored vehicles. According to NBC, Washington “has sought to ensure that equipment sent to Kyiv is not used in attacks on Russian soil.” Obviously, that’s nigh on impossible to control.

Russian President Vladimir Putin has repeatedly hinted that if Russian sovereignty is threatened, he could resort to more rash measures, like a nuclear attack. Even Kremlin spokesman Dmitry Peskov said earlier this year that Russia would use nukes if Russia’s existence as a state was threatened.

So as cracks are forming in the Russian lines, we’re starting to see more signs of this desperation.

In Putin’s annual address to the Federal Assembly in Moscow this year, he delivered a stark warning to the West:

In the beginning of February this year there was a statement from the North Atlantic Alliance demanding that Russia returns to the Strategic Arms Treaty, as they call it, including allowing inspections of our nuclear defense facilities. I don’t even know what to call it. It’s a theater of the absurd. A week ago, I signed a decree to put new ground-based strategic complexes on combat readiness...

Intelligence officials are still unclear about exactly what he’s referring to when he says “ground-based strategic complexes.” But Russian state TV released a video last year detailing how the country’s undetectable underwater nuclear drone “Poseidon” could create a nuclear tsunami, “plunging Britain into the depths of the sea.” And Putin himself released a video last week saying he wasn’t bluffing.

Putin continued his address:

They want to deliver us a strategic defeat while sneaking into our strategic nuclear objects. Regarding this, I have to say that Russia suspends its participation in the New START treaty... Russia does not abandon the treaty but suspends its participation. Before resuming the discussion about this treaty, we must first understand what such countries of NATO, like France and Great Britain, aspire to do.

This statement received a round of applause from a room full of emotionless faces.

Now, the New START Treaty was put in place in 2010 and restricts the number of nuclear warheads that Russia and the U.S. can have deployed at any given time. The deal came with some stipulations, like on-site inspections of nuclear facilities.

Is this all just a negotiating tactic?

In an interview with NPR, Harvard Kennedy School professor Matthew Bunn said, “Most nuclear experts say the likelihood of Russia actually using a nuclear weapon is still relatively low, but given Putin's current predicament and his public statements, the threat is seen as increasing.” He went on to say that there’s a 10%–20% chance that Russia might use a nuke.

Those aren’t good odds!

What's the U.S. to Do?

All these talks of nuclear weapons put the U.S. in a very precarious position.

As Russia gets backed into a corner, Putin could get desperate, and it won't end well.

It’s a subject my colleague and defense expert Jason Simpkins is following closely.

He says it’s not only Russia that poses a threat but also China.

China’s been quietly working on “smart missile” testing — think hypersonic missiles.

Suddenly out of nowhere, these "smart missiles" have made our $200 billion missile defense system obsolete.

We don't want these weapons to get into the wrong hands.

Now we have to rethink our entire defensive position.

That's not good.

But it's why the Pentagon is pouring money into the “smart missile” race.

The U.S. won't let this slip through the cracks.

Our livelihood depends on it.

And once word gets out that a significant portion of that money is flowing into one tiny U.S. company...

Well, it'll already be too late to invest.

For more information on hypersonic weapons, the company spearheading the U.S. response, and a huge potential profit opportunity, we've released a full report for you here.

Have a great Memorial Day.

Stay frosty,

Alexander Boulden
Editor, Outsider Club

After Alexander’s passion for economics and investing drew him to one of the largest financial publishers in the world, where he rubbed elbows with former Chicago Board Options Exchange floor traders, Wall Street hedge fund managers, and International Monetary Fund analysts, he decided to take up the pen and guide others through this new age of investing. Check out his editor's page here.

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