Profits from Under the Sea

Written by Jimmy Mengel
Posted July 4, 2018 at 8:00PM

For centuries, man has been trying to create ways to hide among the waves of the sea. The ocean is a dark, foreboding place that’s mystified man for centuries. We’ve spent time immemorial above the waves, fishing and boating with little knowledge of what lies below…

But the desire for that knowledge, and the more practical reason of recovering treasure and salvaging valuables from sunken ships, has led many inventors to ponder the possibilities of deep-sea travel.

Alexander the Great is often thought to be the first major figure to submerge himself into the ocean.

Aristotle once recalled the tale of Alexander lowering himself into the water in “a very fine barrel made entirely out of white glass, so desirous was he of observing underwater life.”

Countless other inventors have dedicated themselves to solving the problem of breathing underwater.

Eventually, that led to the diving bell, which finally allowed divers to stay underwater for long periods of time.

Finally, man could start safely plundering for underwater treasures…

These rudimentary devices gave way to the machine that I want to talk about today: the submarine.

It is also the basis for the stock advice I’ll be revealing in just a moment.

This submersible vehicle revolutionized deep-sea exploration, naval warfare, and even helped to jump- start the U.S.’s first foray into a world war.

Cornelis Drebbel accomplished the first known prototype of the submarine around 1620. Drebbel was hired by King James I to create a “diving boat” to explore underwater. His invention, Drebbel I, was a sealed rowboat that was operated by 12 oarsmen.


It debuted on the River Thames and was able to dive up to 15 feet underwater.

It was only a matter of time after the Drebbel I was unveiled that the military possibilities were unleashed.

America’s War of Independence marked the first time that a moving submarine attacked a ship. The Turtle was a one-man boat operated with a hand crank that could move the propellers either vertically or horizontally. The idea was that the Turtle could sneak up on a ship and unload an explosive device to the hull.

Talk about a terrifying naval assignment to receive: “Sergeant! Crank this bulbous bicycle into the water, paddle up to that warship, and slap 150 pounds of gunpowder onto that sucker!”

In 1776, Sergeant Ezra Lee was tasked with using the Turtle to attack the British warship HMS Eagle in New York Harbor. He ultimately failed to attach the gunpowder explosive, but history was made nonetheless.

But we kept improving.

In 1900, the first U.S. submarine was commissioned: the USS Holland. It was named for the inventor John Philip Holland and had an internal combustion engine (ICE) on the surface of the water and electric battery power underwater.

It helped set the tone for the modern submarines that we see today, and could now become a treasure trove for investors...

The U.S. has fallen far behind in submarine forces. According to the 2016 Navy Force Structure Assessment (FSA), we need at least 66 attack subs to “provide the global presence required to support national tasking and prompt war-fighting response.”

Our current fleet hovers around 52 and is expected to lose around 20% of that over the next decade.

But China has just built nine new nuclear submarines with much quieter engines. And Russia recently announced plans to modernize its fleet and add six nuclear subs by 2021.

Admiral Harry Harris, commander of U.S. Pacific Command (USPACOM), testified to Congress that he gets only half of the submarines that he needs to perform his missions.

Enter President Donald Trump and his latest defense-spending bill, which authorizes increased production of attack submarines.

Here’s the company that will start building the fleet back up…

General Dynamics Corporation (NYSE: GD)

General Dynamics Corporation operates as an aerospace and defense company worldwide. The company was incorporated in Delaware in 1952. From that time to the 1990s, the company has provided tanks, rockets, missiles, submarines, warships, fighters, and electronics to all the military services.

But GD goes way back — all the way to John Philip Holland’s Holland Torpedo Boat Company. GD helped to develop the U.S. Navy’s very first submarines. We need subs, and General Dynamics happens to be very good at making them. So good that the Navy just awarded the company a $5.1 billion contract to complete a new fleet of ballistic missile submarines, which are due to be constructed by its subsidiary General Dynamics Electric Boat.

General Dynamics won the rights for design, completion, component and technology development, and prototyping efforts for the 12-ship Columbia-class fleet of ballistic missile submarines that are designed to ensure second-strike capability and spearhead strategic deterrence efforts.

Naval submarines are responsible for half of the Department of Defense's (DOD) nuclear warheads through the government's "No. 1 mission" of strategic deterrence. The new Columbia-class subs will replace the existing 14-ship fleet of Ohio-class nuclear ballistic subs. Construction will start in 2021, with first patrol in 2031, and will serve until 2085.

They will carry 16 Trident nuclear missiles each.

All told, the fleet will cost an eye-popping $100 billion over its lifetime! And General Dynamics will play a major part in that. The company will complete 80% of the work for the Columbia-class subs and keep the company rolling for years…

Nobody knows this better than our own Jason Simpkins, who has just unveiled an entire newsletter dedicated to defense. It’s called The Wealth Warrior and it is being launched at exactly the right time. But threats from land, air, or sea aren't what keeps Jason up at night. He is most concerned about the threat of cyberattacks.

So while General Dynamics will be a solid play for years to come, it won't make you rich overnight. Jason is looking into the future and betting on the small companies that will eventually become the big guns in cybersecurity — and potentially the most profitable stocks you're likely to see in this lifetime.

His latest research reveals the fortunes to be made equipping the soldiers of the 21st century: “cyberwarriors.”

You see, governments and corporations are literally under attack from hackers across the globe, and that’s why they’re hiring armies of cyberwarriors who can mount a defense.

It’s the reason why the $84 billion cybersecurity space is expected to grow to a whopping $232 billion by 2022.

This cyberwarrior firm is providing the expertise and weapons everyone needs...

Do yourself a favor and check out his groundbreaking research…

Godspeed,
jimmy-mengel-signature-fixed

Jimmy Mengel

follow basic @mengeled on Twitter

Jimmy is a managing editor for Outsider Club and the investment director of the personal finance advisory, The Crow's Nest, and cannabis stocks advisory, The Marijuana Manifesto. For more on Jimmy, check out his editor's page.

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