King: Lessons I Learned from New Jersey

Seeing a battleship in drydock reminds us what it takes to build great things. May 02, 2024 [WEBSITE]( | [UNSUBSCRIBE]( Lessons I Learned from New Jersey BYRON KING Sean Ring asked if I had an article for you, which works nicely because there’s something right up his old alley. That is, a couple of weeks back, Sean discussed [how he’s originally from New Jersey](. But eventually, he fled the Garden State to travel, work abroad, see the world, get married, and have a family. Now, Sean lives in northern Italy. So, Sean is gone, but New Jersey remains. And I just visited the place, meaning both the jurisdiction and the battleship of the same name; yes, I visited the old USS New Jersey (BB-62), a museum vessel usually berthed at Camden, except not just now. I had some business near Newark, so I flew over. And on the ground, I had a rental car, so I drove down to Philadelphia to see the mighty warship, currently in drydock at the Philadelphia Ship Repair facility, part of the North Atlantic Ship Repair Group. Right away, we have an investment lesson, if not a lesson about life, which is to seize your opportunities. And definitely, I’ve never seen a 55,000-ton battleship up on blocks in drydock. That’s a once-in-a-lifetime thing, I suspect, so I went on the [Battleship New Jersey]( bought my ticket, and packed my gear for an industrial site visit. Your editor at Drydock #3, Philadelphia Ship Repair company, with Battleship New Jersey in the rear. Note: There may be a few tour tickets left for visits later in May, but you should hurry if you want to see this ship from the underside, looking up. Let’s Discuss Battleships The Rude is mostly an investment-oriented letter, so I’ll offer economic and industrial-oriented comments as we proceed. But it’s all going to filter through the lens of battleships. Don’t worry, though; it’ll be fascinating. And I’ll show photos because I know how much our readers love photos. Image courtesy of Battleship New Jersey Museum, Camden, NJ. Battleship New Jersey is normally tied to a pier in Camden, across the Delaware River from Philadelphia. There, it’s been a museum for over twenty years. On a clear day, you can look down and see the ship when you fly in or out, north of Philadelphia International Airport. Congress authorized the construction of the battleship in 1939, pre-World War II, because people back then knew that something really, seriously bad was coming down the line, and they had to prepare. The keel was laid in 1940 in the former Philadelphia Naval Shipyard, which closed in the 1990s but is now reopened and under private ownership. So, from its birthplace to the present, we’re talking about the very same locale. Another way to state things is that the institutional Navy built the USS New Jersey when the government owned and operated big industrial facilities like shipyards. And yes, the Navy still runs what it calls “public shipyards,” e.g., Portsmouth, NH, Puget Sound, WA, and Pearl Harbor, HI. But these sites only repair ships and submarines, all of which are built elsewhere. Along these lines, it’s worth noting that except for submarines, there’s very little design-build capability left in the Navy or anywhere else within the federal government. Heck, there’s a scary paucity within the government of what’s called “technical authority” over complex systems. Even program supervision and contract oversight are problematic. It’s why, say, SpaceX outdoes NASA. The Navy launched the hull of New Jersey on December 7, 1942, one year to the day post-Pearl Harbor. Then, the shell underwent about eighteen months of completion work in and out of Drydock #3, where she presently sits again for repairs. Important lesson here: Big, complex things take time to design, arrange for long-lead components, and then build and test. This pertains to battleships, to be sure; but the same idea also applies today, for example, to the politically mandated reboot of our nation’s energy grid and transport system. In other words, and not to put too fine a point on it, anybody who says that the U.S. (let alone the world) will somehow transition to, say, electric vehicles or be “net-zero” for carbon by 2035, or 2040, or even 2050 doesn’t know what they’re talking about. Meanwhile, if you think that your country will one day go to war, you should never stop planning for exactly that, and I mean planning over decades. Because wars require industrial facilities like shipyards, and much else. Plus, you need steel and other metals, plants that build machinery, and armies of trained workers who can do things like bend and shape materials, install pipe and wire and engines, and generally build ultra-complex systems of systems. Indeed, you don’t fight and win wars with a service economy. You fight and win wars with an industrial economy, because decisive military power is the first derivative of energy and industrial power. And de-energized, deindustrialized countries don’t win wars; they lose them. Ask a Ukrainian. Welcome Home, New Jersey! At any rate, after two decades of floating next to her pier in Camden, this is the year – 2024 – to bring New Jersey in for a drydock period, the first since the early 1990s. The idea is to remove the crud from the hull, take the paint off and get down to the bare metal, inspect for leaks or other issues like corrosion, and give the outside a new coating for the next thirty years or so. Perhaps of interest to some readers, the total thickness of several layers of marine-quality paint on New Jersey will be about twelve times what you have on your car. In late March, the battleship was towed down the Delaware River towards its temporary repair destination, carefully timed with the tides so as to move safely beneath a major highway bridge. No Baltimore-type accidents for this noble ship! Then, the engineers and marine architects pumped some nice, wet river water into the ballast tanks to trim the ship properly for moving into drydock. New Jersey pushed and towed, stern first, into Drydock #3. Fox29 screenshot. And definitely, there’s nothing easy about a parking job like this. Bring her in, and don’t bump into anything. Fox29 screenshot. Once the ship was parked, exactly and to the last inch over the top of massive concrete blocks, the drydock workers closed a cofferdam and then drained the water. The ship settled down onto new foundations for the maintenance period. Blocks carefully arranged to hold the ship along its keel structures. Courtesy USA Today. The timeframe and budget for all of this work is two months (April and May), at a cost of over $10 million, every dime of which had to be raised by the Battleship New Jersey Museum and Memorial. That is, no U.S. Navy budget money went into the kitty for repairs. The museum is on its own. And to be clear, $10 million is a lot of money, especially when you don’t have it. So just the fundraising was a long process of asking, asking again, and asking some more. Indeed, the sale of tour tickets for the drydock is what brought in the last million-or-so bucks: that, plus selling hunks of scrap teak wood from the deck, and even tiny bottles of hull rust as souvenirs. Teak wood and bottled rust for sale; USS New Jersey. Down in the Drydock For the drydock visit itself, the trip to the base of the structure began with a walk down 150 concrete stairs. Down we go for 150 steps. BWK photo. Everything about this ship is massive, like the four manganese-bronze screws and the twin rudders that are each larger than a typical house. Twin rudders, with people for scale. Big! BWK photo. Here’s another view of those rudders, with the screws in the same view. [AI Discovery Leaves Oncologists Speechless: Has One Tiny Company Just Found The TRUE Cause Of Cancer?]( New AI Discovery Will Blow You Away… [>> Click Here Now For The Urgent Details <<]( [Click Here To Learn More]( Four screws, two rudders; everything about this ship is big. BWK photo. And yes, we walked beneath the hull, with 55,000 tons of steel overhead, but it was all sitting on those concrete blocks, with about a foot of wood on top of them, squeezed down to about nine inches. Your editor, crouching beneath 55,000 tons of steel. BWK photo. Looking up from the floor of the drydock, the ship itself looms high overhead, and that’s just the view to the main deck, with no topside structures visible in the picture. Grand Canyon of Battleship New Jersey in drydock. BWK photo. And no tour is complete without a shot looking straight towards the bow of this immense ship. Looking at the bow of the battleship from atop the drydock cofferdam. BWK photo. To end the tour, here’s a shot of your editor with the absolutely awesome, truly outstanding, endlessly energetic curator of the Battleship New Jersey Museum, Ryan Szimanski, star of many YouTube videos. To whom all battleship fans owe a debt of gratitude. Your editor with Ryan Szimanski, curator of the museum. BWK photo. Final Thoughts From bow to stern, and every inch in between (887 feet, 7 inches, per spec), a World War II era battleship like USS New Jersey was, in its time, one of the most complex machines ever built. Sure, in a military sense, battleships like this are obsolete now. They’re costly to operate, and we live in an age of hypersonic missiles. Still, the fact remains that whatever might be the standard of today, back then battleships were the pinnacle of human engineering. And in that respect, it’s no stretch to say that the ideas, attitudes and design philosophies that went into battleships remain timeless. That is, when you want to build difficult things and work at the very edges of knowledge and technical capability, you put your best people and resources into the project. You don’t skimp. Consider how only the very best materials and machinery went into a battleship: the best steel in the frames and plates, let alone the armor plate; the best electrical equipment; the best piping and steam systems; the best guns; the best of you-name-it. And, of course, ships like the USS New Jersey reflect phenomenal quality at every level, in terms of human skills that range from designers and naval architects to welders and countless other trades and crafts. And let’s dive even deeper into the industrial legacy of a naval program that gave the country a ship like the USS New Jersey. The hull that slid down the launch-way and cut water in 1942 was the culmination of a long march of technology, with deep roots that date back to the 1880s, if not before (long story). In terms of scale, it’s worth recalling that the Navy spooled up just this one battleship program (out of many other armaments programs) right before the war, beginning in 1939. Until the end of the conflict in 1945, the U.S. built six of these gigantic vessels: USS Iowa, New Jersey, Wisconsin, and Missouri, and two unfinished ships that were never commissioned, USS Illinois and Kentucky. This all happened in the late 1930s and early 1940s in a country with a population of about 140 million and an economy emerging from the Great Depression. So it’s not unfair to ask: Can the country do anything even remotely similar today? And if so, what sort of project might that be? And if not, then why not? What’s missing today? What has changed so profoundly in the past 80 years? What has the country gained? What has it lost? Deep questions, yes. But if you can wrap your head around issues like these, you’re well on your way to becoming one of the best investors ever to walk the waterfront, because you can see things that others have missed entirely. With that, I wish you well. Many thanks for subscribing and reading. All the best, Byron W. King for Rude Awakening P.S.: Okay, if you insist. More shots of the USS New Jersey entering into drydock. Fox29 Screenshot. And this: Fox29 screenshot. And finally: Big ship, eh? Battleship New Jersey Museum and Memorial. Rate this email Like Dislike Thanks for rating this content! Looks like something went wrong. Please try to rate again. In Case You Missed It… Time For a Breather SEAN RING April 2024 Monthly Asset Class Report We ended April with a stinker of a day. Everything was down over 1%. That’s made the charts look much worse than they did on Friday. Stocks took a hit, but I’m not ready to call time on this rally… yet. I think we’ve got far more upside to go. Bonds are performing terribly in this inflationary environment, except for junk. That’s because junk bonds have equity characteristics. Crypto got taken out back behind the woodshed this month. Only Monero suffered single-digit losses, while the rest were nursing double-digit drawdowns. Despite the last two weeks of losses, the one bright spot is metals, especially gold, silver, and copper, which performed well in April. Gold closed at another monthly all-time high despite the sell-off, while silver touched the $28 level before retreating. Copper has rallied hard, though I’m not sure that will last. Future price action depends on what the Fed does in the coming months. On CNBC yesterday, noted financial commentator and author James Grant said the Fed has as much of a chance of raising rates as cutting them. I agree with him in principle. But since there are no principles when it comes to politicians bribing the electorate before an election, I’m leaning heavily toward a cut or two despite the fact that it makes zero economic sense to me. We need a bit of pain, but democracies are notably pain-averse, and their politicians are unlikely to dole it out voluntarily. With that said, let’s get to the charts. S&P 500 From two months ago: Looking at this chart, there’s no reason in the world to be short. We may take a breather in the coming weeks, but I’d still participate in this rally. The long-term target remains 6,000. With all the fiscal stimulus coming through and despite the Fed not cutting rates anytime soon, I’m still long here. This is the breather we needed as we head down the election-year homestretch. Nasdaq Composite Same, same, but different, as they say in Asia. I don’t think this rally is done. There are too many goodies to be had by politicians bribing voters this November. Hang in there. Russell 2000 (Small caps) The Russell 2000 has shown remarkable resistance in the face of this wave of selling. This 195 level looks like it went from resistance to support. Whatever you think of Joke Biden’s policies, the end isn’t nigh… yet. The US 10-Year Yield It is still in ascendency. This should put pressure on stocks, metals, and crypto, and it has. Of course, this also strengthens the dollar. Rates up, assets down. But the assets aren’t crashing yet. We’ll get a cut late in the year despite all economic sense, thanks to Jay Powell's goosing of Biden’s failing campaign. Dollar Index Okay, we’re nearing a breakout here. If we get above 107, the next level is 111. Above there, we get to the 114-115 area. Much depends on what the Fed does in the coming months. But this dollar strengthening doesn’t necessarily mean gold will head down. USG Bonds I called 90 last month, and I was too timid. Here we are at 88. Is there anything more hatable right now than bonds? “Yours! In size!” as my old trader friends used to say. Investment Grade Bonds Investment-grade bonds had a rough month as well. After a consolidation, they’ve been dumped like their government brethren. I can see us testing the 100 level from here. High Yield Bonds Junk is only off a point this month, and that’s because they act more like equity than debt. A rangebound month may be in order again. [Urgent: Claim Your Copy Of This New Book From America’s #1 Retirement Expert!”]( Forget everything you’ve ever been told about retirement. According to [this new book]( – written by America’s #1 retirement expert – you don’t have to wait until you’re 65+… and you don’t need millions of dollars. [The strategy you’ll find outlined inside this book]( is completely different… All you have to do is tap into the little-known income streams revealed inside this book… And you’ll learn exactly how you can generate almost effortless income every month… instantly, in some cases! [And today, for a limited only, you have the chance to claim a copy of this book for just $1. Click here now to claim your special book offer.]( [Click Here To Learn More]( Real Estate I got this one wrong. Real estate is finally hurting in the US, as one would suspect it would. 76 is our first target, and 70 is our next target. Energy: West Texas Intermediate (Oil) And oil does a U-turn! With inflation where it is, the world economy must be in the toilet for oil to trade like this. It could be a breather before we head up to 92… or it could be a prelude to a fall back down to 70. Base Metals: Copper We blasted through my 4.30 call to 4.56. But this rally was too much, too fast, and I can see us heading back to 4.30 before taking off again. Precious Metals: Gold ***NEW MONTHLY RECORD CLOSE OF $2,302.90.*** From last month: $2,609 is our new target, but it may take a few months to get there. We needed a crappy two weeks to catch our breath. I’m still eyeing that $3,000 mark long-term. Precious Metals: Silver From last month: Up $2 from last month. When silver awakens, watch out! Above $26, and it’ll start to chase, and then surpass, Gold’s performance. GIDDYUP! I’m still a believer… Cryptos: Bitcoin I was looking for a pullback to $66,700. Only off by a “tad.” We can get down to $52,000 before a rebound starts to happen. Cryptos: Ether Ether is stinking to high heaven right now, as well. 2400-2500 zone is my next target down. Once it composes itself, we’ll see a rally again. Trad Asset Class Summary The dollar won the month, which means everyone else lost. Commodities were pretty flat, though down slightly. The broad market and the long bond were both down around 4%. Crypto Class Summary Crypto, in general, stunk up the joint in May. Monero was the least affected, as it also had a rough March, down only 3% or so. The rest were down double digits, with Dogecoin leading the way at down 35%. Wrap Up Stocks, crypto, and gold. It’s the same simple formula from last month. Long live the rally! Finally, let’s take a moment, courtesy of the Twitterverse: Have a wonderful day! All the best, Sean Ring Editor, Rude Awakening Twitter: [@seaniechaos]( ☰ ⊗ [ARCHIVE]( [ABOUT]( [Contact Us]( © 2024 Paradigm Press, LLC. 1001 Cathedral Street, Baltimore, MD 21201. By submitting your email address, you consent to Paradigm Press, LLC. delivering daily email issues and advertisements. To end your Rude Awakening e-mail subscription and associated external offers sent from Rude Awakening, feel free to [click here.]( Please note: the mailbox associated with this email address is not monitored, so do not reply to this message. We welcome comments or suggestions at feedback@rudeawakening.info. This address is for feedback only. For questions about your account or to speak with customer service, [contact us here]( or call (844)-731-0984. Although our employees may answer your general customer service questions, they are not licensed under securities laws to address your particular investment situation. No communication by our employees to you should be deemed as personalized financial advice. We allow the editors of our publications to recommend securities that they own themselves. However, our policy prohibits editors from exiting a personal trade while the recommendation to subscribers is open. In no circumstance may an editor sell a security before subscribers have a fair opportunity to exit. The length of time an editor must wait after subscribers have been advised to exit a play depends on the type of publication. All other employees and agents must wait 24 hours after on-line publication or 72 hours after the mailing of a printed-only publication prior to following an initial recommendation. Any investments recommended in this letter should be made only after consulting with your investment advisor and only after reviewing the prospectus or financial statements of the company. Rude Awakening is committed to protecting and respecting your privacy. We do not rent or share your email address. Please read our [Privacy Statement.]( If you are having trouble receiving your Rude Awakening subscription, you can ensure its arrival in your mailbox by [whitelisting Rude Awakening.](