Casey’s “What’s Facebook Hiding in Building #17…?” Pitch

Looking into the pitch about Facebook's hiring of DARPA engineers for a secret "Area 404" project...

By Travis Johnson, Stock Gumshoe, December 13, 2016

This latest spiel from Casey Extraordinary Technology caught my eye because it includes so many silly enticements… the hint of mystery, the photo of the secret building that a big company never talks about, the connection to unusual world elites (a scale model hand delivered to Pope Francis” and, of course, “a technological breakthrough not even science fiction had imagined.”

So what is it all about? Well, the ad is pitching subscriptions to Extraordinary Technology ($1,500/year), and the “secret” that they’re using to pull you into the ad is really just drones.

Drones aren’t really shocking or secret to most folks anymore, not when half the kids in the neighborhood have little toy “drone” cameras flying around and we all see the stories about increasing military and police dependence on drones for both surveillance and weapons systems… but let’s see what it is that Extraordinary Technology editor Chris Wood is actually recommending as a buy.

His “special report” that comes with your subscription is called “How to Invest in the New ‘Drone Economy,'” and it looks like he’s essentially pitching three drone-related stocks. So what are they?

Well, I’ll skip through most of the looooong lead-in to the specific investment ideas, but let me just give you a little taste of the ad so you can see where Wood is coming from — this is the intro:

“Something extraordinary is being assembled at Facebook Headquarters… and it’s so sensitive… not even Mark Zuckerberg is allowed into the room holding it without prior special permission

“WHAT’S FACEBOOK HIDING IN BUILDING #17…?

“Why was a scale model of it hand delivered to Pope Francis?

“Wall Street knows the answer and so should you!

“Early investors in this revolutionary technology are in a perfect position to see another 1,152% gain in just over 2 years!”

And he spins a tale about Facebook’s big investment in this “secret” project that they run out of “Area 404” … and then the “shocker” ….

“Facebook isn’t the only company building this thing… this device.

“Google is attempting to build it, too.

“As are other tech heavy weights like Intel and Microsoft.

“They’re all building their own versions of it.

“And here’s the real shocker…

“Not one of these companies has any intention, as far as we know, of selling these devices.

“Not to consumers, you and me, not to businesses – not to any one!

“They intend to keep these devices all for themselves….”

So those are, of course, drones — and yes, Facebook is developing them and Google is developing them and pretty much every big company is figuring out how to build or use them to improve their products. Facebook’s is part of their continuing effort to expand internet access to off-grid areas of the world using large solar-powered drones that will act kind of like wireless towers to extend wireless networks, Google is testing drones for similar internet access expansion as well as for more mundane efforts like delivering Chipotle burritos, Apple is using drones to improve its mapping data… you get the idea.

Saying that they’re not intending to sell them is beyond the point — that’s sort of like saying that UPS is designing more efficient trucks and fueling networks and routing software but not intending to sell them to competitors, or that Amazon’s warehouse-management robots are not going to be sold to competitors… all of which is true but not at all surprising. Not all R&D is intended to develop products for sale, much of it is designed to improve existing products or services or internal business processes.

But that’s not the point, really — the point is that Wood thinks we’re on the verge of the next big industrial revolution, fueled by drone technology, and that his ideas for investing in this segment now could end up being as exciting as early buys in Standard Oil or IBM or Microsoft or Intel or Apple or, well, you can pretty much just throw in any other hyper-successful company and say “what if the little guy you’re buying now ends up being the next Apple?”

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And it is undeniably pretty cool — this is a video of a Facebook Aquila drone test flight

But will it make us any money? Will drones actually “transform the entire American economy?” I’m not sure, but let’s look into the stocks Wood thinks will be the beneficiaries. He quotes a variety of analysts and market researchers who indicate that the drone industry could be worth $27 billion a year, or $100 billion, or $127 billion… presumably that means “revenues”, but at this point those are not much better than made-up numbers, though perhaps they can help to give people some idea of scale.

And it almost goes without saying that drones will not have a material impact on Facebook, Google, Apple or Amazon anytime in the next year or two (and probably quite a bit longer, though one hesitates to do much prognosticating during fast-changing times) … so what are the stocks that are closer to being “pure play” drone investments?

More from the ad:

“DRONES COULD CHANGE OUR WAY OF LIFE… OUR CULTURE, AND OUR SOCIETY!

“For that reason and many others, which I’ll share with you…

“You’d be wise to take positions right now in three drone-related companies