Energy and Labor Shortages Are Front and Center

Dear Subscribers,

Welcome to Extreme Disruptions Trader.

Market Commentary

Last week, we saw equity markets rebound. We also experienced the first 5% market pullback in nearly a year.

Congress agreed to kick the debt ceiling can down the road until December. That boosted investor sentiment a little. That’s the good news.

But volatility continues at high levels. Fueling that fire are high energy prices, continuing supply chain issues and labor market shortages.

A record 4.3 million people walked away from their jobs in August. That’s roughly 2.9% of the workforce. Almost 900,000 of them worked in restaurants, hotels and bars.

Contrast that with the country’s 10.4 million job openings at the end of August. The huge number of available jobs provides leverage to those who want to seek better pay and benefits.

Roughly 20% of those looking for work want to work remotely. But only 194,000 people found jobs in September.

In spite of all the job openings, the nation’s workforce is still 5 million below pre-pandemic levels.

Portfolio Update

One of the most exciting companies in our portfolio is Beam Global (Nasdaq: BEEM). Beam makes self-contained, portable electric vehicle (EV) charging stations.

The stations get their power from solar panels and store the energy in batteries mounted on the units. They can be installed in minutes and require no connection to grid power to operate.

Yesterday, the company announced its order backlog is more than $7 million. That’s a new record for Beam.

It also indicated that its sales pipeline was $75 million at the end of the third quarter. That’s a big jump from the $50 million pipeline it had at the end of the second quarter. And that’s also a new record for the company.

While our shares are still 10% below where we purchased them, Beam is an excellent long-term way to play the exploding EV market.

Another great way to play the EV market is via Talon Metals Corporation (TSX: TLO). Talon is developing the Tamarack Nickel Project near Tamarack, Minnesota.

Recently, the company announced that it’s seeing record levels of nickel from recent drill holes at the Tamarack site. That just increases the value of the resource.

Nickel is widely used in lithium-ion batteries. And we could see a big shortage of nickel in just the next few years. That bodes well for nickel miners and shareholders of Talon Metals.

But it’s still early days for the EV ramp-up. And investors looking to profit from it need to invest early and be patient.

That’s all for this week. I’ll be traveling next week, so you’ll receive your next issue – and an important announcement – on October 27.

Good investing,

Dave

To view the current Extreme Disruptions Trader portfolio, click here.