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Welcome to the Deep State... No Need to Introduce Yourself

Written by Alex Koyfman
Posted March 9, 2017 at 2:55PM

You've probably heard the term "Deep State" thrown around in the media over the course of the last several months, but what is this ominous, mysterious force, exactly?

The idea is pretty simple, and pretty terrifying, no matter which side of the aisle you think of as your ideological home. 

Washington, D.C., the nerve center of the federal government, is actually divided into two distinct entities. 

One is highly visible and often talked about, while the other operates from the shadows and is traditionally only discussed by people who become labeled "conspiracy theorists."

In the last several years, however, the idea that there is an all-knowing, all-seeing shadow government out there, operating outside of constitutional limitations, has gained popularity with the mainstream. 

Now, as is the case with all good conspiracy theories, this one has a way of supporting itself, even in the absence of concrete evidence that the president, Congress, and everyone else we've elected is really just the hand puppet of a higher power. 

In this case, lack of evidence in the minds of believers is just evidence that operators of the Deep State are good at what they do. 

Not all evidence is lacking, however.

The One Really in Control is Always the First to Know

Regardless of its nature, positive or sinister, any sort of behind-the-scenes society within the federal government would have to have priority access to relevant information on potential threats.

It would have to be the most active intelligence-gathering agency in the world, in fact. 

Evidence of this is pretty abundant. 

Just three years ago, the NSA opened a data center outside of Bluffdale, Utah, with a rumored capacity big enough to store up to 1 gigabyte of data — or the equivalent of about 5,000 novel-length documents on a typical word processor — on each and every man, woman, and child living in the world in 2017. 


The place opened in 2014 and, despite the latest in efficient and green design, still racks up $40 million per year in energy costs. 

That's the price of running as many as 1 million Intel Xenon core processors simultaneously around the clock and storing data measured in exabytes (billions of gigabytes).

Just like the Deep State, which supposedly does things like swing elections, influence leaders, and control policies from behind a veil of secrecy, the actual work product — the visible benefits — of costly installations like this don't need to be evident to be believable. 

The Utah Data Center, just like everything else the NSA does, is done in the name of national security. 

There have been dozens of successfully foiled terrorist conspiracies since 2001, the details of which are often never offered, nor required by the general public. 

We understand the need for secrecy, and most of us don't want to let all those gory, sleep-destroying details creep into our calm, suburban lives. 

Ironic that it's this very mass sedation that has allowed billions to be spent by our own government on infrastructure designed to primarily spy on its own people. 

Want Proof? Look Up. 

Think I'm being paranoid? In March of 2016, the FAA published a report stating that U.S. airspace was already infested with no fewer than 2.5 million drones, the biggest, most expensive, and most capable of which were property of the federal government. 

The report went on to say that by 2020, that number should hit 7 million, with the biggest operators including state, federal, and local police and security agencies. 

With that much data streaming in from that many different points of reference, just from active, physical surveillance, it's no wonder that the NSA has to build hard drives the size of small cities just to manage it all. 

And don't forget all the information coming in based on passive screening and filtering for things like the right (or wrong) keyword search string, or the right browsing history, or the right degree of separation from a person of interest.

So much data concentrated in just one spot, available only to a select group of individuals within the federal government — unelected, I might add — and the theory of a Deep State is no longer so far-fetched. 

A natural evolution of the information-rich environment that the Internet has given to us, there's nothing that can be done to stem this collection and potential implementation of intrusively acquired evidence against whomever the powers that be deem important enough. 

In terms of the market it drives, however, what can we say from an investment standpoint?

Well, one thing is for sure: the need for more storage will grow, and rapidly. 

From the standpoint of the NSA, and from mathematical reality, it would be ideal to track everyone at all times. 

Given that ultimate goal — legal or illegal — the agency's demand for more data storage may never be fully met. 

Modern War... The Weaponization of Data

And who will supply the hardware that goes into these giant installations?

That list of suspects is far less covert than the activities going on within. 

Cisco Systems, Inc. (NASDAQ: CSCO) and HP (NYSE: HPQ) are big candidates to supply the all-important servers, while Intel (NASDAQ: INTC) is the go-to for the processing power. 

Another potential winner in this race to build the biggest data dump in history may be Google (NASDAQ: GOOG). 

Designers of their own servers since around 2005, the company has been purportedly in cahoots with the NSA for years thanks to its dominant market share in search.

Other companies that control major data nexuses include Facebook (NASDAQ: FB) and Microsoft (NASDAQ: MSFT).

These are large corporations that provide and oversee major aspects of your social networking and other online activities, and if you're asking yourself why would they bother sharing information you offer up voluntarily with secretive government agencies, the answer is: why wouldn't they?

Companies big enough to have anti-trust regulation fears as viable threats to their business models have nothing to lose and everything to gain from having the government owe them a favor. 

Call it one hand washing the other, with one hand being big business, and the other big government. 

Doesn't sound quite so crazy anymore, does it?

Too big to control and too far gone to stop, nothing short of bathing the world in a planetary EMP is going to halt the progression of the Deep State's ability to keep track of things, and make decisions for us. 

Fortune favors the bold,

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Alex Koyfman

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Coming to us from an already impressive career as an independent trader and private investor, Alex's specialty is in the often misunderstood but highly profitable development-stage microcap sector. Focusing on young, aggressive, innovative biotech and technology firms from the U.S. and Canada, Alex has built a track record most Wall Street hedge funders would envy. Alex contributes his thoughts and insights regularly to Wealth Daily. To learn more about Alex, click here.


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