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Big Brother … but Big Opportunity

Big Brother … but Big Opportunity

When it comes to personal privacy, I’m a purist.

I just don’t like the thought of big institutions tracking my every move. It makes me feel less free.

In fact, I feel so strongly about the issue that I researched and wrote a Bauman Letter special report explaining how you can protect your privacy. (If you’re not already a subscriber, find out more here.)

If you’re anything like me, then you’re not going to like one of the inevitable consequences of the COVID-19 pandemic … because it will have serious implications for privacy.

The stock market is betting on a vaccine just around the corner, but the science says that it could be years away.

In the meantime, I’m betting on the rapid development of techniques to control the spread of the virus, using existing technology.

Like it or not, the companies that provide those techniques will profit enormously from what’s coming … and so will anyone who invests in them.

Your Temperature, Please

CLEAR, the company that operates biometric ID kiosks at U.S. airports, is about to introduce a product that will link personal health data to verified IDs. It’s intended to help businesses screen employees for COVID-19 as the economy opens back up.

It is called Health Pass and it launches this week.

Here’s how it works: you download the CLEAR app on your smartphone and enroll in the service using facial recognition.

To get into your workplace, you’d be screened at a CLEAR kiosk. There, you’ll share your health data and verified ID through the app. The kiosk may even take your temperature. If you pass, you can enter the building. If not, you’re out of luck.

CLEAR adds health status information to existing ID platforms. But, it’s not the only company leveraging existing technologies to track the virus.

Apple Inc. (Nasdaq: AAPL) and Alphabet Inc.’s (Nasdaq: GOOGL) Google are working together on a Bluetooth-based technology that will use “contact tracing” to track the spread of the virus.

Your smartphone will scan your immediate environment for Bluetooth “identifier beacons” from other people’s smartphones.

If someone tests positive for COVID-19 and enters it into the app, the identifier beacons of everyone they’ve been close to for the last two weeks are sent to a central server. If you are one of those people — say, you were in a restaurant over the weekend and someone there was infected — you’d get an alert telling you, so you can get tested.

Remark Holdings Inc. (Nasdaq: MARK), a Las Vegas-based purveyor of facial recognition systems, recently upgraded its KanKan AI platform to include thermal temperature imaging and the ability to recognize people wearing masks. Already widely used in China, KanKan is aggressively courting new business for U.S. workplace and public safety applications.

The stock market clearly likes that idea.

MARK was up over 65% yesterday on reports that KanKan was deployed at the reopening of Disney’s theme park in Shanghai — and that several U.S. sports leagues are in discussions to deploy it before the end of the year.

If You Can’t Beat Them…

As an individual, none of this makes me happy. At least I can take comfort in the fact that I’ve been predicting for years that technologies like these would find new uses.

But as an investor, I detect serious opportunity here.

Whether or not I like it, the only feasible way to reopen our economy is to use any means possible to track the spread of the virus.

And there are a lot of very impatient businesspeople out there in a great hurry to get our economy reopened. They will snap up these technologies as soon as they can and use them to convince customers that they are ready for business even without a vaccine.

If you want to get in on this trend now, one way is to buy the ALPS Disruptive Technologies Exchange-Traded Fund (DTEC). Its holdings are dominated by companies on the cutting edge in areas like biometrics, biotechnology and artificial intelligence.

In the context of COVID-19, these technologies are arguably adaptive rather than disruptive … but that’s precisely what’s going to make them so profitable in years to come.

Kind regards,

Ted Bauman Signature
Ted Bauman

Editor, The Bauman Letter

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