Borrowing costs, as measured by US Treasury securities of varied maturities, are up. Nominal rates have gained each day thus far in 2021. While no claim is made here that one should bet on several imminent down days for corporate stocks, there is a chance of it because financial conditions have tightened. The situation coincides with pressing issues that include persistent unrest and also cybersecurity.

Political and lawmaking processes endure some conflict with an attack against our Electoral College tally. President-elect Biden describes those involved as a “Riotous mob of insurrectionists” carrying out “…an assault on the rule of law.” 

The riot is impetus for varied stories throughout media: newsprint, its digital versions and also newer platforms that are controversial in consideration of Section 230 of the Communications Decency Act and for other reasons. It is evident that Twitter, Facebook, and Google are aligning with the new presidential administration. Biden has been among those to call for repeal of Section 230, and cited Facebook specifically as a reason, though the mainstream media apparently is not reminding anyone of that.

Publications tend to have specific audiences. Editorial or strategic objectives are not always clear. It is evident that narratives involving the latest incidents of unrest can be rehashed in varied ways. An extensive compromise of sovereign computer systems, a most serious external threat to national security, tends not to be as topical. To put it another way, there are potential issues with the gatekeepers, or enablers, of the news because of how they can shape our discourse.

Like the personalities on mainstream partisan networks, great expertise on cybersecurity is not claimed here. It does seem that an argument can be made that past concepts of military deterrence do not apply the same way in the cyber realm. Deterrence is a policy or objective that has been used to justify the buildup of nuclear arms: if one were to think of bombing us there is sufficient firepower to destroy the entire planet in response. A different paradigm is probably necessary to protect digital networks in light of espionage, destruction (as with Stuxnet or NotPetya), pilferage through ransomware, an incident attack on New Zealand’s central bank, or perhaps acts of terrorism that could disrupt epistemological endeavors of cosmology.

It is not clear what can immediately be done in response to the multi-stage SolarWinds breach that utilized malware known as “Teardrop.” Is there a similarly-sophisticated means of carrying on espionage through backdoors into computer systems of foreign agents? Is there a weapon that can destroy the storage or cloud computing of their digital infrastructure? 

There is a chance that such a thing does not exist, that mention of it amounts to empty rhetoric or bluster. However, it probably does and capabilities need to remain unknown to potential adversaries. Methodology just is not the same as massing troops, submersibles, or missile systems in strategic locations as would be done via longstanding concepts of defense.

Therefore, aside from any discussion of contemporary deterrence, or its analogue, media coverage must make due with limited information. A monologue that is not the result of research or deliberation, yet published on behalf of an audience, may not help to understand sensible priorities, particularly if facts are top secret. Further, though publications and networks seek out experts, the SolarWinds hack occurred on the watch of our former point man, Chris Krebs, and showed the Cybersecurity and Infrastructure Security Agency (CISA) to be ineffectual. Dialogue on such matters appears lacking.

It is evident that nation states will be stockpiling means to use existing and nascent technologies offensively or destructively. Sovereign actors may enable criminals who use malware for profit. ZDNet or Wired, among others, can still be helpful.

Computers and digital systems are tools, industries, and important economically. Though issues have been raised about ride sharing apps at this blog, there is contention that faster mobile networks gave us Uber and Lyft. The corollary is that implementation of 5G speed should present new possibilities. 

My account owns shares of Sweden’s Ericsson (ERIC), which offers products such as rooftop radios and cell tower masts that enable next generation networks. There are growth prospects all over the world for it, including in China. A risk is that China has threatened to retaliate against Swedish companies doing business within its borders pursuant to Sweden’s ban of China’s Huawei and ZTE. A write-up with attention to the recent Comprehensive Agreement on Investment between Europe and China describes similar Chinese efforts “to bulldoze” that have been stymied.

For most of 2020, pursuant to the market decline when Covid-19 became a pandemic, my account owned shares of CyberArk (CYBR), an Israeli cybersecurity company. The shares gained as the market recovered, but did not really rocket higher until after the SolarWinds attack became known. As with CYBR, the method of selecting cybersecurity stocks here has been partially based on reviewing industry recognition earned by companies and then paying heed to considerations such as their financial position and leaders. However, as awards are given yearly, there is a chance, if not probability, that a key product can suddenly lose marketability and therefore future sales revenue if a competitor wins out against it. Thus, since the share price reached $164, my account no longer owns any stock in CyberArk as visibility into the worthiness of products is murky.

Some cybersecurity firms do not have stocks that are publicly-traded. Pursuant to extensive recognition, Armis might be worthwhile if it were available for investment, as it is identified with “Threat Detection,” “Medical device security,” and “IoT Security,” as of 2020. Given the severity of the SolarWinds compromise, there could be added scrutiny to criteria used as we enter 2021. It is not clear who, if anyone, has a product that definitely would have thwarted the hack.

Anyhow, my account has sold out of CYBR and simply invested in an exchange traded fund with the ticker symbol CIBR. Ratings on who has the top products for varied purposes should be changing. Rather than attempting to pick stocks in the sector, a basket of them can easily be better and less risky. 

There is also the low cost S&P 500 fund with the ticker VOO. Its stocks are a barometer that incidentally beats nearly all professional money managers, who charge fees, each and every year. As its costs are habitually low, it can be preferable to mutual funds that manage retirement money in 401(k) plans, for example.

There is a chance that share prices, as can be tracked with VOO, are bound to head lower during the second full week of January 2021. There could be consecutive days with harsh declines. If Tuesday is the first of them, then there is a possibility of opportunity on Wednesday or Thursday. ERIC, CIBR or VOO may be among securities worth watching. 

***the author owns shares of CIBR, ERIC, VOO.