Well, it could be a wild guess, but Obama’s governing agenda might actually benefit some economical sectors. How? The simple fact that the Obama administration plans are already out and directed towards several sectors could boost the demand in those area. And a higher demand means for sure more prosperity for the companies involved.
New energy sources
Obama’s plan states that the US government will invest massively in revamping the energy sector and in creating 5 million jobs there:
This will of course help develop the companies who offer alternative/renewable sources of energy, in their position as suppliers to the new plans. Although all of these companies suffered dramatically from the recent financial crisis, some of them are investing massively in new production sites, indicating that they anticipate a higher demand in the future. The Emerson (NYSE: EMR) conglomerate recently announced opening a new factory in Romania, a new engineering center in China and prolonging its partnership with Quatargas for the production of liquefied natural gas (LNG). And although its shares are almost to its lowest historical level (around 30 USD/share), it looks like the maximum level (almost double) could indicate some good prospects for growth.
And there are lots of other companies in the energy sector you might look at, especially the ones producing equipment for renewable or alternative sources of energy. ABB (NYSE:ABB) springs into mind, together with a host of other companies which can be easily researched online.
This means that the relatively more efficient hospitals and drug providers will gain, while the others will loose. Here the trick is to bet on the right horse, or the companies who will provide real savings and efficiency improvements to their customers. For example, drug companies who have in their portfolio more prevention-oriented products than curing will benefit. This is not easy, since developing a new drug can take up to 10 years, so the companies who have now these products into the pipeline will benefit, not others. For example, big established drug companies, who can afford (and switch to) investing in such programs will benefit for sure – see Pfizer’s launch of global regenerative research unit or Abbot’s commitment in child nutrition as sustainable initiatives.
And talking about sustainability, the companies which will help the lower class of America to get out of poverty will benefit too. There are over 37 million poor Americans. Most Americans living in poverty work, but still cannot afford to make ends meet. As president, Obama will work to ensure that low-income Americans have transportation access to jobs. Obama will double funding for the federal Jobs Access and Reverse Commute program to ensure that additional federal public transportation dollars flow to the highest-need communities and that urban planning initiatives take this aspect of transportation policy into account.
This might mean that companies providing efficient mass transportation vehicles will for sure benefit. Could be that Ford and GM revive their fuel-efficient buses programs, but I would rather bet on Daimler Benz and on Toyota for these purposes.
At last, but not at least, the openness of the Internet will be one target of Obama’s technology programs. Protecting the internet’s state as an objective medium is going to be prety difficult with the dominance exercised by Google, Yahoo and Microsoft on this sector. However, keep an eye on the new technologies (such as internet 3.0) – these might be here sooner than you think! We at doitinvest.com suppose that the anti-trust actions will be a big issue too, so have a look there too…
Article originally published by doitinvest.com