Tuesday, December 9, 2008: Issue: #581
by Martin Denholm, Managing Editor, The Smart Profits Report
Pack your bags, folks - “There’s no more Wall Street.”
That’s the damning verdict from Alan Greenberg, former CEO of Bear Stearns.
Speaking on Bloomberg’s “Money and Politics” show on Monday, Greenberg declared that the existing Wall Street investment banking model is dead.
I’m not sure about death, but the broader U.S. economy is like a 2:00 AM drunk, continuing to stumble towards the end of a mind-altering 2008, with little long-term relief in sight. Will it ever find its way home again?
One of President-elect Barack Obama’s most ambitious and large-scale plans quite literally seeks to dig America out of this mess - and here’s how you can profit, too. But you’d better act fast - some of Wall Street’s big boys are already placing their bets…
The Eisenhower Model - Part II
Six weeks from today, Barack Obama will take the oath as 44th president of the United States.
Since his election victory, the more he’s said about “getting to work immediately” and having “no time to waste,” the more I think the inauguration ceremony will be a time-consuming inconvenience, distracting him from fixing America’s problems!
One key area in which he’s pledged to spend his way out of the mire is by tackling the country’s aging and rapidly deteriorating infrastructure. He plans to make the largest investment to repair and upgrade the country’s public works systems since Dwight Eisenhower spearheaded the nationwide interstate highway system in the 1950s.
In short, this means utility industries like electric and water will receive huge cash infusions. Roads and bridges will be repaired and rebuilt. Schools will be modernized, part of which will include improving Internet access to a nation that ranks 15th in the world in broadband adoption. Energy efficiency, particularly in government buildings, will be increased. The healthcare industry will make greater use of technology to streamline and computerize medical records to cut costs.
That’s the plan anyway. And Obama says it will create 2.5 million jobs by 2011. But we want profits. Read on to find out how you can grab some…
It’s The Economy, Stupid… Six Weeks Away From $500 Billion Rescue Plan
Obama’s economic brain trust is currently “busy working, crunching the numbers… to determine what the size and scope of the economic recovery plan needs to be. But it’s going to be substantial.”
Kinda vague right now, I know. But early estimates put the economic recovery bill at $500 billion. In terms of infrastructure upgrades, 5,000 road and bridge projects could get underway immediately after Obama puts his autograph on the bill.
Here are some investments that could revel in the building boom…
Brick By Brick… Bridge By Bridge
When the U.S. infrastructure sets to have a sweaty wad of cash lobbed in its direction, construction firms are lining up to grab a share of the spoils, as the need for equipment and raw materials rises.
Appropriately, we start in Obama’s home state of Illinois, which is also home to the world’s largest manufacturer of construction and mining equipment, engines, and industrial turbines.
