Friday, November 20, 2009: Issue #1142

As the old saying goes, "You're either a contrarian, or a victim."

It just so happens that one of the savviest contrarians I know is my colleague, Louis Basenese.

And nobody takes that to heart more than Lou does. I've scratched my head in bewilderment on many occasions after reading one of Lou's bold predictions – only to see his intuition prove uncanny time after time.

So today I'm stealing a page from the "Basenese Playbook" and taking a look at the severely battered transportation sector, one that pretty much everybody hates. However, I think, it's not only about to come off life support, but perhaps become one of the hottest investments in 2010.

The Transportation Sector: The Market's Most Important Domain

Airlines, railways, package carriers, even oil and gas pipelines are all industries that make up the transportation sector.

But why should you care about it?

Because transportation is actually the most important sector – and for good reason: growth or contraction here serves as a proxy for both U.S. and global economic growth.

It stands to reason that if more "stuff" is being shipped, it means companies are producing more goods to satisfy business and consumer demand. In turn, this is a good indication that the U.S. economy – and that of the rest of the globe – is in decent shape.

Right now, however, there's a big change underway in U.S. freight transportation. Thing is though, it's hardly received any attention. So let's take a closer look…

And the World's Most Efficient Transportation System Is…

Let me toss a few statistics your way…

• Every day of the week, nearly 43 million tons of goods are hauled around the United States.
• The price tag of those goods is around $29 billion.
• This 12 billion ton-mile (one ton of freight moved one mile) occurs on the nation's 4,016,741 miles of highways and roads, 94,942 miles of railroads and 26,000 miles of waterways.
• The process also includes thousands of miles of air routes and over 1.7 million miles of oil and gas pipelines.
• It accounts for nearly $400 billion – nearly 3% of total GDP.

When you think about it, the U.S. transportation and shipping system is highly efficient – and routine to the point of being almost boring!

But not from an investment standpoint.