esrosedotblog

WSJ?OTD

Which of these sectors will perform best in 2006?
Defense
Drugs/Biotech
Energy
Housing
Retail
Technology/Internet

I thought I would sit this one out. But, on the other hand, why not? My guess is as good (or even better) than anyone else's.

Defense: Well, I read again about the rise of the military-industrial complex. I think that this will continue to grow fast because the military's supplies are exhausted or blown up. And, we have a war prone administration.

Drugs/Biotech: I have family in this one but I wouldn't bet on it. New drugs aren't doing all that well and a lot of patents are running out. The government environment is good for big Pharma and maybe even little pharma but that will not last and it is not enough. I don't have much enthusiasm for this one.

Energy: Well, bushie is out front on this but it is a pitiful effort. As usual, all blather and no money. The big oil companies will continue to do well, There will be some new technology. But growth? No more than other areas. Not a standout.

Housing: Yeah. Out here, we are in an overheated market at 25% a year growth. Sure it won't continue but it won't collapse and if it collapses it will rise again on about a ten year cycle which has been dependable since I bought my first house in 1958 for 17,500 dollars; a three bedroom split level which is still in A-1 condition or was a few years ago. Today, I am sitting on 7 figures, free and clear, in the same size house (with a pool and a great view. The first house was in a tract development and was in the middle of farmland).

I have made more money (real dollars) in real estate than anything else except my own money machine business but it only lasted 30 years. The housing thing is still going. We keep making babies!

I didn't invest a lot in the loser REIT craze in the 80s. Friends who did, lost their ass. No more of that.

Retail. Schlump. Dead ended. The discounters are killing the profit end.

Technology/Internet: why did they put them together? Technology yes, internet no. Not for big bucks.

So I WILL vote. I give it to Defense and then Housing.

Here is how 980 other people voted: Defense=95 votes (10%); Drugs/Biotech=256 votes (26%); Energy=369 votes (38%); Housing =15 votes (2%); Retail=45 votes (5%); Technology/Internet=197 votes (20%)

So I am out of the mainstream again. But I am right on the contrarian market.