Investment In Alternative Fuel Transportation Already Expanding

Just today in my home state of Kentucky, officials are entertaining Integrity Manufacturing as they look for a home to invest 30 million dollars and employ 300 initially to manufacture Zap Autos, their alternative to fossil fuel driven vehicles.

Supporting what I’ve said in previous posts.  This evolution is going to spur entrepreneurial expansion in the  previously ignored  segment of alternative fuels.  And not just for cars my friend.  This is going to expand to home heating and cooling,  powering your  iMac, and  many other forms of alternative fuel use.  Just watch and see what  great things can come of this.

It’s always darkest before the dawn, and this is just the beginning of all kinds of positive news for our economy.  We just need to be patient enough to see it through.  Read the entire article on Wave news.

http://www.wave3.com/Global/story.asp?S=8643398&nav=menu31_2

Rebates Having A Positive Effect On The Economy

Reports the San Fransisco.  However, they report it probably won’t have the intended effect of spurring on the economy due to rising food and energy costs.  It also reports that another stimulus package may be in the future for consumers. Read more…

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/07/06/MN6C11IPL6.DTL&tsp=1

John Stossel Agrees, Major Networks Going Negative

Finally!  I get some backing from someone in the business.  I won’t even try to paraphrase Stossel, but I’m so thankful that he has called the doom and gloom mongers out.  Thank you! Mr. Stossel…

Major news networks are partly culpable in creating this economic situation.  And it could be the reason my blog has blossomed over the past few months.  So this site remains positive for those that believe we are far better than the major news networks want us to believe we are.  This article is a must read…

http://www.desertdispatch.com/opinion/economic_3738___article.html/exaggerate_networks.html#slComments

Meetings Industry Expects Business As Usual

IMEX, an annual gathering for the meetings industry reported today that most of their attendees expect business meetings (annual sales meetings etc…) to continue on pace, or grow modestly.

Having worked for companies large and small, I know this is one area easy to take the first hit on corporate cut-backs.  It could be that these meetings may still be held, but at a reduction in elegance for the sake of thrift.  We’ll see how this plays out, but it is good to see that one sector of global business is looking for positive results in the year to come.

http://www.meetingnews.com/mimegasite/news/article_display.jsp?vnu_content_id=1003823251

Factory Activity Expands For First Time in Five Months

Factory activity index has risen to 50.2.  That’s positive news considering anything above 50 signifies expansion.  This is the first time in five months that this index has shown an expansion.  While we’re not out of the woods, I’ll take any positive news for our economy that I can scour..  Read the entire article at Reuters.

http://www.reuters.com/article/businessNews/idUSL1764662020080701?feedType=RSS&feedName=businessNews

Stock Market Perspective

Since there’s so much attention paid to the stock market today my post this morning to give a little perspective on the Dow Jones performance over the past thirty years.

The DJIA is not a bell-weather indicator of our economic performance.  Rather it’s a whole bunch of money managers and individual investors playing what I call “Las Vegas East” with the value of public companies stocks.  Some of it’s based in the actual value of the company, it’s products, research and development, future plans and the like.  And there’s a lot more of it these days based on emotions.  One manager gets scared, sells off a block of shares, and many others follow right out the door. 

So while I know that we will pull through this, I understand also that many are completely “freaking out” over the stock market.  I suppose if you’re 63 and all of your investment is in your previous employers stock your fears are warranted.  I’m 43, have a substantial amount invested in various mutual funds, and I’m looking at 20 years down the road.  And if you’re in my shoes, you should too.  Here’s why:

• Thirty years ago the DJIA stood at …………$818.85 - 6/30/78
• Twenty years ago it stood at………………$2.104.02 - 6/17/88
• Ten years ago the DJIA value was………..$8,712.87 - 6/19/98

Given the $10,984.00 DJIA value when I gathered this info on 6/24/08, this represents an increase of:

• $10,984 (1335%) since 1978
• $9,703.00 (461%) since 1988
• $4,024.39 (51.73%) since 1998

In that span of thirty years our economy has had its share of ups and downs, but as investment managers will tell you to keep your eyes on the long-term (assuming you’re of the appropriate age to do so).  Put your money in solid, diversified portfolio’s, and go play tennis, ride your bike, enjoy life. 

This is certainly a time for us to learn from our mistakes, prepare for the worst, but keep moving forward with a positive attitude about our economy.  Remember, this great country has conquered a whole lot worse than what’s going on now (see “The Great Depression”), and we’ll weather this storm as well.

This is not investment advice.  I’m not a money manager.  Which is why I invest my money with good money managers.  Do your research, and pick a fund(s) that reflect where you are in your life, and what your plans are for the future.

Bright Side Of The Gloom

From an AP article I read over the weekend I learned that historically when consumer sentiment is low, the S & P 500 responds with a big return the following year.  Sonsumer sentiment is usually a lagging figure meaning that by the time consumer sentiment is reported low, the economy is already on the uptick. 

The most recent consumer sentiment index was reported, according to this article, in June at 56.7.  Compare this to May 1980, when the same index sat at 51.7%.  The following year, the S & P provided a 1-year return of 19.6%!  Again in October 1990 after the index saw 63.9, the next year’s return for the S & P 27.5%. 

“Since 1978, following the 10 worst readings in the Reuter/University of Michigan’s Consumer Sentiment survey, consumer-discretionary stocks have risen more than 40 percent, on average, over the ensuing year.  The Standard & Poor’s 500 index has risen 20 percent,” says Thomas Lee, JP Morgan strategist in the article.

He goes on to warn that history may not repeat itself, since spiking oil prices could further sink stocks.  But my point is that historically we’ve pulled ourselves out of the gutter of a recession.  This down-turn is not the end of our economy.  Hardly.  This is a period when we as a nation are being forced to re-think the way we live, how we drive, consume, and it’s going to lead to some great things for our country. 

I believe, and have said so before on this blog that this is going to lead to new technologies.  A new sector to spur investment.  New energy is going to be a focus for companies…be it wind, solar, battery, hydrogen…you’re going to see companies racing to develop new products.  Not only for how we transport ourselves, but think of all the other applications that are going to benefit… longer lasting-batteries etc…we just don’t know HOW it’s going to benefit us in other ways.  But I’ll guarantee you it will!

So don’t throw in the towel on our economy. History shows us we’ll be ok.  Keep our eyes on the future, and not glued to the evening news, where we know all we’ll be fed is our daily dose of “the sky is falling!”

Source, Stan Choe, Elizabeth flach, Associated Press

GDP Revised UPward, Consumer Spending Increases As Well

The Gross Domestic Product was revised up for the first quarter.  Initially the gain was reported at a .9% annual rate.  The final number came in at 1.0% annualized.  Consumer spendings final number was revised upwards as well from 1.0% in the first quarter, to 1.1%.

These are small increases I realize.  However, any upward revision is very good news for our economy, which struggles like it hasn’t since the recession of 2001.

Read the full story…

http://www.reuters.com/article/businessNews/idUSMAR64567120080626?feedType=RSS&feedName=businessNews

Retail Sales Rise More Than Expected

Even after taking into account the tax rebates, retail spending beat Wall Street’s expectations.  Read more at Reuters.

http://www.reuters.com/article/businessNews/idUSN1125552220080612?feedType=nl&feedName=usbusinessearly

Economists Believe We Will Dodge A Recession

Over 50% of economists from a recent poll now believe we will not, and have not entered a recessionary period in the US.  And while they believe the slowdown will be protracted, we will dodge the “R” word.  This is not only positive news for our economy, but good economic news globally.  Many other economies depend upon US consumption.

http://www.reuters.com/article/businessNews/idUSN0926134920080610?feedType=RSS&feedName=businessNews