Wednesday, February 27, 2008
Utilities Under Pressure
Utilities one of my target sectors for my Carter Era Stock Portfolio are being pressured buy both increasing prices for coal and natural gas and eco friendly politicians looking to score points with there constituents . 80% of the world’s electricity is generated by coal and natural gas and most utilities bargain with local regulators to set prices to consumers.
Utilities in there quasi monopoly positions are becoming pressured by cost increases both fuel and eco compliance again I remind you we went thru this in the 1970’s with very adverse consequences, thus the weakness in utilities stock prices.
As we head more into a 1970’s state of mind it’s very important to keep reminding your self that 1970’s economic polices were disastrous, stupid and destructive so look out for more of the same and be prepared to profit off bigger government ,higher taxes ,higher energy prices, higher inflation ,weak business conditions and really stupid politics. And Yes you can profit from all these trends.