Thursday, March 20, 2008

Investing in Hard Times

With real estate, stocks, corporate debt, and almost all other assets declining, it's tough to figure out what would be a good investment. But hope springs eternal. Old fashioned American optimism will always find an outlet. Maybe you'll find investment inspiration below:

Dog Food Manufacturers. Inflation of food prices is close to the double digit level. People will turn away from filet mignon and lobster, and toward less expensive alternatives. Sales of dog food could rise, and not necessarily because dogs are being treated better. Dog food manufacturers might jump on this bandwagon and bring new gourmet offerings to the market.

Big Breweries. Think about the large, national breweries that produce the cheap swill and malt liquor that gives you a big bang for the buck. They will probably enjoy increased sales at the low end.

New York City Food Cart Permits. As Wall Street cuts back on expense accounts, $1,000 bottles of wine will sit on store shelves, and hot dog vendors in Manhattan will see sales increase. When you consider that ketchup, mustard, onions, relish and sauerkraut can all be classified as vegetables, the hot dog looks better and better when you have less than $5 for lunch.

Real Estate Opportunities.
Afficionados of late night television know that there are always opportunities in real estate, and hard economic times are no exception. Even when people are down and out, they still need a place to live. Think about mobile home parks, welfare hotels and slums.

Credit Card Companies. Even though the Federal Reserve has been lowering interest rates, many credit card customers have had their interest rates raised. Increased fees have also been imposed. If you're being gouged, consider investing in credit card companies as a hedge against your losses. If you haven't been gouged yet, think about how likely it is that you will be gouged in the future (have you ever met a nice credit card company?) and consider credit card companies as a way to offset future expenses.

Electric Utilities. With the deregulation of electricity, utilities aren't as predictable an investment as they once were. However, many people will be faced with a choice as to what bills to pay. Electricity is used for an enormous variety things today. For example, how could you face your family every evening if the big screen TV couldn't be turned on? How would you keep your sanity if your kids weren't diverted by mind-rotting computer games? As you cut back on restaurant meals, how could you "cook" without the microwave? The electricity
bill will be paid before many other bills, so electric utilities might turn out to be a good investment.

Yellow Mustard Manufacturers. Yellow mustard goes well with bologna, pepper loaf and a variety of other inexpensive meat products. It also helps to mask the flavor of day old and rancid food. Yellow mustard manufacturers can look forward to flush times.

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