Market trends and stocks to watch [May 2005]

FYI

 

Here are some trends and stocks to watch.

 

1) Downtown Brooklyn Real Estate

Now is the time to "double-down or leave the table".  There are agressive development plans in place for Downtown Brooklyn and Ft. Greene. Construction has started on the Sheraton Hotel on Duffield St. (between Fulton Mall and Wiloughby). Most local condo developers are 1yr behind schedule due to a weak real estate market in 2006. Prices to high end, luxury condos will continue to appreciate.  The only value play left is to lock-in a contract at the market price, then negotiate more amenities and high-end fixtures and appliances.  Try to get a balcony/terrace, on-site parking, private storage room, roof deck and a view of Manhattan skyline. Those features will be most valuable in the long-term.

 

2) Inflation is here. Invest in food and water.

Now is the time to build a significant position in the food/agriculture sectors. Think of the food markets as the energy market for humans.  Demand for meats, finished food products and basic grains is escalating very rapidly. Part of this is growing demand from Asia and new alternative enrgy uses for key grains like corn. Also note that available farmland in the US is stagnant (even reducing). There are also concerns about the low number of bees, which is critical to agriculture. All these issue point to higher food prioces in the next 8-12 months.  If you're not sure about this check out the price of lemons. It has tripled in the last six months. To capitalize, you can invest in agricutural sector funds, stocks in food companies (like ADM or WTR), or futures on specific agriculture commodities (corn, wheat, beef, pork, sugar). 

 

3) The longshot of new technology

Check out this firm MLER. Moller International Inc. has exclusive technology in developing personal flying machines and specialized unmanned aircraft. Their vehicles use ETHANOL. They have great potential as an alternative energy play, but also in the growing market for personal transportation. Their stock is closely held and has increased 50% this week. You can still buy for less than $1.

 

Congrats to Denton. He's been following this company [MLER] for a few months. It's tripled since he first started following the stock.

 

These three trends will make money in the next 6-12 months.

 

Victor

vsmith@taxprosonline.com