Home prices have probably hit rock bottom, so buying a rental or two might be a good idea. People continue to get foreclosed on, and they will need somewhere to live. Single family dwellings and duplexes look solid. There was an auction recently, in Detroit, in which foreign investors were buying rental properties for as little as one fucking dollar. When the housing market stops slumping, sell immediately. It will not be the high point, but when bubbles burst, values fall quickly.
I agree with Shadow, that tangible goods are a better buy right now. The commodities market looks solid. Do not buy gold. It has triples in price in three years, and that is probably going to be the next bubble to burst. The value is so hard to determine because less and less contries are making it the standard for currency. It used to be that a dollar was worth a set amount of gold. Now currency is backed by consumer confidence in the US and the Euro, which are the biggest currencies in the west. China's economy is moving the same way. Investing in the Yuan is a good idea as well. China has been undervaluing their currency, which has helped them build a giant trade surplus. They should properly value the currency soon. If you convert a shitload of US dollars now to Yuan, soon, it will be worth quite a bit more than it is now. Some experts believe that three to four times seems ball park within three years. A thousand dollar investment now will be worth $4,000 in five years. This is a bigger gain than most stocks can provide, and is as sure of a thing as investments can be.
If you are going into stocks, liquor, cigarettes, junk food, and Wal-Mart are recession proof. They would be the most likely to make modest gains in the short term while we work out of this recession. Watch the consumer confidence number and the economic growth rate. You want to look at the GDP over the GNP, as the GDP will show how much is being spent here in America, and it will rise first. The GNP follows the GDP. When these numbers start to rise, likely within 12-18 months, identify the emerging industry. I would look at companies that provide green energy. I think for the most part these companies are a sham and the technology needs to catch up to the demand. But, people will invest in them, raising the price, just to satiate their own conscience.
At this point, you will need to identify the next emerging industry. Investing this way is tricky. What seems like a good idea is not always priced to sell, and after the initial promise of the idea wears off, the financials become more and more important. Look at the internet bubble. Prices shot through the roof until investors expected a return and got none. Invest in companies that offer dividends. Thee companies have shown the ability ot earn, and will likely avoid the valleys in turbulent times.
Finally, once the economy is settles, look into companies that did not take TARP funds. These companies have shown the ability to survive, and will likely draw investors. Get in early, and let those late to the party raise the sell price for you.
