I wish I had more faith in my prognosticating abilities, but the truth is that I am no different from any one else in this regard. I can analyze and then speculate about what is to come. True, someone who analyzes has a much higher percentage of predictive success than one who does not, but the future, is well, dynamic, meaning it is subject to an infinite amount of variables. So, no matter what we know, or think we know, the future will be what it is – Que sera, sera!
Which sectors do you think will perform well in 2011?
When I first received this question, I planned to write a detailed series on some specific sectors that I think will perform well in 2011. After thinking about it, I decided not to be so bold (for the reason I stated above). Instead, I will tell you what I think generally about some sectors, and you can go from there.
Like 2010, computer/software technology will advance, specifically in the semi-conductor, Internet switching, and “cloud” computing areas. We need to free up massive bandwidth for all of the apps that now allow anyone to download anything anywhere, any time. We will need faster computers, more memory, and more bandwidth.
Like 2010, the economic recovery will continue, only stronger. As the global economy strengthens, the rising middle classes of Eastern Europe, China, India, Brazil, Russia, and Southeast Asia (along with U.S. consumers) will want cars and appliances (TVs). Look for increased sales in the automotive and appliance sectors.
Like 2010, only more so, the financial sector will improve. Toxic debt will continue to disappear and the issues around the fraudulent mortgage-backed securities will resolve through settlements. Look for increased loans from both big banks and regional banks, which will mean increased revenues.
Like 2010, biotech will continue to announce major breakthroughs and medical advances. The big pharmas will benefit the most, as only they have the “umph” to bring new and daring products to the market.
Like in 2010, only more so, people will tire of the uncertainty, the frugality, and the fear. Look to the airlines, hotels, cruise lines, and resorts for growth, as people begin to let loose with some of the trillions now in savings accounts.
Unlike 2010, the housing sector will begin to turn from bouncing on the bottom to the beginning of a sustained recovery. This is inevitable, as the there are only so many more houses that can go into foreclosure. More importantly, banks will begin loaning again (mortgages) to those who have good credit, as opposed to lending only to those with perfect credit.
Trade in the day; invest in your life …
