America’s 78 million baby boomers are richer than any group in history; the group controls 50% of all U.S. discretionary income and accounts for 75% of drug spending. As an investor you cannot afford to ignore this demographic in the coming years and where they will be spending their retirement money.

As more boomers approach retirement, forecasters expect a huge bump up in certain kinds of expenditures. Two that should see the biggest jump are Health care and Travel/Leisure stocks

National health-care spending is estimated to increase as a percentage of GDP by 22 percent over the next 10 years. For that the health-care industry can thank the boomers, who are just beginning to enter the time of their lives when drug, hospital and other expenditures rise dramatically. In fact, it is estimated that people 50 and older will account for more than half of all health-care spending.

Picking winning companies here isn’t as easy as it might appear. With power in numbers, the boomers could put pressure on prices, making new medical developments less profitable for some companies. (more…)

It looks as though President Obama and the Democrat controlled Congress will definitely attempt to pass some type of environmental legislation in 2009 or 2010. This legislation would be aimed directly at carbon and other greenhouse gas emissions and their role in global warming.

In the coming months and years, either a “Cap and Trade” system or a straight up carbon tax will be likely be passed by U.S. legistators. The moderates in Congress and most of the heavy industrial world, faced with the reality of some type of legislation, are rallying behind a carbon tax for its simplicity and for the fact that the cost can be passed along to the consumer much more efficiently and without the distortion and potential fraud of a cap and trade system.

The U.S. House of Representatives approved legislation on June 26 that would place caps on U.S. greenhouse gas emissions and sets nationals standard for the production of renewable electricity by 2020. The American Clean Energy and Security Act (H.R. 2454) would cut U.S. greenhouse gas emissions by 17% by 2020, from 2005 levels, and by 83% by 2050.

While much of the focus on reducing greenhouse gas emissions will be on the development of next generation renewable energy resources, natural gas can and will play a significant role in this evolving story. Natural gas per BTU of energy is much cleaner than oil or coal, the two primary fossil fuel alternatives, and thanks to new drilling technologies that are unlocking substantial amounts of natural gas from shale rocks, the nation’s estimated natural gas reserves have surged by 35 percent according to new studies. (more…)

It’s no secret that health care costs are spiraling out of control in this country. On average, we now spend more per person on health care than both food and housing. Insurance premiums are multiplying much faster than inflation, which prevents economic growth and leaves businesses with less money to give raises or hire more workers. While the quality and availability of medical care in the United States remains among the best in the world, many wonder whether we’d be better off adopting a universal government-controlled health care system like the one used in Canada. We have outlined some of the points that Proponents and Opponents of the Healthcare Bill argue.

Proponents make the following points….

• The number of uninsured citizens has grown to over 40 million

• Health care has become increasingly unaffordable for businesses and individuals

• We can eliminate wasteful inefficiencies such as duplicate paper work, claim approval, insurance submission, etc.

• Free medical services would encourage patients to practice preventive medicine and inquire about problems early when treatment will be light; currently, patients often avoid physicals and other preventive measures because of the costs.

At the same time, opponents argue…

• There isn’t a single government agency or division that runs efficiently; do we really want an organization that developed the U.S. Tax Code handling something as complex as health care?

• “Free” health care isn’t really free since we must pay for it with taxes; expenses for health care would have to be paid for with higher taxes or spending cuts in other areas such as defense, education, etc.

• Profit motives, competition, and individual ingenuity have always led to greater cost control and effectiveness.

• Government-controlled health care would lead to a decrease in patient flexibility.

• Just because Americans are uninsured doesn’t mean they can’t receive health care; nonprofits and government-run hospitals provide services to those who don’t have insurance, and it is illegal to refuse emergency medical service because of a lack of insurance.

• Government-mandated procedures will likely reduce doctor flexibility and lead to poor patient care.

• Patients aren’t likely to curb their drug costs and doctor visits if health care is free; thus, total costs will be several times what they are now.

• Just because Americans are uninsured doesn’t mean they can’t receive health care; nonprofits and government-run hospitals provide services to those who don’t have insurance, and it is illegal to refuse emergency medical service because of a lack of insurance.

• Government-mandated procedures will likely reduce doctor flexibility and lead to poor patient care.

• Healthy people who take care of themselves will have to pay for the burden of those who smoke, are obese, etc.

• A long, painful transition will have to take place involving lost insurance industry jobs, business closures, and new patient record creation.

• Loss of private practice options and possible reduced pay may dissuade many would-be doctors from pursuing the profession.

• Malpractice lawsuit costs, which are already sky-high, could further explode since universal care may expose the government to legal liability, and the possibility to sue someone with deep pockets usually invites more lawsuits.

• Government is more likely to pass additional restrictions or increase taxes on smoking, fast food, etc., leading to a further loss of personal freedoms.

• Patient confidentiality is likely to be compromised since centralized health information will likely be maintained by the government.

• Health care equipment, drugs, and services may end up being rationed by the government. In other words, politics, lifestyle of patients, and philosophical differences of those in power, could determine who gets what.

• Like social security, any government benefit eventually is taken as a “right” by the public, meaning that it’s politically near impossible to remove or curtail it later on when costs get out of control.

Whether the healthcare bill passes or fails, we at PennyTrader.com are dedicated to helping our members make money. In fact, we have compiled a list of stocks we think could benefit from its passage. And at the same time, we have provided a list of stocks we think members should add to their radars if the bill fails. (more…)

The first thing you as a new investor should be aware of is the high risk involved with small cap investing. When you buy a company like CSCO, IBM, MSFT, GE, or DELL, you are buying a quality company, backed by big names and run by hundreds of managers and consultants. Small cap companies are often run by only a handful of people. Often there is the CEO/founder/president, perhaps a COO and a few other employees.  

It is this small corporate structure which results in the potential for huge gains. Often a small penny stock will see its stock soar after a big contract has been signed, or new partners announced. Any small shift in business can result in multiple increases in revenue for a small company, this is reflected in the stock price. News is in many cases a driving factor for fast rises in penny stock prices and jumps in trading volumes.

The opposite is also true, if a small penny stock company loses a deal, or is hit by a hard quarter, the damage to the balance sheet could send the stock dropping fast. Again, investors should be aware that news is a sizeable factor in the rapid declines in penny stocks. (more…)