Make no mistake, we're living in a seller's market. Weak global economic outlook coupled with anticipated action by central banks (ECB and Fed specifically) will continue to propagate a bleak economic forecast and a hard market. In the wake of a global slowdown, here are some industries that deserve a second look:
Auto: The industry is definitely revitalized since the meltdown in 2008-2009. Declining capacity as a result of the shutdowns has resulted in a more efficient industry. We're currently seeing an upward trend. Manufacturing has grown by 26.4 percent since 2009 and auto sales have increased 23% year-over-year through June. Also worth mentioning: according the the July report, published a few days ago, consumer credit is up to about 5%.
Airline Industry:we've seen increases in efficiency for reasons similar to those of the auto industry. I'd be cautious, though- the airline industry is very volatile-- 40% of cost is fuel.
Gaming: Macau, the Monte Carlo of the Orient, is a good place Western casinos are heading right now. Currently, Macau is the only place in China where gambling is legal. Surely, with the rise of the middle class, we can expect more vacations there. Just this morning, Jim Murren of MGM announced that he expect the Macau government to approve MGM's plan to build a $2.5 billion casino. Macau is the world's largest gambling market and is growing with a 1.5 percent year-over-year increase (this July reported $3.08 billion).
Lodging REITs: The hotel industry is doing pretty well. Click here for a more in depth explanation (graphs and all!)
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