The Beginning Of A New Bull Market?

With the amazing price action in the markets today you might just be suffering from motion sickness. The Dow traded today in a 600 point range... that's right it was down over 300 points at one time during the day, but came back and closed up 298 points in a flurry of short covering and long term bulls.

Needless to say this is a very good sign... With the fed's decision to cut interest rates by 75 basis points yesterday, news of bail outs for loan companies today and a stimulus package from the US government, we are forming a bottom in the markets.

This January was shaping up to be the worst on record before today... As an investor what you need to ask yourself is how bad was it out there for my company? For most stocks in the mortgage and US banks markets, it couldn't get much worse, but there is plenty of companies out there that aren't really affected by a slowdown. They were just taken down with the rest of the market, and are at bargain prices compared to just a month ago.

Since this blog is all about long-term investments these might be fairly redundant but, Royal Bank Of Canada, Zoltek, Google, Evergreen Solar, Boeing, CECO, Vasco Data Securities and Yum brands are all looking tempting at their levels. If you are a first time investor, or have been waiting on the sidelines with cash waiting to get in you had better hurry. The market is oversold, and it is only a matter of time before the fundmentals and long-term outlooks begin to matter again...

Picking Up The Pieces

Tomorrow looks like it is going to be a blood bath for the bulls... The Dow futures are down as much as 520 points as global markets around the world are being hammered. If you are a long-term investors these are the hardest times to take. It is tough to see your hard fought gains go down the drain as the bears take over and short everything in site.

The fact of the matter though, is that stocks have outperformed every asset class over a 20-year period. If you are in it for a the long haul you will be alright, in fact you should be doing some buying of quality companies on sale as the dust settles and people realize that the global economies aren't just going to collapse.

Technology companies will continue to make money, alternative energy will still be a huge growth area, whether or not a bank or insurance company goes under. People will still consume, and companies will still make money...

Most of this decline is simply due to the fact that the banks lent out money to people who couldn't afford to pay after they jacked up rates. I mean isn't it the banks job to make sure it's clients can payback loans even if interest rates jumped? Either way, there is one simple solution and that is an emergency fed meeting, and a large rate cut. The bulls have been on the sidelines simply waiting for the next fed meeting. If this doesn't happen tomorrow it will get ugly... very ugly.

Well, Mr. Ben Bernanke, now is your time to shine...

Fueling The Winds Of Change With Zoltek

First of all, I just want to say that the market has been very hard to take the past month or two. What you need to remember, is that we are in it for the long haul. If you are an investor that thinks long-term, you should be drooling over all of the values out there in the market today. Even with an "economic slow down" here in the states, it really doesn't change the global growth stories of plenty of companies out there today.

For instance, Intel just reported today only 2 cents under estimates yet it is hammered in after hours. The market is overreacting and focusing on any negative news, without even considering a tomorrow. Now is the time to be concentrating on the future, a long term investor needs to be ready to buy at these moments, not panic like some many people tend to do.

That being said, my next long term pick is the carbon fiber producer Zoltek (zolt). This company is the leading producer of the carbon fibers that go into producing wind turbines, a growing source of green energy. This relatively small company (1.26 Billion Market Cap), has signed long term supply contracts with the top manufactures of wind turbines in the entire world! Gamesa Group of Spain, DeWind and the world's largest producer Vestas Wind System will be begin to be reflected in Zoltek's bottom line very soon.

In case you missed the figures wind energy is projected to grow at 25% per year worldwide, and I personally think this is a pretty conservative estimate. As I stated earlier with Evergreen Solar and Ormat Technologies, green energy is going to become the next multi-year bull market.

Zoltek is in one of the sweet spots, and appears to have a near monopoly on a key area of this growing trend. Their revenues have been growing at a very impressive rate and should only continue to do so with it's recent announcement that it had purchased the Guadalajara, Mexico-based Crysel Acrylic Fiber.

As if that weren't enough reason to own Zoltek, they also have the potential to be huge in the automotive market as their light weight carbon fiber could easily be used in the manufacturing of more fuel efficient vehicles. Think about it, the government is just beginning it's push to increase fuel standards, and as oil rises the process will only speed up.

Yeah the market is pretty bearish right now, but there is always plenty of companies to pick up on sale at this level. Always, don't buy all at once and focus long-term... as with all things, this will pass...