Wall Street’s Ghosts of Christmas
There’s a powerful force visiting Wall Street this year. Call it the ghost of Christmas past, present and future. And the worst thing is what it does to companies who accept its influence, even while the number of those falling under its spell continues to grow:
General Motors (NYSE: GM), American International Group (NYSE: AIG), Bank of America (NYSE: BAC), Citigroup (NYSE: C), Well Fargo & Co. (NYSE: WFC) and the list goes on and on…
It’s been quite apparent about its intentions. But what warnings do these Spirits of Christmas – a.k.a. the government – want to give investors? Their message is simple:
Investors can no longer ignore the government when investing.
Regulation is back, and while it seems a heavy hand is needed with lapses like those in the Madoff-ponzi scheme, it will invariably lead to slower growth and increased taxes.
But here’s the true gift for investors. The larger industries like automakers, retailers and technology powerhouses might actually benefit from this environment. These companies are better suited to expensive lobbying, exploiting tax loopholes, and using limited growth environments to squeeze competitors.
Based off of Google’s stock screener, the largest domestic companies are Wal-Mart Stores (NYSE: WMT), Procter & Gamble Co. (NYSE: PG) and Microsoft (Nasdaq: MSFT). These companies are no stranger to controversy, skilled in politics, fiscal policy and ruthless competition. In an “only the strong survive” environment, they should do just fine. Just like Ebenezer Scrooge…
Companies mentioned in this article: AIG, BAC, C, WFC, GM, WMT, PG and MSFT.
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- 2012 Predictions for Income Investors
- PepsiCo Rises on Third-Quarter Earnings
- How to Hedge Against Treasury Positions
