Places to Find Thanksgiving Cheer

"Let's not be turkeys." - Nassim Taleb

Having stayed up most of the night last night smoking a turkey for my son's class I am already in the thanksgiving spirit.  So with Thanksgiving next week I thought that I would look at things that might take the edge off the gloom that is currently weighing on the market.  With the aftermath of hurricane Sandy and Apple shareholders being beaten down by over $200 billion in the past few weeks (even with the holiday season expected to boost revenues) it certainly is not easy to find much to be thankful for however I believe that if we look carefully there are places to invest that will put that smile back on the dial and allow you to enjoy that festive spirit.

So how are we to be thankful this thanksgiving?  First off we are not turkeys! Nassim Taleb is a crisis manager who bets on the only sure thing that will happen in the market - a crash. Now most of the time he losses money but when the crash happens (and it always does) he wins big. His philosophy is summed up by the quote above. If you think about the turkey he lives 1,094 days in peace and tranquility with his friends on the farm not knowing that day 1,095 everyone will be slaughtered. This is the black swan event that he refers to in his book of the same name. Now we may live longer than the turkey but most of the time we invest like them, we bet that life will provide us with continued moderate returns on our investments forever. While I am no Taleb I do believe in his theories as there is no disputing the evidence which is why I spend a lot of time in this blog trying to educate and protect your investments.

Looking at the market though there are a few areas where I feel there is a buying opportunity.  You cannot fight innovation.  This is what took Apple from virtual bankruptcy to the world's most prized company in a decade.  So what other innovative ideas are out there?  One of my favorites is 3D Systems Corp which makes 3 dimensional printers for the home and office.  To me this is the way of the future.  Imagine that for the holidays instead of buying a new iPhone you bought a printer that could print toys?  This is a reality and the stock has appreciated like a rocket.

Another place is the new technology around charging batteries.  The technology is already here but only 10 million have been sold so far.  The technology I refer to is wireless charging systems.  Soon to come to your nearest Starbucks is an insert into the table at which you sit that will automatically recharge your battery on your cell phone and laptop using magnetic fields.  Amazing stuff and not only should it boost revenues at Starbucks (no I am not suggesting you buy this stock) it will go a long way to assisting with battery cars.  Think about it, you can park your Volt at work and while you sit working it automatically recharges itself by linking to the magnetic field in the garage where you parked.  Now that would help offset the $20 a day it costs to park plus it will eliminate the stress of worrying if you will make it home on the remaining charge in your car.

Outside of innovation a relatively safe bet which I have mentioned repeatedly is gold.  Now I would not load up exclusively on gold and gold stocks but I believe that it should have a position in your portfolio as if and when that bad day does show up it will serve you well.

Next is housing.  This investment should provide safety and some decent returns in the next few years as interest rates are expected to remain low at least until Bernanke's tenor is over (January 2014).  Furthermore as the banks are coming to grips with the problem the inventory of nonperforming houses should start to slow which will allow further appreciation.  As I mentioned in my last blog  I would not buy heavily into the builders but looking at the carnage in the dividend paying REITs and closed end funds could be another alternative.

The fiscal cliff that everyone is talking about has caused carnage to these high dividend payers.  The assumption (and I believe it is virtual certainty) is that the tax rate on dividends will be allowed to increase at the end of the year.  Due to this tax increase investors have dumped closed end funds and REITs in large quantities more than offsetting the tax increase through the stock value depreciation.  Some of these investments are yielding more than 10% after the sell-off and I believe that this could be a good investment for the future as regardless of the tax consequences investors want yield.  Locking in the current prices locks in the current yields and as investors settle down you should also get a decent upside kick.

As mentioned before I also believe in generic drug manufacturers and anyone that stands to benefit from Obama care.  Outside of these areas I would caution you to remain skeptical of the market in general as the problems Europe faces and the slowdown in China are hurting big business.  Furthermore unemployment, while improving is still far too high and the government needs to reign in spending.  Now don't let me get started on all the negatives as this is the Thanksgiving blog and the point is that while it may be tough out there with some work and some expert assistance there is always a reason to enjoy thanksgiving.