bstocksdev

I read a quote in an article recently which stated, "What Wall Street is about is smart guys thinking about ways to make money from dumb ones." That quote is attributed to one John E. Fitzgibbon, the publisher of an online newsletter, in an article from Eric Dash via The New York Times. While Mr. Fitzgibbon's remark might validate special investing skill on the part of some smart and timely investors, I take exception to the notion that all those investors who lost money in the markets over the past year are the dumb ones.

The question now is, where is the smart money headed?

First and foremost, you don't need a lot of book learning to know that the dollar's decline signals that the most active investment money is stepping outside our own borders. Let's face it gang, the American economy is entering a maintenance stage where real growth is going to have to wait until we re-valuate the country. Ours is a nation built upon 50 to 60 years of debt, and the time has come to face its reckoning. The idea of investing in debt has lost much of its appeal, and the smart money is having almost nothing to do with it, a concept which might have saved much misery for Countrywide Financial Corp. (NYSE: CFC).

Let there be no mistake that right now, retiring your own debt is the single safest investment that you can make.

I'm suggesting for safety, the best places to conservatively keep money domestically would be as close as possible to the beginning of the manufacturing supply chain. Mining, drilling, and extraction of raw materials should remain quite active and see sporadic growth in localized regions.

Think freight transportation, the bigger the payload the better. I still like the railroads for long-term stability, and there's building activity within the global shipping industry. Investment in the export of raw materials should be very safe money in 2008, but import of even the most essential durable goods shall remain fraught with danger.
Right about now I'd stay away from airlines altogether. They're shaping up for another tough year.

And then there's Google (NASDAQ: GOOG). It's again my top tech choice for another year. I'll make no predictions in regard to share value because I think it's currently topped out. What I will hazard to say is that I think Google will be a little louder in 2008 with regard to the telecommunications industry. I'm also expecting that within the next couple years, we'll begin to see Google contracting with government agencies for information storage and handling services.

Finally, here are some of my prospecting and watch words for 2008: Water, oats, rice, electrical generation, infrastructure, and real estate.

For deeper insight and analysis on specific stocks for 2008, be sure to read the whole BloggingStocks team!

(Gary Sattler does not knowingly have financial interest in the companies he blogs about.)