by Frank Sherosky

Created on: January 06, 2009   Last Updated: January 14, 2009

The best trading mentors always teach trend bias as the prime factor for any investing strategy. It is crucial then to consider the market's bias relative to Obama as our new president.

Whether you voted for Obama or not is irrelevant. His keynote statement, "to do things in a New Way," explains the degree his economic policies will impact your investing choices. In fact, failure to recognize this relation will set you up to miss many profitable option opportunities.

Take the American auto industry, for example. Contrary to extreme opinions, the industry will live albeit smaller; but anyone who thinks the Obama administration will keep writing checks without strings attached is misreading this man's words. Mr. Obama may have applauded President Bush's authorized use of TARP money to General Motors (GM), Chrysler and Ford (F) to stave off an industry crash, but Obama will still demand the "New Way" includes greener, more fuel efficient vehicles. Bonus for you: A host of supporting, green-investing opportunities.

The New Way is Electric:

Regardless which technology you may favor, the future of a clean auto industry will depend on the production and storage of electricity. That is the only way the industry can truly meet mileage and pollution standards of the "New Way." Think lithium-ion battery technologies, like GM chose to develop with A123Systems for the Chevy Volt. It's similar to the battery in your laptop and cell phone.

The first Volt prototype has already delivered 40 electric miles as advertised for under $40k target. Another competitor, the Tesla, has a range of 250 miles, but the cost for that vehicle is over $100k.

The New Way is Biological:

Gasoline and diesel will not disappear overnight, as America will still need trucks to haul things. So, the solution will be one of measured actions. The hybrid will dominate this category, but the use of bio-fuels will move away from food-source, related ethanol, and increase toward bio-oils, natural gas and hydrogen.

The New Way is Fuel Cells and Hydrogen:

The simplicity and speed of refueling like gasoline will taint certain customers away from plug-in vehicles. Pity the apartment dweller requiring 6-8 hours recharge depending on voltage. For that reason, the future will demand smaller, more powerful batteries and a fast-replenishing fuel like clean hydrogen.

The New Way is Wind and Solar Generators:

While battery technology is a good, investing-probability bet, think of electricity generation. Even when hydrogen is used as an auto fuel, electricity will have to be generated to produce it. To negate the fears that polluting coal plants will be used, the solution will center on wind and solar panels contributing to the power grid.

Focus of the New Way:

Earth cannot sustain millions of more drivers (China and India) adding to the collection of air pollution and global warming. For the competitiveness of the American auto industry, it's a done deal; politically and economically. Failure to recognize Obama-related investment setups will set you up for missed opportunities. Do your homework.

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