by Paul Drockton

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

Traditionally, the Democrats have appealed to the Working Class and Their Unions. Thus, the big three automakers: (GM) General Motors, (F)Ford Motor Company and Daimler Chrysler (DCX.BA) should all benefit from "relief" legislation and stronger protective tarrifs. Ideally, the Democratic Party should be more "Protectionist" in other National Industries like United States Steel (X) which have sufferred market loss from Republican Globalized Economic Programs. The US marketplace is still the largest in the world and has the greatests potential to bring about an economic turnaround.

Globalizalized Economics has provided cheap consumer products manufactured overseas and accross our borders but the once favorable position of the dollar has seriously eroded and a weak dollar is good for exporting American Goods! Importing Foreign Goods makes little sense when those same goods can be manufactured for the same cost by better educated and higher producing Americans.

Republicans have favored an international marketplace. With the current economic crisis, look for Nationalism to bring home manufacturing and other jobs that have been "outsourced" overseas. Although these foreign enterprises have paid off politically with our current and former allies, foreign citizens can't vote in American Elections. Political Pressure and a resurgent, politically charged labor force, will lead to stronger boycotts and resistence to purchasing foreign made goods.

Additionally, expect Democrats to reign in corporate profits in the Health-Care industry. In particular, the Pharmaceutical Industry. In return for their co-operation, Congress could actually extend the life of Drug Patents to the big Pharmas like Ely Lilly (LLY) and Merck (Mrk). Also, with the strengthening of the FDA, strict regulation and oversight may actually eliminate domestic competition from "alternative" pharma sources like Natures Sunshine (NTE.BE) and other "herbal supplement" providers.

Expect Profits to decline in the defense sector. Mutual Funds, like Fidelitity's "Select Defense and Aerospace" will continue to lose value as the Democrats look at increasing the human presence in our military and move away from more expensive gadgetry. Look for the Return of the Draft and along with it, an increase in profits for those companies that provide weaponry, artillery, small-arms and basic foodstuffs to Uncle Sam.

Bond Funds will continue to move away from long-term commitments with the destabilization of the dollar and further reductions in the Federal Discount Rate. Look for Precious Metals like gold and silver to continue to attract investor attention. Primarily as a result of economic instability more than any other influence.

Real-Estate will see a resurgence in affordable housing as most Americans move away from McMansions and back into Bungalows. Neighborhood revitalization will play a major role in providing this housing need and Federal Block Grants will be far more readliy available. Big Box Stores like Home Depot will benefit from the move towards home restoration.

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