by Michael Skinner

Created on: May 27, 2009   Last Updated: August 08, 2009

President Obama and the congress are willing to have the United States go trillions of dollars in debt to China in order to create an alternative energy infrastructure. This infrastructure will require that existing buildings be retrofitted, that wind generator turbines be built and serviced, that power lines be run from those turbines to the national power grid, that bridges and roads be maintained, and that mass transit trains be built in almost every state in the union. All of this building will take massive amounts of iron, steel, aluminum, and copper as well as other materials. It might be the best time to invest in mining. An investor would need to be willing to stay with the market for as many as ten years or as few as two years. If none of these pipe dreams come to pass then an investor could loose his entire investment. Therefore, I would recommend that an investor not borrow to make this investment. Financially, few things are worse than loosing money in the market and having to pay that lost money back to creditors as well.

An investor who has capital to risk might have to take his profits in as few as two years. The reason for this is that the mid term elections come up in 2010. If the voters decide to throw the Democrats out, then all those trillion dollars plans could be out as well.

It is likely that whether the government does anything or not, the economy will recover in two years. Boom and bust cycles are historically natural events. Given that is the case, a longer term investor might look at a situation where an Obama administration and a liberal congress would take credit for a booming economy. The congress and the president would then have as many as eight years total to spend trillions of dollars recasting the energy and transportation infrastructure into an alternative energy model. If an investor is willing to bet on this outcome, and he has the capital that he doesn't have to borrow, a long term investor should consider mining as a way to make some money over the next ten years. Moreover, if that investor believes that the world's economy will take off, then the demand for raw materials in China and India will compete with that of the United States and wind turbine building countries such as Denmark, and the price of raw materials will be driven even higher.

So an investor needs to try to predict the futures of the US and the world economy. If he believes that the world economy will rebound, it may be time to invest in mining. If he believes that Western nations will continue to replace their infrastructures will a greener model, it may be time to invest. If he believes that something like a billion people in China and India will continue to bring their standard of living up to Western levels, it may be time to invest in mining.

Learn more about this author, Michael Skinner.
Click here to send this author comments or questions.