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Obama's Energy Policy

Written By Nick Hodge

Posted December 10, 2008

It is a major national security issue.

That reasoning seemed to work the past eight years as countless, often unnecessary, rules and policies were rammed down American citizens’ throats.

Secret wiretapping? National security issue.

Spying on peaceful protesters? National security issue.

Millions of missing White House e-mails just as investigations began into the politically motivated firings of U.S. Attorneys? Obviously a national security issue.

Just like those WMDs, right?

Of course, BILLIONS were made on those "national security issues." (OK, maybe not on the e-mails.)

Private security firms, military and spying software, and defense contractors have raked in billions as a result of our national security issues.

Thing is, you had to be willing to profit from lies, deceit, and destruction to go along for that ride. I certainly wasn’t. And I know a few more like me.

Now, a new President is going usher in a new line of national security issues. The profit potential from these new issues will be equally as great as the old ones, only they’re backed by truth, science, and goodwill—not greed and a get-rich-at-all-costs mentality.

New National Security Issues

To be clear, I’m not in favor of applying the "National Security" label to any pet project that needs public approval. But, that’s the world we live in. Somebody has to herd the sheep.

The moral high ground has many loose stones. And the new administration will certainly use tools sharpened by their predecessors. Hopefully, they have a different end-game in mind.

So far, it looks promising.

Instead of wielding the national security tag to gain access to your e-mail, Mr. Obama has set his targets on less dubious threats: energy security and climate change.

The incoming president has appointed General James Jones as his national security advisor. Jones is also the CEO of the Institute of the 21st Century, a group developed by the U.S. Chamber of Commerce to promote energy development and conservation.

That group, headed by the soon-to-be national security advisor, sent Mr. Obama a report after his election asking him to usher in a new age of energy policy.

Here’s an excerpt from that report:

"For over 40 years, the United States has had an inadequate, contradictory and shortsighted approach with our regard to our energy future. Energy is a national security issue and an international security issue of the highest order. Global demand will increase by more than 50 percent between now and 2030 – and perhaps by as much as 30 percent here in the United States. We must develop new, affordable, diverse and clean sources of energy that will underpin our nation’s economy and keep us strong both and home and abroad."

Did you see the buzzwords in there: "Energy is a national security issue."

This is must be a top priority. Sound the alarms. Get your checkbooks ready. We have a new national security issue.

Surely someone, somewhere, is getting rich of this deal. Shouldn’t it be you?

For a list of what Mr. Jone’s report recommends, click here. I just scanned them, but from what I saw, the price tag comes out at well over a billion dollars.

Basically, we’re substituting First Solar (NASDAQ: FSLR) and EnerNOC (NASDAQ: ENOC), and a litany of other cleantech companies for Enron and Lockheed Martin (NSYE: LMT) here. It may not be exactly straight arrow, but it’s certainly not war profiteering.

And energy security isn’t the only new national security issue. We’re also going to war against climate change.

Here’s a recent quote from the next leader of the Free World on the subject:

"This is a matter of urgency and of national security and it has to be dealt with in a serious way. That’s what I intend my administration to do."

For rhetorical good measure he added that attacking global climate is a "matter of urgency."

Can you see the stocks rising yet?

Profiting from National Security Issues: A Quick Case Study

Take a look at this chart of four major defense contractors over the past five years:

defense contractors

Each of them had substantial runs, earning well over 100%, as they gobbled up government contracts to deal with our national security issues, namely the occupation of Iraq.

It’s no surprise or coincidence that their rise in stock price correlates concretely to our invasion of, and prolonged stay in, Iraq.

Now, you could argue that these stocks began to decline along with the broader markets. But I’d argue they held up comparably well, and only started to decline upon the realization that a new president would be elected with drastically different national security issues.

With new national priorities, a new group of stocks is about to embark on a similar run.

Instead of defense contractors, it’ll be cleantech companies that are receiving government meal tickets for the next few years.

It’ll be the same profit opportunity, only with new players and a more positive end-game.

But you’ll need to get your ducks in a row now in order to take advantage.

To get you started, I’ve compiled a full report on investing in wind energy—one of the first sectors that will receive the Obama-bump.

Be sure to check it out.

And, for continued coverage on this emerging trend, along with complete investment advice and analysis, be sure to join the thousands of other readers already in the know at the Alternative Energy Speculator.

Call it like you see it,

nick hodge