As hurricane Sandy has passed it is time to assess the damage and rebuild. Such times remind us of the frailty of human life and endeavors. Such times also bring us together to build a new and rebuild better than before. The New Jersey governor says he will ask the Army Corps of Engineers for help. But many others will invest in rebuilding the Jersey shore and other hard hit areas. As the storm passes it is always time to look to the future and that includes attracting capital, making plans, and doing the work. There is no good reason why one might not invest in rebuilding the Jersey shore, Hoboken, and other areas of the East Coast with profit as a motive as well as a good heart. This may be a good time for learning how to invest in growth after destruction.
What Is the Damage?
Billions of dollars and counting is what they say on the news about damage from Sandy and adjacent inland storms. All of this will need to be rebuilt. Think in terms of infrastructure like power and water treatment plants and municipal bonds come to mind. Think of roads and both taxes and construction profits come to mind. Think of damages to sew systems and electric grids, local wiring and plumbing, and more and labor unions and skilled labor comes to mind.
Who Are the Players?
Homes have been damaged also the upper Atlantic coast. That may simply require a few trips to Home Depot or Lowe’s or it may require that a local home contractor rebuild a home for thousands from the foundation up. Although the losses will be great there will be money in the pockets of skilled laborers who clean up the mess and invest in rebuilding the Jersey shore and beyond. The profits from rebuilding may come from selling furniture, appliances, and other household goods to replace what was lost or damaged in the storm. It may come from selling a new car or new house to the plumber, electrician, or other union worker who puts in overtime for a year and wants to reward himself. Picking new winners after the storm clears could be profitable.
Insurance companies will need to dig deep to pay for reconstruction costs. Depending on who covers what the most profitable way to invest in rebuilding the Jersey shore and other hard hit areas may be to short insurance company stocks and buy again when they hit bottom.
Where are the Profits?
If you want to invest in rebuilding the Jersey shore and the rest of the US East Coast where are the profits? Timing may be the key factor. The old saying that the best time to invest is when there is blood in the street may apply if only you replace blood with flood waters. Having a clear sense of who will profit and who will lose and buying or selling stock, buying puts or calls on promising trades, or picking the right publicly traded construction company can lead to profits if you get in before everyone else catches on. Where are the profits if you invest in rebuilding the Jersey shore and beyond? Maybe they are everywhere and you just need to look and do the fundamental analysis.