How to Make Money with the Winners of the Financial Crisis

Every big crisis evolves winners and losers. The actual credit crunch at the capital markets makes investing in corporate bonds juicy in these days. The widening of the credit spreads has made corporate bonds attractive. This window of opportunity might stay open as long as the rates of government bonds are decreasing. Investors in corporate bonds have to consider the default risks.

I do not recommend or exclude a certain corporate bond in this article, but I try to determine the industries that look promising or risky. It might be a favourable approach to pick bonds from industries that will flourish in the near future. The cash-in-flow and liquidity of a corporation also needs to be considered besides of the industry.

How to benefit from the Winners

There are always industries that flourish during economic crisis. The People have to eat and they need medication. Corporate bonds of the players of the food industry or pharmaceutical industry should be considered. Barack Obama has promised that he wants to solve the issue of the insufficient health insurance. An overall health insurance in the US will propel the pharmacy corporations.

The governments of the western countries will launch programs to curb the conjuncture. Barack Obama has announced to renovate the public buildings and the school buildings. The German education minister Schavan wants the school buildings renovated. Both of these programs have in common that they seek to improve the energy efficiency of the buildings. Thus the suppliers for building facilities and equipments that improve the energy efficiency will enjoy a good time.

Energy is also an inevitable basic good. Electricity is the backbone of the modern society. Electricity power works are in general very reliable debtors. The producers of renewable energies have a very bright future. Solar power and wind power will be among the stars of a coming boom.

Water is the fluid of life. The water suppliers belong traditionally to the best rated debtors. There is worldwide a tremendous need for pure and healthy water. Water title will be attractive.

Leave out the losers

Banks, credit card issuers, insurance companies are the big losers of the actual crisis. They are joined by the car industry. Their bonds show big credit spreads but this reflects the risks of these stumbling industries. More about money issues displays the website and forum of Make Money Tip.