# The place to be in the next twenty years is...



## Bushman (26 October 2009)

I am interested what sectors investors see as leading growth over the next twenty years? 

My keen interest is energy and soft commodities followed by hard commodities on the back of the once in an investment generation industrialisation and adoption of Western living standard of Chinindia. In particular, I am a long-term bull on: 
1. Energy. Has to be a no brainer. Dwindling oil supply, no new major oilfields discovered for years, climate change (brown coal) is a classic pincer move for the old 'oil/coal' axis. In the short-term, oil companies could be an outperform due to supply shocks with the existing brown infrastracture taking a few more years to develop. In the medium term, uranium. For the long term, it is CSM, geothermal and one or two others that can provide base load power. Not sure about the future of transportation energy - hydrogen, electric? 
2. Fertilizer needed to feed a population of 10billion on an ever dwindling bread basket. 
3. Water technology - ditto above. 
4. Green buildings, especially core property sectors (huge consumers of energy). 

I can add more to the list but I would love to hear the thoughts of any futurists in the meantime. For instance, my interest has not been in technology but I am sure there is money to be made out of technological innovation especially in infrastructure, communication and medicine.


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## Bushman (28 October 2009)

Wow - this thread is a bit like a one armed man clapping. Not many futurists it would seem. 

From a portfolio point of view, this NY Times article provides an interesting persepctive on the stocks vs bonds conundrum. 

www.nytimes.com/2009/10/25/business/economy/25mark.html?partner=rss&emc=rss

To summarise the data, long dated bonds (either government or corporate) were the place to be over the last decade, with stocks and bonds neck-on-neck over a twenty year period. 

Data (source is Morningstar) 

10-year period (annualised returns): 
Long-term gov't bonds 8% return 
Long-term corporate bonds 7.8% 
S&P 500 Stock Index -0.2% 

20-year period: 
Long-term gov't bonds 8.8% return 
Long-term corporate bonds 8.3% 
S&P 500 Stock Index 8.0% 

So, when you take your investment advice, listen to Pimco rather than Goldman Sachs or Morgan Stanley. This makes sense as the bond guy is usually the most pessimistic man or woman in the room....and this was a good state of mind for the 'boom/bust' equities market of the last decade! 




Source: Morningstar


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## Wysiwyg (28 October 2009)

> In the medium term, uranium. For the long term, it is CSM, geothermal and one or two others that can provide base load power. Not sure about the future of transportation energy - hydrogen, electric?




I agree the big E, energy is most likely the sector to be in. Local and international government policy changes being the news to look out for.


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## wildkactus (30 October 2009)

agree with energy and commodities for the medium term, 

but what I think will be a go would be any new or leading technologies in the sustainability area, ie any company making things that are not going to cost the earth! (pun intended)
as governments will change the rules sooner or later as they see this as a vote winning area.

happy trading


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## sjx (1 November 2009)

Biotechnology and Telecommunications.


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## Sean K (1 November 2009)

Plumbing, in Chindia.


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## drillinto (1 November 2009)

Commodities, Emerging Markets and Australia.


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## Gurgler (1 November 2009)

Went to listen to a futurist (Peter Ellyard) speak about Training for the future couple of months ago and one of the remarks he made was that many of the jobs required in 2030 haven't been created yet! (PPT pdf attached - heady stuff, 85 slides but some interesting mindset changes required)

Amongst other points are these (slide 83)

Develop Industrial clusters which specialize in the chosen industrial future and which integrate research and development, community learning
and business formation 
Attract entrepreneurs, expertise and investors with special knowledge of /interest in the chosen industrial future
Promote leadership dedicated to realizing the sunrise (industrial future) rather than protecting the sunset (industrial past)

(There are a lot of politicians doing the latter i.e.protecting the sunset!)

All of which makes prediction difficult!


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## Mofra (3 November 2009)

Definately agree on energy - surprised nobody has mentioned healthcare as yet given the aging population and the higher community expectations when it comes to standard of living in retirement.


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## prawn_86 (3 November 2009)

The biggest problem (imo) with trying to predict so far ahead (20 yrs) is trying to get the micro level right.

SUre, energy, healthcare and maybe a couple other sectors are no brainers, but trying to pick actual companies that will survive and prosper over that timeframe is a much more difficult task.


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## jayinoz (3 November 2009)

Give me's in my opinion are energy, commodities, biotech, healthcare, IT&T, media\entertainment\gambling, emerging economies and Aussie. The challenge is definately picking the right companies- history shows more so that a passionate driven leader or founder has a much better chance of success. Plus they need to choose the right industry at the right tiime- aka gates, buffet, jobs, etc. Maybe in hard commodities in Oz we could say Forest.


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## Smurf1976 (3 November 2009)

With regard to energy, liquid fuels are where the real, difficult to overcome supply limits exist in the medium term. There just aren't too many new oil fields sitting around awaiting development no matter how much money anyone has to spend. That does imply rising oil prices assuming demand doesn't collapse.


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## Bushman (4 November 2009)

prawn_86 said:


> The biggest problem (imo) with trying to predict so far ahead (20 yrs) is trying to get the micro level right.
> 
> SUre, energy, healthcare and maybe a couple other sectors are no brainers, but trying to pick actual companies that will survive and prosper over that timeframe is a much more difficult task.




The old 'top down' or 'bottom up condundrum. 

For me, get the sector right at the very least as you can always diversify your risk by spreading capital across a few likely players. 

In terms of energy, the new technology that can deliver 'base load' power will be the winner IMO.


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## jbocker (4 November 2009)

Since the projection is twenty years then I would hazard to guess that the 'things' of the future (in the 20th year) havn't been thought of yet. Go back to the '80s (if you were born ) and if someone said "internet" or "web designer" to you, you would have thought they were talking about spiders!

...from the little I know I would guess Alternative Energy is a certainty, Carbon capturing and something called nanotechnology. This is the manufacturing of structures at the nano scale. Companies that successfully adopt some edge of nanotechnology in their applied fields will probably do verry well. 

Maybe Mork from Ork was onto something  ...Nano ...Nano.. 
(sorry another '80s thing - early Robin Williams on a TV series)


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## jonojpsg (5 November 2009)

Smurf1976 said:


> With regard to energy, liquid fuels are where the real, difficult to overcome supply limits exist in the medium term. There just aren't too many new oil fields sitting around awaiting development no matter how much money anyone has to spend. That does imply rising oil prices assuming demand doesn't collapse.




Agreed Smurf - the convenience of transport and use of liquid fuels is what makes them so useful!  In my mind, this makes H2 the main possibility as a future liquid fuel, since biofuels are going to take up too much valuable arable land which we'll need for food production and electric requires massive amounts of additional generation capacity to charge the transport fleet. 

Potentially biofuels from a microbial perspective, eg modifying bacteria to produce combustible liquids??  So a combination of biotechnology and energy.

I like this thread


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## jbocker (20 November 2009)

Any more ideas out there? 
I hear that there is nearly always a change in direction after a bust.  So after the GFC, new industries will come to the fore. Some small caps transition (and survive) to become the future big businesses. 

So what are the industries that will spawn these new companies. Anyone want suggest an 'out of the square' industry...

:robot2:


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## Wysiwyg (20 November 2009)

jbocker said:


> So what are the industries that will spawn these new companies. Anyone want suggest an 'out of the square' industry...
> 
> :robot2:




Might be worth watching those old science fiction movies for the imaginative technologies they have. Will population continue to grow exponentially and will the demand for non-core items grow too? What about subsections of essentials like food, warmth, cool, accommodation, clean land, clean water, clean air and natural surrounds.


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## prana (20 November 2009)

energy, water, food


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## Bushman (20 November 2009)

jbocker said:


> Any more ideas out there?
> I hear that there is nearly always a change in direction after a bust.  So after the GFC, new industries will come to the fore. Some small caps transition (and survive) to become the future big businesses.
> 
> So what are the industries that will spawn these new companies. Anyone want suggest an 'out of the square' industry...
> ...




nanotechnology.


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## Taltan (20 November 2009)

Good thread however the answers aren't easy in the 1960's & 1970's a lot of people were sure that buying arlines was a sure bet. Every transport technology prior to flight (trucking, shipping, railroad etc) was first used for passengers and then mainly for freight, many assumed the same would happen for airlines + people's want to fly and they would make fortunes.

Fast forward 30 years, mix in global warming, govt funding of competitors (Etihad), oil price rises and good theories have of often been proved wrong.

Looking ahead how can I know if in 20 years I'll be driving an oil fuelled car to work, an electric car to work or staying home to work cause my virtual office is just as efficient.

So whilst I agree on energy I think a better bet might be aged-care facilities. We know people will live longer and we know they will not want to die (as much as we know most predictions). 

Along with that we will won't more drugs to take, again assuming we'll want to live longer and look better etc. The problem with the drug companies as mentioned before - picking the right one. I like most people within the financial sphere have relatively little idea on all things medical.


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## jonojpsg (20 November 2009)

Taltan said:


> Fast forward 30 years, mix in global warming, govt funding of competitors (Etihad), oil price rises and *good theories have of often been proved wrong*.
> 
> Looking ahead *how can I know if in 20 years I'll be driving an oil fuelled car to work*, an electric car to work or staying home to work cause my virtual office is just as efficient.




My good theory, which may well be proved wrong, is that there is almost NO way that you will be driving an oil fuelled car to work in 20 years, NO way.


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## Wysiwyg (20 November 2009)

Some excerpts from an article published during the Howard Government reign in regards to where the market sectors might be.



> But the latter is twofold. For if you accept climate change as a reality, your first question must be: *What companies or sectors will be **adversely affected by climate change?* *Agriculture seems obvious, for example, and insurance.* The mining industry does not seem obvious more a case of damn the torpedoes, full steam ahead but much production has been lost to flooding, landslides, hurricanes and other climatic anomalies in recent years.





> There would also be winners under climate change. Persistent outbreaks of disease would not hurt the *healthcare sector*, for example.





> Winners include *alternative energy companies* (eg Origin (ORG)), *recyclers* (eg Simms (SGM)), *property* *trusts that actively manage property sustainability* (eg Investa (IPG)), *financial institutions who will benefit as intermediaries in* *a carbon marketplace*, *banks that acknowledge and* *adjust for climate change risk* (eg Westpac (WBC)), and *healthcare companies* *providing solutions against widespread disease* (Eg Sigma (SIP)).


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## alter1217 (21 November 2009)

jonojpsg said:


> My good theory, which may well be proved wrong, is that there is almost NO way that you will be driving an oil fuelled car to work in 20 years, NO way.




In 2014 China dumps all their US treasuries
In 2015 WW3 starts
In 2025 War is over, everywhere lays in ruins
In 2027 Reconstruction begins. Powered by petroleum cars. It's used because combustion is a technology that can be much more easily replicated then high-tech batteries and efficient solar panels.

Anything can happen


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## sinner (22 November 2009)

The place to be in the next twenty years is...buying Chinese Yuan.


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## gooner (22 November 2009)

Bushman said:


> I am interested what sectors investors see as leading growth over the next twenty years?
> 
> My keen interest is energy and soft commodities followed by hard commodities on the back of the once in an investment generation industrialisation and adoption of Western living standard of Chinindia. In particular, I am a long-term bull on:
> 1. Energy. Has to be a no brainer. Dwindling oil supply, no new major oilfields discovered for years, climate change (brown coal) is a classic pincer move for the old 'oil/coal' axis. In the short-term, oil companies could be an outperform due to supply shocks with the existing brown infrastracture taking a few more years to develop. In the medium term, uranium. For the long term, it is CSM, geothermal and one or two others that can provide base load power. Not sure about the future of transportation energy - hydrogen, electric?
> ...




Energy agree

Food agree. But I understand most fertiliser is made from oil, so fertiliser manufacturing is a process, so even if food prices are high, the value in the chain will go to the oil producer not the fertiliser producer, IMHO. Interested in what people think are good food companies - basically that own producing agricultural land.


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## nulla nulla (22 November 2009)

Buy a big block of land in the Wimmera/Mallee Victoria, build a subteranean nuclear fallout shelter complete with filtered water tanks. Grow your own produce above ground and butcher your own stock. Install Solar panels and hook some generators up to your windmills. Stock up from Safeway, Woolworths and Coles with the essentials like toilet paper, tooth paste and canned goods whenever they are on special. Buy a shotgun and shells to keep unwelcome guests away when the going eventually gets tough. You'll be right.


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## Nero64 (22 November 2009)

Any company involved in IP Television in the next 5 years. 

It's going to be big. You just click on a few buttons from your home TV and your shopping will be Delivered to your door. Games, movies and more, leaving the home will become unnecessary. 

Mainly service providers like iiNet and TPG have already kicked this off. Then every man and his dog will be onto it.


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## nulla nulla (22 November 2009)

Nero64 said:


> Any company involved in IP Television in the next 5 years.
> 
> It's going to be big. You just click on a few buttons from your home TV and your shopping will be Delivered to your door. Games, movies and more, leaving the home will become unnecessary.
> 
> Mainly service providers like iiNet and TPG have already kicked this off. Then every man and his dog will be onto it.




Never need to leave home. So much for integrating in society. Become totaly paranoid. Fortress suburbia. Shoot anything that moves (other than the delivery man).


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## oztrades (22 November 2009)

agree with nero.. and nbn around in 5 just makes it all better


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## Wysiwyg (22 November 2009)

Nero64 said:


> Any company involved in IP Television in the next 5 years.



Somethings to consider is who is going to be the major telecommunications business that will provide this service? Another factor will be subscription and whether people want to pay. Is pay t.v. in every home now? Not by a long shot.


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## Wysiwyg (23 November 2009)

Nero64 said:


> Any company involved in IP Television in the next 5 years.
> 
> It's going to be big. You just click on a few buttons from your home TV and your shopping will be Delivered to your door. Games, movies and more, leaving the home will become unnecessary.
> 
> Mainly service providers like iiNet and TPG have already kicked this off. Then every man and his dog will be onto it.




A high speed connection in the order of 10 Mbps is required 100% of the time unlike the present network which is used by everyone and speeds vary greatly. Current infrastructure doesn't allow these speeds to be accessible or affordable to everyone. There is presently internet, internet TV, terrestrial free to air TV and Pay TV as competition for this service and I can see only *those in the medium to higher income bracket as the "possibly" interested consumer. *

Maybe common place IN twenty years time.


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## Bushman (23 November 2009)

Wysiwyg said:


> Somethings to consider is who is going to be the major telecommunications business that will provide this service? Another factor will be subscription and whether people want to pay. Is pay t.v. in every home now? Not by a long shot.




Who are the global players? Access to vaste amounts of capital will be needed.


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## Bushman (23 November 2009)

sinner said:


> The place to be in the next twenty years is...buying Chinese Yuan.




But when will they float the yuan? Is this a twenty-year timeframe? The Chinese financial system is still very much in its infancy. However if the US does become a banana republic then the world will be crying out for a new global balance sheet from which to settle its trades.


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## THE BUZZ (23 November 2009)

Nuclear power technology.

China plans on building hundreds state of the art reactors in the next 20 years.

3rd and 4th Generation Technology.
Other countries might eventually turn to the mighty Atom.

Uranium will be in demand.

http://www.world-nuclear.org


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## THE BUZZ (23 November 2009)

more specific link...
soz.

http://www.world-nuclear.org/info/inf77.html


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## Bushman (31 December 2009)

Here are a few common sense investment rules and principles to think about for the next decade. Basically boring is back.  

www.theaustralian.com.au/business/n...of-a-lost-decade/story-e6frg90x-1225814878616


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## craigj (31 December 2009)

the basics must come first to support the growing population

food and water   -  the essentials to life

anything to improve soil and water quality and availability


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