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Hello Crazy Gang,
The jolly old government confirmed in the Queen's speech that they are indeed going to encourage the building of three million new homes.
With the banks now more careful about lending the money, one wonders how this will all come to pass. But you can bet the building firms will do well out of it. But we're not just talking about the big building groups here.
It's also good news for many companies which make electric fittings and cable, the cement firms, the brick makers, quoted estate agents, timber suppliers, plumbing suppliers, garden centres, and... well the list is endless.
One of my little ploys is to look for big news stories like this and consider which firms will make money out of the situation.
For example, when the summer floods happened I read that people were desperate to get their hands on caravans to live in, while their homes dried out.
So all those companies which make caravans and gear for caravans suddenly found their stock shifting like hot cakes, whereas trade had been a bit soft before.
The shares in this limited number of caravan-related companies went up, while insurance shares went down. (Insurance companies are now getting back on their feet as the floods are forgotten, by the way).
While another obvious example is that if the government were to announce a huge injection of cash into the NHS, then all the drugs companies might be boosted.
Any road up, here's the general tip you might take on board. Look out for the big news story and consider who will do well out of it. There are always a few companies which can take advantage - and the share price, of course, rises with the profits. Rocking on!
To find out more about Malcolm CLICK HERE
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