Well, it's official. It's now kosher to discuss how partisanship will affect different sectors of the market in the face of an election year.

It all started on January 4, when Reuters ran a story called "Energy Crisis? Not on U.S. Campaign Trail."

That article called the energy crisis an "800-pound gorilla," despite the scant attention it's received thus far on the road to the White House. Going further, it claimed energy could "be one of the most pressing issues facing the next winner of the Oval Office."

That was the same week oil hit $100 per barrel.

And so it began. Just how would the election of one candidate over another affect the energy scenario and, in turn, the associated stocks?

According to the article, "Everyone's making the usual comments but none of the candidates has offered any practical details."

Flash-forward two weeks and three primaries and the picture changes drastically. Recession fears have mounted and the economy has tied the war as the most pressing issue on Americans' minds. Almost on cue, the outcome of the election--and the conventional views of each party--were being discussed as vital to which sectors of the market would do well.

Now we're seeing Reuters headlines like this: "Wall Street Sifts Stock Plays on White House Race." And investment scenarios, both positive and negative, are being formulated by analysts for all major candidates.

So how, exactly, are they being sifted?

Taking Stock in Democrats or Republicans

Well, just as you'd suspect, I suppose. Here are some bullets taken right from the Reuters article:

• If New York Democratic Sen. Hillary Clinton goes to the White House, some analysts see a possible boost for badly battered homebuilder stocks like D.R. Horton (NYSE: DHI), Pulte Homes (NYSE: PHM) or KB Home (NYSE: KBH).
• A likely long-term loser under Clinton would be the health care sector, "especially HMOs and branded prescription drug makers," says Robbert van Batenburg, an analyst at Louis Capital Markets.
• Some construction stocks might look good if Republicans win. Except for McCain, they widely favor building hundreds of miles of fence along the Mexican border to control illegal immigration.
• Some Republicans want tamper-proof, biometric identity cards for non-citizens. That could help identification technology companies such as Cogent Inc (NASDAQ: COGT).

But what about energy?

• "Democratic candidates, for the most part, would likely be a more positive policy outcome for the clean energy sector than their Republican peers," say Morgan Stanley analysts.
• Edwards has the most aggressive ethanol production targets. Obama and Clinton also would lift the sector, while Republicans put more emphasis on oil, coal and nuclear power.

That's what the pundits have to say. How about the people?

According to a Zogby poll released last week, "Some 47.5 percent of those surveyed think a recession is likely in the next year, up from 43.4 percent in the previous month's survey."

In addition, only about 20% approved of the current administration's economic policy, which, until very recently, touted the economy as strong and resilient. And many voters--sorry, no specific numbers--said they would be better off with a Democrat in office.

The Reuters article about the poll reported that "When asked which presidential candidate would be best for respondents' financial situation, 20.1 percent said New York Democratic Sen. Hillary Clinton, making her the top vote-getter. Some 17.5 percent were unsure, and 13.6 percent chose Illinois Sen. Barack Obama, another Democrat. Arizona Sen. John McCain led Republicans with just 10.9 percent of the vote, followed by former Massachusetts Gov. Mitt Romney at 8 percent. Former New York City Mayor Rudy Giuliani trailed well behind with 3.8 percent of the vote."

In general, history tells us that the incumbent party loses the presidential election when the economy flirts with recession in an election year.

But polls have been wrong before. Do you remember "Dewey Beats Truman," "Gephardt is Kerry's VP Pick," or even the miscall of the recent New Hampshire Primary?

With so much information coming from so many different angles, it's hard to know what to believe.

That's why I follow the money and what's actually happening on the ground. Things like:

• Washington State Gov. Christine Gregoire's plan to reduce her state's emissions 50% below 1990 levels by 2050, and the 200% increase in green jobs it will bring to the state.
• The doubling of geothermal energy capacity once projects currently developing come online.
• Clean energy investment rising 33% in 2007 to $117 billion.
• The more than $20 billion in new construction planned for the North American liquid natural gas (LNG) sector.
• Goldman Sachs "strongly recommending" fund managers to overweight energy in the face of a looming recession.

It's these things that provide a real inkling as to where the markets are headed, and that Green Chip uses as a launching pad for winning trade after winning trade.

If you don't want to miss another one, click here.

Until next time,

Nick
www.energyandcapital.com

"Energy stocks... The only way a human is going to make any money."

-- Matt Simmons, Peak Oil's first and most vocal proponent,
and founder of the country's last pure play energy investment banking firm.

Follow the money trail. Sign up for Energy and Capital now.

Enter Your E-mail Address Below:

By signing up, you'll also get our latest report, The Truth About Oil.

Hello Nick:
Gee whiz, if you are talking about politcal candidates that would have an enormously positive impact on the American dollar and economy, read what Dr. Ron Paul has to say----he is VERY informed on economics and foreign policy----he has been involved in US politics as a sitting 10 term congressman from Texas. His perspctive is based on the US Constitution. He is the "champion of the Constitution". His economic policies strongly address the massive deficit debt of +-$9Trillion. I am sure you have noticed that the US Dollar is in freefall, the recession is official and worse is looming.
So, please do have a look at Ron Paul, if you Google www.ronpaul2008.com his policy positions are there for ALL to see.

Thanks to the unending shrill screed eminating from the media about "a recession is coming, a recession is coming", they've just about got us talked into one!