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In May Google announced that it made an industrial size investment in industrial scale wind power. The search engine behemoth put up over $38 million toward a 169.5 megawatt wind farm in North Dakota, being developed by Florida based NextEra Energy, Inc. (FPL). It truly is an exciting project, using advanced blade technology and dynamic control systems. 

Why does Google care so much about wind power? Probably because it just does, as shown by its efforts aimed at conserving energy as a company, and pushing for better clean energy policies for the country. Just as important, though, Google is essentially in the electricity consumption business. The company is very secretive with their actual energy usage, but even so, their myriad of servers and data centers require lots of reliable electricity. The Times Onlineestimated that a single Google search generates between 1 and 10 grams of carbon pollution (though Google disputes this). Given this potentially massive carbon footprint, energy policies have a direct affect on Google’s assets and bottom line, be it monetary or environmental.

The good news for Roen Financial Reportsubscribers is that NextEra Energy (formally FPL Group) was recommended for inclusion in the Paradigm Portfolio back in May of 2009. FPL was profiled in the November 2009 issue of the Roen Financial Report. I agree with Google that this is a good company to invest in.

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Source: U.S. Department of Commerce Bureau of Economic Analysis. Data as of 4/30/2010. All figures in $Billions.

As a result of the tech bubble in the late 1990’s, stocks became tremendously overvalued for an extended period, and then came down in price once that bubble began to burst. The volatility that ensued lasted for several years as economic uncertainty made it very difficult for investors to pin down where fair market value should be. A similar event happened after the S&L crisis of the early 1990’s, but to a lesser extent. Considering the extreme market moves of the past few years, it’s not surprising to see a return to volatility, which is likely to remain a characteristic of the market for some time to come.

This makes it even more important to have a disciplined investment plan with a long-term investment horizon, to help weather capricious market moves.

The Roen Financial Report will profile Covanta Holding Corp (CVA) in the June issue, highlighting the pluses and potential pitfalls of this innovative company.

The June issue will also introduce a brand new company to the paradigm portfolio.  Online subscribers will have the most immediate access to upcoming issues.

Research performed by sentimenTrader analyzed what happened during similar occurrences when new highs were reached and then erased shortly thereafter. While the periods that followed after a shocking crash were decidedly rocky, only 3 months later the market was up over three quarters of the time.

Even with valid global concerns stemming from the monitory crisis in Greece spreading to other countries, this situation could bode well for US stocks and the dollar-now perceived as safer havens. This, combined with very positive economic news in areas like Industrial Production and Corporate Profits, may make the rout at the beginning of May 2010  look like a good buying opportunity.

I am not predicting a “W” shaped graph at this point; rather I believe the more likely scenario will be some large steps in a staircase gradually trending in the up direction.

During a crippling market downturn, I offered sound advice that my readers could act on with confidence when many professionals had little stomach left for recommending investments. Specifically designed around finding high-quality companies in the field of energy alternatives, the Roen Financial Report formulated a dynamic portfolio of key companies working to decrease dependency on foreign oil while reducing pollution. Since the flagship edition, 84% of the stocks selected have had positive returns (listed below), and over half of all company picks posted better than 40% gains.

The goal for the Roen Financial Report over the past year has been to present expert content in a useful, affordable newsletter. Going forward, I will continue to search out and analyze the best information available that will help me create and share new ideas about high-quality companies and mutual funds. A warm thank-you goes out to my valued subscribers.

If you are interested in learning more, click here to download a free sample.

One of the financial indicators I follow closely is investor sentiment, which is a very strong contrary indicator to market direction. In other words, when investors as a group get too giddy about the market, it is usually a cause for concern. I regularly watch sentimenTrader, one of the best websites that tracks these trends (they have a shorter term perspective than the Roen Financial Report, but their information is still very useful). The folks there yesterday wrote “…we saw more extremes in our indicators than just about any other time in five years. The number and variety of extremes are too numerous to mention, and we had to leave many out.” 

While there are real concerns in today’s economy, I feel the good news in the economy outweighs the worries and we are toward the early end of a positive business cycle. This type of stock market correction is likely a necessary downturn in a positive market ahead.

The question remains, though, why are these ads coming out now? I believe there are two main reasons. First, the industry has poised itself to ride a wave of goodwill after Obama’s announcement about increasing offshore drilling in the continental U.S. and Alaska. This could help in garnering local and national support in siting and permitting new drilling facilities, not a small consideration in an increasingly challenging regulatory environment.

Second, and more importantly, political support is needed for bill such as S.1408, known as the Nat Gas Act. The bill has 141 cosponsors in the House and 7 cosponsors in the Senate, including Orrin Hatch [R-UT] and Harry Reid [D-NV], powerhouses from both sides of the isle. The bill allows for tax incentives, such as lowering excise taxes on natural gas products to make them more attractive in the marketplace, and allowing tax credits for the purchase of natural gas vehicles. It also requires federal agencies to purchase “alternative fuel” vehicles for fleets. The greater the buzz that can be created around the development of domestic natural gas sources, the greater chance a bill like this will be passed

I will be following these developments with great interest.