Last week we took a tour through transportation, barely touching on some highlights for that sector of the markets. This week, we'll begin to tackle industry, the behemoth of market sectors.

The industrial sector can be divided into various categories: Industrial transportation, general industrial services, building or construction, electrical components, industrial services, and aerospace, to name just a few. This sector overlaps and incorporates many other sectors. The one defining boundary to this sector could be the definition of the act of invention, using machinery and to create more machinery and other products. In many cases, this includes the power generated to complete and maintain industrial projects.

This is possibly the most competitive sector on a global level outside of technology. Japan was a direct competitor to the U.S. a little over fifty years ago, and this eventually evolved to include technical competition. Today, global competition to U.S. industries includes every country with companies listed on global markets.

Most of you are familiar with the Dow Jones Industrial Average. This is a good place to peruse industrial firms in the U.S. and globally through their various publications. If you type "Industrial Sector" or "Industrial Sector Stock Market" into any search engine, you'll come up with numerous sites that will lead you to information about this sector in various nations, along with comparisons of competition level to U.S. markets.

As with transportation, most information in U.S. and European industrial sectors will lead us by the nose to energy consumption problems inherent in this category. Before we tackle some of the similarities and differences in energy consumption between transportation and industry, let's ponder how technology has affected this sector over the past century.

You know by now I'm not one to leave history alone. Although the industrial sector may seem tired, dirty, and overused in many respects, it's a sector that was birthed fairly recently. We could presume industry began its long childhood during the Age of Discovery in the 1400s with shipbuilding. One reason England and other countries were avid about exploration was the hunger for materials to build ships.

Tall pine trees were one goal - these were excellent for masts and were in short supply in Europe and England. The next goal was acquisition of land to grow hemp, the material to make the canvas for the masts of these ships. Once our ancestors settled and had more time for Civil Rights and civil matters, industrial goals changed. More machinery and new inventions were needed to replace slave labor used in farming and manufacturing processes.

The need became even stronger once child labor laws were enacted in 1904. In the time between 1860 and 1940, more machinery and equipment was invented during any other time during the life trek of modern man. War machinery was part and parcel of this package. That's why this period is called?you guessed it?the Industrial Revolution.

Inventions beget inventions, but sometimes inventors are too busy jumping into new creations rather than improving what we have in our hands. The first efficient typewriter was invented in 1867. It wasn't until almost one-hundred years later when Betty Nesmith Graham (mother to Michael Nesmith of Monkee fame) invented and sold her "Mistake Out" - known today as White-Out or Liquid Paper.

Typewriters were a boon to the industrial revolution. Communications helped inventors compare and discuss, creating more products within a highly competitive global atmosphere. Telegraph and telephones increased the knowledge base for more efficient equipment and machinery. When the Information Age busted on the scene in the 1900s with computerized equipment, industry adopted this mode of communication like it was a true offspring of their sector.

Today, industry incorporates technology not just in communications, but also in various manufacturing processes. One reason why hemp isn't grown in this country - outside of U.S. legal ramifications and open market restrictions - is because the machinery used to harvest and prepare hemp for textiles is fairly obsolete. Any equipment leftover from U.S. hemp manufacturing during the World Wars has been abandoned and is totally unacceptable for profitable marketable materials.

Flax is very similar to hemp in harvesting and production for textiles. This is why linen - made from flax - is so expensive. Most manufacturing equipment isn't in the states, and major manufacturing of flax or other plant materials for textiles is limited and located in other countries other than the U.S. This trend away from plant materials for clothing and other products began with Dupont's invention of nylon in 1939.

Nylon and other man-made materials increased the demand for petroleum products. Check out your clothing labels. If you're wearing Kevlar, nylon, polyester, acrylic, polypropylene olefin, and spandex, then you're wearing clothing made by chemists from by-products of petroleum. These fabrics have become a boon in the U.S. market because of several factors: one is the lack of interest in the equipment to produce natural fibers; two is the need for less expensive materials for a more populous country; three is that most of us aren't aware how pervasive petroleum products are in our lifestyles; four is that U.S. land is becoming more and more limited for growth of natural fibers for creation of products.

Textiles are part and parcel of the industrial sector, since they're used to create many machine parts. Other "extractive" - or from-the-earth - materials include just about every metal available. Plastics - another by-product of petroleum - are used for construction. Other countries, including those in Europe, Canada, Australia, and China are using plant materials to create resins and other materials that seem very competitive to plastic. If you have a child who's a skateboard or snowboard fanatic, take a look at the company who makes these sport toys, and the materials used to create them. You might be surprised.

This same cellulose - or plant fiber material - is being tested in automobile parts and in space programs. We discovered in transportation that the demand is high for lighter and safer materials. Perhaps this is one avenue to scope out for investments.

This is the lighter fabric of the industrial sector. Next week, we'll party down with the heavier stuff. In the meantime, Cora and I both wish you all a Happy New Year, and many more?

Until Next Week,
Linda Goin

BUYandHOLD does not recommend any securities. The securities mentioned above are being used for illustrative purposes only and should not be regarded as an offer to sell or as a solicitation of an offer to buy.