Bet on Healthcare Utter Nonsense
Generally when the government gets involved in any business, its bad, but never for Wall Street. This time, as it pertains to healthcare, I honestly have no idea what might make a great investment. We know it won’t be the insurers, they’re going to have to compete with a company that can post a loss. Maybe hospitals, but who knows how much regulation the healthcare bill might entail.
Usually these are obvious. When the stimulus passed, it was inflation and commodities, particularly steel. If this bill passes, who knows who’s going to win out.
Healthcare Is Incredibly Complicated
Even more complicated than the healthcare bill is the industry itself. Hospitals are in bed with insurers and insurers are in bed with hospitals. Drug makers are sure to benefit, but that’s only if the new healthcare bill would cover the cost of prescriptions. And what if regulations are so tight that businesses are literally driven out of business.
At this point its virtually anyone’s ball game. Its premature to invest in anything healthcare just yet, mostly because those who think it will pass are already invested, and those that don’t, are staying away with a 10-foot pole.
I almost don’t think the healthcare bill will pass due only to its cost. $160 billion per year is unlikely to go unnoticed, especially when the benefits of the bill will be paid for by taxpayers and benefit those who are not likely to pay taxes.
Despite the heavy democratic majority, odds are that this bill will first be filibustered, then a greater majority will be needed. Either they’ll go the route of a procedural filibuster and simply say “I am filibustering this bill” or they’ll actually debate nationalized healthcare forever. That is, after all, the true filibuster, and in my opinion is the best route for any bill.
If a healthcare bill isn’t passed soon it won’t happen. Taxpayers are already overwhelmed and they’re likely to be up in arms about greater spending. Plus, with next year being an election year, chances are if this doesn’t get passed in 2009 it won’t be passed at all.
No bets for now. Nothing is certain, and should the bill fall by the wayside, healthcare stocks are going to be pummeled. On the first sign of passage, all in on the healthcare industry. Otherwise, seek a better investment.
