One of my favorite financial commentators is Jim O'Neill, who heads up the asset management division of Goldman Sachs. He's the guy who famously coined the acronym BRIC to refer to Brazil, Russia, India, and China, and he's just written a new book titled The Growth Map, which explores economic opportunity around the globe.
In addition to his enthusiasm for booming economies like the BRICs and emerging economic powerhouses like South Korea and Mexico, O'Neill is surprisingly bullish on the United States. Just recently, he told Charlie Rose that the world shouldn't count America out.
O'Neill feels that real progress is being made in the housing and energy sectors of the American economy, which will help lead the recovery. And he even believes unemployment will drop more than many of his fellow pundits are forecasting. A look at some recent studies seems to support O'Neill's overall outlook.
Last week we heard some very encouraging news on the energy front. A Bloomberg report noted that America's domestic oil output is the highest in eight years, and projected that the United States could become the world's top energy producer by 2020. This is great news, which could result in higher incomes, employment, and government revenue in the near future.
This is potentially great news for investors in particular. My colleague Dave Meier feels Denbury Resources (NYSE: DNR ) is an excellent way to play this growth in America's energy output. The company uses CO2 to extract leftover oil from older wells, and is likely to be a growing domestic player over the next 20 years. I also believe that ExxonMobil (NYSE: XOM ) is well positioned to benefit from current energy trends, as it has the size and breadth to continue investing in key areas like natural gas for future growth opportunities.
Is the housing bottom finally here?
There's also evidence that the housing market is improving. The well-respected blog Calculated Risk argues that we may have finally reached a bottom in housing prices. The blog feels that we've already seen the bottom for housing starts and new home sales, and that the bottom for housing prices should be reached around March 2012.
This news also bodes well for investors. As the housing market picks up, that should considerably improve the prospects for both Lowe's (NYSE: LOW ) and Home Depot (NYSE: HD ) , as consumers spend more on new and existing homes. Home Depot's stock price has been the stronger performer of the two over the past year, but I suspect both companies will do well in the near future. An improving housing market should also steady our big banks. I think Wells Fargo (NYSE: WFC ) , for example, is a solid, well-managed bank that might do very well in a recovery.
Hear our engines roar
Clint Eastwood declared in the now notorious Super Bowl ad that "the world's gonna hear the roar of our engines." Actually, there seems to be a lot of evidence that it already is hearing that roar. We're obviously not out of the woods yet by any means. The one big thing that worries O'Neill about the United States is our completely dysfunctional political system, which seems more than capable of snatching defeat from the jaws of victory.
I strongly feel that energy will be one of the big drivers of growth for America in the coming years, and I think ExxonMobil might be a solid way to play that trend. Our top analysts here at The Motley Fool, however, really like another well-run energy company that they believe is "one of the best operators" in the industry.