Every now and then, unlikely things happen, from the fall of the Berlin Wall to the sudden, dramatic rise of the Internet in everyday life. We investors need to remember that many elements of the status quo that we take for granted may not be around tomorrow. And these changes have major implications for the companies in which we invest.
The end of TV?
If you're invested in a maker of high-end televisions, such as Sony
Sure, this probably doesn't spell the end of TV as we know it. I'm a fan of board games, but I must concede that video games are a much bigger business, and they use television sets, instead of supplanting them. Still, little news stories like Cindy Hoedel's can be helpful, reminding us to consider alternate futures. Perhaps board games will drive growth at some companies in the near future, for example. Hasbro
It happened to the world of traditional cameras and film. Who would have ever imagined that Eastman Kodak
Developments afoot
Change is brewing everywhere in the world. For example, Congress is revisiting the idea of authorizing the Food and Drug Administration (FDA) to regulate tobacco. If it succeeds, the FDA would be able to restrict advertising and sales of tobacco products, especially in regard to minors. It might also end up altering the composition of cigarettes, perhaps making them less addictive. (A recent study by the Harvard School of Public Health found that cigarette makers increased the amount of addictive nicotine in cigarettes by some 11% from 1997 to 2005.) This kind of development can end up shrinking, or at least giving grief to, businesses such as Reynolds American
Other developments can spell trouble for some businesses, or opportunity for others. For example, researchers have now successfully bred edible cotton seeds. As governments approve the new product, it could help feed hungry people in Africa and elsewhere. According to New Scientist magazine, "...the cotton already produced worldwide has enough protein to meet the requirements of 500 million people."
This could have an impact on existing foodstuff businesses as new competitors emerge. It's obviously an opportunity for newcomers, though, and also an opportunity for existing companies to adapt and make more money on cotton.
Investors paying attention to new developments in the world can set themselves up to make some big bucks. That's how we invest at Motley Fool Rule Breakers, seeking small but rapidly growing companies with innovative offerings. That strategy has made me a lot of money in the past, such as when I invested in a young company called America Online, and in an online bookseller called Amazon.com, which now sells everything from lawnmowers to Manolo Blahnik shoes.
Profit from big changes
If you're interested in profiting from big changes in the world, you've got to keep your eyes and ears open. Keep up with nanotechnology and other evolving developments. Watch for new techniques in retailing -- Netflix's innovative ways of getting movies to its customers, for example. Follow alternative energy, particularly now that our nation is more open to alternative energy sources than ever before.
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Longtime Fool contributor Selena Maranjian owns shares of Amazon.com, Netflix, and AOL parent Time Warner. Amazon.com, Hasbro, and Netflix are Motley Fool Stock Advisor recommendations. The Motley Fool is Fools writing for Fools.
