Trade #6—Business Capital Spending

The Democrats will go for some reductions in corporate givebacks, which is dumb because this essentially is a tax increase that will get passed along to consumers.  At the same time, the Democrats will pass a meaningless chunk of tax relief for small business owners and in turn they will pocket the dough or use it as working capital. Combine this ineffective action with a steep recession, and you will see information technology (IT) spending take a savage hit -- and this is being validated right now by ongoing ChangeWave IT Spending surveys.

Recommendation: Stick with the obvious and short a company that is far too exposed to China and is getting clobbered by Apple here and in Europe, and also being beaten up by cheap clone makers and the economic slowdown in Asia. That company is Dell (DELL).