For those who watch Jim Cramer’s Mad Money show, one might thing the coal producers would be the perfect “Trump stock” as the EPA is set to reverse course on air pollution standard regulations, enacted during the Obama era.
But coal stocks are not doing well at least in the last 3 months. Since the beginning of 2017, Arch Coal (ARCH) is down 16% and Cloud Peak Energy (CLD) is down 27%.
We have plenty of coal resources, but declining demand. See prior post, “Coal Craziness” for more details with links. The decline in employment over the last 70 years or so, is due to a high level of mechanization in the mines as well as less demand for coal. The electric producers will use the lowest cost fuel, and natural gas is a very competitive alternative to coal.
I suggested in my last post, that coal miners might be able to retrain for the more lucrative area of the manufacturing of solar energy photo-voltaic panels. A recent university study suggests this is possible, and the benefits would be enormous:
The coal industry is not disappearing (sorry Al Gore) but the solar energy industry is likely to be booming in the next 5 to 10 years.
Investing in solar energy has been a bumpy ride. I would never think “green energy” and Trump policies go together. But based on year to date, investing in a solar power fund (KWT) would have made about 10%, better than the market average of 6%. Pulling out the international agreements to reduce fossil fuel emissions, and subsidies for the solar industry are among the worst plans of the Trump administration.