Mick Weinstein The Week's Best Stock Blogs

With Barack Obama surging in state primaries and polls indicating the November presidential contest is the Democrats' to lose (Obama has a five-point lead over John McCain, according to RealClearPolitics), market bloggers have begun speculating what an Obama White House could mean for the market -- and how to position portfolios accordingly.

Democrats and the Markets

• From the left: Kris Tuttle of Research 2.0 believes a November Obama victory could "materially change the world perception of the United States, which has suffered terribly under the Bush/Cheney administration." For Wall Street, that would mean "a little less uncertainty and an improved appetite for things American, including the dollar, [to] help the market recover over time."

• From the right: Donald Luskin at SmartMoney, an "unpaid economic advisor to Senator McCain," compares data from prediction market Intrade.com to equities' performance over the past couple months to conclude that "stocks have absorbed the high probability that the next president will be a Democrat. ... at first stocks were frightened by the rising prospect that the Democratic nominee might be Barack Obama. But ... stocks have now changed their minds -- they now prefer Obama to be the nominee instead of Hillary Clinton."

• San Diego-based portfolio manager Gary Gordon sees value in analyzing both the candidates' voting records and what they're saying on the campaign trail. Obama's vocal support for alternative fuels leads one to expect alternative fuels to pop higher; that could mean exchange traded funds such as the Market Vectors Alternative Energy ETF (GEX) and Powershares Global Clean Energy Fund (PBD) will outperform.

Gordon also notes that "in Obama's Wisconsin victory speech, he spoke about shifting tax incentives away from multinationals that ship jobs abroad. And he wants to give tax incentives to upstarts and smaller firms that invest in Americans." Good news for small-cap stocks? Talk? Words? Perhaps," says Gordon, "yet the day after the Potomac primary victories the iShares Small Cap Value (IJS) gained 2 percent to the S&P 500's (SPY) 1 percent." And "the day after [Obama's] Wisconsin/Hawaii victories, IJS outperformed SPY once again."

• When you look at corporations and stocks all day, they begin to take on personalities -- and those, in turn, can become useful political metaphors. Portfolio.com's Matt Cooper, likens Obama to Apple Inc. and Clinton to Dell. Cooper says the Clintons, like Dell, are still a strong brand with a thriving following, but they lack that special something: "The first woman president is arguably as radical a step, as big a moment on the world stage, as the first African-American one. But she's not a new brand. She's Dell, strong, solid, formidable -- but lacking Apple's immense coolness."

• Dan Gross at Slate extends the comparisons: Obama is the alternative-energy sector, while Clinton is Citigroup. Obama is "hybrid, next-generation upstart, unafraid of entrenched market leaders, and embraced by corn-growing Iowans, Silicon Valley venture capitalists, and East Coast moneymen." Clinton, meanwhile, is a "New York-based, enormously well-capitalized, longstanding market leader whose name is synonymous with the sector it dominates. A powerhouse in the 1990s is having difficulty reclaiming past glory."

Money Ain't What It Used to Be

With the official Consumer Price Index coming in this week at a surprisingly high 4.3 percent over the past year, inflationary concerns leave bloggers expecting no miracles from Wall Street, the Fed, or the government.

• Penn State University professor John Mason comments that at this stage, the central bank is damned if it does cut rates, and damned if it doesn't: "The Fed has had to deal with financial market dislocation and the fear of a recession. It also has the falling value of the dollar to deal with." This leaves Bernanke and company "out of its comfort zone."

• U.S. inflation need not become a huge problem, says James Picerno, but it does require attention -- and the clock is ticking: "The Fed has been expecting that the slowing economy would take the edge off inflation. So far, however, nothing of the sort is happening. ... But no one ever said that running a central bank is a shortcut to popularity."

• Money manager Eddy Elfenbein takes a closer look at how inflation impacts equity performance over the long run, concluding that "inflation isn't good for stocks, but the troubling numbers we're seeing are still a long way from being a major problem."

• Finally, Wall Street veteran Barry Ritholtz says oil crossing $100 a barrel this week was "a 2-by-4 across the skull" to those who believed lowering interest rates in a slowing economy would somehow contain inflation. Rather, Ritholtz says we're "inflating our way into recession."

Investment Idea: Agricultural Commodities

With the stock market sputtering and its longer-term prospects questionable, money managers and individual investors are turning more aggressively toward so-called "uncorrelated asset classes" that zig when the stock market zags. Agricultural commodities are one such area that's recently become hot, and they can have the added advantage of being a "natural hedge" against inflation.

Abnormal Returns reminds us that "investments are not ends, in and of themselves; rather, their purpose is to generate funds for future expenditures. So from an asset-liability perspective our consumption of various commodities plays a meaningful role in future expenditures and overall portfolio construction."

In other words, investing in agriculture right now may make sense for anyone who plans to shop at a grocery store in coming years. But outside of individual names such as Potash Corp. (POT) -- which is up 192 percent over the past year -- how might an investor enter this market?

• A popular ETF, PowerShares DB Agriculture Fund (DBA), offers exposure to agricultural commodities by investing in future contracts of wheat, sugar, soybeans, and corn. With demand rising from China, India, and other markets, and supply down because of global challenges to food production, it's a "perfect storm for DBA," according to portfolio manager and newsletter writer Don Dion. While risky, "DBA has a lot going for it. More important, commodities, especially those in the agricultural sector, can offer a real haven when economic times are tough and stocks struggle."

• Hard Assets Investor notes that grain prices have gone through the roof recently, and some grain buyers blame speculative money (institutional investors) for artificially driving up prices. But HAI finds the actual numbers don't support those claims, and the reality is that "grain market fundamentals are tight. Between the effects of biofuels on crop planting and usage, increased demand for feed grains to satisfy increased demand for beef and poultry, and adverse weather shocks elsewhere on global crops such as wheat, it is no wonder that we are seeing prices at all-time highs." If the increased demand is therefore "real," that's a bullish sign for agricultural ETFs such as DBA, which have yet to see that "hot money" pour in.

• DBA isn't your only option, though. Investment advisor Matthew McCall takes a closer look at six agricultural exchange traded products on the market, and finds that "DBA is the most liquid of the ETFs by far, but the concentration in only four commodities does put the risk at above average." Other options that diversify one's exposure to a broader range of agricultural commodities: the iPath Dow Jones AIG-Agriculture ETN (JJA) captures seven, and the ELEMENTS ETN -- Agriculture (RJA) captures no less than 20 different agricultural commodities. McCall notes that RJA may be suitable for those looking for a smoother ride in agricultural investing: "With more diversity among commodities, the upside potential [in RJA] will be less than the previous two ETFs, but the downside will also be less."