The theme of my book, The Great Super Cycle, is just as the title sounds. Cycles. I believe that markets have a life of their own and move in huge 15- to 20-year cycles.

For shorter cyclical moves, I look for markets that are largely oversold and undervalued. For example, over this past summer, I was telling investors to look to Greek stocks, which have soared since then.

In 2008, you might have thought that solar stocks or wind companies would soar with President Barack Obama about to begin a huge stimulus by throwing money at those sectors to promote alternative energies. However, after a short rally in 2009, solar companies have crashed the past three years, as costs in the industry rose and prices of panels fell hard.

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From 2000 to 2008, President George W. Bush seemed great for the financial and housing sectors. But the housing market crashed in 2008, and many bank stocks fell hard.

Many thought Obama would be a disaster for the stock market. However, with the Federal Reserve's ultra-loose monetary policy keeping rates near zero, stock prices have risen the past four years.

It is interesting that stocks have outperformed when so-called anti-business Democrats are in office as opposed to pro-business Republicans (this simple analysis ignores which party has control over the House and Senate; however, it still rings true).

Sometimes policies can have an effect if a cycle is in process. President Jimmy Carter’s spending, for example, helped gold prices and inflation soar in the late 1970s, while George W. Bush’s loose fiscal and monetary policies were great for commodities.

I think Obama’s loose monetary and fiscal policies will be good for gold, as well. However, this more lies in the midst of a cycle rather than causing the cycle.

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The warning here is to not think that defense contractors or banks will do well under Republican administrations or that healthcare and alternative energies will do well under Democratic administrations.

When investing you should look for the undervalued cheap companies and where the long-term trend is, no matter who is in power.

About the Author: David Skarica
David Skarica is a member of the Moneynews Financial Brain Trust. Click Here to read more of his articles. He also writes the Gold Stock Adviser. Discover more by Clicking Here Now.