The fact is, whatever new tech gets developed still has to be manufactured, distributed, and sold through old economy infrastructure.
Amazon (NASDAQ: AMZN) has a powerful footprint in digital retail, but it isn’t as much what it sells as its logistic model – same-day or two-day delivery – that has made it such a hit with consumers.
Building out that logistical infrastructure, partnering with Old Economy innovators like UPS (NYSE: UPS) and FedEx (NYSE: FDX), as well as the US Postal Service, is what has made AMZN such a juggernaut.
Mobile phones don’t work without antennas and fiber optic cables to distribute the signals. None of the digital world can function without reliable, efficient power grids.
That means, while it’s great to have Netflix (NASDAQ: NFLX) to watch or your Apple (NASDAQ: AAPL) devices to play (or work) with, if you don’t have Nextera Energy (NYSE: NEE) or Dominion Energy (NYSE :D) delivering the power, it’s all worthless.
The same can be said about the newest trend – space.
We have great new rocket and satellite companies doing amazing work on innovating and expanding our abilities in orbit and beyond.
The big goal the world is racing toward now however is getting back to the Moon, but this time it’s not about planting a flag and hitting a golf ball, or riding around on a lunar dune buggy. It’s about colonizing the Moon and having humans live and work there for a sustained basis.
That takes Old Economy knowhow. It’s not going to be Tesla (NASDAQ: TSLA) that builds the equipment. It’s going to Caterpillar (NYSE: CAT).
CAT and NASA have been working together for decades on autonomous vehicles to build infrastructure as well as mining equipment for the Moon and beyond.
CAT has used some of this work to start innovating with its heavy equipment on Earth already.
The reality is, there’s an interdependence between leading Old Economy companies and New Economy companies.
The way to find the winners is to follow the MegaTrends.