Bet With the Rich on High-End Retail

This column was originally published on RealMoney on Jan. 31 at 12:51 p.m. EST. It's being republished as a bonus for TheStreet.com readers. For more information about subscribing to RealMoney, please click here.

Estee Lauder(EL Quote): strong.

Ralph Lauren(RL Quote): strong.

Coach(COH Quote): strong.

Nordstrom(JWN Quote): strong.

Saks(SKS Quote): strong.

Do I detect a pattern?

People keep asking me why the consumer is strong. I do the obligatory gasoline thing. But then I was listening to the president this morning -- yes, I actually listened -- and he was talking tax cuts.

The rich got the lion's share of those cuts -- I'm not being political, and I am paying a lot less than I used to -- and they are spending. They are spending tons. But there are only a few plays on that, and I gave you the best ones up top. (Brunswick(BC Quote) should have said that boats were strong but didn't, the only chink in my thesis.)

I would like to say there is a trickle-down effect here, and that you are going to see big numbers at the next level: J.C. Penney(JCP Quote), Sears(SHLD Quote), Lowe's(LOW Quote) and Kohl's(KSS Quote).

Those have all been strong stocks, but I think each is strong for its own reasons: Penney cause of the turn orchestrated by Questrom and shepherded amazingly by Mike Ullman; Sears, well, it's not doing well, but it is managed well by Eddie Lampert; Lowe's because of a perception that housing has bottomed; and Kohl's on good merchandising.

No, what's going on here is that the rich are spending, and if you want to know what is "safe" to invest in, I'd buy the above and just watch the continued levitation.

Quite impressive.

Random musings: Speaking of impressive, how about that management of RPM(RPM Quote), with all of those niche consumer coatings? Just a great plodder. ... I also like that Greenbrier(GBX Quote), which I got from Stockpickr , which generates more ideas than any site I have ever seen. ... If you love following stocks as much as I do and want to help me help people make money, you're someone I need. I'm looking for an experienced research assistant based in the New York metro area to help me out. (CFAs welcome.) Please send your resum and cover letter to [e-mail], with "research assistant" in the subject line.

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