This is an exceprt from James Altucher's just-released book, The Forever Portfolio.

Every time that I look in the mirror
All these lines on my face gettin' clearer.

-- Aerosmith

Let's forget about the Intenet for a bit. In Silicon Valley there's a popular bumper sticker that says, "Please, God, let there be another bubble," The idea is that if the Internet were a bubble again, everyone there would get back on track toward making billions. That's fine -- best of luck to them. But we have other things to focus on.

So what's next? Clearly, the World Wide Web (via certain stocks) did not prove to be the bubble it was widely accused of being. Instead, we have a demographic trend of rising Internet use around the world that's still only on first base, or the first inning, or the first quarter or whatever other analogy you want to use (other than "bubble"). There's only one more demographic trend I can think of that's almost as explosive in terms of the potential for profit. Of course, I'm talking about women's legs.

A combination of three trends -- the post-World War II baby boom, increased life expectancies and the shrinking workweek (resulting in more leisure time) -- has the demographic of women age 45 to 55 increasingly looking to medical solutions for cosmetic problems in skin care and rejuvenation, varicose veins, weight issues and a host of other problems. With 1,000,000 more people each year entering that demographic than leaving it, the companies that service this group are not as subject to economic pressures as, say, General Motors ( GM) or Wal-Mart ( WMT), two companies that live or die on the basis of every uptick or downtick in the consumer.

Two companies have the cash, the current investor base and the technology to be worth looking at for a "Forever Portfolio."

Venus Medical Technologies ( VNUS) specializes in non-invasive, outpatient treatment of varicose veins. About 25 million people in the U.S. suffer from varicose veins, and another 40 million in Western Europe. In 2006 1.2 million sought treatment for the condition. The reason so few seek treatment is that it often involves painful invasive surgery (removing the vein in question) with potentially many side effects.

The Venus procedure is to give the patient a radio-frequency, or RF, generator that provides the power and monitoring for a disposable catheter that heats the vein. The disposable catheters generate recurring revenue for the company. Of the estimated 65 million people who have varicose vein conditions, only about 60,000, as of the time of this writing, have used the company's procedure for treatment.

Venus' revenue has gone up every year since it started selling its product in 1999, and the company has been profitable since the fourth quarter of 2003.

Syneron Medical ( ELOS) is another company in the sector.

Syneron also uses RF energy to deliver heat to layers of the skin below the epidermis, avoiding the burning associated with other skin treatments. Syneron's device can constantly monitor the level of heat and energy it is applying to an area and adjust accordingly. These treatments have been used for wrinkles, leg veins, acne, cellulite and a host of other cosmetic solutions. Revenue and income have gone up every year since 2001.

Part of the need for more aesthetic and cosmetic procedures is the shrinking workweek. People simply have more time on their hands to socialize. Every month, it seems, economists go into spasms over every fractional change in the average workweek. The idea is that if people work fewer hours, then the economy is going into a death spiral. In 1900, the average workweek was over 60 hours, as people (including children) regularly worked 12-hour days, five days a week.

Perhaps we should have all started shorting the market when the average workweek went down to 59 hours. Now, depending on your source of economic statistics, the average workweek is somewhere between 35 and 40 hours. For the extreme outlier, visit the National Sleep Foundation, which says the average workweek is 46 hours -- but this doesn't include coffee breaks.

Un-Tattoo You

I thank God I never got a tattoo, and apparently I'm not alone. Six million Americans want to be tattoo-free, but their problem is that they actually have a tattoo.

According to a Sunday New York Times article from June 17, 2007, some 45 million Americans have tattoos, and 17% of them regret it. And the problem is going to only get worse. More people than ever are getting tattoos, and that means that 10 years from now, more people than ever will want to remove tattoos.

When you gets a tattoo, it's really hundreds of pinpoint needle pricks in your skin, with each tiny point break in the skin being filled with pigment. To remove the tattoo, a pinpoint laser shoots into each hole and disintegrates the pigment cells.

But tattoo removal treatments are painful and expensive. The process consists of lasers basically disintegrating tattoos in anywhere from six to 20 separate treatments. According to the Times story, each treatment is like having rubber bands snapping against your skin, but as the baby boomers age, what was once a picture of Satan on your right shoulder is now just a flabby red grinning face laughing at you. This is a trend we can invest in.

Companies that specialize in tattoo removal aren't focused only on tattoos. Fortunately for us, they tend to specialize in the larger demographic trend of using lasers for aesthetic treatments and cosmetic procedures including wrinkle removal, skin tightening and scar removal. These procedures are growing industrywide at a pace of 30% per year.

The stock in the sector that I believe deserves to be included in a Forever Portfolio is Cynosure ( CYNO).

Cynosure also develops lasers for aesthetic treatment -- everything from cellulite removal to varicose vein removal to tattoo removal. You can find some before-and-after shots on the company's Web site.

Again, these are companies that are involved in all aspects of minimally invasive cosmetic treatments, which are riding a huge demographic trend. I plan on covering this space in more depth over the next few weeks. One of the companies I'm particularly interested in has more than $60 million in net cash and 230% year-over-year earnings growth.


Other competitors of Venus Medical Technologies include AngioDynamics ( ANGO). and Vascular Solutions ( VASC). Competitors of Cynosure include Candela ( CLZR), Cutera ( CUTR) and Palomar Medical Technologies ( PMTI).

Please note that due to factors including low market capitalization and/or insufficient public float, we consider VNUS, ELOS and CYNO to be small-cap stocks. You should be aware that such stocks are subject to more risk than stocks of larger companies, including greater volatility, lower liquidity and less publicly available information, and that postings such as this one can have an effect on their stock prices.\

James Altucher is president of Stockpickr LLC, a wholly owned subsidiary of TheStreet.com and part of its network of Web properties, and a managing partner at Formula Capital, an alternative asset management firm that runs a fund of hedge funds. He is also a weekly columnist for the Financial Times and the author of Trade Like a Hedge Fund, Trade Like Warren Buffett and SuperCa$h. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Altucher appreciates your feedback; click here to send him an email.

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