Morris Beschloss

2) A re-examination of America's bloated government structure which now absorbs 37.5% of U.S. taxpayers' expenditures for entitlements, is embellished by a $1.5 trillion annual debt and deficit increase. A re-examination of America's tax structure is overdue. The current purview of the Internal Revenue Service is so riddled by special interest provisions, that a total overhaul of this unworkable structure will be required to conform to current realities.

3) A revised approach to the continuing housing depression, beset by foreclosures, short sales, and a mass rejection of single family homes for short-term apartment leases. The future of homeowning requires a national policy of making it worthwhile to return to this once-cherished asset from today's liability.

4) A more rational foreign policy that cuts back on expenditures for organizations (World Bank, International Monetary Fund, UNESCO, and other United Nations subsidiaries) that are at best indifferent, and at worst, hostile to American interests.

5) A massive make-work and skills improvement for the nation's out-of-work and underemployed that prevents a meaningful recovery due to the length of today's unprecedented unemployment rate.

A logical 2012 forecast approach foresees a continuation of the current malaise, which is encumbered by strangulating financial regulations, such as Sarbanes-Oxley, and Dodd/Frank, healthcare overload, and the unlimited reign of the Environmental Protection Agency. Although the sheer inner strength of America's business, industry and the world's most productive labor force will prevent a slide into a new recession, there is little sign that either international opportunities for export or domestic investment will create the scenario for an upward breakout.

Having kicked off the year with the Iowa Republican caucus and broadening into the GOP nomination through state delegate selections and climaxing with the political Super Bowl on November 6, the post election results will determine America's economic future.

The 2012 PHCP industry, estimated to be generating $100 billion in annual volume, will find the $30 billion pipe-valve-fittings as its growth engine throughout all of this year.

However, even the overall construction activity, which includes a depressed residential home construction sector is expected to show the greatest signs of life since the September 2008 financial crash. Although a near-record seven months' housing inventory will suppress housing starts to a relatively dormant 320,000 annualized level (25% of the 1.3 million annual housing starts, reached at the peak 2000-2007 period), there are saving graces in the plumbing-heating-cooling arena that will assure overall activity eclipsing the 2008-2011 housing start depression.

Benefitting distributors, PHC contractors, and a variety of tradesmen involved in this industry will be an unprecedented surge in apartment building- both multi-story edifices in the big cities and individual units in the suburbs and rural areas. This new rental phenomenon is reflective of a sea change that appears to have gained permanence for some time to come.

With a continuing U.S. growth population well over 300 million, housing needs of the foreseeable future will likely be requited by a switch to rentals from ownership, which started gathering momentum in the second half of 2011.

Also keeping the PHCP industry factors increasingly busy will be existing homes' maintenance and repair, as well as energy generation through such growing popularity of solar panels, and various weather-proofing and energy-saving devices, as retentive home owners settle down for the long-term pull, rather than flipping homes every few years. Distress pricing, and a continuing flood of foreclosures and short sales make such strategies apparent for some years to come.

PVF Foresees Record Year

With revolutionary oil and gas production techniques, such as hydraulic fracturing (fracking), a shift to "Buy America" due to "just-in-time" inventories and need for product security and responsible fallback in case of product failure, PVF manufacturers, distributors and mechanical contractors can look forward to an avalanche of business during 2012.

Much of this turnaround pivots on the red-hot activity of America's multitudinous refineries that have expanded capacity well beyond the level achieved in the previous record years of 2006-7. Also, excess revenues generated by refineries purchasing West Texas Intermediate crude oil from the huge Cushing, Oklahoma oil storage depot, and selling refined products to the retail markets at high prices has provided ample liquidity. This has allowed refineries to greatly expand capacity onsite.

Capacity expansion has negated the need for new refineries for the indeterminate future. Furthermore, such expansion has enabled refiners' derivative opportunities (gasoline, jet fuel, heating oil, diesel) for export. Currently 60% of Mexico's gasoline requirements are fulfilled by a cluster of refineries in the Houston and Louisiana areas around the periphery of the Gulf of Mexico.

Also adding to the PVF potential are the rehabbing of utilities from coal to natural gas, as well as a limited expansion of industrial construction. This also includes the dramatic growth of healthcare facilities as well as expansion of 'renewable energy' producers, heavily subsidized by the U.S. Government. This includes solar, wind, geothermal and ethanol. All in all, be ready for what could be a major breakthrough year for the $30 billion PVF sector.