What recession? This bull will run on

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I was in San Francisco this week attending the ThinkEquity Conference and meeting with people from a number of companies in the ChangeWave Investing and ChangeWave MicroCap portfolios.

While we keep seeing forecasts of a 60% chance of a recession in the United States, not only do I not see this coming, the CEOs here don't either.

Emerging capitalists in Asia, Europe and other global regions don't care about the housing bust in the United States. They don't care that a million or so people -- who should have never gotten home loans in the first place -- unfortunately are going to lose their homes.

Are they callous or uncaring? No.

You know what they are? Capitalists!

They're so fantastically busy they don't have time to worry about other people's problems -- they've got their own worries. How are they going to get the roads built? How are they going to get their goods manufactured? How are they going to get consumer electronics to the customer?

Lighten up, economists

All those gloomy economists are looking at the U.S. housing bust as the end-all, be-all catalyst that's going to take our nation into a recession. But they forget that all of the other recessions we've seen were brought on by much larger catalysts.

And they've evidently forgotten that we have a global economy that is racing along and ignoring the part of the U.S. economy that is entering a recession.

What we are seeing now is similar to 1998 after the Russian debt default and the Long-Term Capital mess. The market appears, at this point, to be taking a breather -- and if that is the case, then you don't want to miss the biggest "whoosh up" since 1999 and 2000 in stocks.

This means that real growth stocks -- stocks that are growth oriented and have secular growth -- are going to be the new leaders of this three- to four-year final leg of the global expansion.

Our proprietary ChangeWave Alliance research shows that we're experiencing a slowdown, not a recession -- not even close. And we'd know if one was on the way. Thanks to the ChangeWave Alliance, we were able to call the recession in 2001.

All of our research says that we are about to head into the next great stock mania, a humongous final leg of the 2003-2012 bull market that will make the old stock bubble look frail. That's because the entire world is participating this time -- not just the United States.

The road just ahead

Here's what you're going to see during the next six months.

All of the investors who have been sitting on their hands waiting for the world to collapse will be disappointed, because it ain't happening. And the folks sitting on their cash are going to rush back into the market. We have not seen the individual investor at all in this bull market since 2003, but we'll see them jump back in at some point during the next 12 months.

Companies are going to begin to ramp up their capital expansion after this pullback ends, because they will realize that the worldwide growth is there and they don't have enough employees. So they'll need capital investments to replace employees and increase productivity.

Then you're going to see price-earnings ratios rise. We are hovering around 15 for P/E ratios, and that's the end of a bull market? Oh, come on.

Finally, you'll see the big strategic buyers come in. The private-equity buyers are done because they're out of free money, which is great in my book. You're going to see real mergers come in, and it will be for stock, not cash.

Back to the future

The parallels to 1998 are eerie. The market fell superhard on the Russian bond blowup, which is very similar to the big meltdown in Chinese stocks in February.

In the case of these meltdowns, it always seems to be the case that some out-of-the-blue financial situation is a factor, similar to when the subprime-mortgage-issuing slimeballs began going into bankruptcy in the spring. That was just like when the Nobel Prize-winning brainiacs at Long-Term Capital lost their shirts when they leveraged $10 billion into $200 billion of bonds that blew up in 1998.

Back then, the market fell into an abyss and guess who came to the rescue? Alan Greenspan and the Fed. After the Fed came in, things got going and the market took off.

It's very much like this today, but now the Fed's move is literally multiplied hundreds and hundreds of times over.

Why? Because now it's a global thing.

Now we've got the European central bank putting more than $300 billion of equivalent cash in its system. We've got the Federal Reserve of Japan and even the Russians and Chinese, for crying out loud.

All of these countries have sloshed a huge amount of cash-liquidity money into the system to make sure we don't lock up so we can get the credit system going again in the United States and Europe.

In addition, we now have billions of new capitalists and consumers who weren't around in 1998. Russia and China were not even on the map as consumers back then, but now they are part of the great wave of global consumerism.

This time, realistic values

So we have a different situation with similar structural catalysts. Once things settle down, people will forget about bank and hedge-fund blowups and start looking at the fundamentals of tech stocks and real growth stocks. Money -- as always -- will be going to the companies benefiting from secular waves of growth, because there's a lot of cash available that needs a place to land to get maximum growth.

It will be similar to the 1999-2000 run. The difference, though, is that now we're seeing relatively low common valuations. Remember that in 2000, JDS Uniphase (JDSU, news, msgs) was selling for a 700 P/E. AOL was selling for at a 200 P/E. Sun Microsystems (JAVA, news, msgs) wasn't making any money but was worth $50 billion. And Cisco was the most valuable company in the world with a $500 billion market cap.

We're going to make some money this time -- and we're going to keep it (which reminds me of a bumper sticker I saw in Silicon Valley: "Oh God, Please Give Us One More Tech Boom. We Promise Not To Throw The Money Away This Time"). We just have to be in the right names. And they won't be AOL, Qualcomm (QCOM, news, msgs) or Dell Inc. (DELL, news, msgs).

They're going to be the leaders of the new millennium, in new growth areas and spaces around the world. And that's what I'm talking to companies in San Francisco about this week, but, then, that's what we do at ChangeWave every week.

These companies are going to be involved in infrastructure and technology -- mainly consumer technology.

We've got a list of the stocks that are poised to become the new AOL or Cisco. Remember when PMC-Sierra (PMCS, news, msgs) went from $2 to $95? Well there are some new PMC-Sierras out there. One of them is Sigma Designs (SIGM, news, msgs). There are others in my Strategy Lab portfolio, and of course, my subscribers get still more.

Stick with ChangeWave, stick with secular growth and stick with these names for this next run, and in three to four years you could have the wealth that you want.