U.S. Immigration Could Spell Big Business

Reuters ^ | 1-22-2005 | Reshma Kapadia

[boris]

U.S. Immigration Could Spell Big Business

Saturday January 22, 4:01 PM EST

By Reshma Kapadia

NEW YORK (Reuters) - The largest immigration boom in U.S. history is expected to lift earnings at companies from discount retailers to telecommunications providers, putting dollar signs in the eyes of investors looking to cash in on the wave of newcomers, mostly from Latin America and Asia.

Demographics is "one of the top five tools any macro analyst and investment manager should be following," said Robert Justich, senior managing director at Bear Stearns Asset Management. "And there has been no bigger demographic change than today's migration."

The future looks promising.

"If you are forecasting into the next two decades, you are looking at an economy with tremendous opportunities in the realm of immigrant-related activity," said Marcelo Suarez-Orozco, co-director of immigration studies at New York University. "Never have so many highly educated and highly skilled (people) come into the immigration flow."

The last big wave in immigration, from 1900 to 1910, was driven by Europeans. Although slightly higher on a percentage basis, the number of immigrants in the United States then was less than half of what it is today, according to the Center for Immigration Studies based in Washington D.C.

Census data from 2003 show nearly 12 percent of the U.S. population, or about 33.5 million people, are foreign-born, and demographers see an increase in coming years with both legal and illegal immigrants coming to the U.S. seeking greater economic opportunity or religious and political freedom.

The recent wave is more diverse in terms of countries of origin -- from Mexico to India -- and educational levels, said Suarez-Orozco.

The largest group comes from Latin America and tend to be younger and just starting families, he said.

That is certain to drive additional business for those who sell clothing, own apartment complexes and build homes.

Some retailers such as Sears, Roebuck & Co. (S) and Kmart Holding Corp. (KMRT) are already building brand loyalty by targeting potential immigrants in their home countries, Suarez-Orozco said.

Mario Gabelli, fund manager of Gabelli Asset Management, pointed to Spanish-language broadcaster Grupo Televisa SA de CV (TV) and brewer Femsa (FMX) as companies already reaping benefits by catering to the Hispanic market.

Drawing on the desire to stay connected, satellite companies and telecommunications companies benefit as well.

"The cost of communication has come down tremendously and people are communicating with their homeland like never before," said Bear Stearns' Justich, who recently released a paper about illegal immigrants and the underground labor force. "In any immigrant neighborhood, you will see vendors with calling cards and calling centers."

HOMEBUILDERS, BANKS TO STAY BUSY

Low interest rates are a big part of the reason for increased housing demand, but Justich also attributed some of that upside to increased migration.

Many expect the home buying spree to continue.

"Within three to five years of immigrating, they are looking to buy in the low-end entry home market, which will hold up the best," said Harry Dent, investment strategist and founder of Dallas-based H.S. Dent Foundation.

Saving for housing and education is a priority, but many immigrants also send money back to families, creating a major source of foreign exchange for some countries and generating business for financial services companies.

"Banks understand the size of the marketplace and how big the fees are in remittances," Justich said. "People were paying a lot for risk-free transactions and some of the larger financial institutions have come into it."

Growing faster than the average bank are niche banks like Cathay General Bancorp (CATY) and East West Bancorp Inc. (EWBC), which target specific populations, said Randy Watts, a small-cap growth fund manager at Boston Company Asset Management.

"If you look at the mean family income for Asian and Pacific Islanders, it is $78,800. That compares to $73,800 for Caucasians. In addition, 48 percent of Asian and Pacific Islanders have college degrees compared with 29 percent of Caucasians," Watts said.

That bodes well for investments in ethnic banks as well as education-related companies.

"Asian immigrants are conservative savers. Many open up passbook savings, which have a lower cost of deposit for banks, but they also are very entrepreneurial," Watts added.

While the current wave of immigrants is more divided than in the past when it comes to upward mobility, Suarez-Orozco said all still offer opportunities for Corporate America.

"Walk into one of these huge stores, like Wal-Mart, and you can see who the customers are; it's amazing how much Spanish and Chinese is spoken," Suarez-Orozco said. U.S. companies "are most definitely aware of the opportunity."

[Marine Inspector]

The nineteen hijackers were here under legal visas. They were not border jumpers.

Sorry bayourod, you are wrong, again.

At the time of the attack, Satam al Suqami, Nawaf al Hamzi and Hani Hanjour were not legaly in the United States. They were in fact illegal aliens.

We know Hanjor entered legaly at one time, but he violated his status and was illegal. As for Suqami and Hamzi, neither had any entry data, which indicates they entered illegally.

While it is most likely they entered illegally from Canada, there is no evidence of that either. They could have entered from Mexico, from the sea or in an aircraft. No one knows.

And last, but not least, we have Zacarias Moussaoui, also an illegal alien at the time of the attacks.

Get your facts straight bayourod.

[Marine Inspector]

Remember, being anti-immigrant and being anti-illegal immigrant are two different things.

Not to bayourod.

[sixmil]

Maybe not. But if you read the article you will notice that as a percentage, immigration is higher than it was during the last big wave. That of course ended with some rather xenophobic legislation to fix the situation. Do you have any reason to believe this time will be much different?

[Dan Evans]

There is a difference between immigration and invasion. Too many people don't understand the difference. Huddled masses used to come to America yearning to breathe free. Now it seems most of them come here yearning for freebies.

[KC_Conspirator]

"If you look at the mean family income for Asian and Pacific Islanders, it is $78,800. That compares to $73,800 for Caucasians. In addition, 48 percent of Asian and Pacific Islanders have college degrees compared with 29 percent of Caucasians," Watts said.

I really question these numbers. It sounds like "white man bad" agenda.

Regardless, if they are not illegal, this is not a problem. However, this article does not address the real problem which is illegal immigration.

[Ramonan]

The Saudi's visas had long expired. No one ever checked.

You do not live in Southern California.

Everyone here has either had someone do a "hit and run" crash on them or knows someone who has.

Whole neighborhoods now look like Tijuana, because " That's their culture".

Hospitals-eight, that I know of--have closed due to bankruptcy.

[winker]

Illegal Immigration is a Conservative Issue we are winning; the opinion polls of 85+ % prove that. Illegal Immigration is a "REPUBLICAN" problem they are losing 100% wrong on all points! See Y-ALL!

[bayourod]

"Polls show that the majority of Americans are opposed to rewarding foreigners who violate our immigration laws."

Hadn't seen one that said that. Please ping me next time one is posted on FR. I'm not registered to search the archives on any polling organizations.

President Bush's guest worker proposal doesn't reward anyone for anything. In fact several have alluded to fines or penalties being levied against anyone already in the US. They don't go to the front of the green card line and aren't even allowed to apply for citizenship, unlike other immigrants.

.

"I don't know many Americans who are anti-immigrant but I know that the majority of Americans are anti-illegal immigrant. "

Ever hear of FAIR, CIS, NumbersUSA? They were started by the ZPG crowd (that means zero population growth, something we already have in America except for immigration)

You may not know people like Governor Lamm but there are lots of them out there. They see Hispanic immigrants (not just illegal ones) as destroying their culture. You see, both legal and illegal Mexican immigrants share a common language and culture. You can't separate the two and say that only the children of illegal immigrants necessitate bilingual education, listen to Spanich radio stations, litter, have babies, get drunk on Saturday nites, shop at KMart, drive poorly, smoke marijuana, don't have medical insurance, etc...

Remember Buchanan's ad about the man choking to death because the 911 phone system was bilingual? It didn't distinguish between legal and illegal.

By the way, when you see a brown skinned person working on construction sites, shopping at the dollar store, going into an emergency room or serving you tacos, how do you know whether to like or dislike them? Do you check to see if their green card is current? What if you mistakenly hate someone whose great grandfather died at Iwo Jima?

[bayourod]

The hijackers were not border jumpers. A fence around the entire country would not have made any difference. People who use 9/11 as an excuse to keep out Mexican laborers are hiding their true reasons.

From the 911 Staff Report, pg. 8:

"OVERVIEW OF THE HIJACKERS' ENTRIES

"The hijackers successfully entered the United States 33 of 34 times, with the first arriving on January 15, 2000, at Los Angeles International Airport.

All others entered through 8 airports on the East Coast, including 11 entries through New York area airports and 12 through Florida airports.

The four pilots passed through immigration and customs inspections a total of 17 times from May 29, 2000, to August 5, 2001. Ziad Jarrah was the most frequent border crosser, entering the United States seven times. Mohamed Atta and Marwan al Shehhi came in three times each, entering for the last time on May 2 and July 19, 2001, respectively.

"Hani Hanjour was the only hijacker to enter on an academic visa, arriving on December 8, 2000. He had already attended both English and flight training schools in the United States during three stays in the 1990s. Hanjour was also the only pilot who already had a commercial pilot’s license prior to entry, having acquired it in 1999 in Arizona.1

" Though Khalid al Mihdhar and Nawaf al Hazmi came to the United States as early as January 2000, the remaining muscle entered between April 23, 2001, and June 29, 2001. They arrived in six pairs and one trio. Four pairs were processed by the same immigration inspector. Only three of the muscle were referred to a secondary inspection for further scrutiny. Of these, only one, Mohamed al Kahtani, was refused entry to the United States.

" Entering the United States as tourists was important to the hijackers, since immigration regulations automatically guaranteed tourists six months of stay. Thus the 14 muscle hijackers who entered the United States in the spring and early summer of 2001 were able to remain in the country legally through September 11. The six-month tourist stays also assured the hijackers of sufficient time to make such preparations for their operation as obtaining the identifications some of them used to board the planes on September 11.

" Fourteen of 15 operatives and all of the pilots acquired one or multiple forms of U.S. state-issued identification. Only Satam al Suqami did not, possibly because he was the only hijacker who knew he was out of immigration status: his length of stay end date of May 20, 2000, was clearly inserted in his passport."

You need to find another excuse to build your wall to keep out Mexican laborers. Arguments that work with the anti-Hispanic crowd that has recently been attracted to FR aren't going to fool the people making the decisions.

[Marine Inspector]

You need to find another excuse to build your wall to keep out Mexican laborers.

That's funny; I've never advocated building a wall.

[Caipirabob]

Meanwhile it was reported that after all was said and done, Illegal Immigration has cost California alone over 10 Billion dollars. So much for the contributing more than they take part.