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"U.S. Global Investors (NASDAQ: GROW) -- a mutual fund management company which focus on resources and emerging economies -- will benefit as declining interest rates in the U.S. also boost emerging economies and demand for resources," says Ken Kam.

The editor of Marketscope explains, "When the Federal Reserve wants to lower interest rates, it can print more money, but it cannot control where the new money will go. Fed policy makers intend for the new money to stimulate America's economy.

"But there is no reason the money has to stay in America. The U.S. dollar is accepted around the world and this means that when the Fed cuts interest rates, the new money stimulates the economies of others countries as well as ours.

For 25 years, Steven Halpern, editor of TheStockAdvisors.com, has surveyed the leading financial newsletter advisors asking for their favorite stocks for the coming year. This article is one of 100+ ideas in the Best Stocks for 2008 report.

"My favorite conservative stock for 2008 is Mastercard (NYSE: MA)," says Ken Kam, who first added the stock to the 'Best Ideas' portfolio of his Marketscope newsletter in June.

"With the financial sector getting killed as the credit crisis expands, investors are scrambling for quality and safety in financials -- the largest sector of the S&P 500. Mastercard fits the bill because of the reasons we liked it in the first place -- no credit.

"Until recently, most investors thought of Mastercard as a credit card company. Its comparables were American Express, Capital One, and Discover -- all credit card companies that HOLD credit card risk on their balance sheets. Mastercard does not.

"Mastercard processes the transactions and charges an interchange fee. The credit crunch spiraling its way through the market is affecting consumers. Access to credit has dried up so it is difficult, if not impossible, to get new mortgages or home equity loans.

For 25 years, Steven Halpern, editor of TheStockAdvisors.com, has surveyed the leading financial newsletter advisors asking for their favorite stocks for the coming year. This article is one of 100+ ideas in the Best Stocks for 2008 report.

"My favorite speculative stock for 2008 is Elan (NYSE: ELN)," says Ken Kam, editor of Marketscope, who also featured the same stock as his favorite in last year's report.

"The stock started this year at $14 and now trades at over $24 -- up over 70% for the year, and more than triple from our original recommendation. It is hard to believe it, but I think Elan still has more room to run.

"I originally recommended it in June 2005 at $7 after the company withdrew Tysabri, a multiple sclerosis drug, from the US market. After being reapproved by the FDA nearly 17 months ago, Tysabri is used by less than 20,000 out of more than 1 million potential patients in North America and Europe.

"For all the gains we've seen so far (up 70%), these Tysabri sales have ramped up more slowly than I expected. However, next year there is a good chance that Tysabri sales will hit an inflection point where sales can more than double in a short time.

"Valero Energy is misunderstood on Wall Street," says Ken Kam, the editor of Marketscope. Here, he explains why he considers Valero Energy (NYSE: VLO) one of his "Best Ideas."

The advisor says, "When oil prices go down and Wall Street wants to sell energy stocks, Valero invariably gets sold off as well, just because it's part of the energy index. But Valero does not produce oil; it refines crude.

"So its profits do not necessarily rise and fall with the price of oil. Valero's earnings have skyrocketed in the past five years not because of rising oil prices but because there is a shortage of refining capacity. That shortage gets worse as the economy grows and our government refuses to allow more refineries to be built.

"I think the chances that the government will allow a refinery to be built in this country within my two-year investment horizon are pretty close to zero. This means that unless there is a recession, the shortage of refining capacity will get worse and Valero's profits will get better, whether oil prices go up or down.

Each year Steven Halpern, editor of TheStockAdvisors.com, surveys the leading financial newsletter advisors asking for their favorite stocks for the coming year. This article is part of his 24th annual Top Picks Report.

Valero Energy (NYSE: VLO) is the favorite conservative investment for 2007 from Ken Kam, editor of Marketocracy's Marketscope. He notes, "In spite of nearly doubling its earnings in the past year, Valero currently trades at a P/E of 6.

"I find comfort in the combination of solid earnings, earnings growth, and low P/E ratio. With the economy slowing, many companies are going to find it harder to keep their earnings growing next year.

"I think many people misunderstand Valero's economics because the stock seems to sell off whenever the price of oil drops. But when oil prices go down, Valero's biggest cost of production goes down and demand for refined products increases. How is this bad for Valero?

"Wall Street accords the stock a P/E of 6 because analysts think refining industry profits are going to fall. To back up their view, they point to the fact that there has been a bust after every previous oil boom.

"They may be right, but I think Valero's profit margins will remain high as long as there are no new oil refineries built in this country. The minute we hear that the government has issued all the permits needed to build a new refinery, we'll have roughly two years before it comes online and begins to affect refining industry profit margins.

"We'll be monitoring the situation, but the last time a new refinery was brought online in the U.S. was in 1976, so don't hold your breath waiting for news on this front."

To see Ken's favorite speculation for 2007, click here.

Each year Steven Halpern, editor of TheStockAdvisors.com, surveys the leading financial newsletter advisors asking for their favorite stocks for the coming year. This article is part of his 24th annual Top Picks Report.

Elan Pharmaceuticals (NYSE: ELN) is the top speculative stock for 2007 from Ken Kam. The editor of Marketocracy's Marketscope, explains, "Last year, I also chose Elan as my top pick because I thought their multiple sclerosis drug, Tysabri, would be approved for sale again.

"It was, but it didn't happen until July. Further, the FDA then required additional testing. This slowed down the sales that I had expected and led to disappointing sales in the third quarter. However, I think this delay was a speed bump, not a brick wall. Thus, the growth I thought would occur in 2006 I now think we'll see in 2007.

"Over the next 12 months, I think Elan's price will move up as Tysabri sales accelerate in the U.S. and Europe. In addition, Elan just filed today for approval to use Tysabri to treat patients with Crohn's disease -- a patient population that may ultimately double Tysabri's sales potential.

Ken Kam is a longtime mutual fund manager who came up with an innovative way to manage money about five years ago. He created the site Marketocracy.com, an online community where investors are invited to join and create portfolios, which are tracked publicly. He then takes the picks of the top 100 performers and sticks them in the mutual fund he manages (this is simplifying a bit, but you get the idea).

The Marketocracy Masters 100 Fund (MOFQX) has outperformed the S&P 500 the past two years, but did pretty poorly in 2004. Morningstar gives it just one star, but Kam is looking forward to its five-year anniversary when he says its returns will be more than double the S&P 500 over that time.

What I find fascinating about Kam's business model is that the community at Marketocracy has become Kam's own research pool. When he has an idea, he tests it against members. When he's looking for new ideas, he checks to see what the top-performing managers on the site are buying. (Premium members get to do the same thing).

This year Kam started his Best Ideas Blog. There he posts about companies he considers, well, his best ideas. His site charges subscription fees for full access to newsletters, forums and the blog. But he shared some of his ideas during a recent visit to AOL's offices.