For example, all the companies dealing in military and defense electronics, such as Elbit Systems (Nasdaq: ESLT; TASE: ESLT). It's hard to believe that a company like Elbit Systems, with so much know-how in electronic technology, won't be a sought after supplier. Does anybody think that defense budgets will fall in 2005? Not me.

Other interesting fields include software protection, and programs against spam and all the other Internet plagues. The big problem in safeguarding confidentiality on the Internet and similar things will definitely continue full force into 2005 and beyond. Preserving privacy on the Internet is becoming a big problem, and every company in the field will be tested from every direction. Companies like Aladdin Knowledge Systems (Nasdaq: ALDN) and Check Point (Nasdaq: CHKP) will surely attract many admirers.

I received two different reviews of the alternative energy sector for 2005 yesterday. Should we expect the fuel cells field to finally revive because of what happened to the oil and energy industry in 2004? Why now? For fifteen years people have been harassing investors on this exciting subject. Why exciting? Because the hope is that a new type of device, one that could power everything from car engines to pocket PCs, will come along, and take the place of conventional batteries. Investors have been living on these high hopes for a long time, and a new cycle on Wall Street is beginning now.

Do you remember Medis Technologies (Nasdaq: MDTL)? It was one of the first Israeli companies to be listed on Nasdaq. I remember Medis's road show, its dream technology, and the enthusiasm it created, but that was ten years ago or more. Meanwhile, Medis, like all its competitors, has no sales, and the dream is probably fading away as energy prices fall.

Medis develops, produces, and hopes eventually to sell a battery powered by the fuel cells that it has developed. The company plans to enter every field that uses batteries, and extend the life of batteries. The company is taking particular aim at computers, cellphones, and other popular electronic toys. Medis also develops products having to do with fuel cells, particularly for the medical diagnostic field, but its main effort right now is devoted to its consumer electronic applications.

The company was founded in 1992 as a joint project of Israel Aircraft Industries and a US investor named Robert K. Lifton. Lifton, who has led the company ever since, is well-known businessman and public figure, an attorney, active in Jewish affairs, and a popular writer on economics and politics.

The truth is that I'm tired of all these alternative energy companies. Ever since taking up the cause of Arotech (Nasdaq: ARTX) (formerly Electric Fuel), I've given up talking about the subject. Yesterday, when I received a review recommending reconsideration of the field, I took a look, and got a shock. The Medis share has quadrupled in price since the beginning of 2003. The share has risen 60% so far this year, and 46% since the beginning of October. The share is now at almost $17, and the company's market cap is nearing $450 million not bad for a company with no sales, a $14 million loss, and $14 million in the bank. The company also expects to go on losing money for the foreseeable future.

Huh? How do you explain rises like that?

I checked it out, and discovered that besides the general rise in energy shares, the company has entered into a joint venture with giant General Dynamics (NYSE: GD). Furthermore, David Redstone, editor and publisher of "The Hydrogen & Fuel Cell Investors' Newsletter, wrote in November that the share had room to rise another 25% in the coming year. The system being developed in cooperation with General Dynamics charges batteries without an electrical outlet. That's the kind of story that's worth its weight in gold on Wall Street. What about Main Street? We'll see.

Don't think that I'm getting cynical. Lifton is talented and strong enough to lead his company to success. Medis is competing against both giants like Toshiba (TSE: 6502; LSE: TOS; XETRA, AEX, Paris: TSBA) and smaller companies like Mechanical Technology (Nasdaq: MKTY) (led by Israeli Dr. Shimson Gottesfeld), MTI Fuel Cell, (a subsidiary of Mechanical Technology ), and others, including Arotech, of course.

In general, Arotech looks more interesting to me than Medis, and the reason is simple. First of all, Arotech already has sales, and those sales are growing rapidly. Arotech operates in two fields that have been warmly recommended for the coming years: vehicle protection and alternative energy. So why is the Medis share skyrocketing, while Arotech is stuck? Mostly because Wall Street gets everything backwards. The last thing in the world I'd recommend is changing from one to the other. In any case, alternative energies are back on center stage on Wall Street, and it's time to start checking out the bargains.