By Lance Helfert

Many financial journalists wrote about bear market opportunities long before our current recession achieved official recognition. Back in December 2007, Tim Middleton wrote about "Recession-proof ways to make money," noting that "Consumer spending, which accounts for two-thirds of gross domestic product, is weakening. But some forms of spending do not weaken as much as others. Addicts will buy cigarettes at almost any price. When factories are emptied, saloons fill up. People don't stop going to the doctor or paying their electric bills."

Companies like Molson-Coors (NYSE: TAP), Johnson & Johnson (NYSE: JNJ), and Kimberly-Clark (NYSE: KMB) seem to fit in with this set of "everyday purchase" companies, and they also meet the three criteria of the so-called "recession playbook" of large-cap stocks with safe earnings and international exposure.  Portfolio Manager Chris Orndorff told US News & World Report that recessions create opportunity as well as upheaval: "There are always ways to make money, even in a recession."

According to a February 9, 2009 article on Kiplinger.com, other typical recession investments include so-called countercyclicals, companies that benefit from economic weakness, such as high profile discounters like Wal-Mart and Dollar Stores, but also auctioneers of construction and agricultural equipment like Ritchie Brothers Auctioneers (RBA). During a housing downturn, self-storage companies benefit because people move from large homes they cannot afford into smaller homes or apartments. The logic of countercyclicals is clear, but an investor must remember that when happy days are here again, a portfolio of countercyclicals could be a pretty depressing possession.

Entrepreneurial investors prefer companies that know how to make money, rain or shine. The confection industry looks good in that regard. Today, three public companies and one private company dominate the industry: Cadbury (NYSE: CBY), Hershey (NYSE: HSY), Tootsie Roll (NYSE: TR), and Mars, Inc. Others include confections among their broad range of products, but these four are completely focused on sweets, and Cadbury, Tootsie Roll and Hershey have been operating for over 100 years each. In good times or bad, a fifty-cent candy bar provides an inexpensive emotional boost. Facing the worst economic crisis since the Great Depression, one might find solace in companies that have survived, and thrived, through every financial panic, depression, and recession of the last century.

Lance Helfert is co-founder and president of West Coast Asset Management, and a co-author of The Entrepreneurial Investor: The Art, Science and Business of Value Investing. This blog entry is an excerpt from West Coast Asset Management's newsletter, Exclusive Outlook.