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Technician Sean Cline finishes up the conversion of a diesel engine on Jan. 17, 2013, that has been converted to run on a blend of diesel and natural gas in Gibsonia, Pa. Oil- and gas companies from Pennsylvania to Texas are using the huge diesel engines to operate pumps that propel millions of gallons of water, sand and chemicals down a well bore in the fracturing process to break apart rock or tight sands that trap natural gas.

Keith Srakocic/The Associated Press

Forecasts of future energy independence in the United States aren't hypothetical daydreams: Production is already on the rise in a big way. Combine that with increased energy efficiency and a decrease in U.S. energy imports and you can construct a bullish outlook for the economy.

Some forecasters already are. Strategists at Pavilion Global Markets pointed out that domestic U.S. oil production has risen 21 per cent in the past 12 monts, while imports have fallen 17 per cent – and they expect the trend to continue with improvements and advances in crude oil production technology, particularly fracking.

While the U.S. energy industry might look like an obvious place for investors to look for opportunities here, energy stocks haven't exactly wowed anyone yet: The S&P 500 energy index is up just 4.6 per cent over the past 12 months, trailing the 12 per cent return for the broader index.

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But the benefits of rising energy independence could be broader. As the current account deficit decreases, competitiveness increases. From Pavilion: "Cheaper, domestically produced oil translates to reduced shipping and manufacturing costs (which increase competitiveness), reduced heating and cooling bills, and improves the auto market," the strategists said in a note.

"The U.S.'s ability to reduce these types of costs, particularly in manufacturing, will contribute to the economy's ongoing improvements in competitiveness. When considering the exchange rate and unit labour costs, it is currently 14 per cent cheaper to manufacture in the United States now than it was in 2005. In comparison, it is 21 per cent more expensive to manufacture in Canada. Interestingly, the U.S.'s cost competitiveness has improved at the same rate as Germany's, the country that is often heralded for its exemplary labour cost control."

Ed Yardeni, president and chief investment strategist of Yardeni Research, has a similar view. In his latest note to clients, he again stirs up his ongoing debate with Robert Gordon, the Northwestern University professor who has argued that U.S. economic growth has a dismal future.

Mr. Gordon believes that growth will fall to, at best, half its historic rate of 2 per cent a year – with new inventions failing to provide the sort of boosts provided by some of big developments since 1875: The electric light bulb, indoor plumbing, the telephone, the airplane and computers.

Mr. Yardeni, on the other hand, dismisses Mr. Gordon as a modern-day Malthus, arguing that new drilling technologies and cheaper U.S. energy could spur a "fourth revolution."

"The surprise might be that the future is bright," Mr. Yardeni reiterates from an earlier argument. "Could it be that we are in the early stages of yet another great bull market in stocks, but are too depressed to know it?"

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