Friday January 20. As the housing market firms up, that more than any other single factor, will probably lead the recovery, don't you think?

Friday January 20. As the housing market firms up, that more than any other single factor, will probably lead the recovery, don't you think? Because there is a humongous amount of wealth there, even a small change has a big effect. It was the real estate bubble more than anything else that caused the 2007 "great recession". But how could so many smart people be wrong? How could so many smart people, at the Fed, in Congress, business people, homeowners, even speculators and the average citizen, fail to see that coming? That is the burning question, because we continually fail to see the bubble bursting, but it has happened on the average every eight years for 236 years now. In order to be smart investors, we must keep our bearings, our wits, our perspective and our balance. That is why I am so interested in trying to predict the macro-economic trends. and also because they are not that hard to predict. I don't know if I proved it in part by predicting the DJIA a year in advance. But the business cycles in the United States follow fairly predictable patterns, if you stand back and look at them. Our problem comes when we invest, we throw this perspective away. I feel that it is just this perspective that is so critical to us. That is why I pursue this line of reasoning in the newsletter.