Before they go over the cliff to their destruction these little furry ones get together for a party and celebration. Each tells the other how smart he has been with his investments and buying and selling of stocks and real estate.
Wait a minute. Did I say lemmings? I think I meant investors. It seems they had that same party in January 2000 and it was a doozy that lasted for several months. A great time was had by all. They did not have one in 2001 as membership dropped off. Nor again in 2002 and by 2003 there wasn't anyone around at all.
The lemmings (oops, investors) had gone over the cliff. And they were such nice little guys too. The few at their party who tried to preach caution were drowned out with loud squeals that the market was going to 40,000 or maybe higher.
This new crowd said it will never happen to them as they are not going to put their money in that risky stock market. Oh no, there is a really safe investment that always goes up ? real estate. There is only so much land and no more is being created. The population is expanding so the demand will continue and prices can only increase.
Even for the novice speculators there is a place to make big bucks. They are joining real estate clubs just like the old stock market investment clubs to which they have previously been members. Put in a few thousand and watch it grow as the real estate market keeps going up and up. These investors know they are on the verge of great expectation that will mean wealth. Wealth without work or effort. Maybe they forgot how much they lost from the expert advice in that previous investment club, but everyone knows real estate is a sure thing.
A stock investment is just a piece of paper, but real estate you can feel the dirt, walk through the building and slam the doors. That's solid. You can't miss. With each deal they recognize how they are getting smarter and smarter. Hurrying, doing nothing constructive to make their fortune. Just like in 2000.
For more than a year the professional traders, insiders and large institutions have been quietly selling their stocks and I am now beginning to hear of sales of major properties. Just because someone has a lot of money doesn't mean he is smart. These groups can be as wrong as the little investor.
Real estate may continue to be an excellent investment, but speculation in real estate can be hazardous. If, or maybe I should say when, this market stops going up or even starts down it is very hard to sell a property. Payments must be made and upkeep maintained. It is possible to rent out some houses or offices, but the income ratio today does not allow a breakeven to costs.
These real estate lemmings don't seem to care. They are gathering in larger groups and are working under the greater fool theory.
This is a time for caution as it was in 2000 for stocks. You don't want to go over the cliff again.
Copyright 2005
Al Thomas' best selling book, "If It Doesn't Go Up, Don't Buy It!" has helped thousands of people make money and keep their profits with his simple 2-step method. Read the first chapter to receive his market letter for 3 months at www.mutualfundmagic.com to discover why he's the man that Wall Street does not want you to know.
weekly home cleaning Highland Park ..Are you paying any attention to your retirement savings? Do... Read More
In one of my previous articles (Investing in the stock... Read More
After finding the price of a particular stock, usually the... Read More
Reduce your investing and stock market risks by:Setting your sights... Read More
Suppose your position has made a big move and you... Read More
Every stock market investor faces one primal enemy. An enemy... Read More
As one of my regular readers you know I have... Read More
It's about time someone spoke the truth concerning outsourcing. The... Read More
The bear market that showed up at the end of... Read More
Options trading can increase the profits you make when trading... Read More
Are you one of those many people who dread reading... Read More
It is commonly reported that the stock market averages about... Read More
Before you embark upon a journey of trading stocks or... Read More
When it comes to buying a stock or mutual fund... Read More
This is a rather simple strategy with which I am... Read More
Mutual funds were created with the idea that one person... Read More
Mutual funds by definition are a mixed bag of stocks,... Read More
Ever jumped out of an airplane? It's OK if you... Read More
Duck! No I don't mean a quack, quack. I meant... Read More
Last time we looked at the real performance of the... Read More
The Bollinger Band theory is designed to depict the volatility... Read More
Sometimes the best way of lowering exposure to risk is... Read More
Robert Rodriguez likes to buy stocks at their lows. When... Read More
With the internet such a huge part of our daily... Read More
Sometime around 1980, can't remember exactly, there was a flight... Read More
whole house cleaning Park Ridge ..∙ Make every investment in the stock market a long-term... Read More
Mutual funds were moderately successful in creating a presence in... Read More
When it comes to stock market trading it PAYS to... Read More
How is it possible that trash Companies are posting less... Read More
It depends on your level of understanding of the market... Read More
With an insecure job market, overworked employees, insufficient retirement savings... Read More
Mutual funds and brokers are always preaching not to buy... Read More
When you stand on the ocean shore and watch the... Read More
In today's volatile and confusing stock markets everyone is searching... Read More
The bear market that showed up at the end of... Read More
With over 6,000 mutual funds available, it may be tempting... Read More
Invest in the stock market for the RIGHT reason, using... Read More
With the stock market stubbornly refusing to settle down and... Read More
I have watched my cat play with a bag of... Read More
I go to the Money Show every year to visit... Read More
It is difficult to make money in a bull market,... Read More
One of the great "secrets" of successful people is discipline... Read More
A colleague of mine just returned from a scuba diving... Read More
There are many good penny stock investments available, which could... Read More
If you haven't heard of the technical indicator with the... Read More
TOO OFTEN, INVESTORS SIMPLY CHOOSE TO follow the crowd. This... Read More
So you're started trading, you bought some positions with your... Read More
Many people would like to diversify their portfolios to expand... Read More
There is a current movie entitled "Eternal Sunshine of the... Read More
I am sure that if you have a brokerage account... Read More
Stocks & Mutual Fund |