Tuesday, April 11, 2006

Investment Ideas Inspired by Monkeys

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That at least is the subtitle of a news letter, Capuchinomics, that has some valuable speculation insights this week.

The article is based on the housing bubble and the excuses made to support it. What it is in reality is a short lesson in
keeping your head when everyone else is losing theirs.

The author never quotes the infamous line that appears so often at market tops "Its different this time," but you can feel his understanding of why it isn't different.

Housing is a regional phenomena - so it is more like soap suds than a single balloon.

He compares housing with the stock markets in 2000, not a novel comparison, but here it is a well done comparison with some novel insights.

This of course does not mean all the housing soap suds bubbles will pop tomorrow.

Just because we become aware of a danger does not imply the danger will soon increase, subside, or destroy.

Read that article - it has information that will help you understand speculating.

That brings us to a true Speculation Rule:

inevitable is not the same as immediate.


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