It takes a deliberate effort to be informed in a world of nonstop media. Fear and drama sells much better than a considered deliberation of facts and options.
Books in the 1970’s touting an inevitable inflationary spiral had middle class consumers buying gold and Swiss Francs. Little is inevitable. Few expected the country to subdue inflation and enter an era where the dollar reigned supreme, economic growth accelerated, interest rates fell, unemployment dropped and working Americans became rich as they accumulated equities in their 401k’s.
Popular names like Harry Brown, Howard Ruff and many others who made nice livings selling doom and gloom faded into the overstocked book sections. By the time the common consumers are receiving investment advice on popular television shows and retail bookstores, it is too late to make money on their advice. Do you really think that the truly wealthy take advice from these clowns?
In fact I would advise that if you are considering investment advice that is receiving any prominent shelf space at your local Borders or Barnes and Nobles, you should ignore it.
Popular advisors seem to sell impending disaster much better than rational analysis. And they become much more lethal if they have been recently correct.
During extremes in market movements it pays to be a contrarian. A contrarian view today may consider that the dollar in undervalued, gold is overvalued, and that American equities may be a good place to be.
The problems we face are real and serious, but not so terribly unique. Economic progress is up despite a century of destructive wars, depressions, oil shocks, terrorist attacks, genocides, inflations and other serious problems. We seem to be at our best when facing the worst.
Ignore most of the media and populist disaster peddlers. They have been wrong too often.
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