[quote=sdrealtor]But timing is everything. There will always be cycles and making your timing bets correctly is what determines winners and losers. In 2003 it was obvious we were in a housing bubble but the biggest gains came after in 04/05.If you sold a year or two early you missed out big time[/quote]
Catching the tops and bottoms of bubbles/crashes would be great if it were possible, but it’s not. All you can do, in my opinion, is to buy stuff that’s reasonable/cheap, and sell when it’s expensive.
To use your example, if you sold RE in 2003 and then bought back when it was cheap post crash, you did great. So what that you missed out on a couple years of illusory, temporary gains.
Anyone who happened to hold on until the peak simply got lucky — they held a grossly overpriced asset, and it got even more overpriced. Nobody could have known just how far it would go, or exactly when it would top out.
Again, it would be great to catch the tops and bottoms on the nose but it’s not possible in the real world. What is possible is to buy cheap and sell expensive. I am fine to let the heroes try to catch the turn… imo that’s a good way to wipe yourself out.
On a kind of related note, it’s too early to declare Dave wrong or right. If you re-read the original thread, it seemed pretty clear that it was a longer-term forecast. Not just 5 months. I am not endorsing the opinion, just saying that it’s too soon to say if it’s right or wrong.
