I chalk alot of this up to the differences between people and their approach to things. For example, I like to analyze things and am continually adjusting my opinion about issues like the real estate market, the economy, political issues and everything else based on new information that I take in through research and intuition. Because of this, I usually find that I am ahead of the trends and have a good sense of what is happening at any moment in time, which gives me a better ability to predict the near term future.
In stark contrast, I have a friend who is an entrepreneur and owns a moderately sucessful business. He is optimistic to a fault and disregards any information that does not support his preconveived beliefs about his business being sucessful. He is strong willed and pushes ahead without an inkling of doubt that he will succeed. Interestingly, he is also overleveraged on his house and still believes that it will only keep going up. He is now advising me to buy again! Another friend of mine is extremely religious and has even tied his multi level marketing business into his religious beliefs. God is willing him to succeed, and if he merely believes, it will surely happen. He too has closed his mind to new information, advice and trends and pushes ahead even though he has made no money in 7+ years of business. He can’t quit because Amway and Quickstar have brainwashed him into thinking he would be letting down God. On the surface, these two friends sure exude confidence and poise, but I can’t help marvel at how false it is.
Ironically, it’s these two friends who put the most pressue on me not to sell and who would look down on me the most now that we have cashed out. Similar to your relative, I respect them, but also respectfully disagree with their overconfidence, criticism and closed minded approach to everything. They get away with it because on the surface it always appears that all is well even when the business is failing and the home equity is stretched to the limit.
