My Experts

I don't usually "listen" to the so-called experts on tv. Sometimes I pay attention to what they say. I am always curious to hear what Cramer (of Mad Money) will say on CNBC after a bad day for the stock market. You can even sometimes pick up good pieces of advice. But I would not model your portfolio around what any of them have to say.

I pay attention to people that understand economics. There aren't many of them. Even some who understand economics get investment advice wrong. Remember what Austrian economics is all about. Just think of Mises' most famous book. The name is Human Action. That is what Austrian economics is all about. Humans act freely. You should take this into account when making investment decisions. You may think of all of the reasons in the world why gold should go up or stocks should go down or whatever, but it all depends on the individual decisions of millions of people. You may think than interest rates should go up tomorrow, but if enough people make a decision to buy bonds on that day, your opinion doesn't really matter.

With all of that said, the people that I trust most in economics and investments, all seem to come to one opinion. The economy is going to get much worse before it gets better. I couldn't agree more. I just can't believe the consensus. The opinions are more mixed in the mainstream media (although there is even some pessimism there), but the people that I read and listen to who know their economics all seem to agree that the economy is going to get really bad. There are some varying opinions (hyperinflation, massive inflation, depression), but they are all bad. Of course, it will depend on certain things, like what the Fed and the government decide to do. But with all of the previous malinvestment, there is little doubt that there has to be a severe correction. It is just a question of how much the government allows it to happen.