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Author: Howie52 Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 5069  
Subject: Re: Looking back... Date: 7/21/2010 3:26 PM
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"Hello all.
I was browsing through some posts from 2007 and was struck by how different the mood was back than.
Lots of talk about how investment returns were greater than annual savings so why bother continueing to work?
I guess if every year was that good no one would need to work.

Regards
Mosquito "

^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^

Are years good because everyone is working - or is everyone working
because the year is good?

Business cycles - they are in part due to fluctuations in supply/
capacity versus demand. In a world where forecasting trends
growth to follow last years or the last 5 year plan, and where
project profitability is extrapolated from the last project of
similar size or product, assumptions become reality until there
is an action which causes the markets to consider real things
---- inventory, capacity utilization, debt load, present
value. And at some point in time, people will wonder if
a dollar or yuan of earnings here is different than a dollar
or yuan of earnings there and question why a premium is justified
for this or that and question if a given return is real.

Howie52
Crowd theory 101.
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