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“Interesting how the experts have turned completely bearish, while formerly bearish (Jesse?) seem to be looking for the upside.” –The Best Minimum Wage Job a Middle Aged Guy Ever Had

I don’t have a clue when the economy will turn around. I don’t know when the real estate, commodities market or stock market will find a bottom. I don’t pretend to know if inflation or deflation is a bigger risk to the economy over the coming 12 months.

What I DO know is that the majority is usually wrong (check out Manias, Panics, and Crashes: A History of Financial Crises (Wiley Investment Classics)).

Right now the majority expects a stock market crash over the coming 12 months (Yale School of Management). The majority thinks there will be no inflation over the next 30 years (as evidenced by long treasuries). The majority of consumers have never been more pessimistic about the prospects for the economy (U. of Mich. poll).

As an investor, business owner and an informed and concerned citizen, I have to assume that these beliefs are wrong. So I am making the following assumptions in 2009: the stock market will not crash (again) this year; inflation is more likely than deflation over the next few years; and the economy will be better than most currently expect.

So, yes, Duncan, I’m optimistic – at least more than most. But not for any other reason than I’m in the business of being a contrarian.

“Half of the people can be part right all of the time,
Some of the people can be all right part of the time,
But all of the people can’t be all right all of the time.
I think Abraham Lincoln said that.
‘I’ll let you be in my dreams if I can be in yours.’
I said that.” –Bob Dylan

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