Answer: Thursday, December 18, 2008

I get a few of these every week. They are not really questions. They are statements written ... almost in glee ... almost hoping, praying wishing for some terrible calamity to befall us. The writers are wrong ... of course, we have been there before ... 1974, 1981, 1987, 1990, 1998, 2001 ... etc. Each time we were in it we say "We have never had it this bad before". And there they are right ... it was always worse, primarily because we always printed more money in between each crunch and today even more so. If inflation is a monetary phenomena (according to Milton Friedman) then we are seeing the 'mother of all monetary phenomena' right now! That is why I believe the naysayers will likely be wrong again. Yes, the numbers are bigger, the zeros larger and each time - after climbing a wall of fear - we muddle through with the result that hard assets will be even higher again five to 10 years later. In any case, real estate is doing remarkably well. Anyone that was invested in the NASDAQ (down 49 per cent year over year), the DOW (down 51 per cent) and the TSX (down 45 per cent since June) would really rather have that investment property now ... particularly one that we have recommended for years ... where the tenant pays your mortgage and it cash flows. And as far as depression goes ... don't hope for it ... life as you know it, would change - even if you were hoarding gold.

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