A MUST READ: derivatives exposure in a simple graphic, easy enough for a child to understand.

LONG STORY: A derivative is a legal bet (contract) that derives its value from another asset, such as the future or current value of oil, government bonds or anything else. Ex- A derivative buys you the option (but not obligation) to buy oil in 6 months for today’s price/any agreed price, hoping that oil will cost more in future. (I’ll bet you it’ll cost more in 6 months). Derivative can [...]

Some things that will make home prices go up:

1. inflation

2. plentiful jobs so someone can buy your home

3. interest rates going down significantly. They are presently sub 5%

4. more demand than supply

5. real estate taxes going down

Some things that will make home prices go down

1. deflation

2. depression and no jobs

3. interest rates going up

4. shortage of houses

5. real estate taxes going up

You will know housing has [...]

Nobody can see the future. Not Bob Prechter, Charles Dow, or Ricahard Russel. The laws of mathematics are clear – you CAN’T predict the future.

Yesterday a video was posted on SA with the Black Swan himself, Nassim Taleb, in the interview hot seat. One of the points he made is that, to paraphrase, all the mathematics taught in B-School is wrong, as in, the math is mis-applied to the subject at hand. And Elliot Wave theory is a good example.

Elliot Waves, and a host of other attempts to predict the future of the stock [...]