They Are Grumpier About the Sharemaket Than Me!

Comment from what some call " The land of The Brave & the Free"


Wall Street (in particular, the S&P 500) has clearly been on something of a tear lately. But as they say in the fine print in all those ads, past performance is no guarantee of future performance. While the same could be said about real estate, at least with real estate, what you see is what you get.
Lately, there have been a few efforts to take the ratings agencies to task, most recently by California Attorney General Jerry Brown, who is in the midst of a seven month investigation into whether ratings agencies “acted improperly during the credit boom by assigning super-safe, triple-A ratings to mortgage-backed securities that later turned out to be extremely risky and in some cases worthless.”
Did you get that – AAA ratings for something that turned out to be “worthless.” Someone please explain that one to me.
Where does that leave the average person who has learned to become distrustful of the once-seemingly infallible Wall Street system of investing? Real estate, of course.
If you buy an investment-grade property right, you need not lie awake at night wondering if that “triple A” rated “investment” your broker sold you was actually a worthless piece of paper – because you have a performing physical asset that will be around for a long time, one you can touch, feel, and rent for a profit. And even when it’s gone, you still have the land. That’s more than you can say for much of what’s been sold to investors on Wall Street the past few years.