Recently I had the opportunities to talk to several people who had profited tremendously from the current financial crisis. They recognized that there was a huge housing bubble, and the loose lending practices would get us into deep trouble. I guess you could call them "Dr. Dooms" — in the past year, they have been preparing for the worst, shorting financial stocks, buying gold, and warning people about a severe recession. Interesting enough, many of them believe that the worst hasn’t come yet and we’ll be entering a depression.
You could argue that some of them got lucky. However, all of the people I talked to share a few things in common and we could all learn from them:
- they’re all very frugal although they have made handsome profits.
- they all have a strong background in economics and finance. Most of them studied economics in college, and have keen interests in the market and economics.
- they’re critical thinkers. They don’t trust what they heard from the mainstream media. They form their own opinions.
- they’re very critical of the bailout package and how the US Treasury has been spending the bailout money.
- they’re big fans of Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets and The Black Swan: The Impact of the Highly Improbable.
- they’re well-read, and well informed. When I probed further and asked them what they read to keep up with the rapidly changing economy and market, I found something quite interesting. They all seems to read the same finance blogs! They told me that blogs have been their best source of information and analysis. Here are a list of blogs they’re reading:
- Do you read any of these blogs? If not, check them out.
- Do you know any other finance/business blogs that you would like to recommend? Leave a comment.
- Do you want to better understand current financial crisis and learn the lessons from Great Depression? Check out Panic: The Story of Modern Financial Insanity, Edited by Michael Lewis and The Return of Depression Economics and the Crisis of 2008 by Paul Krugman, the 2008 winner of Nobel prize in Economics.