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Nobody makes money in the stock market by investing in the current trend. By the time a trend becomes known to the general public, it is already too late. In the dot com boom and bust, the public started piling on when it became general knowledge that tech stocks were going up and everybody was going to get rich. The mom and pop investors jumped on the bandwagon and put their hard earned pennies into the tech stocks, the stocks went ballistic, the smart money got out, and mom and pop were left holding the bag.

The same happened with the housing bubble and the same thing happens with every bubble. Your small investor gets in at the end when it is common knowledge that housing prices will go up forever. This influx of small investors, ironically, is what actually helps to burst the bubble. The influx of investors saturates an already overvalued market and, like any pyramid scheme, the last ones in get stuck with an overpriced house that no one wants to buy.

In order to make money in the stock market, you have to know what is going to happen, not what is happening now. What are the markets going to be doing next year or the next five years or ten years? So how can the ordinary small-time investor hope to make money when even the big boys often don't seem to know where things are going?

The reality for the small investor is that you don't have the time or the know-how to do your own research and come up with important market trends. Should you give up? Not necessarily. There are people out there who have spent their lives trying to understand these trends, real experts in economics and in the stock market. Let them help you with your investments.

First let me tell you who these people are not. They are not, for the most part, the experts you will hear holding forth in the mainstream media. These guys are either morons, have a hidden agenda, or are following a seriously flawed economic system. Another problem with the mainstream financial guys (and gals) is that they tend to hype blue chip and large cap stocks. Some of us can't afford to buy a single share of Google at $700 or other high cost blue chips.

To give you an example of what you can expect from the mainstream financial
pundits, I saw a show on Fox at the beginning of 2007. Three Fox commentators were ganging up on an outsider. The outsider was Peter Schiff, author of "Crash Proof: How to Profit from the Coming Economic Collapse." He was arguing that housing was in a bubble and there was going to be a big downturn

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