The Scary Part of Legal Gambling

I receive an assortment of "financial" newsletters. In general, they tend to be amusing in these interesting financial times. That is, they tell you all is well with stocks and then, a short time later, they tell you why something bad that they missed happened but now everything will be ok now.

The latest predicted event (from two different newsletters) is that education stocks will crash. I could list about 10 reasons why, without reading what they have to say, this would make sense to me. But, much more important, I want to relay a story from the 1970s that seems like a better guide of where to "invest".

In 1973 I owned a small farm. We had two acres of apples and most of the rest was in alfalfa. (It had been grapes but wheat was big business in the area and the 2,4-D overspray from the wheat fields was killing all the grapes in the area.) We were in a farm management class in the local community college.

The price of sugar has just trippled. Sitting in the classroom before class, most of the students were talking about this and saying they were going to plow under their alfalfa and plant sugar beets. Lots of people did. A year later the price of sugar had stabilized and the price of alfalfa had doubled.

The moral: do what makes sense to you and to the real needs of the area. Without government manipulation, the market will sort things out.