[idiopathic]

That's a good point, but for me at the time, I did not know how to short. All I knew was that I should save a third of my paycheque so that, when the crash comes, I have money with which to buy a house at a much cheaper price. (By the time the crash came, I sunk all my savings into my start-up, but that's another story.) At the time, this everyone else thought this was madness because money had to go on a mortgage now, before prices rise yet again.

So my error was not that I was full of it, just that I lacked the financial knowledge to maximize the benefit of the money that I had used to support my bet.

[MichaelApproved]

There are many brokers that will show you what you need to if you want to bet the economy is about to go bust. You can short, buy options, buy bonds, etc. If you truly thought it was very predictable then it wouldnt have been difficult to get those money hungry bankers to show you what to do. They'd even teach you how to bet their own bank would go under.

[borism]

I'm glad you didn't fall into the short selling trap.

It's not about predictability, it's about timing!

Pretty much everyone except Wall Street and Washington knew by the middle of 2008 that bubble is about to burst. Of course very few if anyone predicted when exactly and to what extent it was going to happen. I got burned by mistiming my short and underestimating how devastating the crash will be.

[MichaelApproved]

I love this one too "pretty much everyone knew"

Think about what you're actually saying here. If pretty much everyone knew then 401k account holders would've hedged their bets or moved into safer places. Instead they took a bath with the rest of the economy.

Your 20/20 hindsight vision is amazing. I can't wait for you to tell me who will win the 2008 superbowl.

[borism]

knowing something doesn't mean it's immediately actable upon.

I stand by my claim that pretty much everyone knew by the end of summer of 2008 that bubble was deflating.

Hedging can turn on yourself. Southwest was very successful at hedging rising oil prices until they weren't rising anymore, then their hedges almost bankrupted them.