Some analysts were justifying high stock prices on the grounds that earnings were at record highs. Of course, if they were at record highs, we commented, they would most likely come down. What's bringing them down? Ben Bernanke's hot money. He juices up the world's hot money. Commodity prices go up. Commodities – especially oil, which appears to be headed over $110 a barrel -- are a major cost for most producers. Higher costs with little pricing power (remember, we're still in a Great Correction) mean lower profits.

But that's what government almost always gets – just what it doesn't want. Investors didn't seem to care yesterday. The Dow rose 69 points anyway. 

But when push comes to shove, the money goes wherever the elites want it to go....first and foremost, to themselves. Which is why the Fed bailed out Wall Street. And why Fannie and Freddie continue to push money to the big banks. Government is part bribe and part larceny. One group uses it to steal money. Another group accepts pay-offs in order to look the other way.

And more thoughts...

Business – at least in our experience of it – is much different from most people think. Businessmen are not cold and calculating. They are not trying to maximize profits at all costs. They are not necessarily rational. Not necessarily sensible. Often not very reasonable. And frequently driven more by vanity and sentimentality than the search for return on investment.

We buy land for $500 an acre. We sell it for $500,000 an acre. And we lose money over a 10-year period. Not just a few bucks. Millions.

"Who do we think we are? The US government? The Fed? It is fundamentally wrong to operate this way. Because it is phony. We're doing something that isn't economically sound. We're living a lie. It's like living at a level of luxury you can't really afford. We've got to find a way to make the community self-sustaining...so that we're happy with it...and so that it can stand on its own two feet."