Hysteria,

I also joined in Phase 2 of the bull market. You sound a lot like me. I am a Gen X'er, 33, and noticed similar things with my generation. Get a good job, contribute to a 401K, buy a house, or several if you have ambition. I read an article in the Economist in 2003 that made a good case that there was a bubble in US Housing. Everyone was very busy buying, refinancing, etc. Something just felt wrong about the whole thing. I found myself in repeated arguments with people about housing values. I argued in late 2003, just after I was married, that it made more sense to wait until the bubble burst, not understanding that public policy was centered around desperate bubble creation.

Then, Katrina and Rita happened in 2005. The government's reaction bothered me greatly. So, I started looking for answers. I found Financial Sense, or perhaps it found me. I started reading lots and lots of books, which I was in position to do as a professional book dealer. I discovered Ron Paul, G. Edward Griffen, the Plunge Protection Team, Freedom to Fascism, Fiat Empire, Housing Panic, and many other things. I cried when I discovered the great crime and the great lie.

I jumped into gold mining stocks right before they took off in 2005, when gold broke out from about $450 or so. Bought loads of silver at $9.50 in Jan 2006. Had a quick 50% gain from there.

Now everyone thinks I've very sharp for being generally right about most things that have happened. Of course, I am standing on the shoulders of giants who have done the work for me, and all I had to do was listen.

Now, the people who heard me recommend gold and silver earlier are starting to listen. They're starting to respect me for holding off on buying the overpriced house and load up on PMs. And I would agree, that the next phase of investors, the optimism stage, are ready. I have a few friends, not many, who now get it. They will be buying. They are now watching the gold price everyday, and talking of revolution. In fact, EVERYONE I know under the age of 40 but over 21 is talking of Revolution. They are all conservatives.

I also have another group of friends who never will buy gold until the top. They're still fixated on housing, and probably will be for a good long while. They love to mention when gold dips, and tell me, "See, gold is bad investment! It went down!" Others tell me "Gold is too expensive." These same people said gold was too expensive at $500, $675, $850, $900, and now $1000. They're afraid to overpay, and they don't believe in it, and so never buy on the dips. They have opinions, but no knowledge.

Oh well - everything the masters say about the psychology of bull and bear markets is true. Now I understand why that is.