Beware of Fashionable Investments

"There’s an overriding sense of impermanence. This is a fashion choice. No one will buy one of these gloomy spaces and say, ‘I want to have kids here. I want to grow old and die here.’ This is simply an investment opportunity with sleepover possibilities."

Condos of the Living Dead by A.A. Gill, October 2006

I'm reminded of a quote from Warren Buffet that you should only buy something that you'd be perfectly happy to hold if the market shut down for 10 years.

What is interesting is that as soon as the leveraged IPO market dries up, the entire private equity model that relies upon it for an exit dies too. This has many implications for certain sectors whose values are fluffed up as from constant M&A speculation: think Equity REITs (ICF), Base Metals (XME), and Steel (SLX).