Our forecast for 2012. Stocks End Up 10-15%. Housing Stays Crappy. Middle Class Struggles. Politics will continue to be politics. Don’t worry, there’s still good news in this article.

Housing numbers have weakened in recent weeks and months (from an already weakened state). Most homeowners now are numb to the fact that they’re getting killed on their home values and it only gets worse. I believe that housing will drop likely another 5-20% from current levels, but possibly even more demoralizing is that I think it might take place over a span of 2-4 years. Such a prolonged period of decline is definitely hard to stomach for most homeowners.

We are living in arguably the best time to purchase cash flowing rental property. Areas that didn’t pencil out 3-5 years ago are providing a steady monthly cash flow of $300-500 a month for savvy investors. Another factor to consider is that inflation is beginning to rear its ugly head in our everyday lives (just visit your nearest grocery store), and a 30-year fixed rate mortgage is a great way to hedge against the declining value of the dollar.

After I graduated from college, I set out to discover a way to get ahead financially in my 20s. I bought TONS of books on the topic of investing and personal finance. After numerous hours of diligent reading, it seemed that all of the books pointed to essentially 4 ways to become financially independent (I didn’t include the Lotto). I’ll save you hundreds of hours of reading and provide you with my findings.

If you watched the recent 60 minutes segment on the continued mortgage mess – this time focusing on the false documentation and fraud that has penetrated the mortgage industry over the recent years – you know that the industry is anything but out of the woods.

I’ve talked before about the growing trends of strategic defaults in America.  By strategic default, I mean the person who stops paying his or her mortgage simply because they don’t want to or they see it as a bad financial strategy.
How could it be a bad financial strategy you ask?  Well, when you can live in a house for a couple years without paying your mortgage without the bank evicting you, maybe it’s a good strategy?  Sure your credit will get hit (who cares), and they might come after you …

Guest post Author breaks down his formula for investing in cash-flowing rental properties. Check out his experienced views and lesson on the subject.

We have a long way to go in housing.  It’s interesting to me that the ones who speculate that housing will improve soon and the end is near don’t have any reasons for it.  Instead, they just figure it’s been long enough of a decline, and thus, the decline must be over soon.  How could it keep going?
Unfortunately, this type of analysis while it might make sense on the surface doesn’t really hold up and doesn’t really mean anything at all.
On the other hand, the folks that look at the …