Yes, the retail residential real estate market is still volatile and trending down. But, only real estate speculators buy at retail. The investor buys properties based on value and cash flow.

Yes, there is some weakness showing in some commercial real estate markets. But, again, the long term value investor will be fine.

REITs are massively over-sold. Now, a REIT is not going to give you returns of 50% but they have two components of value to offer. The first is the income from operations most of which must be distributed to the shareholders - by law. The second is since many REITs are cash heavy right now they are buying bargains. That means as their asset values climb, so will their share price.

Technology stocks have been beaten down and are over-sold. The announcement this morning that Microsoft is buying Yahoo in a hostile takeover is one of the best indicators of the state of tech stocks.

Financial stocks are similarly beaten down and many offer some great value investing opportunities.

Mergers and acquisitions are accelerating. No surprise there. The conventional wisdom is the environment in Washington after January 20, 2009 will be much less business friendly than it is today. The tax laws will be less favorable or moving in that direction. So, now is the time to complete those long contemplated mergers.

This should be a good year and the smart investor is going to prepare themselves for the change in administrations next year.