The realities of yesteryear will be re-learned tomorrow.

The trouble with real estate is that there are too many people involved. It is not just bricks and mortar, but tenants and contractors; lenders and partners; city officials and judges. All try to obscure your vision with their agendas and dreams.

The one good thing about real estate is that it is a personal investment.

When you buy stock, you usually don't even possess the shares. They are kept by the broker, who then issues you a monthly listing of the stocks that you own in your portfolio. Your thoughts and ideas about how the company in which you own a hundred shares should be run are not sought by the powers that be. Ever try getting in to see the CEO of a Fortune 500 company? The stock market is a passive investment.

The stock market and real estate have one thing in common - everyone is an expert. At present it is impossible to find anyone who hasn't made money by trading stocks. Each thinks that they have chosen the right stock by using their unique expertise. As far as they are concerned, no one ever succeeded in the stock market by just blind luck.

Here is an example of just how absurd investing in the market has become. One of my oldest friends owns a little refrigeration and air-conditioning business on Long Island. He married his high school sweetheart and bought a little house in Holbrook more than 25 years ago, where he still lives. He has seen his kids grow up and go off to good colleges. Before 18 months ago, his riskiest investment was a six-month CD.

Then he discovered the thrill of investing on the Internet. He began reading the Wall Street Journal. When I would see him, he would tell me about his latest "penny stock" investments. His adroitness (at least in his own mind) of researching new stocks is nothing short of incredible. This is now how he spends his time. However, when you ask him how much he has made, his answer is shrouded in the type of language that can be found in any good yearly report to shareholders.

Yet the stock market keeps going up and up. Sure, it has a bad day or week every once in a while, but the market keeps climbing. Perhaps the reasons are more and more people like my friend, who are becoming, if not exactly savvy investors, then just investors. With such a huge volume of money chasing shares of stock, the prices for those shares just keep going up.

The longer I live, the more that I come to the conclusion that economics is not as complex as people think. If you can remember a few basic principles, you have framed the big picture. One of those principles is that old chestnut known as "supply and demand." Stocks have become our current investment vehicles of choice.

At the present moment, there are millions of baby boomers entering the most productive earning years of their lives. The kids are leaving. The houses have been bought. It is time to begin saving for their golden days in the sun. Disposable excess earnings are being invested for future retirement income.

For the next decade or so, if the government doesn't screw it up, we should have economic growth. However, as my generation begins drawing down on their accumulated savings to live in retirement, there may not be enough new money coming into the pipeline to keep the market constant. In order to keep momentum going, someone has to have the cash to buy the baby boomers stocks, homes and other real estate.

If the next two succeeding generations do not have the ability to buy these investments, then the price the retirees sell at will be less than what they may have planned. Again, the economy is captive to the simple principle of supply and demand. The stock, real estate or labor markets are nothing more than pyramid schemes. Everyone wins until there is not enough people to keep sending those dollars out to the people above.

So how do you make sure that what you are investing your money into will not lose value over time? Whether the investment is stocks or real estate or impressionist paintings, don't overpay. When you are worried about losing out on that next big score, you're no longer investing but gambling. My friend from Holbrook's father use to say that with small profits you never go broke. I sometimes think that my friend, as well as a whole generation, has forgotten our fathers' advice.