[BearCub]

Shoot, even defense stocks have been driven lower solely on negative news in our housing market

That's the herd panicking. A downturn in defense stocks in reaction to a collapsing housing market is irrational panic on the part of the herd. There is little real connection between the two markets. You make money by observing the herd and generally doing the opposite. When the herd realizes its mistake, the defense stocks will recover and money will be made by the anti-herd.

[BureaucratusMaximus]

This is a cycle like any other. Stocks go up, stocks go down. Same with houses. The long term trend is up and this is a buying opportunity for those who kept some powder dry.

A downturn in defense stocks in reaction to a collapsing housing market is irrational panic on the part of the herd. There is little real connection between the two markets. You make money by observing the herd and generally doing the opposite. When the herd realizes its mistake, the defense stocks will recover and money will be made by the anti-herd.

Bump to all that. There is so much EMOTION involved in the stock market and ignorance to cyclical patterns in the overall economy that it borders on ridiculous. Booms (or bubbles) don't last forever.