Fundamentals are hard to argue against, but predictions of timing are hard to get right. The fundamentals may indicate one thing, and predictions based on them are reasonable, until the fundamentals change. Timing of predictions is a very different thing because despite the fundamentals there are external factors you simply cannot predict.

Predicing there would be a housing bubble in 2001 was merely a case of seeing the changes in the law under Clinton, the change in financial settings at the federal reserve under Bush due to the dotcom crash and 9/11, and looking at the way the incentives were set up with Fannie Mae and Freddie Mac. Many people said you can't predict such a thing and in 2006 it was common to see on TV the claim that there was no housing bubble, and that the economy was fundamentally sound and I heard this a great deal from people in day to day life who were buying houses and thought I was insane to think houses were overpriced. I'm not a genius, I just read the right article in 2001 from a "economic doomsayer" and between 2001 and 2008 as far as everyone was concerned, I was crazy, and then after 2008 instantaneously "it was obvious" there was a housing bubble and thus my insight was pointless.

The lesson here is to look at the fundamentals, but don't bet on the timing. I invested against the housing market in 2002-2007. I wish I had known about the existence of CDOs. I got out in 2007. I was a year early. You can't predict the timing.

But you can take fundamentals to the bank.