Everybody's a contrarian these days.

It was hard to find one back in 1999, the good old days of the New Economy. The term "contrarian investor" turned up just 42 times in Dow Jones Interactive articles that year. More people like the moniker now -- use of the term soared to 104 mentions in 2002. But this increasingly common usage threatens to make it as absurd a term as "alternative rock" was five years ago.

You can see why it's cool to be contrarian: Fund manager David Dreman tracked market opinions of experts going back to 1929, and found that the consensus was wrong 77% of the time.

The trick is knowing what you stand for -- or, more accurately, stand against. To be a good contrarian, as the legendary Marc Faber says, "you need to know what you are contrary about." Is it contrary to be a bear these days and think the U.S. market is headed for a Japan-style slide? Or does the contrarian think the naysayers on this latest rally are just latter-day bears still stinging from being so giddily optimistic back in 1999?


Devil's Advocates
References to contrarians and contrarian investors have soared since 1999
* Projected.
Source: Dow Jones Interactive.

Will the real contrarian please stand up? To get to the heart of things, we put the conundrum to three bona fide contrarians: Dreman, Faber and Banc of America Securities strategist Tom McManus. Not surprisingly, they contradicted each other. Nonetheless, their conclusions aren't entirely at cross-purposes -- the collective recommendations to consider Japan and Asia, steer clear of frothy U.S. tech stocks, and hunt for value in the U.S. makes a lot of sense.

Dr. Doom Contrarian: Marc Faber

To folks with a limited historical perspective on the markets -- say, five years -- Marc Faber is known as an "unrepentant bear." Not so. He is merely a contrarian, and a highly effective one. But he doesn't mind being known as "Dr. Doom" -- in fact, his useful contrarian Web site is called The Gloom, Boom and Doom Report , which details his efforts to find underappreciated investments and warn against overvalued ones.

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