Every year, as Jan. 1 comes round the corner, we make resolutions to do things like lose weight and exercise more -- things that we think will improve ourselves. So while we're at it, why not throw in some investing New Year's resolutions? Here are three initiatives we could all take on in 2008 to become better investors.

1. Don't get frustrated by Mr. Market.
This year, I spent a great deal of time being frustrated by what the stock market was doing. I got frustrated when it knocked down stocks I owned, and lifted stocks I didn't own.

Berkshire Hathaway (NYSE:BRK-A) (NYSE:BRK-B) chairman Warren Buffett once said, "The stock market is there to serve you rather than instruct you." Although it's tough to keep that mind-set when one's investments are going down the tubes, investors need to maintain a rational approach. After all, something bought at X per share should be more attractive at 0.7X.

It helps to remember that even the great investors sometimes make this mistake. During the year, Sears (NASDAQ:SHLD) Chairman Eddie Lampert bought positions in Citigroup (NYSE:C) and bought back a lot of Sears stock at prices much higher than their current levels. I'd be willing to bet that Lampert sees the lower prices of Sears and Citigroup as opportunities, rather than setbacks.

2. Focus on the balance sheet first.
Not too long ago, having a great balance sheet was almost considered a corporate crime. If your company sported a conservative balance sheet, activist hedge-fund managers would bang at the gates, and in the name of shareholder value, demand huge share buybacks fueled by copious amounts of debt.

But that was a different world, when debt was cheap and risk premiums almost nonexistent. In the post-credit-crunch world, having a great balance sheet is a good thing again, and investors should look for companies with strong balance sheets that can provide strong downside protection in an increasingly uncertain world.

This year, there were a lot of situations where investors got blindsided. Thanks to their black-box-like financial statements, it would have been very difficult to predict the huge losses that companies like E*Trade Financial (NASDAQ:ETFC) and Merrill Lynch (NYSE:MER) had to take. In retrospect, perhaps the best way an investor could have avoided these hidden bombs would have been to recognize that these companies' balance sheets are weighed down by a lot of leverage. Not only does that leverage ensure that any cracks will be magnified several times over, it also says something about management's attitude toward risk.

3. Pay more attention to industry conditions.
Value investors like to talk about only paying attention to individual companies, and ignoring things like cyclical and macroeconomic factors.

I think this is a mistake. Every company in the world goes through product and business cycles, and it's extremely important to have an idea of what inning of the game we're in before investing.

After all, anyone who invested in a homebuilder earlier in the year would've gotten creamed, no matter which homebuilder it was. Ditto for the big investment banks, with the exception of Goldman Sachs (NYSE:GS). Because we humans suffer from alternate bouts of greed and fear, it's a safe bet to say that there will always be boom and bust industry cycles.

Anytime we buy shares of a stock, we're not only betting on the future success of that company, but we're also betting on the future success of that industry, so it's important to keep that in mind when investing.

Here's hoping you have a Foolish 2008.

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Berkshire Hathaway is a Motley Fool Stock Advisor and Motley Fool Inside Value recommendation. Sears is also an Inside Value pick.

Fool contributor Emil Lee is an analyst and a disciple of value investing. He doesn't own shares in any of the companies mentioned above. Emil appreciates your comments, concerns, and complaints. The Motley Fool holds stock in Berkshire Hathaway and has a disclosure policy.