Brutal Week, Brutal Month

I am not exactly a spring chicken, but I have never seen such bearish markets. I remember after the dot com bubble broke, a financial adviser was asked what advice she was giving her clients. Her answer, "first I tell them they need to open their statements and see how they are doing."

That is surprisingly un-fun. It is tempting for me to continue with MFI, but pretend like I am starting anew, so I don't have to look at the oceans of red ink around my portfolio. I am actually catching up with the benchmarks as we both are losing the same percentage recently, but the benchmark is a percentage of a bigger number! We're essentially racing to zero... or so it seems.

But I am stubbornly plugging away, even though companies like BOLT get crushed 25% post earnings (Bolt Technology Reports First Quarter Results) today. They have 63m of assets and about 6m of liabilities (no debt) yet have a market cap of $48m. How does that make me feel?

It reminds me of the movie "Caberet" (I know, I am dating myself). When Sally Boyles gets frustrated, she goes under the "L" train and when a train rumbles by, she screams at the top of her lungs, even though she can't be heard. That makes her feel better. Sadly no L trains around here.

It is difficult to talk about the fundamentals of stocks, when they don't matter in the short term. I know that a couple years from now, the markets will be significantly higher, people simply need to get over their fear. And it will happen. Companies will get bought, credit will thaw, people will have courage renewed. A bunch of these commodity companies are trading at 10 to 20% of their highs. They still have the gold/copper/zinc/oil. The world is going to still need those basic resources and they will be in short supply. Some one (maybe a Chevron or Rio Tinto) will start buying these assets on the cheap and then the stock prices will get religion. Same in the banking sector, PNC buying NCC is a positive sign. Other banks, flush with govt capital are going to start putting it to work, building for tomorrow.