The Hardest Mile
Thursday, October 30, 2008 | Dylan JovineRating:
Ugly market, no doubt. We had a nice rally this week, but the odds are good it will get uglier in the short-term. When groups of people begin to panic, there is simply no telling how far they’ll run from the danger. It reminds me of the panic I felt on 9-11. I was at the New York Stock Exchange that day. As we all stared in utter shock as the buildings burned, someone asked a cop if he thought there may have been chemical weapons on board the plane as well. The officer looked back and said he didn’t think so. But his eyes revealed what we all knew: Anyone who would fly an airplane into a building like that was certainly capable of loading it with chemical weapons first.
Then the first tower began to collapse and all hell broke loose. Oh My God - what if there WERE chemical weapons in that plane? Before I knew it, there was a rolling cloud of smoke the size of the NYSE heading right at us. Chemical Weapons. I was so scared that I started running faster than I have ever run from anything in my entire life. Just stay ahead of the smoke, Dylan. Please Lord keep me from getting engulfed by the smoke.
At the time I was in the best shape of my life. I was running 40 miles a week training for a marathon. But as I ran I thought my heart was going to explode. For the first time in my life, I was in a full-fledged panic. I ran down Wall Street to the East River and took a sharp left heading north. I didn’t realize how far I had run until it occurred to me that I was about 1 mile north of Wall Street on the FDR drive. It was the hardest mile of my life.
9-11 was a life or death situation. I believed I was literally running for my life. The stakes just don’t get higher than that. And though the market cracked, when it opened a week later, it wasn’t a panic by any means. People, while shocked, were going to buy stocks because we believed in America. It was orderly. And that means it wasn’t a panic.
This market is different. Investors are scared. In a state of panic. Running for their financial lives. How long before they can’t run any more? Are they a 1/2 mile north of Wall Street? 3/4 of a mile? Only time will tell.
For the first time since 9-11, I’m a buyer of stocks. Not all at once; maybe 10% of my cash each week. It’s like buying $1 for .50 cents one day, .40 cents the next and .35 cents the next.
If you don’t buy stocks when they look absolutely terrible, you’ll never buy a bargain.
The stocks I like most are consumer products companies. I’ve always loved buying companies whose products I actually see people use every day.
Here are a few on my list that I believe are likely to be much higher in 5 or 10 years from now than they are today:
- Coca-Cola (SYM: KO)
- Pepsi (SYM: PEP)
- American Express (SYM: AXP)
- H & R Block (SYM: HRB)
- Omnicom (SYM: OMC)
- Nike (SYM: NKE)
- Bed Bath and Beyond (SYM: BBBY)
Good luck,
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Dylan Jovine
Chief Investment Officer
The Tycoon Report
