THE DOW TAKES A DIVE
(skydiving….without a ‘chute)

The Dow just took a dive, as investors, lemming-like, stampeded themselves right off a cliff of uncertainties, unable to bear a load of bad economic news.

This kind of panicky irrationality is nothing new, of course, and is the equivalent of leaving a perfectly good aircraft in midair to try skydiving….without a ‘chute. An initial few moments of free-fall might provide some anxiety relief; but, as that ground rapidly gets closer, the prospect of a hard splat landing quickly replaces it with the certainty that this was not the smartest means to relieve those anxieties.

Of course, contrarian mavericks who’ve had the smarts not to play the market’s casino game of just chasing stock values are, instead, drooling in anticipation that such a sell-off event is a golden opportunity to further enhance their high dividend yield holdings….on the cheap. For them, the fear factors that have driven this event are of little concern or even relevance. What is relevant is how well they will now be able to swoop in like so many canny buzzards finding a grand road-kill, and cherry pick the best of those dividend-yielding stocks now at prices they can afford, thus increasing their holdings of these, and thereby increasing the income returns from that.

This is also nothing new. My late card-sharpie grandmother (she of green-eye shade and fancy arm garter fame) made herself a tidy bundle doing just that, all during the Great Depression back in the 1930’s. While others wailed and gnashed their teeth, and stood in soup lines, she, went entrepreneurial, opened up a tea-shop and, combined with her card playing winnings, quietly went about buying up every high dividend yielding stock she could afford.

By the time WWII had come along, she had not only been able to maintain her high-society life style in St. Louis during all that time, but had also been able to move into the newest and fanciest high rise apartment building in town, where she lived on in elegant comfort for the rest of her days (while occasionally bailing out a wayward grandson from some of his less than smart escapades of one kind or another). She was nearing 99 when she finally exited from it all.

If there’s a moral to all of that, it’s quite simple – when a herd of frantic lemmings stampede themselves right off a cliff….stand back out of the way….you can make a bundle picking over from much of what they’ve dropped along the way.

CENTURION