Humans are social beings. They are greatly influenced by others. During crises, this predilection increases, especially when fear is involved. Fear is a very powerful human emotion. However, good investing requires that decisions be based upon cold rational evaluation. Personal preference, perhaps influenced by others and fear, is sometimes wrapped in something passing for analysis. Guard against this.

Today, stock markets around the world are correcting. Corrections are normal and necessary. They correct for excesses, over enthusiasm, and projections divorced from reality. The catalyst has been the outbreak and spread of the Coronavirus. That is not to say that this is not a significant event and likely to have many effects on world growth and near-term profitability of many businesses. Near-term does not mean forever. The history of virus outbreaks is that they are eventually contained. This one will be too. Therapies and vaccines are already in the works.

As individuals and companies put off normal activity, demand gets pent up. Governments and central banks will take actions to work against any downturn. Good companies’ prospects are not erased by temporary phenomenon. The Bull and his partners believe that much of the damage from this correction has already occurred. That does not mean prices and averages cannot go lower; it’s just so much damage usually takes place early in a panic phase.

The Bull still has his head and maintains his independent thinking status, even if he’s still lonely. Stay steady, my friends.

The Lonely Bull