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high on the basis the stock has gone down this much how you know how much further can it go down I remember when Polaroid went from 130 to 100 people said here's this great company great record if it ever gets below 100 you know just buy every share you know and it did get below 100 a lot of people bought on that basis saying look it's gone from 135 to 100 it's now 95 what a buy within a year it was 18 and this is a company with no debt I mean this is a company it was just so overpriced it went down I did the same thing in my uh I think my first or second year at Fidelity.
Kaiser Industries had gone from $26 a share to 16. I said, "How much lower can it go?" It's 16. So I think we bought one of the biggest blocks ever on the New York on the American Stock Exchange at Kaiser Industries at 14. I said, "You know, it's gone from 26 to 16. How much lower can it go?" Well, at 10, I called my mother and said, "Mom, you got to uh look at this Kaiser Industries.
I mean, how much lower can it go?" It's gone from 26 to 10. Well, it went to six. It went to five. It went to four. It went to three. And uh now I unfortunately this happened rapidly or I would probably be still caddying or be you know working at the stop and shop but I it happened fast I was able to this compressed that uh and at three I figured out you know there's something very wrong here because Kaiser Industries owns 40% of Kaiser steel they own 40% of Kaiser aluminum they own 32% of Kaiser cement they own Kaiser Broadcasting they own Kaiser standard gravel Kaiser engineers they own Jeep they own business after business and they had no debt.
Now, I learned this very early. This might be a breakthrough for some people. It's very hard to go bankrupt if you don't have any debt. It's it's tricky. Some people can approach that. It's a real It's a real achievement, but they had no debt. And the whole company at three was selling at about 75 million.
At that point, it was equal to buying one Boeing 747. I said, "There's something wrong with this company selling for 75 million." I was a little premature at 16, but uh I said, "Everything's fine and eventually this will work out." And they what they did is they gave away all their shares to their shareholders.
They they passed out shares in Kaiser cement. They passed out shares in Kaiser aluminum. They passed out their public shares in Kaiser Steel. They sold all the other businesses and you get about $50 a share. And but if you didn't understand the company, if you're just buying on the fact the stock had gone from 26 to 16 and then it got to 10, what would you do when it went to nine?
What would you do when it went to eight? What would you do when it went to seven? This is the problem that people have is they sell stocks because they didn't know why they bought it. Then it went down and they don't know what to do. Do you flip a coin? Do you walk around the block? You know, what do you do?
The psychiatrists haven't worked so far. I've never seen them running in the the psychological psychiatry fund. I've never seen this listed for the uh with the SEC to make it through as a mutual fund. So, I they haven't seem to help. Uh I've tried prayer. That hasn't worked. The uh the uh so if you don't understand the company, you have this problem when they go down.
Uh eventually they always come back. Uh this one is uh this one doesn't work either. Uh people think uh RCA just about get back to its 1929 high when General Electric took it over. Uh a lot of double knits never came back. Remember those beauties? Uh uh floppy discs, Western Union. Uh the list goes on and on.
Uh people saying it'll come back. Well, it doesn't have to come back. Uh here's another one you hear all the time. It's $3. How much can I lose? I have had people call me up saying, "I'm thinking of buying the stock at three. How much can I lose?" Well, again, you you may need a piece of paper for this, but if you put uh if you and if you put $20,000 in a stock at 50, or your neighbor put 20,000 at full at 50 into the stock and you put $20,000 in at three and it goes to zero, you lose exactly the same amount of money, everything.
And people say it's three, how much can I lose? Well, if you put a million dollars on it, you can lose a million dollars. Just the fact a stock, this is the only, this may be a reason to research a stock, the fact a stock is three down from 100, doesn't mean you should uh buy it. And in fact, short sellers, people that really make money in stocks, they don't short Walmart.
They don't short Home Depot. They don't short the great companies, Johnson Johnson, they short stocks down from 80 to seven. They'd like to short it at 16 or 22, but they they figured out at seven that this company is going to go to zero. They just haven't blown taps on this thing yet. It's going to zero and they're selling it short at 7.
They're selling it short at six, at 5, at 4, at 3, at 2, at 1 and a/4. And you know, to sell something short, you need a buyer. Somebody has to buy the damn thing. And you want to who's buying this thing? It's these people saying it's three. How much lower can it go? Yeah. Yeah.
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