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there's a lot of times people buy on the basis the stock has gone down this much how you know how much further gonna 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 didn't get below 100 and a lot of people bought on that basis saying look it's not 135 to 100.
it's not 95 what a buy within a year it was 18. and this is coming with no debt i mean as it comes it was just so overpriced it went down i did the same thing in my uh i think my first or second year 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 in the new york on the american stock exchange of kaiser industries at 14 i says you know it's covered twenty six to sixteen how much lower can i go well at ten i called my mother and said mom you gotta uh look at this kaiser industries i mean how much lower can it go it's gone from twenty six to ten well it went to six it went to five it went to four and went to three and uh now i unfortunately have rapidly i would probably be still caddying or being working at the stop and shot but i it happened fast i was able to this was compressed and at three i figured out you know there's something very wrong here because kaiser industries owns 40 percent of kaiser steel they own 40 percent of kaiser aluminum they own 32 percent of kaiser cement they own kaiser broadcast and they own kaiser santa 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 so many people it's very hard to go bankrupt if you don't have any debt it's tricky some people can approach that it's a it's a real achievement but they had no debt and the whole company at three was selling at about 75 million and 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 i said everything's fine and eventually this work out and they what they did is they gave away all their shares to their shareholders they passed out shares and guys meant they passed up chairs and cars aluminum they passed out their public shares and 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 into 10 what would you do when it went to nine what would you do when went to eight what would you do when 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 now do you flip a coin do you walk around the block you know what do you do psychiatrists haven't worked so far i've never seen them running in the side the the psychological psychiatry fund i've never seen for the uh with the sec to make it through as a mutual fund so i they haven't seemed to help i've tried prayer that hasn't worked the uh the uh so if you don't understand the company of 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 floppy disks 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 three dollars how much can i lose i've had people call me up saying i'm thinking of buying a stock at three how much can i lose well again you may need a piece of paper for this but if you put uh if you and if you put twenty thousand dollars in a stock at fifty or your neighbor put twenty thousand at full at 50 into the stock and you put twenty thousand dollars into three and it goes to zero you lose exactly the same amount of money everything if 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 that this is the only this may be a reason researchers thought the fact that 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 show at walmart they don't share at home depot they're not sure the great companies johnson johnson they short stocks down from 80 to 70.
they'd like to short it at 16 or 22 but they they figured out at seven 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 short seven they're selling a short at six at five at four at three at two at one and a quarter and you know what should sell something short you need a buyer somebody has to buy the damn thing and you wonder who's buying this thing it's these people saying it's three how much lower can it go you
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