Pettit Funds

   I recently “purchased” some Gulfmark Offshore, Inc. (GLF) for my Pettit Energy Fund virtual mutual fund at Marketocracy–which fund has more than quadrupled since it was started in January, 2003.

   Actually this stock was one of the original 30 or so that I purchased at the fund’s inception.  I don’t recall when I sold it–probably a couple of years later, for a small profit.

   Wouldst that I had held on, as it has done very well since then.  I’m back in the stock now, as it showed up on my screen again.  I hope I don’t sell too early–or too late–this time!

   I bought this stock early in 2001, when I got back into the market after having been totally in cash from the beginning of 2000.  (I had been worried about the market getting weird about Y2K and cashed out in late 1999).

   I purchased it for about $5/share and hung on for a couple of years and cashed in most of my shares at about $20.  This was the first stock (not counting my 1 share of Berkshire Hathaway A that I used to have) that I made some “significant” money on.

   So it is with sadness that I read in today’s USA TODAY that it has been delisted by NASDAQ, having given notice that it has filed bankruptcy this week.  It now trades at 22 cents per share, despite being the #2 video-rental chain in the country after Blockbuster.

   Farewell, my friend.  Thanks for the memories.

Ok, going with Ceradyne (CRDN)–some tech company that makes industrial ceramics for the automotive and other industries (including defense).

Always glad to pick up a few war profits.

Earnings announcement coming out on October 30th, so there will be likely some excitement then.

Again, a bigger company than I’m used to buying, but I couldn’t quite decide to pull the trigger on a couple of others I looked at: North American Galvanizing & Coatings Inc. (NGA), and Republic Airways Holdings Inc. (RJET). Maybe next time.

I’m reading a book right now called EGONOMICS, by David Marcum and Steven Smith, and have come across this passage about an interesting experiment done on a group of pre-schoolers. Read and learn:

Between 1968 and 1974, Walter Mischel of Stanford University conducted a series of studies on what makes it hard or easy for children to delay gratification. One simple experiment included four- and five-year-old preschoolers and a marshmallow. Mischel brought each child into a room, one at a time, and offered the child a marshmallow. But before he allowed the children to eat the marshmallow, he told them if they waited fifteen minutes for him to return, they would get two marshmallows instead of one. Once Mischel left the room, he and his team recorded the behaviors of the children.

For some children, there was no space betwen stimulus and response. the moment the door closed–gulp–the marshmallow disappeared. Some children fought the temptation as long as they could, taking tiny bites off the bottom, hoping their nibbles wouldn’t be seen. But their efforts to resist were in vain and they eventually succumbed, happily eating the rest of the marshmallow. A few children pushed the boundaries as far as they could and licked the marshmallow, apparently reasoning that licking wasn’t technically eating and so was allowed. But alas, licking led to eating.

On the other hand, some children kept their distance using different strategies–ignoring the marshmallow’s pleas to be eaten. A few of the children pretended the marshmallow wasn’t there and wandered around the room. Others sat in front of the marshmallow with their faces bured in their hands, occasionally peeking between their fingers to see if the marshmallow had escaped. Others talked to themselves as if there was an imaginary friend in the room. One girl sang nursery rhymes to take her mind off the temptation, and then crawled under the table and fell asleep.

Mischel conducted follow-up studies on these children for twenty years after the initial impulse control study. Those with the willpower to outlast fifteen minutes of temptation and wait for two marshmallows were educationally more successful and emotionally intelligent. They showed better skills under stress, embraced challenges, and pursued goals rather than giving up in the face of difficulties. They were more confident, dependable, and willing to take more initiative than those who ate the marshmallow. They scored an average of 200 points higher out of a possible 1,600 on the Scholastic Aptitude Test (SAT) college entrance exam.

***

I think this is fascinating, and not that much of a surprise.

Parents, set out those marshmallows. If you discover your child has a problem, think about that the next time your child just has to have that piece of candy at the checkout line.

    So I land at nearby Oakland Airport 1-ish Friday afternoon. Getting to the rental car facility is a hassle. Have to wait 15 minutes for a shuttle bus. Get on and am immediately told to get back off–full! Another comes along in 5 minutes. I squeeze on. Standing room only. The bus takes us a long, long ways (to what appeared to be the next county over) to the rental car facility. Long line. Long, SLOW line.

But…I’m finally out and have installed my GPS locator (I’ll never travel without one again) and find my way to the Marketocracy headquarters. I chat briefly with Ken Kam (once he was able to get off of his phone!), and head to the hotel. I read a little more of Greenspan’s book, so I can drop Greenspan-isms into the conversation over the weekend and try to impress these new peers.

Then it’s back to Marketocracy 5-ish to meet the guys who have thus far arrived. Cool! Great to be able to connect names with faces. And everybody’s NICE–not pretentious, as I’d feared some might be. I think we’re all so relieved to be around “our own kind”, rather than with our suffering spouses and bored friends that just don’t “get it” when we start talking about finance.

Instant friendships. I’d never seen anything like it. At all of the lawyer conferences I’ve been to over the years there IS plenty of pretentiousness and condescension. None of that here. I LOVE these guys!

We walk over to a nearby clubhouse for pizza and drinks. (All non-alcoholic. Never saw an alcoholic drink anywhere the entire weekend–which was fine with me, although I’ve been known to drink a beer or two. Interesting choice…) Nice clubhouse: pool table, shuffleboard. For some reason, I am pooped by about 8:00, though (and only a couple of time zones as an excuse), and a few of us go back early. Zzzzzzz…

Saturday morning we’re carpooling back to Marketocracy and arrive at 7:45 a.m. Coffee, bagels, and other stuff to sustain us and we start about 8:30. Ken gives a little history of himself and Marketocracy. Then Tim Erikson (’teriksen”) gives a presentation for DHIL–Diamond Hill–a stock he has selected for his m10 fund. Another presentation for Legg Mason. (I might be confused and he gave this second one on Sunday morning). Next up is m10-er Gary Franklin (”cfranklin”) discussing AMRN–Amarin–a pharmaceutical company. Looks risky to me. I start thinking to myself, “I’ll give this one a ‘2′…” and then I think, “Wait! This is GARY FRANKLIN recommending this stock. Ok, gotta give it an ‘8 1/2′…”

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