WaMu Gets it up the Wazzoo

Fear comes in may forms. There's vague anxiety, nail-biting, jaw-dropping awe, trembling terror and why-not-pee-in-your-pants-because-I'm-about-to-die-anyway. That latter fear is what stockholders of WaMu are feeling these days (including myself). Of all the financials I own, this one has performed the worst. That's quite a feat considering some of the stinkers in my portfolio. The reasons are many: subprime write-downs, regional bank chaos, low reserves, shaky strategy, worldwide financial collapse...

But WaMu deserves better than it's got. It shouldn't be a $4 stock. It should be a $7 stock. Welcome to the world of value investing.

All successful value investors have one characteristic that--without it-- leads to surefire ruin. Fear. They understand the emotion of fear and they know how to deal with it. They understand that fear is what undervalues stocks to begin with. And they are willing to jump into the pool aided by reason when the rest of the market is indulging in fear-inspired screaming.

So let's hear it for being fearless about WaMu. Even though I've lost 60% of my investment in it, I'm still not selling it.