The lobby is empty save for Warren and me. I put down Schwab’s copy of the Wall Street Journal and inquire, “Are people calling in sounding genuinely distressed?”

“A lot of people are very concerned about where the market is heading. Especially compared to where they were one year ago, six months ago. Definitely.”

“Have you heard panic?”

“People are coming in and saying, ‘I need to sell everything right now.’ ”

That’s a long way from panic. “I was visiting Washington, D.C., in ’87 when the Dow dropped 508 points in one day, except then, 508 points was 22 percent of the Dow. That morning, I went to the Schwab office on I Street. You couldn’t telephone. Schwab had so many phone calls, their switchboard imploded. When I arrived, there must have been 50 people milling around on the sidewalk trying to get in the front door. Women were crying. People who had made it inside the lobby couldn’t see a broker. It was…”

“No, it’s not that bad.” Warren smiles as if I’ve been explaining how covered wagons are built. “The closest I’ve seen to that is a 10-, 15-minute phone wait to get through to a broker.”


“How long have you been in the market?”

“About four or five years,” says Steve Schoob, a truck driver from Cottonwood, Arizona. Schoob’s in town visiting his parents and stopped by to check his stocks. I ask the usual. “Did you see this coming?”

“The guy who sells to me did.” Schoob is wearing a navy blue T-shirt, jeans, and a huge silver necklace with what, I swear, looks to be a trout fish lure minus the hook as a pendant. “We’re in electric and water stocks and all that stuff now. We didn’t get hurt bad, but we’ve lost some.” Schoob thinks for a moment. “I’ve got a friend who’s $1,500,000 down.”

Hey, it’s only paper money. “Have you reconsidered any plans or purchases?”

“Nope, not at all.”

I believe him. “How did you first come into the market?”

“Bank of America. Through mutual funds. Then I started getting into it more.”

Captain Crunch breakfast cereal, Coca-Cola, marijuana, heroin, and then the stock market. It’s a straight line to hell in a handbasket. “Is this the beginning, middle, or end of the bear market?”

“I hope this is the end, but who knows?” Schoob makes a cowboy shrug. “It might go a little bit lower.”

“Do you ever worry about the market?”

“Heck, no.”

“Have you spent any time studying the market, researching it?”

“Not really. I have a friend who does that for me. I just give him money and he takes care of it. This guy really studies the market and we’ve made money.”

There is, at the end of the day, no argument to that. “What do you think caused the Dow to crash?”

“I think 9/11 had something to do with it. And all the executives taking off the top.”

I note a trace of cowboy anger. “What should be done with them?”

“I hope they hang them. I think they should be hung.”


10:28 a.m. and the Dow is down 168 points.


“How long have you been in the market?”

Joe Nalven says, “Since the early ’70s.”

Mr. Joe Nalven is middle-aged and could pass as a twin of Senator Joe Lieberman, if, that is, Senator Joe was born with blond hair and raised on the West Coast. Citizen Joe lives in Poway. I ask, “What got you started in the market?”

“My in-laws thought it would be a good place to put extra money from time to time.”

“What was your first stock?”

“Warner [one of the sires of AOL Time Warner] and General Motors.”

“So you’ve seen this before?”

“Oh, yeah, the cycles of depression and elations are quite familiar.”

“Where are we along the axis of despair and joy?” Pretty damn poetic question.

“I’d like to believe, and I think all of us are hedging our bets, but I’d like to believe we’re near a low.” I note Joe speaks like Joe Lieberman. “Looking at the overall robustness of the economy, it doesn’t make sense to be this low. But, then again, listening to the news, the highs weren’t probably where we ought to have been either.

“The big question is, if you pull out and take a tax hit on what you’ve made, even if it was not as much as you would like to have made, then what do you do with that money? Do you put it in your mattress? The market forces you to balance risk in a number of different ways. And that’s suddenly one of the problems we have now, because it’s hard to gauge the kind of risk we’re in.”

Nalven poses a question many of us need not answer since one is not required to pay taxes on losses, only on gains. I say, “The Dow P/E is over 20, indicating to people who believe P/Es are important that the stock market is still overvalued.” P/E, or price-earnings ratio, is the price of a stock divided by its earnings per share. For instance, a $60 stock price divided by $3 of earnings per share gives you a P/E ratio, or P/E, of 20.

Nalven isn’t buying. “But you have other stocks, like Microsoft, which has always had a P/E in the 30s, 40s, and 50s, and it’s held its ability to grow. Still, the market may force us to go more towards value.

“Where is the real value in putting your money in the stock market?” Now he really sounds like Joe Lieberman. “Say you hold Johnson & Johnson. Well, that’s a good stock. And I emphasize good stock. And now you read about how they are having accounting problems. If bedrock firms start having problems, how do you make sense of that? What’s real?”

Theft and fraud. “What do you think ought to be done with Enron and WorldCom executives?”

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