By: musicwhiz I shall type this post purely from scratch and this is based on the thoughts that I had rationalized over the last week as the stock market had taken probably the worst slide in the last 21 years (since the 1987 market crash). I intend to cover a few areas so please bear with me if the post seems haphazard, I am trying to organize my thoughts as I type and if there are some ideas which seem disjointed, it's because this is a rather "ad-hoc" posting. What we have witnessed in the past 2 weeks is probably the worst rout in the history of stock markets, and for some time to come no doubt. I shall not go into the details as every major newspaper and website would have covered the events to death, sounding more doom and gloom to an already panicky cauldron of potent witchbrew. Mr. Market has shown time and again that he can be extremely emotional; as one year ago he was irrationally exuberant and bidded up the share prices of companies to lofty valuations. Now, exactly a year later, he is ferociously thrashing every one who made him look like a fool for being such an eternal optimist. I was reminded of some sections of the "Intelligent Investor" which stated that in a bull market, you'd worry about not making as much money as your neighbour; in a bear market, you just worried about whether your money will dwindled to absolutely nothing as the value of your portfolio dips by 50-60%. But I digress. I am here to categorically state that as I am HUMAN too, I was affected by the emotional roller-coaster unleashed by a manic Mr. Market, and I was rather distressed throughout the whole week. This being my first true bear market (and a savage one at that), the severity, intensity and consistency of selling has truly amazed me. Reading books on such selling is one thing; actually witnessing it is an altogether different experience, one that I certainly won't like to experience too many times in my life. However, I would like to state that I did NOT capitulate and sell all my shares in a panic, even though the recent news on Ferrochina's bankruptcy and China Printing and Dyeing's scandal have further exacerbated my lingering worries about the financial health of my companies. Being an aspiring value investor, I think the most rational and prudent thing to do would be to do a quick review on the underlying health of my companies:- Read more..