Light & Truth

“Confession isn't just good for the soul; it's good for the share price.

“Friday, Merrill Lynch said it would take a third-quarter loss after writing down $5.5 billion tied to mortgage investments and leveraged buyout commitments. Washington Mutual said its third-quarter income would fall by 75% after taking a $975 million loan-loss provision. Merrill Lynch shares rose $1.89, or 2.5%, to $76.67. Washington Mutual rose 79 cents, or 2.2%, to $36.07. Last Monday, Citigroup said that its third-quarter results would get hit by $5.9 billion in write-downs and charges. Its stock jumped and finished the week with a 3.5% gain.

“Given last week's experience, maybe other companies should follow suit. U.S. car companies could come out and say that they're so far behind in the innovation race that they don't see how they can catch up. Microsoft CEO Steve Ballmer could publicly relent and allow his kids to scrap their Zunes for iPods. Retailers could say that despite ideal weather, sales have been weak.

“What makes financial companies like Merrill and Citigroup different from other companies is that they are naturally more opaque. You can get on a subway and see how many Zunes you can spot, and you can walk through malls to see how the stores are doing. But trying to figure out what's going at a financial company, where positions are constantly shifting and valuations and default possibilities are based on assumptions, is much tougher. It's one reason that financial company shares carry lower valuations than other stocks.”

("Ahead of the Tape.” Justin Lahart. Wall Street Journal: October 8, 2007. pg. C.1)

HOW CAN TRANSPARENCY open doors for you to stand out from the crowd? Courage is not the absence of fear, but acting on principle in the face of fear and uncertainty. Do not wait for the crowd to move; let the light of truth lead into what may appear to be dark today.