Larry was a client of mine. He didn’t have a lot of money. He didn’t have any financial knowledge. An oft unemployed painter, he somehow came up with the idea of investing in one of the large banks that was selling for pennies in the Fall of 2008. He was sure that they would return to the stock prices of their hey day. The problem here was that these banks were in far worse condition than even the insiders knew, let alone two guys talking in a discount brokers office.

Larry had already invested $400 in one of them. $400 isn’t a ton of money for most people. The executives of the above mentioned banks probably spent more than that on lunch that day. Larry had $400 in cash in his hand and he was thinking of making an additional investment in this particular bank. I convinced him not to, primarily because I didn’t really understand what was going on with these companies at the time. After studying it in the years since, I’m still not sure that I understand.

I’m glad that I was able to convince Larry not to invest more. I wish I had known he was to going to invest the initial $400 because the stock went to zero. I suppose I may have saved him another $400. Like I wrote earlier, it wasn’t a ton of money to most people , but it must have been to Larry because he committed suicide when he lost it all. After all of these years, I can still see him sitting in my office, white paint on his hands, holding that $400 in cash.