Letter From The Fool

The recent state of the stock market can be disconcerting. If you're tempted to act rashly, remember: This, too, shall pass.

There are still plenty of sound, well-run businesses that will reward calmness and patience. Better still, many of them are now selling at a discount to their fair value.

The markets will likely remain volatile for a while. The response from Wall Street and the financial press will range from euphoric to despondent, and much advice given will be emotional and shortterm in focus. There are real risks in the market today. More companies are sure to struggle.

But don't panic. If we retain our wits, we'll make better decisions than most investors. Here at The Motley Fool, we tend to avoid companies with significant debt in favor of companies with cash-rich balance sheets. Although the crisis in the financial sector is dragging down the market, there are bargains to be found.

After nearly every sudden drop the market has experienced, it recovered within a few years. Six months after the 1995 Oklahoma City bombing, the S&P 500 had gained 17 percent, and six months after the lows of Sept. 11, 2001, it was up nearly 19 percent.

We're paying close attention to the market, and we encourage you to come to Fool. com and to our discussion boards for regular commentary.