Broker Tailors Tale to Match Market
By the time Black Monday faded into Gray Tuesday, the uncertainty on Wall Street had colored nearly every aspect of broker Jeff Kilpatrick’s life, including his story-telling style. Take the one he tells about how he got to work Tuesday morning. Please.
The day after the Dow Jones Industrial Average--the most popular barometer of Wall Street’s health--lost 508 points in an unprecedented free fall, Kilpatrick piled into his car at about 6 a.m. It didn’t start. He climbed onto his motorcycle, but half a block from his Irvine home, it too broke down.
So the 10-year veteran of the stock market walked home, called a co-worker for help and finally made it to the office of Newport Securities in Costa Mesa just before the market opened Tuesday at 6:30 a.m. PDT.
As Kilpatrick, the company’s founder and president, watched the Dow Jones rally, flag, then rally again, he recounted his tale for clients who telephoned looking for bargains and to reporters in search of information.
The facts remained the same, but the ending changed, depending on how the market was faring at the time.
When the Dow had gained about 200 points from Monday’s close of 1738.74, he used upbeat Ending A to describe his vehicular trauma: “Ya know, I figured that was about as bad as this day could get. And I was right.”
Later, when the Dow was more than 20 points in the red, Ending B unfolded: “I said to myself,” he recalled to the listener, “this is gonna be one bad day.”
Which was it? Neither. And both. While the market finally closed up 102.27 points Tuesday, it went through 6 1/2 hours of gut-grinding gyrations before arriving there.
But most of Tuesday’s high drama was confined to the screen of Kilpatrick’s desktop computer, where icy white numbers toted up the stock market’s rise and fall: 7 a.m., +110; 7:12 a.m., +143; 7:30 a.m., +200; 8:07 a.m., +115; 8:25 a.m., +54.36; 9:30 a.m., -22.73.
The office hush was punctuated by the tap of computer keys, and an occasional oath from other brokers, frustrated by a computer slowdown caused by the unusually high trading volume.
Bargain hunters calling early in the rally were treated to Kilpatrick’s guarded optimism. “Hi, Doctor,” he’d say. “Better. It’s up 200. IBM’s at 118, up 14 3/4. That’s moving in the right direction.”
Or: “I think we’re getting some values here.”
Or: “I’ve talked to several traders, and all they’re hearing is buy orders.”
But by 8:30 a.m. the glow was rapidly receding, and portfolio manager Chris Menrad ran breathlessly into the office. One client “says he wants to buy $14,000 worth of a decent blue chip,” Menrad said.
“He says you know what he wants. He’s going to the dentist, but he says do it.”
Menrad left. The market had just lost nearly 170 points of its initial rally. Kilpatrick looked up, turned his head, frowned. “Blue chips. The guy wants blue chips. You got any ideas?” He paced. “Some fun, huh? I guess I can always be a plumber.”
Kilpatrick never really had to worry about stocking up on pipe wrenches and drain plungers, because Monday’s crash dented but didn’t destroy his clients’ life savings.
“We took a lot of our profits about two weeks ago,” he said. “Not that I saw a great decline or anything, but a lot of the stocks were overvalued. . . . If something seems unusually overvalued, we’ll sell. . . . I have this old saying: ‘Bulls can make money, and bears can make money, but pigs never do.’ ”
By noon, broker Larry Butler was showing signs of stock market strain as he worked across the office from Kilpatrick.
“This is an ugly day, and I feel ugly,” said Butler, who trades in stocks of smaller companies listed on the American Stock Exchange and the over-the-counter market.
“I’m just worn out. It’s so bloody active. I’ve made 31 buys and 20 sales and the day’s only half over for me.”
Brandishing a thick sheaf of pink telephone notes, he said: “And these are the people I haven’t called back.”
The market finally closed at 1 p.m. after a day that tension had stretched into a seeming eternity. Kilpatrick finally had the time to wax just a little philosophic: “The Dow Jones is rallying, but the small stocks are getting killed. Some things are starting to improve. Hopefully, tomorrow will be a good day.”
But for now, Kilpatrick had a more important thing on his mind: “Lunch.”
