"There was initial concern and disbelief, then anger, then limp laughter. You went through that whole cycle. It was numbing to say the least. . . .There was one client that had been in too small an equity position for quite awhile. This was a $40 million balanced portfolio with about 30% in equity. In May of '87, we convinced them to go to 40% because we felt the market was high, and asked them for the discretion to put the money to work. Well, at the close on that Friday in October, we put about a third of the cash - about a million and a half - to work. We bought Alcoa and it closed on Friday at 56. It opened on Monday at about 48 and ended the day at 42. I never lost money so fast in my life, at least not on a new purchase. And never felt quite so stupid so quickly. It was humbling."
Peter C. Bennett
Executive vice president,
CIO for equities
State Street Research
