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Letter to the Editor

This article originally appeared in the October 2003 Issue of INSIGHT

Strict But Fair

If only I had written this article a week ago, when the Dow was at a very pleasant 9478! Wall Street resumed its downward slide this morning, even as I type, following disappointing reports on consumer confidence and business activity in the Midwest. The Dow Jones industrials dropped more than 100 points so far today to 9275.

Is this a catastrophe? No way! I am sure that things will even out and start gently upward again - probably by this evening. This has been the atmosphere of the Stock Market all through 2003.

Traders are just being careful and letting small adjustments discipline the Dow. Strict and fair, just like my best teachers - better in the long run, for the economy and for my blood pressure.

Investors have been increasingly uneasy about stock prices, fearing they have climbed too high too, too fast given the still fragile economic recovery. Wall Street interpreted the end-of-September re-ports as confirming its fears about the economy.

The refinish manufacturers are all in the plus column this month for year-to-date activity. BASF’s price per share, in fact, is up almost one-fourth since January, at a current $46.40.

The paint companies were wise to implement cost containment and budget cutting measures over the past couple of years. The flat market environment for refinish paint and materials, where we sense no change, at least in the foreseeable future, requires stern accountability to keep the bottom line steady.

Keystone Automotive has been moving steadily along all through this year, as through 2002, doggedly determined to stick to the company’s well thought out business plan.

LKQ, as of today, has not yet begun trading. We may see the company’s IPO later in October.

Progressive has almost doubled its stock price this year. The Cleveland-based insurer has brought its price per share up to $70.

Both Copart and Insurance Auto Auctions have been struggling this year for balance. Both companies have invested a good deal in technology and software development vital to their expansion and acquisition strategies. Will the money invested prove to be well-spent? Perhaps by mid-2004, the auto auction businesses will be able to make their shareholders smile.

During the last quarter of 2003, collision repair facilities will, as usual, be counting on Mother Nature to send business to them. After some very slow months, a few good Winter storms would be welcome.

-Charles Baker-

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