Fenimore Asset Management Chairman Tom Putnam began his investment firm’s annual meeting this morning by reading newspaper headlines screaming about panic gripping world stock prices and retailers bracing for a horrible holiday season.
While the headlines seemed to reflect the tumult that has rolled through global financial markets over the past month, they actually dated back to October 1987, the month of the stock market’s last crash.
“A lot of those problems back then were similar to the problems we’re facing today,” said Putnam.
Putnam recalled seeing many “glum faces” when he held the first annual meeting for his firm that October — 10 months after launching the FAM Value Fund. Although that $730.7 million mutual fund is down 21.6 percent for the year, Putnam today did not encounter glum faces at the Holiday Inn Turf on Wolf Road.
Many FAM shareholders at the meeting expressed more concern about the general economy and its impacts on the Cobleskill firm than on the performance of its funds. Addressing those worries a day after the Dow Jones Industrial Average rallied 936 points on news of a worldwide government bank rescue, Putnam tried to maintain that momentum and take a bullish stance.
“We know we’re pretty near where things start to get exciting on the upside,” said Putnam.
After sitting on the fence for much of the year, FAM managers and analysts told investors they are going into buying mode and prowling for undervalued stocks.