Art Cashin, managing director of UBS Financial Services, has stalked the floor of the New York Stock Exchange for more than 50 years.
The other day, Josh Brown, CEO of New York City-based Ritholtz Wealth Management, recounted an instructive Cashin story.
It’s perfect for COVID-19 times.
Cashin’s early days on the NYSE, in the 1960s, were during the cold war’s pinnacle.
The most dramatic event of those days was The Cuban Missile crisis. That’s when the (then) Soviet Union installed nuclear-bomb tipped S-4 and R-14 ICBM missiles in Cuba just 90 miles from the U.S.’s shore.
U.S. President John Kennedy countered with a navel blockage to ensure his Soviet counterpart, Nikita Khrushchev, could deliver more missiles to Cuba. It is not hyperbole to suggest we were a whisper away from a nuclear war.
In that environment Cashing was swept away one day on a rumor that the missiles had been launched and were in bound from Cuba.
The young trader went with his instinct and decided it was a good time to sell.
His boss was incredulous;
He collared Cashin and said “You BUY on inbound missile talk. If it turns out true, you’re dead anyway.”
In the markets, it’s the cooler head that generally prevail.