6 Words You Don't Want to Say

I'll tell you a story, and you tell me what you think.

It's about a young man who "gambled" a fortune and lost -- and in so doing, learned a valuable lesson. Naturally, there's a surprising twist.

But is it true?
I'm not sure. It was first told by Napoleon Hill, a friend of Andrew Carnegie, in his book Think & Grow Rich and has been passed down faithfully for 71 years.

I think you'll find it offers some perspective in this baffling market -- plus, the six words you don't want to say. Listen closely, and you may even discover a "million-dollar" takeaway.

In the gold-rush days ...
A young man and his uncle went west. The going was hard, but eventually they hit pay dirt. Quietly, they covered up the mine, retraced their steps, and told a few friends and neighbors of the strike.

They bought their gear, had it shipped, and followed it west -- to one of the richest "finds" in Colorado! Just a few carloads worth of ore would clear their debts. Then would come the big killing in profits.

"Down went the drills! Up went the hopes of Darby and Uncle! Then something happened! The vein of gold ore disappeared! ... They drilled on, desperately trying to pick up the vein again all to no avail."

Given the way the market has behaved, with the once-heady gains of the past year wiped out, you probably feel their pain.

And we do, too
There was a time when everything we touched turned to gold. In April 2002, when I helped David and Tom Gardner launch their Motley Fool Stock Advisor newsletter, you could have plucked a ticker from the actives list at random and made serious money through the end of October.

Cisco Systems (Nasdaq: CSCO) more than doubled. Yahoo! (Nasdaq: YHOO) more than tripled. As for Apple (Nasdaq: AAPL) and Research In Motion (Nasdaq: RIMM) -- if you don't own them, you don't want to know what they did.

Yet all four have been dropping. Suddenly, the mine has run dry.

The S&P 500 has coughed up more than 12% since October. And that's peanuts compared to the pain inflicted on folks who fell into the Dell (Nasdaq: DELL) value trap or those of us holding big financials such as Bank of America (NYSE: BAC) or Citigroup (NYSE: C). That entire sector seems to fall 10% per day.

It would be easy to give up
After all, that's what our heroes did when their vein of gold ore dried up. They quit -- sold their tools to a junk man for a few hundred bucks and took the train back home. And that should have been it.

But the "junk man" had other ideas.

He hired an engineer to survey the abandoned mine. I'll spare you the technicals, but he calculated that the vein would pick up just three feet from where they had stopped drilling. That's exactly where it was found.

You can guess what happened next. The "junk man" took millions of dollars in ore from the abandoned mine.

"I stopped three feet from gold!"
Of course, those are the six words you never want to say. And why, when I recently spoke with David and Tom Gardner, they weren't telling their Stock Advisor subscribers to sell. In fact, like most money managers (see recent commentaries from Richard Pzena, Bill Miller, or Ron Muhlenkamp), they're shopping for bargains.

Earlier, I said that in April 2002, you could have picked a stock almost at random and made money. That's obvious, in hindsight. But for the first six months the S&P was down -- a full 30%. I feel for those who threw in the towel.

As for Stock Advisor subscribers, they're glad they stuck with it. According to Hulbert Financial Digest, David and Tom's picks are up more than 20% per year, including 24 that have doubled or more. At that rate, your money doubles every three-and-a-half years.

Just call us "junk men"
What we need right now is help surveying the goldmine that skittish investors have left for barren. That's how I look at David and Tom Gardner. Like the engineer in our story, they have a proven methodology, the tools, and years of experience on their side -- and they're digging in the right place.

Do you really want to risk saying, "I quit three feet from gold?" I know I don't. Especially when you can try Stock Advisor free for 30 days. You get David and Tom's latest picks, including their top five stocks for new money now. You can even read every single issue instantly online. If you don't like what you see, you don't pay.

Personally, I don't try to call market tops or bottoms. But I have a funny feeling that patient, long-term investors will look back warmly on this brutal market. We always do. To find out more about your special offer to try Stock Advisor free, click here now.

Paul Elliott owns shares of Bank of America. Dell and Yahoo! are Stock Advisor recommendations. Dell is also an Inside Value pick. Bank of America is an Income Investor recommendation. You can see all of David and Tom's Stock Advisor picks instantly with your free trial. The Motley Fool has a disclosure policy that prefers Assateague to the Hamptons.