JBL: The Sweet Spot

Congratulations to our great armed forces for finally getting the main bad guy in Iraq, al Zarqawi. This is a huge win for the good guys.

Two years ago I was in the Sunni Triangle in Iraq doing a USO performance for our troops, whom I love to support, and the incoming mortar signal went off. All the soldiers in the stands headed for the exits, and we got escorted off of stage into a bunker until the mortar fire was over.

While I was in the bunker, I realized my dear friend Al Franken was still handcuffed and dressed like Saddam Hussein from a skit he was doing for the soldiers; it was quite a strange sight. However, I was too busy becoming religious to realize the irony of the situation.

This past week felt like I was watching the same exodus from the market to the safe bunkers as I did that night in Iraq. Investors don't know what to do and are figuratively running for safe haven.

Opportunity Knocks

Buy low, sell high. Sounds easy, but so often we do just the opposite. When momentum is taking us too far in one direction, it is time to be a contrarian. I have a few stocks today that have been taken down with this market and have become buying opportunities.

One example is American Science and Engineering (ASEI Quote), which I wrote about positively on Monday. It suffered renewed weakness during the market upheaval last week, which I believe is an even more compelling reason to buy.

While I can't control our Fed Chairman talking about policy to a reporter at a party -- and those words roiling the market -- I can control the stocks I buy.

Imagine a scenario in which the cost to produce something remains relatively constant yet the price you can sell it at keeps increasing. This is where MEMC Electronic Materials (WFR Quote) finds itself.

To view John Layfield's video take of this column, click here.