"The word "forgive," according to the Chambers Dictionary of Etymology, comes from the Old English for-completely + giefan-GIVE."

~ Jeff Kober

Bob didn't hit bottom in a dramatic fashion.  As he tells it, he looked in the mirror one morning, and he spied a foreclosure notice out of the corner of his eye.  He looked directly at himself in the mirror and thought, "Who is this guy I'm looking at? I don't like him!  That's it, I'm done."  He thought of the jerk he had become, and he figured that suicide may be the best amends for his sins. Bob went for a walk that morning, pondering whether to end his life.  On the walk Bob bumped into an old trading buddy who had heard about his fall.   The buddy invited him to an Alcoholics Anonymous meeting that night. 

At the meeting Bob recounted his story and was amazed that many in the room could relate.  He had spiraled downward driven by forces and compulsions he was only dimly aware of, yet many in the room had parallel stories of self-destructive behavior.  Like others in the room, Bob had poisoned many of his relationships with ego-fueled ambition and narcissism.  Bob realized that his life wasn't just about him.  And as he looked around the room, and listened to the stories of other alcoholics, he realized that he had hurt many good people. 

Bob went home that night made an inventory of everyone he had hurt.   He decided that suicide would be no use if he didn't at least try to make amends to these people for the pain that he had caused them.

He first called his parents and apologized for virtually destroying the family business.  He explained his realization that he was alcoholic and out of control.  He apologized for past behavior and volunteered to work 80 hour weeks for his family for two years in exchange for room and board.   Eventually they let him come back to work in a minor capacity, but not without testing his sincerity.  

As in the quote that opens this section, in order to win redemption from a life of narcissism and petty resentments, one must give completely of himself.  After his fall, Bob spent two years working off his moral debts and maintaining his sobriety.  During this period he regained some social support and mental balance.  With the blessing of his family, he left the business to begin his new career in technology.  Bob started and grew his own technology company.  He has been sober for 15 years, and what's more, he recently started a happy, healthy family of his own.

RIMM management has made a series of blunders that in any other industry besides smart phones would not be so quickly fatal.  But RIMM lost brand credibility and has fallen far behind.  Nonetheless, 10% of the global smart phone market is not a bad place to be if your customers are loyal individuals (or inert corporate clients).  Rumors of RIMM's demise have been swirling for more than a year and intensified this summer.  But lo and behold, RIMM stock is rising from the ashes.  Is this a value-play or an honest-to-goodness redemption? 

Don't expect RIMM to recapture its former glory.  There has been open dissention and a loss of shared passion.  See this open letter for details.  That said, the leaks appear to have turned positive.  These product development leaks show an impressive pipeline.  Given that expectations are the driver of risk taking among investors ("buy on the rumor"), we could see a continuing rally in RIMM shares until the new phones are released ("sell on the news").

We have already seen increased Liking of RIMM by online investors.  The green line in the chart below quantifies the amount of Liking expressed about RIMM and RIMM products in the financial social media from Nov 2010 to Nov 2012.  Note that Liking has risen substantially off its lows.

We are also seeing that RIMM is re-emerging among its peers in overall Sentiment.  Note in the chart below that Microsoft (MSFT) typically drags the floor in sentiment.  Apple (AAPL), which usually rides high in sentiment, had a serious sentiment decline this summer around its price peak, and it is now below Google and RIMM in overall sentiment value.  Meanwhile, Google surged in sentiment following its July 19^th 2012 earnings report.

In the case of RIMM, a short-term redemption may finally be at hand.  But the safest way to be involved is to buy the rumor of redemption.  For companies, long term redemption is nearly impossible.  Remember Nokia (NOK)?  Amazingly, the one year Fear and price chart on Nokia looks incredibly similar to that of the Coal industry, below.

The coal industry has been down in the dumps lately due to falling Chinese demand and concerns about climate-related regulation.  "Sandy" is again focusing attention on the human consequences of greenhouse gas build-up, as this Bloomberg cover testifies.    There has been a recent price surge in Coal.  Whatever the cause, the long-term outlook for the coal industry is negative in the U.S.  In the image below there is a recent surge in Fear (green line) in the Coal-industry ETF (KOL) to multi-year highs as the U.S. election approaches, the stock prices hit new lows, and more utilities turn to natural gas.

I'm not endorsing a long-term coal investment.  But from a contrarian point of view, coal is certainly interesting.  And some U.S. stocks like BTU have good cash positions and are exporters.

Is "redemption" likely for the coal industry?  No.  Coal is a chief culprit for global warming and mercury in seafood, and it's unlikely to become less regulated or more favored anytime soon.

Redemption is not easy for companies, and likewise it is not easy for individuals like Bob.  That said, as individuals we have more control over our individual destinies.

This material is not intended as and does not constitute an offer to sell any securities or a solicitation of any offer to purchase any securities. 

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