"This market is frightening. Do you have any advice?" That is an excerpt from just one of many letters I received in the past week. I suppose a fair interpretation of what is being asked is: Do I know what the markets will do going forward? Is the Fed going to lower interest rates? What effect will the credit crisis or the price of crude have on a portfolio? Suppose there is a recession, what should I do?

Oh, to be a soothsayer of such repute so as to know the answers to all those questions. Yet, even the briefest search uncovers all manner of prognosticators willing to offer up an opinion. They run the gamut from such intellectual illustrations of deep thought as taking a chain saw to the head of a stuffed teddy bear, to the noncommittal speeches put forth by the various members of the Federal Reserve. My adding to the discourse would merely compound the problem by inserting one more voice to the already deafening din of uncertainty.

Instead, I would prefer to tackle the aforementioned bundle of questions as if it were a large Gordian knot. You slice through the knot by adopting a stance whereby you ignore the perturbations that conspire to roil the financial markets and not let the decisions and reactions of others drive your investment strategy.

Let me offer up some examples. The shares of Bank of America (Ticker: BAC) felt the wrath of Wall Street as a result of its latest earnings announcement indicating that net income for the quarter was 82 cents per share vs. $1.18 a year ago. Revenues decreased 12 percent to $16.3 billion.

BoA is certainly not on life support. Furthermore, expense controls are solid and a slight expansion in net interest margin, to 2.61 percent from 2.59 percent, helped to increase net interest income to $8.62 billion. Furthermore, management is taking corrective action with regard to the money-losing investment banking division.

So would I suggest holding on to the stock? Absolutely, and if you are considering purchasing the stock, keep in mind that the current dividend is 5.4 percent. A 10-year Treasury note is yielding only about 4.41 percent.

Nonetheless, the Street's analysts tripped over themselves to downgrade the shares. It is likely that there also were numerous calls made by brokers encouraging a shift out of BoA. Needless to say, it would be crass of me to even suggest that commissions and fees played a role.

Here is another example, Varian Medical Systems (VAR), a stock never mentioned here before. The shares are down because of a drop-off in sales. Yet, as Barron's indicated in its Oct. 22 edition, there is pent-up demand for a type of radiology machine used to treat cancer that Varian manufactures.

As Barron's points out, orders for the $3 million machines have fallen off because of rising interest rates and increased mergers in heath-care related services. That has meant a deferral of major capital expenses until the deals close and companies are integrated.

"Most of the orders were delayed, not canceled outright," Varian's Chief Executive Officer Tim Guertin told Barron's. "The drop in orders was temporary and will soon be made up."

Varian recently reported earnings for fiscal 2007 ended Sept. 29 of $239.5 million, or $1.83 per share, vs. $245.1 million, or $1.81, in fiscal 2006. The company had about 5 million more shares outstanding in 2006. Revenue increased to $1.78 billion from $1.6 billion.

The intrinsic value of the shares, using discounted earnings with an 11 percent discount rate and a 14 percent earnings growth rate, is $66. A discounted free cash flow to the firm approach produces an intrinsic value of $59 per share. The shares are currently trading at about $42.67.

My earnings estimate for 2008 is $2.05 per share with a 12-month price target on the shares of $50, for a potential 17 percent annual gain.