"Now, Wall Street is in the penalty box. We are not an investor in that space. I determined many years ago that if you want to make money on Wall Street, you work there; you don't invest there. They just pay themselves too well. I would rather look elsewhere for investment opportunities." Leon Cooperman of Omega Advisors, a $5 billion hedge fund, about today's economy.

Some call it "the penalty box" and we call it "the penalty phase" of the largest monetary expansion in the history of the world. This penalty phase will last longer than most investors anticipate and will be deeper, more painful than we want to anticipate.

It must not be "the end of the world as we know it" though. Omega, or so we are told, is buying Corning (NYSE:GLW), a company that makes glass for flat-panel TVs, sells for a little more than 10 times forward earnings, and pays a nice, little dividend to boot. That's fairly optimistic investing.

They are also reportedly buying shares of Transocean (NYSE:RIG), the world's largest offshore rig operator; and health care companies, most likely ones like Johnson & Johnson (NYSE:JNJ) and Novartis (NYSE:NVS). In other words, they are following their investor instincts.

Unusally successful investors don't mindlessly follow the herd. They ask the tough questions, study publicly-traded companies' web sites, and patiently wait for a stock to "come to them" at the price they are willing to pay. They "smell and intuit" opportunity, especially when good things are happening.

Take Occidental Petroleum (NYSE:OXY), please! The Los Angeles-based maker of oil and chemical products announced that its board added 20 million shares to the company's buyback plan. This addition brings the total amount of shares authorized for repurchase to 95 million, dating back to when the buyback program began in 2005.

From 2005 through the second quarter of 2008, Occidental has bought back about 59.5 million shares, leaving 35.5 million shares available for repurchase. The buybacks will be made from time to time pending on market conditions. In addition, Occidental will not use any credit to fund buybacks.

Ray R. Irani, Occidental's chairman and CEO, said: "Market conditions have given us the opportunity to purchase additional Oxy shares which we believe are currently trading at a significant discount to intrinsic share value." Hey, now that makes sense to my instincts.

In late April, Occidental, the fourth-largest U.S. oil company, reported record first-quarter earnings, with profit surging 52% to $1.85 billion, or $2.23 cents a share, from $1.21 billion, or $1.43 a share, in the same period last year.

Revenue for the quarter increased 50% to $6.02 billion. The huge surge in profit can be attributed to the skyrocketing crude prices. Occidental paid 68% more for its oil this year than it did in the year-earlier period, but they are also making more on every barrel they sell.

Credit Suisse has an outperform rating on the stock and issued a bullish note after Occidental and SandRidge Energy (NYSE:SD) teamed up to develop a new Co2 extraction plant in West Texas. The CS analysts increased their price target for OXY from $103 to $109 to reflect the optimistic news.

So, when the price per share is around $76 and they are selling at less than 7 times the forward 12 months earnings (PE ratio of around 6.8), very little debt, operating cash flow of (ttm) of $7.86 billion and levered free cash flow of almost $3 billion, instinctually saavy investors usually get quite interested.

On a day like Monday, July 28th, when 4 of the top 6 most actively traded shares included the Financial Select SPRD (NYSE:XLF) ETF, Citigroup (NYSE:C), Washington Mutual (NYSE:WM) and Wachovia Corp (NYSE:WB), I do like Cooperman; I "look elsewhere."

Do you believe that inflation is real? Don't be buying Ford (NYSE:F) or General Motors (NYSE:GM), but do consider buying Kinross Gold (NYSE:KG) or Silver Wheaton (NYSE:SLW).

Believe you me, I'm not talking about "thinking outside the box." No, I'm talking about "thinking inside the box"...that box being reality, plain, clear and simple. During times like these ("the penalty box") it is intuitive and instinctual to be choosing OXY over, say, Merrill Lynch (NYSE:MER). Unless, of course, you have a terrible gambling addiction.