Comment by VLM
9 years ago
It is an awesome book and its an extremely thinly disguised biography of Jesse Livermore.
Its interesting to read up on why its thinly disguised. Its widely believed the author both got, and planted, stock tips for Livermore, but the author wanted no written legal document connecting them in case things went wrong and he ended up in court discussing his documented long financial relationship w/ Mr Livermore. Legally on paper he can say he has never had anything to do with the guy, etc. Everyone knew exactly what was going on, of course.
Fred Schwed's "where are the customers yachts?" is another investment classic.
Another classic comedy was Ben Graham's Security Analysis; its a comedy in the sense that market prices currently have no relationship to fundamentals from a Graham perspective. When I was young and dumb I thought I'd spend my life making wise investment decisions based on fundamentals using Mr Graham's techniques. Instead, my entire adult life has been spend in central bank bubbles. In that sense the book is useless today. But in your grandpa's day, or great grandpa's day, this is how investment decisions were calculated, and its kinda interesting historically.
It would be amusing some slow day to have a HN article along the lines of "books recognized as cool, that have nothing to do with computers". I think we've had them in the distant past, years ago.
> It would be amusing some slow day to have a HN article along the lines of "books recognized as cool, that have nothing to do with computers". I think we've had them in the distant past, years ago.
That would be very cool, I love reading how the world works outside computers but there is so much of everything and it's hard to filter in fields I know nothing about, have you considered suggesting it to dang, it would fit in well still I think.
> its a comedy in the sense that market prices currently have no relationship to fundamentals from a Graham perspective
You missed the whole point of Security Analysis and Intelligent Investor(another Graham book). The market is irrational from time to time, so you patiently wait on the side when prices are overvalued and invest in fundamentally good companies when prices are undervalued.
Not missed on a large enough scale. Prices used to fluctuate and occasionally be below the fundamental value. That never happens anymore, supply and demand issues. Given that fundamental value never exceeds price, if I were investing instead of speculating/gambling I'd never buy in. And if you're speculating/gambling, the fundamental value of a company is irrelevant. Or rephrased the above is the comedy I'm referring to.
> That never happens anymore
Really, it never happens?
Forget about me, if the worlds greatest value investor Warren Buffett and his managers are buying. What more do you want.
As I said you missed the whole point of those books. You should read the books again, it takes multiple readings to understand them.
You should re-read Reminisces if you think that investment decisions were ever calculated in the spirit of Graham/Dodd.