Alex Sebastian

On Ben Graham, Bank Stocks, Jason Zweig and Tom Brown

With all due respect to Mr. Gannon, I feel that you may need to go back to and re-read your copy of "Investment Analysis." If you even own own...

You said:

"Graham saw every investment as a black box – and that didn’t trouble him. A lot of investors spend a lot of their time worrying about the inner workings of the companies they own – Graham never did. He didn’t look inside the “system”, i.e. the company itself; instead he looked only at the outputs – the financial statements. He spent almost no time worrying about a business’s management, corporate culture, or future prospects." (Note especially the last item on the list of things Benjamin Graham would barely consider)

Benjamin Graham said in the last few pages of Chapter 11 of The Intelligent Investor:

"We suggest that analysts work out first what we call the 'past-performance value' which is based solely on the past record...The second part of the analysis should consider to what extent the value based solely on past performance should be modified because of new conditions expected in the future"

Although I have found other articles written by Mr. Gannon to contain good analysis, I feel that the above seriously comprises his authority to speak on Benjamin Graham and value investing until he goes back to the books.