Factors Affecting the Buying and Selling of Equity Securities

In 1955, as the Dow Jones Industrial Average was at prices not seen since 1929, a nervous Congress called a hearing to discuss “Factors affecting the buying and selling of equity securities.” They interviewed the father of value investing, Benjamin Graham, to get his take on why the market climbed so fast, where it might be going, and if an “orgy of speculation” would result in a 1929-like disaster. Below are a few excerpts.

Here is Graham on the type of stocks he invests in.

intrinsic

Believe it or not, current members of Congress look like financial experts compared to those from the 1950s. 

 

profit taking

Today it’s dividends versus buybacks, then it was dividends versus retained earnings. 

retained earnings

Graham had a sense of humor. 

snark

Graham on forecasting. 

 

forecasting

Graham on the mystery of value investing. 

value

Source: Stock Market Study

 

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