Security Analysis

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1. throw0101cJul 2023
   > And then read Security Analysis […]

   And then read (original co-author) Graham's last published interview ("A Conversation with Benjamin Graham", Financial Analysts Journal, September/October 1976):

   > In selecting the common stock portfolio, do you advise careful study of and selectivity among different issues?

   > In general, no. I am no longer an advocate of elaborate techniques of security analysis in order to find superior value opportunities. This was a rewarding activity, say, 40 years ago, when our textbook "Graham and Dodd" was first published; but the situation has changed a great deal since then. In the old days any well-trained security analyst could do a good professional job of selecting undervalued issues through detailed studies; but in the light of the enormous amount of research now being carried on, I doubt whether in most cases such extensive efforts will generate sufficiently superior selections to justify their cost. To that very limited extent I'm on the side of the "efficient market" school of thought now generally accepted by the professors.

   * http://www.grahamanddoddsville.net/wordpress/Files/Gurus/Ben...

   There is probably even more "enormous amount of research" going in the decades since he said those words. Hedge funds are using satellite imagery to get an information edge:

   * https://newsroom.haas.berkeley.edu/how-hedge-funds-use-satel...

   * https://www.theatlantic.com/magazine/archive/2019/05/stock-v...

   What are you, as an individual investor, doing to get an edge over other market participants?

   With a much smaller portfolio it is a lot easier to be more nimble, but you're going to spend hours researching things. If you find that enjoyable, go nuts; but for most folks the market returns of index funds will probably allow them to meet their financial goals (e.g., retirement nest egg), and so IMHO the time is probably better spent with family and friends.

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2. vmurthyDec 2021
   1. Start with no - this is an awesome primer on negotiating

   2. Never split the difference - ditto . IMO, "start with no" is a sub set of this but it is worth separately anyway

   3. Fooled by randomness

   4. The black swan

   5. Books on intermittent fasting by Dr Jason Fung

   6. All books by Noah Harari but start with Sapiens

   7. Security Analysis by Ben Graham

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3. mitchelldeacon9Mar 2020
   I studied economics in college, then I worked for a few years as a business journalist before I finally switched careers to IT systems engineering. The following is a list of my favorite books on financial securities, banking and investment theory. These books are generally comprehensible to anyone with an interest in the subject, regardless of their educational background.

   Arrighi, Giovanni (1994) The Long Twentieth Century: Money, Power and the Origins of Our Times

   Brealey, Myers, Allen (2011) Principles of Corporate Finance, 10th ed.

   Bruck, Connie (1988) Predators' Ball: Inside Story of Drexel Burnham and Rise of Junk Bond Raiders

   Fisher, Philip (2003) Common Stocks and Uncommon Profits and Other Writings, 2nd ed.

   Fridson, Martin and Fernando Alvarez (2002) Financial Statement Analysis, 3rd ed.

   Graham, Benjamin, J. Zweig, D. Dodd (2006/08) Intelligent Investor, rev ed; Security Analysis, 6th ed.

   Greenblatt, Joel (1999) You Can Be a Stock Market Genius

   Greenwald, Kahn, Sonkin, Biema (2001) Value Investing: From Graham to Buffett and Beyond

   Henwood, Doug (1997) Wall Street: How It Works and for Whom

   Levitt, Arthur (2003) Take on the Street: How to Fight for Your Financial Future

   Lewis, Michael (2010/1989) Big Short; Liar's Poker

   Lynch, Peter and John Rothchild (2000) One Up on Wall Street, 2nd ed.

   Mishkin, Frederic (2004) Economics of Money, Banking and Financial Markets, 7th ed.

   Taleb, Nassim Nicholas (2005/10) Fooled by Randomness, 2nd ed.; Black Swan: Impact of the Highly Improbable, 2nd ed.

   Vilar, Pierre (1976) A History of Gold and Money: 1450-1920

   Tracy, John A. (2009) How to Read a Financial Report: Wringing Vital Signs out of the Numbers, 7th ed.

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4. mmhsiehMar 2020
   Reminiscences of a Stock Operator by Lefevre and Security Analysis by Graham and Dodd
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5. mitchelldeacon9Sep 2016
   Here is my short list of favorite books on finance and economics:

   FINANCIAL SECURITIES / BANKING / VENTURE CAPITAL

   Bruck, Connie (1988) Predator's Ball: Inside Story of Drexel Burnham and Rise of Junk Bond Raiders

   Draper, William (2011) Startup Game

   Graham, Benjamin and Jason Zweig (2006) Intelligent Investor, revised ed.

   _________ and David Dodd (2008) Security Analysis, 6E

   Greenblatt, Joel (1999) You Can Be a Stock Market Genius

   Greenwald, Kahn, Sonkin, Biema (2001) Value Investing: From Graham to Buffett and Beyond

   Henwood, Doug (1997) Wall Street: How It Works and for Whom

   Levitt, Arthur (2003) Take on the Street: How to Fight for Your Financial Future

   Lewis, Michael (1989) Liar's Poker: Rising Through the Wreckage on Wall Street

   _________ (2010) Big Short: Inside the Doomsday Machine

   STATISTICS

   Ayres, Ian (2007) Super Crunchers: Why Thinking by Numbers is the New Way to Be Smart

   Bernstein, Peter (1996) Against the Gods: Remarkable Story of Risk

   Kahneman, Daniel (2011) Thinking, Fast and Slow

   Silver, Nate (2012) Signal and the Noise: Why So Many Predictions Fail, but Some Don't

   Taleb, Nassim Nicholas (2005) Fooled by Randomness, 2E

   _________ (2010) Black Swan: Impact of the Highly Improbable, 2E

   BUSINESS DEVELOPMENT / ENTREPRENEURSHIP / INNOVATION

   Christensen, Clayton (1997) Innovator's Dilemma

   Stone, Brad (2013) Everything Store: Jeff Bezos and the Age of Amazon

   Wallace, James and Jim Erickson (1992) Hard Drive: Bill Gates and Making of the Microsoft Empire

   Walton, Sam with John Huey (1992) Sam Walton: Made in America

   Wilson, Mike (1996) Difference between God and Larry Ellison: Inside Oracle Corp

   POLITICAL ECONOMY / THEORY / ECONOMIC HISTORY

   Arrighi, Giovanni (1994) Long Twentieth Century

   Braudel, Fernand (1979) Civilization & Capitalism 15th-18th Century, vol. 3: Perspective of the World, trans. Siân Reynolds

   Brechin, Gray (2006) Imperial San Francisco: Urban Power, Earthly Ruin

   Heilbroner, Robert (1999) Worldly Philosophers: Lives, Times & Ideas of Great Economic Thinkers, 7E

   Marx, Karl (1867) Capital, vol. 1

   Stiglitz, Joseph (2003) Roaring Nineties: A New History of the World’s Most Prosperous Decade

   _________ (2010) Freefall: America, Free Markets and the Sinking of the World Economy

   Vallianatos, E.G. (2014) Poison Spring: Secret History of Pollution and EPA

   Vilar, Pierre (1976) A History of Gold and Money: 1450-1920

   Yergin, Daniel (1992) Prize: Epic Quest for Money, Oil and Power

   Would enjoy email correspondence with anyone interested in these subjects: mitchelldeacon9@gmail.com All the best

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6. rubyn00bieSep 2016
   Preface: For a bit of I suppose... uhh, qualification, I took nearly every single upper division Economics class my university offered (~25). I did so because I LOVE Econ. Also, sorry for the rambling nature of this.

   First things first, finance is only sort of economics, it's really just finance. I'd highly recommend taking an accounting class (or book) and a grab an intro finance book. Accounting will really help with jargon, and just some really basic things (like balance sheets). Also, "Security Analysis" [0] is the "only" book you'll ever need, Warren Buffet recommended it to Bill Gates, and now Bill Gates recommends it to everyone.

   Back to Economics... There are two primary "groups" of thought... sort of like twins separated at birth who grow to hate each other.

   ---------------------------------- The First: Neoclassical Economics ----------------------------------

   Focuses primarily on microeconomics and largely mathematical. It's birth is largely due to Economists wanting to make econ a "true science" like we see the physical sciences (biology, chemistry, physics). It starts around the late 1800s and really picks up steam around the time of Einstein. Math was hot and being applied everywhere.

   A really interesting period to research and study is right after black Tuesday (and before the great depression) and what the central bank didn't do (before central bank intervention in markets). While I really detest the bastard, Milton Friedman's work on monetary policy is pretty science and generally good here. [1],[2].

   I'm a Keynesian (I suppose-- Econ gets deep fast), and so you'd be no where without reading some of what Keynes did to get our assess out of the great depression (i.e. government spending). It's also more or less the birth of Macroeconomics... You'll know you're good when you laugh at forgetting: Y = C + I + G + (X - M). Some good things to get started are looking at the IS-LM [3] model and AS-AD [4] model.

   That gets you into the 60s - 70s. Tall Paul Volker is the unsung hero of the 80s, read about him (he ran the federal reserve). After that microeconomics starts to fragment into things involving game theory and behavioral economics (Daniel Kahneman is the man).

   Econometric analysis mathematically speaking is just multivariate regression analysis for time series or cross-sectional data. More "modern" analysis is probably using panel data [5] (combination of cross sectional and time series). Calculus, linear algebra, and differential equations should prepare one plenty for everything but panel data analysis. The real "econ" part is applying solid econ theory to the mathematics you're using, a textbook will help [6]. For finance this is your bread and butter.

   Game theory will apply a lot of different mathematical tools. You will need to love pure math. To really get into it requires pain or love. I like a healthy amount of both.

   ---------------------------------- The Second: Heterodox Economics ----------------------------------

   So as it turns out, neoclassical economics is at most half of Economics. It's really where the "philosophy" comes into play. You're gonna need a quick history lesson to sort of see it's topic matter. Economics really didn't exist before... the 1500s. You can try to apply economics to earlier times but you could also just make shit up and post it to twitter. Both would be equally likely to contain truth.

   Economics came into existence around the time the Dutch began developing trade routes (1550s). A by product of all this trade, is tons of cash, and goods-- currency (silver, metals, whatever) starts to actually be used in society (before that it was mostly just a status symbol). It pisses off a lot of _institutions_, most of all "the church" and monarchies because money is allowing people to gain power. It's usurping power from them. This is the rise of the "merchant class" and now thanks to money (trade really, but whatever it's complicated)-- people are liberating themselves from the social status they're born into. Eventually modern republics appear, and governments form. Nations trading globally becomes more common (Dutch, English, Spanish) and we get to Adam Smith, David Ricardo [7], et. al.

   Now it's the 1800s. People are seeing the birth and growth of capitalism, industry, corporations, and the tumultuous death of agrarian life. Now the way the "common person" lives their day dramatically changing, for a few it was better for most it was worse. Some economists begin to ask why are we replacing these now defunct _institutions_ with equally shitty, or possibly shittier, ones. This is more or less becomes the birth of heterodox economics which largely studies the more abstract ideas like "institutions"; by it's very nature the content tends to be philosophical.

   By the 1920s heterodox economics is falling by the wayside. The content is less able to be tested like a physical science (i.e. no math/stats); so, it's treated like a misbegotten child... By the 1950s heterodox content was marginal at best-- the cold war and fear of communism made (makes) people insane. Economists pretty much had to be pro-capitalism or face being called "commies" and thrown in jail or worse being a narc in a witch hunt. This was more or less the nail in the coffin in mainstream heterodox economics (at least for research in the Occident). After the cold-war ended the nail got pulled out, but I wouldn't say it's really outta the coffin yet.

   This book [8] isn't great but it's quickly digestible and will point you in the appropriate directions.

   ---------------------------------- ----------------------------------

   Some Rambling to Finish

   I'd highly recommend not just learning how to use the tools, but why we have them and where they came from. Economics is vastly deeper than the average person will ever know. That depth is greatly empowering and guiding when using its lenses to see and solve problems. One last thing, know there's no going back, you will see the world differently.

   [0] https://www.amazon.com/Security-Analysis-Foreword-Buffett-Ed...

   [1] "The Role of Monetary Policy." American Economic Review, Vol. 58, No. 1 (Mar., 1968), pp. 1–17 JSTOR presidential address to American Economics Association

   [2] "Inflation and Unemployment: Nobel lecture", 1977, Journal of Political Economy. Vol. 85, pp. 451–72. JSTOR

   [3] https://en.wikipedia.org/wiki/IS%E2%80%93LM_model

   [4] https://en.wikipedia.org/wiki/AD%E2%80%93AS_model

   [5] The course I took on panel data, http://web.pdx.edu/%7Ecrkl/ec510/ec510-PD.htm

   [6] https://www.amazon.com/Using-Econometrics-Practical-Addison-...

   [7] He more or less invented trade theory (competitive advantage) https://en.wikipedia.org/wiki/David_Ricardo

   [8] https://www.amazon.com/Age-Economist-9th-Daniel-Fusfeld/dp/0...

   Edit: for formatting.

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