In 1934, Benjamin Graham revolutionized the investment world with the publication of his book Security Analysis. “The Value Bible,” as modern investors affectionately call it, contained Graham’s accumulated wisdom from years of evaluating and expertly buying/selling stocks in an unprecedented, but radically successful, manner.
In fact, Graham defied all contemporary investing strategies in such a way that Warren Buffet, cited as the third richest man in the world, would credit Graham as the predominant influence on his investment strategy in an article published over 70 years after Security Analysis.
Gates Capital Management's ECF Value Funds have a fantastic track record. The funds (full-name Excess Cash Flow Value Funds), which invest in an event-driven equity and credit strategy, have produced a 12.6% annualised return over the past 26 years. The funds added 7.7% overall in the second half of 2022, outperforming the 3.4% return for Read More
Although Graham’s legacy primarily thrives through his money-making strategies in the investing world, few actually appreciate his true rags-to-riches story and the right-place-at-the-right-time circumstances that eventually guided his genius to Wall Street.
Fortunately, Joe Carlen seamlessly weaves Graham’s life, lessons, and life-lessons together in an educational, inspiring, and insightful book entitled The Einstein of Money: The Life and Timeless Financial Wisdom of Benjamin Graham.
In this amazing hardback, Carlen skillfully explains not only the fundamental concepts of Graham’s contrarian investing strategy and how it compared to the contemporary wisdom, but also the timeline of Graham’s life and how his upbringing shaped his attitude toward buying stocks.
Chapter by chapter, Carlen switches back and forth between guiding the reader through the world of an exemplary genius and instructing the reader about Graham’s key investing concepts along with examples of how they apply in real-world circumstances.
Graham stood out from his peers throughout his entire life
During the biography portions, Carlen emphasizes that Graham stood out from his peers throughout his entire life. He skipped multiple grades throughout school, achieved valedictorian of his elementary school, learned multiple languages in his time attending the 2-year accelerated program at Townsend (which is still considered one of New York’s top high schools), received a scholarship for Columbia University, completed the coursework in two and a half years (rather than the expected four), and was offered three teaching positions upon his graduation, which was completely unheard-of at the time.
The reader also learns in these biographical segments that Graham’s initial entrance into the investment world was largely circumstantial. The most glaring of these coincidences was Graham’s meeting with Alfred Newburger, the senior member of the Wall Street firm Newburger, Henderson, and Loeb. Carlen outlines the surprising details of this fateful meeting in chapter 3.
Best part of the book is Carlen’s superior investigative abilities
In my opinion, the best part of the book is Carlen’s superior investigative abilities. Throughout the book, he illustrates how both Graham’s early childhood as a poor youth and his mother’s impulsive stock market excursions provided the blueprint for his famous “Margin of Safety” principle and the entire philosophy of value investing. Never before in a book, or perhaps in a man’s life, have I found such interesting correlations between childhood circumstances and a professional legacy.
Whether you are an investor seeking to produce more profits, an admirer seeking to understand the man who drastically and permanently altered how people evaluate stocks, or a student interested in geniuses, you will find this book appealing to the point that it’s almost impossible not to turn the page. Not only is Graham’s life filled with drama and coincidences that ultimately change the world, but his lessons are so powerful because they completely defied an established way of thinking.
Check out the book here The Einstein of Money