Endnotes
Introduction: What This Book Expects to Accomplish
- “Letter stock” is stock not registered for sale with the Securities and
Exchange Commission (SEC), and for which the buyer supplies a let-
ter stating the purchase was for investment. - The foregoing are Moody’s figures for AAA bonds and industrial
stocks.
Chapter 1. Investment versus Speculation:
Results to Be Expected by the Intelligent Investor
- Benjamin Graham, David L. Dodd, Sidney Cottle, and Charles
Tatham, McGraw-Hill, 4th. ed., 1962. A fascimile copy of the 1934 edi-
tion of Security Analysiswas reissued in 1996 (McGraw-Hill). - This is quoted from Investment and Speculation,by Lawrence Cham-
berlain, published in 1931. - In a survey made by the Federal Reserve Board.
- 1965 edition, p. 8.
- We assume here a top tax bracket for the typical investor of 40%
applicable to dividends and 20% applicable to capital gains.
Chapter 2. The Investor and Inflation
- This was written before President Nixon’s price-and-wage “freeze” in
August 1971, followed by his “Phase 2” system of controls. These
important developments would appear to confirm the views
expressed above. - The rate earned on the Standard & Poor’s index of 425 industrial
stocks was about 11^1 ⁄ 2 % on asset value—due in part to the inclusion
of the large and highly profitable IBM, which is not one of the DJIA
30 issues.
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