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On Ben Graham and Bank Stocks
By admin - Posted on July 29th, 2008
Jason Zweig writes the Intelligent Investor column for The Wall Street Journal. I’m sorry to say this week’s column is especially unintelligent. When asked whether Graham would be buying financial stocks today, Zweig says no. Crumbling real estate prices alone would not have deterred Graham. He liked to use long-term averages and estimates of what normal conditions would bring. He relied heavily on the past as an indicator of the future. Real estate prices will recover at some point. Even if they don’t anytime soon, land still has value and Graham would have done his best to conservatively estimate that value.
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