From an interview with Benjamin Graham published by Security Analysis in 1951: Common stocks have one important characteristic. Their investment value and average price tend to increase irregularly but persistently over the decades as their net worth builds up through the reinvestment of undistributed earnings. However, most of the time common stocks are subject to irrational and excessive price fluctuations in both directions as the consequence of the ingrained tendency of most people to speculate or gamble — ie, to give way to hope, fear and greed. The stock exchanges appear to me chiefly as a John Bunyan type of Vanity Fair or a Falstaffian joke that frequently degenerates into a madhouse — "a tale full of sound and fury, signifying nothing". The market resembles a huge laundry in which institutions take in large blocks of each other’s washing … without true rhyme or reason. Most stockbrokers, financial analysts, investment advisers are above average in intelligence, business hon...
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