In the stock market forest, look for these three branches. They enable you to steer away from the Q culture and thrive in the V culture, a value-oriented investing culture nurtured by Graham and Buffett | CONCLUSION THE V CULTURE Readers with an arbitrage orientation may regret that the exemplars of great modern CEOs covered in the last chapter apart from Warren Buffett consist of one who is dead one who has announced his retirement and only one who is likely to reign for the foreseeable future. Who s next and why not name them If I knew I would not say. Not so much because I want to gain a competitive edge. No my reticence is precisely because of an insight in this book Judgment is the key and my judgment will invariably differ from yours. Our circles of competence are necessarily different. Our interpretation of the past differs and our prognosis for the future must as well. It contradicts the whole point of this book for me to tell you who I believe are the up-and-coming star CEOs. My picks are irrelevant to your judgments. Go back to the masters mentioned in Chapter 1 and you ll see that it was precisely their independence of thought their utter and profound common sense which led to their remarkable success. I condense these ideas and insights in the spirit of a teacher and professor not an investment adviser. I hope you ll use these pages as a foundation for picking stocks as a savvy sophisticated investor or failing that picking advisers who share respect for the basic philosophy of outstanding investors such as Graham and Buffett . The basic philosophy of business analysis investing integrates three branches finance accounting and governance. Finance is commonly defined as the science of management of money and other assets. So much for this definition if you agree that finance is one part science and the other part art. Behavioral economics a field that draws on numerous disciplines including psychology statistics history and sociology may deserve to be called a social sci- 243 Copyright 2001 The McGraw-Hill Companies Inc. Click Here for Terms of Use 244 In Managers We Trust ence. Its approach to finance is the most promising for it recognizes the first .
