The Intelligent Investor: The Definitive Book On Value part 10. The purpose of this book is to supply, in a form suitable for laymen, guidance in the adoption and execution of an investment policy. Comparatively little will be said here about the technique of analyzing securities; attention will be paid chiefly to investment principles and investors’ attitudes. We shall, however, provide a number of condensed comparisons of specific securities - chiefly in pairs appearing side by side in the New York Stock Exchange list in order to bring home in concrete fashion the important elements involved in specific choices of common stocks | 76 The Intelligent Investor Such were our efforts to evaluate former stock-market levels. Is there anything we and our readers can learn from them We considered the market level favorable for investment in 1948 and 1953 but too cautiously in the latter year dangerous in 1959 at 584 for DJIA and too high at 892 in 1964. All of these judgments could be defended even today by adroit arguments. But it is doubtful if they have been as useful as our more pedestrian counsels in favor of a consistent and controlled common-stock policy on the one hand and discouraging endeavors to beat the market or to pick the winners on the other. Nonetheless we think our readers may derive some benefit from a renewed consideration of the level of the stock market this time as of late 1971 even if what we have to say will prove more interesting than practically useful or more indicative than conclusive. There is a fine passage near the beginning of Aristotle s Ethics that goes It is the mark of an educated mind to expect that amount of exactness which the nature of the particular subject admits. It is equally unreasonable to accept merely probable conclusions from a mathematician and to demand strict demonstration from an orator. The work of a financial analyst falls somewhere in the middle between that of a mathematician and of an orator. At various times in 1971 the Dow Jones Industrial Average stood at the 892 level of November 1964 that we considered in our previous edition. But in the present statistical study we have decided to use the price level and the related data for the Standard Poor s composite index or S P 500 because it is more comprehensive and representative of the general market than the 30-stock DJIA. We shall concentrate on a comparison of this material near the four dates of our former editions namely the year-ends of 1948 1953 1958 and 1963 plus 1968 for the current price level we shall take the convenient figure of 100 which was registered at various times in 1971 .
