Speculation

LS showed me some email communication between JW and KL. In short, the two old boys talked about the stock market - and of course had very different opinion.

JW is the kind of man who buys stock with great long term potential and holds for years; he is always proud of being an investor (according to the definition of Benjamin Graham in his classic Security Analysis).

KL, on the other hand, is a head-to-toe speculator. I take it as a good sign - at least he has the insight. Most people speculate and (often when the result is not agreeable) believe they are doing investment.

Graham is often taken as a pioneer of value investment and a great investor. The first half is no doubt true. Nonetheless he was a real speculator by his own definition - he bought reasonable company at a bargain and sold when its intrinsic value is reflected in the price. He hardly ever regarded himself as the owner of that company - the very character of an investor. "Value investment" is - alas, a specific, albeit highly educated - form of speculation.