A Successful Investor's Letters to His Son

[Carter Press, Minneapolis, Minn., $1.50]

THIS contribution to the absorbing subject of investments accomplishes the difficult task of treating a technical matter with pleasing informality. It begins by stating the basic problem with which every investor is confronted: namely, to ‘conserve the principal he has already accumulated and then to secure as much income and as much capital gain as is consistent with safety’; and it proceeds in orderly fashion to point out many of the difficulties involved in its satisfactory solution.

Mr. Hellberg holds that successful investment management depends upon accurate diagnosis of fundamental conditions, or long-term trends. These he likens to the sure ebb and flow of the tides, in contrast to the unpredictable temporary conditions, or short-term variations, which are merely the waves in any tide; and he discusses with an appropriate blend of scorn and pity those board-room habitués who are so foolish as to expect to profit by chasing the day-to-day ripples. He describes the true functions of the investment banker, the local investment dealer, the broker, the commercial banker, the statistician, the investment trust, and the investment counselor with an understanding and fairness which give these chapters high educational value. Ultimately, he rests his case upon the assumption that the ‘expert and unbiased investment advice’ which is essential to successful money management seems most likely to come with greatest dependability from the proved investment counselor.

While this reviewer scented at many points in this book the blood of an investment counselor rather than the trail of an experienced investor, nowhere was this more strong than in the case built up for an unbiased advisor — one who has no securities to sell and therefore no axe to grind. Any such notion as that honorable men cannot be trusted to use their best judgment on a client’s behalf except when disinterested as to profit is stuff and nonsense, of Course; but it runs like a theme song through almost all investment-counselor literature. How silly it would sound if applied to other situations. Fancy saying to your surgeon who has just advised an operation: ‘Thanks, old man. Ordinarily I’d trust you no end, but your desire to operate naturally prejudices you, so I’ll have to turn to a more disinterested source in this case.’

Still, one need not like every single stripe in the plaid to admit that it has merit, and such is the case with this well-written, thought-provoking hook. It can be read in a couple of hours, or it can be studied longer — either way, it’s worth the time.

ARTHUR W. JOYCE