From time to time, fundamental changes of great investment significance affect large groups of common stocks. Usually for some time after these new i… - Philip Arthur Fisher

Look at the analysts around you. Although few of them are living in downright squalor, most do not seem quite so financially well off as should be warranted by taking full advantage of the unusual field in which they are working. Therefore should we conclude (1) analysts are a bunch of dumbbells, or (2) it is impossible to do what most of them are attempting, which is possibly a polite way of saying they are a bunch of charlatans, or (3) there are fundamental errors in the methods of approach used by sizable numbers of them, which errors of method prevent them from accomplishing the results that their basic intelligence would otherwise attain?

What are these matters about which the investor should learn if he is to obtain the type of investment which in a few years might show him a gain of several hundred per cent, or over a longer period of time might show a correspondingly greater increase? In other words, what attributes should a company have to give it the greatest likelihood of attaining this kind of results for its shareholders?

In its letter of December 1956, the First National City Bank of New York furnished a table showing the worldwide nature of the depreciation in the purchasing power of money that occurred in the ten years from 1946 to 1956.
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Of course, these figures are only conclusive for this one ten-year period. They do indicate, however, that these conditions are worldwide and therefore not too likely to be reversed by political trends in one country. What is really important concerning the attractiveness of bonds as long-term investments is whether a similar trend can be expected in the period ahead. It seems to me that if this whole inflation mechanism is studied carefully it becomes clear that major inflationary spurts arise out of wholesale expansions of credit, which in turn result from large government deficits greatly enlarging the monetary base of the credit system. The huge deficit incurred in winning World War II laid such a base. The result was that prewar bondholders who have maintained their positions in fixed-income securities have lost over half the real value of their investments.