One division might be in three parts: First, the techniques of security analysis; secondly, standards of safety and common stock valuation; and thirdly, the relationship of the analyst to the security market.

Another way of dividing the subject might be to consider, first, the analyst as an investigator, in which role he gathers together all the relevant facts and serves them up in the most palatable and illuminating fashion he can. And then to consider the analyst as a judge of values, or an evaluator. This first division of the subject is rather useful, I think, because there is a good field in Wall Street for people whose work it will be mainly to digest the facts, and to abstain from passing judgment on the facts, leaving that to other people.

Such sticking to the facts alone might be very salutary; for the judgment of security analysts on securities is so much influenced by market conditions down here that most of us are not able, I fear, to express valuation judgments as good analysts. We find ourselves almost always acting as a mixture of market experts and security experts. I had hoped that there would be some improvement in that situation over the years, but I must confess that I haven't seen a great deal of it. Analysts have recently been acting in Wall Street pretty much as they always have, that is to say, with one eye on the balance sheet and income account, and the other eye on the stock ticker.