Acknowledgements

Acknowledgements often leave me with the impression that I've been lied to.

—Ben Cheever

For anyone interested in a close observation of the more basic human emotions on amusing display, it is hard to beat the acknowledgments section of most books. Here we find inadvertently laid out for inspection such passions as jealousy, ambition, insecurity, unctuousness, feckless gratitude, insincerity, lack of judgment, and, as Mr. Cheever points out in the epigraph, good old-fashioned deceit.

In bygone days, the acknowledgments section of a book was really nothing more than a dedication, typically addressed to a nonentity who happened to have deep pockets and whose favor the author was trying to curry. Insincere, to be sure, but at least with a healthy pecuniary motive.

Today, however, a really good acknowledgment, firing on all cylinders, will list several times as many contributors to the book as there are ideas in it. An even modestly energetic author will not omit to thank his neighbors, pets, sisters-in-law, fourth grade homeroom teacher, and even (in the case of Alice Walker) assorted flowers, trees, and “most especially, the animals.”⁷ We are left to wonder if it might not be a useful improvement to the copyright laws to deny authorship (and royalties!) to anyone who claims that more than, say, two dozen people contributed importantly to the book.

Well, far be it from me to spit into this self-absorbed headwind. I therefore cheerfully admit that everyone I have ever known or read or read about or heard about, to say nothing of the millions of people I have never heard of, have all contributed importantly to this book, and I thank them all. To paraphrase Ben Schott, if there are errors in this book, it's probably their fault.⁸

On the other hand, there actually are a small handful of people whose contributions were more direct and critical, essential in the sense that parts of the book would have been quite different, and quite worse, had these people not existed. These persons fall into the following categories:

• My clients. Though it is true that few clients are deeply knowledgeable about investment matters—they made their money being brilliant at other things altogether—every conversation we have with our clients tells us whether we are meeting their needs or not, whether we are explaining the investment world in words that can be understood.
• My partners at Greycourt. Many of the chapters in this book were originally published as Greycourt white papers, something the firm is rather famous for. Before being distributed to Greycourt's clients and to friends of the firm, those papers had to pass through an internal peer review process in which they were circulated to each Greycourt partner for comment. I did not keep detailed track of which comments were useful or nonuseful, which were incorporated intact and which simply informed a revision, or even of the many that corrected glaring errors. But much of what you will find in this book was thoroughly improved by my partners' comments. And far beyond that peer review process, my ongoing conversations with the senior professionals at Greycourt have vastly enriched my own understanding of the investment process and how its essential attributes can and cannot be communicated.
• Other writers in the field. I have read dozens and dozens of investment books over the years, and even the worst of them has probably taught me something—if only about what not to do. But it has been the best of these writings that have educated and inspired me. By “the best” I refer, in alphabetical order, to Warren Buffett's Annual Reports on Berkshire Hathaway,⁹ Charles Ellis's Winning the Loser's Game,¹⁰ Benjamin Graham's The Intelligent Investor¹¹ (and its in-depth original, Security Analysis, written with David L. Dodd),¹² David Salem's multitudinous-but-trenchant essays published by The Investment Fund for Foundations¹³ and, more recently, by his new firm, Windhorse Capital Management,¹⁴ and David Swensen's Pioneering Portfolio Management.¹⁵ Anyone who reads those writings carefully will no doubt wonder why I bothered to write this book.

Finally, it is customary to thank one's spouse. A writer worth his salt should be wary of what is customary, but in this case the shoe fits. My wife, Simin, the founder and CEO of the American Middle East Institute, leads a busy professional and public service life of her own. Yet she put up with my many absences from our large and complicated family, as I stole every possible opportunity to work on this book. Her own career was put on hold while she helped me launch Greycourt into the world. If this book were to become a classic in its field, worthy of being mentioned in the same breath with the writings listed above, it could not possibly compensate her for her contributions, her kindnesses, her patience, or her love.

Credits

Most of the material in this book was written for it, but some of that material was published elsewhere before the book appeared. In particular, many of the chapters, or parts of chapters, first saw the light of day as white papers published by Greycourt & Co., Inc., the financial advisory firm I founded and where I now serve as chairman. Although I appear as sole author on most of those papers, my partners at Greycourt often supplied many helpful comments. All material has been reprinted with the permission of the original publisher. Throughout the book I have credited Greycourt and the appropriate partners who were my coauthors and have referred readers to the Greycourt website at www.Greycourt.com.

Pittsburgh
August 2012