Preface
What's a cynic? A man who knows the price of everything and the value of nothing.
—Oscar Fingal O'Flahertie Wilde (1854–1900), Irish author
ON JULY 4, 1956, over 55 years ago, I arrived in New York on the Queen Mary; it was the sixteenth anniversary of my first of numerous visits to the United States. The trip was part of a summer job as a junior securities analyst, visiting steel companies in the United States and Europe; this was an essential element of a project to compare the values of the publicly traded shares of recently denationalized British steel companies with their stock market prices. While an interesting, indeed fascinating, endeavor, it was not profitable for the London stockbroker who initiated it, as nearly all the shares were overvalued, but at that time few institutional investors were willing to sell or switch. Today, there are no publicly traded shares of British steel companies; the major producer is now Tata Steel Europe, wholly Indian-owned.
This long-ago experience convinced me that value is something connected to, but not necessarily the same as, price, even though the Financial Accounting Standards Board (FASB) in the United States and the International Accounting Standards Board (IASB) in the rest of the world have justifiably based their concept of fair value for financial reporting on the price a seller could receive for an item. This is the subject of the book; it is not designed for specialist valuation experts or even for neophytes in the ...
