Rating: 
Summary: This is a great book...
Review: I won't be able to say anything that hasn't been said before, but this is really a good read on passive index investing strategy and market history. I found this to be good companion book to Larry Swedroe's Rational_Investing_In_Irrational_Times. This book covers market history, efficient market theory, statistics on actively manged funds vs. passive vehicles, and detailed information on how and why diversified portfolios work the way they do. I think the biggest hurdle people will have following the passive index strategy is having the guts to stick out bad markets and putting money into lagging asset classes by taking money from your winners. Overall the critics are largely irrelevant (re: people who point out Warren Buffet). Although Bernstein presents a fairly weak argument in his book about the success of value investors such as Buffet, I still think the core of the book stands on it's own. I like Warren Buffet's writings and investment style as much as the next person (and even own a few shares), but he really isn't running a "mutual fund" as people sometimes think. He runs a conglomerate that purchases good businesses that largely run themselves and hands money off to him as profit. This is a great business model, but significantly different from where Berkshire started decades ago. Of course most of these deals come to him because he is Warren Buffet and this gives him a decided advantage over the individual investor. I think in the end the efficient market theorists will be shown correct. I'd like to think that somewhere out there people are beating the market hand over fist continuously, but this is becoming harder and harder to do as an external investor buying stocks. Buffet's advantage over the recent past hasn't been his stock prowess but the fact that he owns the companies and has control over their destiny and cashflow. Regardless, this book is a great read for anyone interested in protecting their money and beating virtually all money managers with minimal stress.
Rating: 
Summary: Quite good
Review: I'll reiterate what some others have said by stating that this is a very good book on basic investing and the construction of a longterm portfolio. My only qualm is that some of the advice rearding asset allocation is predicated on a prediction that stock returns and the return on TIPS will be virtually identical. So Bernstein advises even a young person who wants to invest aggressively to keep at least 20% of their portfolio in TIPS. As we all know, long term predictions tend not to come true. Bernstein is predicting stock returns that are far, far below the long term return of the market in the past. After one of the worst bear markets in history, this does not make sense to me. Yes, he explains in detail why he makes this prediction. But, still, it seems intuitive that stock returns should over the long run be back at the 10-11% a year average that they've done over the past century. In fact Jeremey Siegal has remarked that they should be above average. Therefore, the advice to keep at least 20% of an aggressive portfolio in bonds seems imprudent for a young person, and I would reject this advice, especially if you would have to keep them in a taxable account. But, overall, this is an outstanding book that almost anyone but the most well read investor would benefit from.
Rating:
Summary: A bitter pill for the investment business to swallow
Review: In a calm and carefully reasoned way he punctures the egos of nearly everyone in the investment industry who would stand between you and your assets. Those familiar with Jack Bogle's writings will find little new here, but Bernstein has a slightly different perspective as an individual financial adviser. His words of reassurance for the long term investor in these troubling times are worth the price of the book. I have read many books about investing, but few have risen to this level of usefulness, timeliness and readability. And most amazing, he is a fellow physician. We are not known for our financial common sense.
Rating:
Summary: Required reading for intelligent investors
Review: It took a doctor to write the most succinct, penetrating book about investing for laymen and professionals. Bernstein writes so well and is so right on about reality of investing. It is counterintuitive and difficult to say the least. His advice on building portfolios that will work is worth the price of the book. I am getting copies for family and friends.
Rating:
Summary: Astonishingly Incompetent Review
Review: It's scary that a previous reviewer is actually challenging what is accepted by a wide spectrum of authors and economists, namely that index funds handily outperform actively managed ones over the long term. This is not an original Dr. Bernstein idea. The number varies but no one usually argues with the oft quoted 85% figure. THIS is what is at the heart of Dr. Bernstein's book and the book really is a cookbook about the mechanics and psychology of index investing. He does bring up some examples of actively managed funds that have had good runs for awhile and then crashed miserably. If you selectively look at certain periods of time, namely when they are having their good run, then yes, you can make the misleading claim that these funds beat the market over time. But in those cases you would have had to bail out of the funds before the storm clouds came, and this is precisely the point Dr. Bernstein is trying to make with the examples--no one knows when to do so and even if you did, you would take a capital gains bath and give up a lot of the returns anyway. Over the long term investing horizon, actively managed funds are a horrible bet. If Dr. Bernstein is incompetent, then so are: Vanguard founder John Bogle, Larry Swedroe, Burton Malkiel, Tom and David Gardner (Motley Fool), Drs. French and Fama, et al. There may be some minor valid points of contention to be taken in Dr. Bernstein's book, but to present them as evidence that the basic principles of the book are invalid is embarrassing in its intellectual dishonesty. If you are interested in how to design a portfolio with a decent long term return that will beat most mutual funds and match the market, and want to be psychologically prepared for the trials and temptations on that path ahead, buy this book. If you want to be the best pal of the commission-churners, keep your business with the load funds and stock brokers. Better yet, write a nasty review of this book or one of those of an author mentioned above.
Rating:
Summary: Good for beginners and the investment jaded!
Review: Mr. Bernstein has written a solid book, based on his "four pillars" of investing. They are as follows "investment theory", "historical perspective", "investor behavioral errors", and lastly " brokerages et. all don't have a responsibility to their clients.
For those of you coming out of the dotcom fiasco many of you will find that this book will heal some of those wounds. The poor accounting practices, the fraud and deception by both analyst and corporations have all made today's investors sceptical and cynical. Mr.Bernstein will be the guiding light for many of you. His lengthy discussion on investment theory will open your eyes to the various ways to go about investing, and in that respect he borrows a lot from Benjamin Graham's, Warren Buffet's mentor, value investing. Which smoothly leads into his second pillar historical perspective. Mr.Bernstein shows mathematically that over time the stockmarket and the bond market converge until their yields are the same, which is very interesting if you believe that the only way to make money is when the markets go up, I don't. Lastly he lambast brokers and money managers both for their incompetency to beat the indices and for their uncaring attitude to see their clients thrive and prosper. Many of the subjects he discusses in his book will give investors renewed power and strength to attack the investing world again. Where Mr.Bernstein fails is his leaving out the investing theory of non-correlative investment strategies. It's where you invest in different types of investments that have no relation to one another. This type of investing is essential during bear markets. I have been involved with futures as an investor, broker.... It is the only known non-correlative investment to the stock market. It allows investors to still make double and triple digit returns while the stock market is collapsing. From my own experience this the only way I survived the dotcom bubble and it is the only way I know a lot of investors could have avoided this massacre as well. Mr.Bernstein loses sight of alternative investments and of various other types of money managers outside of just stockbroker et. al. That is my primary criticism, but this book otherwise is sound and solide in its strategy and investment suggestions.
Rating:
Summary: The most important investment book you'll ever read
Review: Right up front, I read Bernstein's first book and thought it was a classic. However, it wasn't a huge market success which the author admits for many reasons but it was/is still a fine book (The Intelligent Asset Allocator). Now Bernstein comes back with an even better book from the standpoint of being readable for just about any kind or type of investor, experienced or inexperienced. The math and the charts are still there but with less rigorous emphasis. ... The Four Pillars of Investing is both a historical review of investment success and failure with a very honest discussion of risk and reward. The pillars are the theory of investing, the history of investing, the psychology of investing (which is now recognized as a critical component in understanding why we invest the way we do) and finally, the business of investing. BTW, the humor in many of these chapters has not been lost either. I don't think your favorite stock broker or investment pro is necessarily going to enthusiastically recommend that you read this book. Much of what is in the new book should be almost automatic wisdom/rules for investors but as we all know, we usually stray far and wide from good advice and common sense. In this post high-tech bubble collapse period, some solid review of investment principles is necessary. Call it back to basics if you will. It's just that Bernstein backs it up with the data to prove his points. What really makes this book different from the first book (for me personally) is that Bernstein has finally put the portfolio construction recipe on paper in Chapter 13 called Defining Your Mix. And now a special message to parents of high school and college graduates: buy them a copy of this book. Don't worry if they don't read it now. Or if they look at you strangely. For those that do read it, they'll be ten to twenty years ahead of their peers in investment wisdom and hopefully, financial security. And that's really what this book is all about; not how to trade or gamble on market timing but rather on how to use sound principles of investing to manage/understand risk while builiding a solid foundation of assets for the longer term.
Rating:
Summary: Good general concepts...can be inaccurate at times
Review: The author makes a worthy stab at reviewing the topic of investing, its theory, history, psychology, and business practices. For the most part, this is a good book for the beginner and intermediate investor. With the right level of attention, it could leave the reader with a road map for the future which would be solid enough. But, the author gets a little too passionate about his arguments and points more than once, and overstates his case. Since the book is written for a novice investor, this is a dis-service. Also, the book has some inaccuracies and inconsistencies, none of which are fatal, but some are material. Finally, the author tries to run the reader through some asset allocation examples - which turn out to be overly complex on the one hand, and simplistic on the other. All in all, a good book, but should only be a starting point for the curious investor.
Rating: 
Summary: Erudition Spoiled by Intellectual Dishonesty
Review: The best single critique of the efficient market theory was done by Warren Buffet in "The Superinvestors of Graham-and-Doddsville." Bernstein never troubled to address it.
Rating:
Summary: This book is a must in any investor's library.
Review: Thinking about getting started in the stock market? Already invested? Are you in a 401k program? If so, you'll want to read this book! In fact, you need to read it. These are nervous times we're living in. To relieve the anxiety that extreme market volatility creates, many investors turn to the public financial press and even worse, private newsletters for direction and assurance. This book was worth ten times the price of admission just to see those mediums exposed for what they really are - advertising cloaked as sound financial advice and tea leave readings portrayed as definitive harbingers of future market moves. As Bernstein notes, the people who produce this stuff make Miss Cleo look good by comparison in terms of accuracy and honesty. As this book boldly explains, and as many investors have already concluded form their own observations, there are no discernable patterns in short term market movements. It is for the most part a totally random process. This unsettling revelation leaves you with only one viable course of action: make sure that your portfolio is properly diversified, utilize index funds as your core holdings, lean toward a balance of conservative (read: value stocks and bond) assets, and close your eyes to short term upheavals. If you can do this and stay in the game for 20 years or so, it's likely that things will work out just fine. You owe it to yourself to read this book before plunking down another hard earned 50 dollars or so for the latest wave theory (or other flavor of the month) newsletter that purports to know the future. Bernstein has convinced me that they (the authors of such things) are looking for faces in the clouds and want to line their pockets while doing so. My thanks go out to Mr. Bernstein (and his associates Jack Bogle, et al) for giving a damn about the little guy. Such people owe all of you a debt of gratitude.
| 
