Ben Graham's Duplex
"Most of the problems in my life have to do with my confusing what I want and what I need." - David Foster Wallace
Our experience with money doesn’t change gradually but in steps — Nick Maggiulli once compared it to climbing a ladder. When we reach a new level, it’s important to pause before making big decisions. It’s like stepping into a room with bright lights and giving our eyes time to adjust.
Ben Graham is known as the founder of the conservative value approach to investing, but in 1928, he was one of the first young hot-shot hedge fund managers. That year, he made 60% for his investors, and plans for another, much larger fund were in the works.
His family had struggled with money after his father’s early death. Now he was finally flying high and it was time to live the good life.
Graham and his wife picked a new home, a lavish duplex in a brand new “thirty-story apartment building of ultimate luxury” on Manhattan’s Upper West Side. The place had “ten rooms and Lord knows how many baths” on the 18th and 19th floors. Plus a terrace. This, Graham wrote in his memoirs, this was “what the high-flying Grahams wanted.”
The building was the Beresford whose distinctive shape is familiar to anyone strolling through Central Park.
Rent was $11,000 a year, “small figures” compared to the $600,000 Graham had earned that year before taxes. (Inflation adjusted by about 18x, that’s about ~$200,000 in rent.) Graham signed a ten-year lease before heading to Palm Beach for a Christmas vacation. “What a Wunderkind I was,” he quipped decades later.
The Grahams moved into their “regal duplex” in October 1929, “just when the holocaust in Wall Street was at its height.”
