Martin J. Whitman (September 30, 1924[1] – April 16, 2018[2]) was an American investment adviser and a strong critic of the direction of recent changes in Generally Accepted Accounting Principles (GAAP) in the U.S.
Furthermore, "Most private companies, given a choice, seek to enhance [Net Asset Value] by means other than having reported operating income, which is taxable at maximum rates."
In particular, he cited as wrongheaded an advertisement in the Wall Street Journal of April 27, 2004, which argued that "financial statements exist to help investors make informed investment decisions".
For example, in a discussion of John Maynard Keynes, Friedman and Hayek, Whitman wrote that the three "…great economists… missed a lot of details that are part and parcel of every value investor's daily life."
As illustrations of this, he points at "Japan after World War II, Singapore and the other Asian Tigers, Sweden and China today… Government has a necessary role in determining how control persons [management, boards of directors, etc.]
[7] Further, Whitman argued (explicitly against Hayek) that "a free market situation is probably also doomed to failure if there exist control persons who are not subject to external disciplines imposed by various forces over and above competition."
For example, there are "voluntary activities, where each individual makes his or her own decision whether to buy, sell, or hold" but there are also what he defined as "[c]oercive activities, where each individual security holder is forced to go along…provided that a requisite majority of other security holders so vote…" His examples of the latter included proxy voting, most merger and acquisition transactions, certain cash tender offers, and reorganization or liquidation in bankruptcy.
"[10] "I am one with Professor Friedman that, other things being equal, it is far preferable to conduct economic activities through voluntary exchange relying on free markets rather than through coercion.
[13][14] He was also an adjunct faculty member at Yale School of Management[3] In 2008, he and his wife founded The Lois and Martin Whitman Scholarship Fund at Tel Aviv University to support the educational needs of Arab-Israeli students.
[3] Whitman related his experience as a Jew in the United States, “I spent half my life as a second-class citizen” and his inability to attend Ivy League colleges at the time.