tisdag 23 september 2014

Howard Marks "memos" genom åren

"We conclude that most of the time, the future will look a lot like the past, with both up cycles and down cycles. There is a right time to argue that things will be better, and that`s when the market is on its backside and everyone is selling things at giveaway prices. It`s dangerous when the market`s at record levels to reach for a positive rationalization that has never held true in the past. But it`s been done before, and it`ll be done again." (WILL IT BE DIFFERENT THIS TIME?, November 25,1996)

"To say technology, Internet and telecommunications stocks are too high and about to 
decline is comparable today to standing in front of a freight train. To say they have 
benefited from a boom of colossal proportions and should be examined very skeptically is 

something I feel I owe you."(BUBBLE.COM, January 2,2000)

"Every once in a while, an up-or down-leg goes on for a long time and/or to a great extreme and people start to say "this time it`s different." They cite the changes in geopolitics, institutions, technology or behavior that have rendered the "old rules" obsolete. They make investment decisions that extrapolate the recent trend. And then it turns out that the old rules still apply, and the cycle resumes. In the end, trees don`t grow to the sky, and few things go to zero. Rather, most phenomena turn out to be cyclical." (YOU CAN`T PREDICT. YOU CAN PREPARE, november 20, 2001)

"This memo can be summed up simply: there’s a race to the bottom going on, 
reflecting a widespread reduction in the level of prudence on the part of investors 
and capital providers. No one can prove at this point that those who participate will 
be punished, or that their long-run performance won’t exceed that of the naysayers. 
But that is the usual pattern." (THE RACE TO THE BOTTOM, February 14, 2007)

"For a bullish phase ... to hold sway, the environment has to be characterized by greed, optimism, exuberance, confidence, credulity, daring, risk tolerance and aggressiveness. But these traits will not govern a market forever. Eventually they will give way to fear, pessimism, prudence, uncertainty, skepticism, caution, risk aversion and retience... (NOW WHAT?, January 10, 2008)
"It's the job of investors to strike a proper balance between offense and defense, and between worrying about losing money and worrying about missing opportunity.Today I feel it's important to pay more attention to loss prevention than to the pursuit of gain. For the last three years Oaktree's mantra has been "move forward, but with caution." At this time, in reiterating that mantra, I would increase the emphasis on those last three words: "but with caution." 
Economic and company fundamentals in the U.S. are fine today, and asset prices – while full – don't seem to be at bubble levels. But when undemanding capital markets and a low level of risk aversion combine to encourage investors to engage in risky practices, something usually goes wrong eventually. Although I have no idea what could make the day of reckoning come sooner rather than later, I don't think it's too early to take today's carefree market conditions into consideration. What I do know is that those conditions are creating a degree of risk for which there is no commensurate risk premium. We have to behave accordingly." (RISK REVISITED, September 3, 2014)

"When interest rates decline, the value of assets increases. And to replace the return that people used to make safely in treasuries or high grade bonds, they migrate out the risk curve, to higher risk investments to try and replicate the return they used to make. And along the line they usually forget to be cautious. And so, you know Buffett says "The less prudence with which other conduct their affairs, the greater the prudence with which we must conduct our own affairs", thats TODAY. there`s not that much prudence around. Its our job to be prudent." (Howard Marks, Bloomberg TV, 22 September 2014, länk)

Howard Marks är briljant och man bör därför hörsamma hans tankar. Jag tror personligen att Howard Marks underskattar riskerna på dagens marknader. Marks motivera prissättningen på börsen med att "foward p/e" för S&P 500 bara är 16, men problemet är att nyckeltalet bygger på prognoser. "Trailing p/e" ligger istället runt 20. Den som lever får se.

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