The silver investing bullet - doesn't exist

"When a market, an individual or an investment technique produces impressive returns for a while, it generally attracts excessive (and unquestioning) devotion. I call this solution du jour the 'silver bullet'.

Investors are always looking for it. Cal it the holy grail or the free lunch, but everyone wants a ticket to riches without risk. Few people question whether it can exist or why it should be available to them. At the bottom line, hope springs eternal.

But the silver bullet doesn't exist. No strategy can produce high rates of return without risk. And nobody has all the answers; we're all just human. Markets are highly dynamic. and, among other things, they function over time to take away the opportunity for unusual profits. Unskeptical belief that the silver bullet is at hand eventually leads to capital punishment."

-- Howard Marks, 5-31-2002

Suspension of disbelief - not that great for investing

"In fictions, willing suspension of disbelief adds to our enjoyment. When we watch Peter Pan, we don't want to hear the person sitting next to us say, 'I can see the wires' (even though we know they're there). While we know boys can't fly, we don't care; we're just there for the fun.

But our purpose in investing is serious, not fun, and we must constantly be on the lookout for things that can't work in real life. In short, the process of investing requires a strong dose of disbelief ....Inadequate skepticism contributes to investment losses. Time and time again, the postmortems of financial debacles include two classic  phrases: 'It was too good to be true' and 'What were they thinking?'"

-- Howard Marks, 10-17-2005

Warren Buffett quote

“Some great big strong American companies look very cheap compared to investment alternatives. I mean, in the end, you know, you're sitting with money in your pocket. Do you leave it in your pocket, you get zero on, do you put it in a money market fund, you still get zero on it, do you buy 10-year Treasuries and get 2 percent, or do you buy American businesses that are earning very good money, that have high returns on equity, have high returns on incremental capital, are buying in their stock at a rapid rate so that your ownership in the business increases significantly? I love all those things.

“The world's always uncertain. The world was uncertain on December 6th, 1941, we just didn't know it. The world was uncertain on October 18th, 1987, you know, we just didn't know it. The world was uncertain on September 10th, 2001, we just didn't know it. The world—there's always uncertainty. Now the question is, what do you do with your money? And if you—the one thing is if you leave it in your pocket, it'll become worth less—not worthless—worth less over time. That's certain—that's almost certain…If you own a good business locally in Omaha and somebody says Italy's got problems tomorrow, do you sell your—do you sell your business? No. But for some reason, people think if they own wonderful businesses indirectly through stocks, they've got to make a decision every five minutes. So I do not think if Ben Bernanke comes up and whispers to me that he's going to do X, Y or Z tomorrow, I'm not going to change my view about what businesses I want to own.”
-- Warren Buffett on CNBC 

Master your emotions

"Individuals who cannot master their emotions are ill-suited to profit from the investment process."
-- Benjamin Graham

Warren Buffett Quote

"The stock market remains an exceptionally efficient mechanism for the transfer of wealth from the impatient to the patient."
-- Warren Buffett

Ride the market - up and down

"The only way to ride the market up, is to ride it down from time-to-time."
--Dave Yeske

Americans always do the right thing?

"Americans will always do the right thing after they've exhausted all the alternatives."
-- Winston Churchill