Howard Marks

Experience is what you got when you didn’t get what you wanted

The most valuable lessons are learned in tough times

Some of the most important for me were Charley Ellis’s great article “The Loser’s Game” (The Financial Analysts Journal, July-August 1975), A Short History of Financial Euphoria, by John Kenneth Galbraith (New York: Viking, 1990) and Nassim Nicholas Taleb’s Fooled by Randomness (New York: Texere, 2001). Each did a great deal to shape my thinking

Everything should be made as simple as possible, but not simpler

It’s not supposed to be easy. Anyone who finds it easy is stupid.
CHARLIE MUNGER

In my view, that’s the definition of successful investing: doing better than the market and other investors

Who’ll get it? The person who’s a step ahead

Thus, your thinking has to be better than that of others— both more powerful and at a higher level

You must be more right than others … which by definition means your thinking has to be different

First-level thinking says, “I think the company’s earnings will fall; sell.” Secondlevel thinking says, “I think the company’s earnings will fall less than people expect, and the pleasant surprise will lift the stock; buy.