financial market dynamics Quotes

Reversion to the mean is the iron rule of the financial markets.

A pin lies in wait for every bubble. And when the two eventually meet, a new wave of investors learns some very old lessons: First, many in Wall Street (a community in which quality control is not prized) will sell investors anything they will buy. Second, speculation is most dangerous when it looks easiest.

What's both fascinating and challenging about investing is that the changing nature of business and finance means you can never have it all figured out.

Incredibly, at this critical juncture in financial history, after which so much changed so quickly, the only constraint in the subprime mortgage market was a shortage of people willing to bet against it.

I love it when the market reacts naturally to events. It's like a cat coughing up a fur ball.

I do believe that some of these regulations made the markets more volatile, and it remains to be seen how bad that can be.

I contend that financial markets never reflect the underlying reality accurately; they always distort it in some way or another and the distortions find expression in market prices. Those distortions can, occasionally, find ways to affect the fundamentals that market prices are supposed to reflect.

The number of managers with great track records in a given market depends far more on the number of people who started in the investment business (in place of going to dental school), rather than on their ability to produce profits.