There’s an old saying – variously attributed – to the effect that “capitalism without bankruptcy is like Catholicism without hell.” It appeals to me strongly. Markets work best when participants have a healthy fear of loss. It shouldn’t be the role of the Fed or the government to eradicate it. […] I see no reason why financiers should be bailed out simply because the event they’re being harmed by was unpredictable.

Howard Marks, Knowledge of the Future

All professions are conspiracies against the laity. And we cant all be geniuses like you. Every fool can get ill; but every fool cant be a good doctor: there are not enough good ones to go round.

George Bernard Shaw, The Doctor’s Dilemma

The great contrarian, Warren Buffett is famous for saying he likes hamburgers, and when hamburgers go on sale, he eats more hamburgers.

Howard Marks, Calibrating

These days everyone has the same data regarding the present and the same ignorance regarding the future.

Howard Marks, Calibrating

Because biographies of famous scientists tend to edit out their mistakes, we underestimate the degree of risk they were willing to take. And because anything a famous scientist did that wasn’t a mistake has probably now become the conventional wisdom, those choices don’t seem risky either.

Biographies of Newton, for example, understandably focus more on physics than alchemy or theology. The impression we get is that his unerring judgment led him straight to truths no one else had noticed. How to explain all the time he spent on alchemy and theology? Well, smart people are often kind of crazy.

But maybe there is a simpler explanation. Maybe the smartness and the craziness were not as separate as we think. Physics seems to us a promising thing to work on, and alchemy and theology obvious wastes of time. But that’s because we know how things turned out. In Newton’s day the three problems seemed roughly equally promising. No one knew yet what the payoff would be for inventing what we now call physics; if they had, more people would have been working on it. And alchemy and theology were still then in the category Marc Andreessen would describe as “huge, if true.”

Newton made three bets. One of them worked. But they were all risky.

Paul Graham, The Risk of Discovery

Im Grunde genommen ist es die Liebesgeschichte eines Intellektuellen mit einer Kleinbürgerin. Das muss ja mit dem Teufel zugegangen sein.

Bertolt Brecht

People may ask me for my opinion because they think I’m intelligent, think I’ve been a successful investor, or know I’ve lived through a lot of history. But none of that should be confused with expertise on subjects of every kind.

Howard Marks, Nobody Knows II

What a man wishes, that also will he believe.