The Third Pig


Shooting The Messenger

http://www.brickfinancial.com/thethirdpig/archive/2007/03/shooting_the_messenger.html

Posted by Ben Taylor on March 17, 2007 02:40 PM

Warren Buffett, Letter To Shareholders 2009 Berkshire Hathaway Annual Report

"...neither Charlie Munger, my partner in running Berkshire, nor I can predict the winning and losing years in advance. (In our usual opinionated view, we don’t think anyone else can either.) We’re certain, for example, that the economy will be in shambles throughout 2009 – and, for that matter, probably well beyond – but that conclusion does not tell us whether the stock market will rise or fall."

Benjamin Graham, The Intelligent Investor

"Nearly all bull markets had a number of well-defined characteristics in common, such as (1) a historically high price level, (2) high price/earnings ratios, (2) low dividend yields against bond yields, (4) much speculation on margin, and (5) many offerings of new common-stock issues of poor quality. Thus to the student of stock-market history it appeared that the intelligent investor should have been able to identify the recurrent bear and bull markets, to buy in the former and sell in the latter... "

Graham went on to say that there have been sufficient variations in market cycles to make rendering identifying the exact high and the exact low of the market. Thus, as Graham puts it,

But it seem unrealistic to us (he and David Dodd) for the investor to endeavor to... wait for demonstrable bear-market levels before buying any common stocks."

Jeremy Grantham,

On November 20, 2008 Grantham published a short quip on the market. His firm (GMO) gave it's forcasts for the next 7 year period beginning October 31, 2008 when the S&P stood at xxx.

As told to James Montier, of SG Securities. "If stocks look attractive and you don't buy them and they run away, you don't just look like an idiot, you are an idiot."

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