Thinks 434

Howard Marks: “I believe most investors trade too much and to their own detriment and that the best solution for illiquidity in markets is to build portfolios for the long term that don’t rely on liquidity and trading for their success. I believe there are two main reasons why people sell investments: because they’re up and because they’re down…Simply being invested to benefit from miracle of long-term compounding of returns is the most important thing.”

Israel Kirzner: “The theory of the competitive market process teaches that where resources within a society leave opportunities for improvement via exchange, production, or some combination of both, they will appear as opportunities for entrepreneurial profit. The lure of profit will lead entrepreneurs to discover these opportunities and pursue them until, through the competitive entrepreneurial process, resources have been reallocated in an equilibrium that eliminates both the profit opportunities and the misallocation. Freedom of entry is crucial to this process. The process depends heavily on the likelihood that, whenever anyone perceives an opportunity for improvement, he will be motivated by the lure of profit to exploit that opportunity. For this actually to occur it is necessary that no one who has perceived such an opportunity be barred from exploiting it.” [via CafeHayek]

Anticipating the Unintended: “The [Indian] union government still runs a sizable revenue deficit, meaning that a part of government borrowing is being used merely to keep the government running today. In other words, we are snatching money from future generations to meet the demands of the current generation’s citizens and government employees. This tells us why the rampant expansion of government expenditure is not just irresponsible but also unethical.”

Published by

Rajesh Jain

An Entrepreneur based in Mumbai, India.