Friday, June 1, 2007

Quotable Quotes (and a little V - TV)

“…we remain alone in our view that S&P 500 earnings are the most cyclical in history (dating back to 1940!). If that is true, then one should be careful when making statements about low PE ratios for the overall index. If earnings are indeed the most cyclical in history, then a low PE might simply reflect peak earnings.”

Rich Bernstein

“We have trouble recognizing how much information is enough and how much is too much. We pay excessive attention to low-probability events accompanied by high drama and overlook events that happen in routine fashion. We treat costs and uncompensated losses differently, even though their impact on wealth is identical. We start out with a purely rational decision about how to manage our risks and then extrapolate from what may be only a run of good luck. As a result, we forget about regression to the mean, overstay our positions, and end up in trouble.”

Peter Bernstein

"There are two kinds of investors, be they large or small: those who don't know where the market is headed, and those who don't know that they don't know. Then again, there is a third type of investor - the investment professional, who indeed knows that he or she doesn't know, but whose livelihood depends upon appearing to know."

William Bernstein

“To achieve great things, two things are needed; a plan, and not quite enough time.”

Leonard Bernstein

…and for a little V – TV, see the following blog entry.

Have a good weekend.

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