The .350 hitter expects, and also deserves, a big payoff for his performance - even if he plays for a cellar-dwelling team. And a .150 hitter should get no reward - even if he plays for a pennant winner.
Goldman Sachs saying they might be interested in such an investment. I'm familiar with the company. I've known the management, the current management, Jack Welch before Jeff Immelt. I've known him for decades.
We say we are trying to buy into businesses with excellent economics, run by honest and able people at a decent price. We buy very few securities, so we look at it as "focused" investing.
So smile when you read a headline that says "Investors lose as market falls." Edit it in your mind to "Disinvestors lose as market falls-but investors gain." Though writers often forget this truism, there is a buyer for every seller and what hurts one necessarily helps the other. (As they say in golf matches: "Every putt makes someone happy.")
The latter qualification brings to mind a fellow who applied for a job and stated he had twenty years of experience-which was corrected by a former employer to read "one year's experience-twenty times.
I mean, you can explain the fact that these are depressed prices, you know. We think these assets are going to be worth a lot more. And I think that case can be made in certain situations. But I think to just say, you know, we're going to say a dollar of cash is worth $2 all of a sudden, it isn't worth $2. It's worth a dollar today.
I have worked with investors for 60 years and I have yet to see anyone - not even when capital gains rates were 39.9 percent in 1976-77 - shy away from a sensible investment because of the tax rate on the potential gain.
People went crazy with tulip bulbs. They went crazy with the South Sea Bubble, they went crazy internet stocks, they went crazy with the uranium stocks back when I was first getting started.
An argument is made that there are just too many question marks about the near future; wouldn't it be better to wait until things clear up a bit? You know the prose: "Maintain buying reserves until current uncertainties are resolved," etc. Before reaching for that crutch, face up to two unpleasant facts: The future is never clear and you pay a very high price for a cheery consensus. Uncertainty actually is the friend of the buyer of long-term values.
You're dealing with a lot of silly people in the marketplace; it's like a great big casino and everyone else is boozing. If you can stick with Pepsi, you should be OK.
It's going to be tough because the economy is going to be getting worse for a while. And it might fall off a cliff if this doesn't pass. But nobody will ever know that if it does.