When you sell options, you get paid for assuming risk. That can be a profitable business, but it does not mix well with the risks inherent in a leveraged portfolio.
If we carry this line of argument to its logical conclusion, the meaning of life consists of the flaws in one’s conceptions and what one does about them. Life can be seen as a fertile fallacy.
By creating the European Central Bank, the member states exposed their own government bonds to the risk of default. Developed countries that issue bonds in their own currency never default, because they can always print money. Their currency may depreciate, but the risk of default is absent.
Economics seeks to be a science. Science is supposed to be objective and it is difficult to be scientific when the subject matter, the participant in the economic process, lacks objectivity.
I contend that financial markets never reflect the underlying reality accurately; they always distort it in some way or another and the distortions find expression in market prices. Those distortions can, occasionally, find ways to affect the fundamentals that market prices are supposed to reflect.
The pro-Israel lobby has been remarkably successful in suppressing criticism. Politicians challenge it at their peril because of the lobby’s ability to influence political contributions.
Just as the process of repealing national alcohol prohibition began with individual states repealing their own prohibition laws, so individual states must now take the initiative with respect to repealing marijuana prohibition laws.
The world order needs a major overhaul.
I’m not doing my philanthropic work, out of any kind of guilt, or any need to create good public relations. I’m doing it because I can afford to do it, and I believe in it.
Globalization has rendered the world increasingly interdependent, but international politics is still based on the sovereignty of states.
My main concern is with the world order.
Misconceptions play a prominent role in my view of the world.
Fundamental analysis seeks to establish how underlying values are reflected in stock prices, whereas the theory of reflexivity shows how stock prices can influence underlying values.
I called gold the ultimate bubble, which means it may go higher. But it’s certainly not safe and it’s not going to last forever.
In politics, manipulating reality can take presidence over finding reality.
I commissioned two political experts to advise me about what I could do to oppose the re-election of President Bush.
The trouble with institutional investors is that their performance is usually measured relative to their peer group and not by an absolute yardstick. This makes them trend followers by definition.
There is a resurgence of anti-Semitism in Europe. The policies of the Bush administration and the Sharon administration contribute to that. It’s not specifically anti-Semitism, but it does manifest itself in anti-Semitism as well.
The people currently in charge have forgotten the first principle of an open society, namely that we may be wrong and that there has to be free discussion. That it’s possible to be opposed to the policies without being unpatriotic.
The bureaucratic method of building an integrated Europe has exhausted its potential.