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Ratings agencies are highly conflicted, unimaginative dupes. They are blissfully unaware of adverse selection and moral hazard. Investors should never trust them.

Seth Klarman

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Seth Klarman
Age: 67
Born: 1957
Born: May 21
New York City
New York
Seth Andrew Klarman
Never
Agencies
Unimaginative
Rating
Conflicted
Selection
Dupes
Investors
Hazard
Agency
Ratings
Highly
Adverse
Trust
Unaware
Moral
Hazards
Blissfully

More quotes by Seth Klarman

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When people give away stocks based on forced selling or fear that is usually a great opportunity.
Seth Klarman
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Pressure to produce over the short term - a gun to the head of everyone - encourages excessive risk taking which manifests itself in several ways - fully invested posture at all times, the use of leverage, and a market centric orientation that makes it difficult to stand apart from the crowd and take a long term perspective.
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If only one word is to be used to describe what Baupost does, that word should be: 'Mispricing'. We look for mispricing due to over-reaction.
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Like to have a catalyst - reduces dependence on the market: Distressed debt inherently has a catalyst - maturity.
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Having clients with a long-term orientation is crucial. Nothing else is as important to the success of an investment firm.
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Value investing by its very nature is contrarian.
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When a Wall Street analyst or broker expresses optimism, investors must take it with a grain of salt.
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Things that have never happened before are bound to occur with some regularity. You must always be prepared for the unexpected, including sudden, sharp downward swings in markets and the economy. Whatever adverse scenario you can contemplate, reality can be far worse.
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Why should the immediate opportunity set be the only one considered, when tomorrow's may well be considerably more fertile than today's?
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Almost every financial blow up is because of leverage.
Seth Klarman
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Be focused on process and not outcome
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If you can remember that stocks aren't pieces of paper that gyrate all the time --they are fractional interests in businesses -- it all makes sense.
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The overwhelming majority of people are comfortable with consensus, but successful investors tend to have a contrarian bent.
Seth Klarman
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Depressions aren't good but the depression mentality is good.
Seth Klarman
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Complexity - limits competition.
Seth Klarman
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As Graham, Dodd and Buffett have all said, you should always remember that you don't have to swing at every pitch. You can wait for opportunities that fit your criteria and if you don't find them, patiently wait. Deciding not to panic is still a decision.
Seth Klarman
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All an investor can do is follow a consistently disciplined and rigorous approach over time the returns will come
Seth Klarman
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A commodity doesn't have the same characteristics as a security, characteristics that allow for analysis. Other than a recent sale or appreciation due to inflation, analyzing the current or future worth of a commodity is nearly impossible.
Seth Klarman
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My view is that an investor is better off knowing a lot about a few investments than knowing a little about each of a great many holdings. One's very best idea's are likely to generate higher returns for a given level of risk than one's hundredth or thousandth best idea.
Seth Klarman
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Investing today may well be harder than it has been at any time in our three decades of existence.
Seth Klarman