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Howard Marks Interview - "In The End, The Devil Always Wins"


saltybit
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I am a conservative investor. My ownership of Oaktree Capital and the income I derive from Oaktree’s success and my investments in Oaktree funds is very substantial.

So I’ve never felt the need to press up my risk exposure. I am not one of these people who feel that every dollar has to be fully employed at maximum return every minute. I derive a lot of comfort from having liquidity and a dependable portfolio. Before the crisis, I used Treasuries for virtually all my money that was not invested in Oaktree. That allowed me to get a return of around 6% with total safety. Today, if I want to invest in Treasuries with one to five year maturities I only get 1%. That’s not enough because after taxes and inflation I lose money.

So the answer is that I have increased my active investments. I’m still not maximally aggressive. By necessity, like everybody else in the world, I’ve moved out the risk curve – but in my case with caution.

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But we’re harvesting. The assets we own have become very valuable because we bought them in a time of worry and now we can sell them at highly appreciated prices. And although it’s not easy there are still certain areas where we are investing: For example real estate, Europe and shipping.
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Am I the only one having to smother yawns every few words I read from Marks? He rarely says anything that's not extremely general and bland.

 

Well, we have almost never got single investment discussion by Mr. Marks before. And there is no reason to expect him doing so in the future either! If that is what you meant.

As far as I am concerned, I always like to hear where he thinks the pendulum is standing at each point in time. That’s basically why I continue to listen to him and to pay attention to what he has to say with interest. :)

 

Gio

 

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I really like Howard Marks approach especially in determining where we are in terms of sentiment.  I guess I don't see how his statements are any different than those of Buffet, Pabrai and other good investors.  They all have an approach and apply it by repeating the same thought process to investments over time.  Maybe its boring but its consistent.

 

Packer

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  • 1 month later...

Thanks for the link, that memo was an incredible read. I imagine most members here "know" and share most, if not all, of these thoughts, but what has always impressed me about Marks is how well he articulates these concepts. The guy is a master of words

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