Failure to perceive that the dollar, or any other unit of money, expands or shrinks in value
The conquest of inflation was a landmark accomplishment with enduring benefits, but it came with heavy costs. After a brief recession in 1980 and a short rebound, the economy slumped deeply in 1981 and 1982
Among other factors, indicators of extremes of euphoria seem much more important than price
Market conditions are fixed only in part by balance sheets and income statements; much more by the hopes and fears of humanity; by greed, ambition, acts of God, invention, financial stress and strain, weather, discovery, fashion, and numberless other causes impossible to be listed without omission
On this basis it could be argued that, at that time, since expected returns were well below historic norms, prices were too high.
Human decisions affecting the future, whether personal or political or economic, cannot depend on strict mathematical expectation, since the basis for making such calculations does not exist.
We do not have, never have had, and never will have an opinion about where the stock market, interest rates, or business activity will be in a year from now
A few years ago I realized we needed a plan in the event I predeceased my wife
Despite this problem, we consider the owner earnings figure, not the GAAP figure, to be the relevant item for valuation purposes
Too much of a good thing can be wonderful