The Ledger
Every statement that passed quotation and attribution checks. Mix any filter with any other: certainty 1/5, debate potential 5/5, or both at once.
why aren't all 31 resolved? a statement only gets an assessment when the public record can support or contradict it. opinions and what-ifs never can, and 0 checkable ones are still open, waiting for their date. predictions held up or didn't; assertions are supported or contradicted. on every card: ▮▮▮▮▮ certainty · ▮▮▮▮▮ debate potential. speakers are clickable
Marks: The investor who best understands AI will dominate the next decade
“Who is the person in the investment business today who will find the most success in the next 10 years? The answer is, in my opinion, the person who best understands AI and its capabilities and implications.”
Marks: Exceptional human investors will retain an edge over AI
“Neither can most people. So, so what that says is there is a role for exceptional people, even in an AI world.”
Howard Marks: Second-level thinking cannot be taught, like height in basketball
“Asking me how to become a second level thinker is like in basketball, we say you can't coach height. All the coaching in the world will not make your team taller. So can you, I can tell you that you must become a second level thinker to be successful as an inv…”
Marks: Forcing AI to generate non-consensus ideas usually leads to errors
“If you believe that consensus is as close to right as most people can get, then if you tell Claude, I only want non-consensus thinking, then it has a high probability of being wrong.”
Howard Marks: Ability to infer market behavior rises after extreme events
“The things that have happened, for example, in the economy and the markets are likely to induce certain behavior in the future, and you can know a little bit about that. And, but when the history and the past behavior has been extreme, the ability to infer fro…”
Marks: Annual S&P 500 returns are almost never between 8% and 12%
“The return on the S&P, which averages 10, is almost never between eight and 12.”
Marks: AI-driven markets without emotional bias should produce steadier returns
“It stands to reason that it would. If America, if we programmed AI to find the elements and expect the patterns that produced success in the past and left it alone. And since we're told AI does not have greed or fear or optimism or pessimism, you would think t…”
Marks: 99% of Oaktree's high-yield bonds paid full principal and interest
“I've been in high yield bonds for 48 years. And in our experience, 99% of the bonds have paid interest in principle as promised.”
Marks: Oaktree's 40-Year Default Rate Is Roughly One-Third Market Average
“Over the last 40 years, on average, something like 3.6 or 3.7% of all high yield bonds have gone into default every year. And our default rate has been Roughly a third.”
Marks: 80% Stock Drops Usually Stem From Incomplete Initial Analysis
“When you look at a portfolio and you see a stock that's down 80%, It's usually because something wasn't covered. And because the analysis was not disciplined enough to touch all the bases.”
Marks: Indexation won because active management was bad, not because indexing is great
“My answer is that indexation has taken over as it has, not because it's so good, but because active management was so bad.”
Marks: Psychological barriers prevent most investors from buying during market panics
“The bad times create an opening for active management. But it's still hard, and not many people can do it well. Why do bad times create an opening? Because panic drives down, let's say, stock prices. But the same panic causes most people to panic, which means …”
Marks: Average insight into AI will not provide an investment edge
“So if your excitement level, and by that I mean your insight level, is average, you don't have an edge. Your, and you get involved in AI, your performance will be average. You will go along with the tide if it works. You'll be schmeiced if it doesn't work.”
Howard Marks: Readily Available Present Data Cannot Create Above-Average Returns
“Readily available, quantitative information about the present cannot hold the key to success. Because everybody has it. Success in investing is doing better than others. Investing is a funny field because it's really easy to be average, and it's really hard to…”
Howard Marks: Contrarian thinking must be different and better than consensus
“Second level thinking or contrarian thinking is not just different from the herd. That's not enough. It has to be different from the herd and better.”
Marks: Prepare portfolios for multiple middle-probability outcomes rather than maximizing single scenarios
“In investing, you can put together a portfolio rather than one that will produce maximum success. If a certain future unfolds, you can put together a portfolio Which will do fine if several, any of several futures unfold, and not too terribly if a bunch of oth…”
Howard Marks: Market history and human psychology have semi-predictable future implications
“History, the things that have happened so far and people's reaction to history have Semi-predictable implications for the future.”
Marks: Market cycles are behavioral excesses and corrections, not just ups and downs
“Rather than thinking of cycles as ups and downs, which I think most people do, think of them as excesses and corrections.”
Marks: Real-World Cycles Occur Predictably Despite Variable Timing and Amplitude
“Patterns in the real world, the non, non-scientific, non-mechanical world Certainly aren't regular, but they do occur ups and downs. They do it predictably, but not necessarily predictable in time or predictable in amplitude, but they certainly occur predictab…”
Howard Marks: US Economic Recovery Is in Healthy Middle Age
“Well, I think that the recovery is, ah, I think it's, ah, it's gone on a good while, and, ah, it's, ah, it's not nascent, it's not adolescent, ah, it's, but it's also not, ah, ah, geriatric. I think it's in middle age, ah, and I think the US economy, if that's…”
Marks: AI Infrastructure Is Booming but Bust Risk Remains Unknowable
“That, that, well, that is the area that's booming in our economy. And I need people who know more about AI than me to tell me whether it's going to bust. You know, the question is, is all of this, or is some of this construction unwarranted? I don't think anyb…”
Marks: Ambition Starts with Money but Transitions Away in Enlightened Cases
“I think that most ambition starts with the dollar sign. In enlightened cases, it transitions to non-dollar.”
Marks: Founding Oaktree at 49 Was His First Intentional Career Decision
“When I think about my early decades, not years, decades, and I think about you know, what I did from, let's say, I would say from the beginning of, let's say high school until starting Oak Tree in, in 95. So that 35 year period, which took me up to age let's s…”
Marks: Buying Nifty 50 stocks in 1969 led to 95% losses
“And if you bought those stocks, the day I got to work in September of 69, if you held them tenaciously for five years, you lost about 95% of your money. 95%. Because for many of them, something did go wrong, and for all of them, the price was too high. The P.E…”
Marks: Bruce Karsh managed $70B in distressed debt with 90%+ profits
“He's managed about 70 odd billion dollars since 1988 in that field, by far the biggest. And of his total profits and losses, well over 90% are profits, less than 10% are losses.”
Marks: Exceptional, low-risk returns come from unloved assets, not popular ones
“If you go into a field that everybody likes and they like it a lot and have bid up the price, then your returns are not likely to be high. If they, if you go into a field where everybody else has been blind to the merits and says, I wouldn't touch that with a …”
Marks: Superior Credit Investing Requires Predicting Default Probabilities Better Than Competitors
“The base, the most important fundamental skill set is predicting the probability of the fault better than other people. That's where if we don't have that, that's the necessary condition for superior performance.”
Howard Marks: Investing success depends on outperforming others, not absolute correctness
“This is a competitive game... You don't have to, it's not a matter of being right or wrong. It's a matter of being more right than the other person or less wrong.”
Marks: History rhymes because human nature changes very slowly
“There are certain themes that re that rhyme from instance to instance in history. And They mostly have to do with human nature. And I think human nature doesn't change incredibly slowly. I mean, when we talk about fight or flight, people will start talking abo…”