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Smith
Faculty Opinion Article
The 30
Seconds Outlook
August 1, 2008
"[Investing] is
the one sphere of life and activity
where victory, security, and success
is always to the minority and never
to the majority." -- John
Maynard Keynes.
In the current tough market
times, it is worth to heed the words
of Legg Mason’s record holding value
investor, Bill Miller. "I do think
some things are obvious: it is
obvious the credit crisis will end,
and it is obvious the housing crisis
will end, and that credit markets
will function satisfactorily and
house prices will stop going down
and then start moving higher. It is
obvious that the American consumer
will spend sufficiently to keep the
economy moving forward long term. It
is obvious that the U.S. economy,
already the most productive in the
world, will get even more productive
and will adapt and grow. It is
obvious stock prices will be higher
in the future than they are now."
This is the mantra for value
investors who will reap abnormal
returns in the next bull market.
by John A. Haslem
John A. Haslem,
Professor Emeritus of Finance,
University of Maryland.
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