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#431: Howard Marks on the US Dollar, Three Ways to Add Defense, and Good Questions

May 11, 2020

Guest

Howard Marks

Howard Marks, co-chairman of Oaktree Capital Management and renowned author, shares insights on the US dollar's significance as a reserve currency. He discusses defensive investing strategies and the importance of cautious decision-making amidst economic uncertainty. Marks reflects on his investment journey, emphasizing lessons learned from past market pitfalls. He highlights the impact of government interventions during crises and stresses the need for reliable information sources to navigate today's data-heavy landscape.

01:05:37

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question_answer

ANECDOTE

Nifty Fifty Loss

Howard Marks joined First National Citibank in 1968, amidst the "nifty-fifty" investing era.
He witnessed significant losses despite investing in top companies, learning a crucial lesson about price.

question_answer

ANECDOTE

High-Yield Success

Transitioning to Citibank's bond department in 1978, Marks pioneered high-yield bond investing.
This shift from "best" to "worst" companies proved profitable due to their undervalued prices.

insights

INSIGHT

Propositions over Winners

Investing success hinges on identifying superior propositions, not just picking winners.
Focus on mispricings where odds are favorable, regardless of perceived quality.

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Navigating Investment Strategies: A Personal Journey

06:21 • 8min

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Navigating Economic Uncertainty in Investing

14:40 • 32min

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Navigating Economic Recovery During Crisis

46:48 • 11min

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Navigating Information Overload: A Discussion on Bias and Decision-Making

58:00 • 4min

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Navigating Investment Strategies: Risk, Time Horizon, and Personal Decisions

01:01:58 • 3min

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Reflecting on Insights and Resources for Listeners

01:04:50 • 3min

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#59866

Decision Making Under Uncertainty

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C. Jackson Grayson

#119

• Mentioned in 100 episodes

Thinking in bets

Making Smarter Decisions When You Don't Have All the Facts

Annie Duke

In this book, Annie Duke teaches readers how to make better decisions by treating them as 'bets' on uncertain outcomes. She emphasizes the importance of distinguishing between the quality of a decision and its outcome, acknowledging the role of luck, and avoiding biases such as 'resulting' and hindsight bias. Duke draws on her experiences as a professional poker player and combines these with insights from cognitive psychology and other fields to provide tools for making more objective and thoughtful decisions. The book encourages readers to get comfortable with uncertainty, seek truth through diverse opinions, and learn from outcomes to improve future decision-making.

#775

• Mentioned in 27 episodes

The most important thing

Jean Ure

While specific details about the plot are not readily available, Jean Ure's books generally delve into the lives of young characters navigating various challenges and learning valuable life lessons. This book is likely to follow a similar pattern, focusing on the emotional and social development of its characters.

#71

• Mentioned in 131 episodes

Outliers

The Story of Success

Malcolm Gladwell

In 'Outliers: The Story of Success', Malcolm Gladwell examines the often-overlooked factors that contribute to high levels of success. He argues that success is not solely the result of individual talent or hard work, but rather is influenced by a complex web of advantages and inheritances, including cultural background, family, generation, and luck. The book delves into various examples, such as the success of Bill Gates, the Beatles, and Canadian ice hockey players, to illustrate how these factors play a crucial role. Gladwell also discusses the '10,000-hour rule' and the impact of cultural legacies on behavior and success. The book is divided into two parts: 'Opportunity' and 'Legacy', each exploring different aspects of how success is achieved and maintained.

#847

• Mentioned in 25 episodes

Mastering the market cycle

Getting the Odds on Your Side

Howard Marks

In 'Mastering the Market Cycle: Getting the Odds on Your Side,' Howard Marks provides a comprehensive overview of market cycles, emphasizing the importance of understanding the patterns of ups and downs influenced by economics, markets, companies, and human psychology. Marks draws on his decades of experience to explain how investors can position their portfolios to take advantage of market cycles by studying past cycles, understanding their origins, and remaining alert for the next cycle. The book highlights that market cycles are driven by cause-and-effect relationships and that investors should prepare rather than predict market outcomes. It also delves into the psychological markers and emotional factors that influence investor behavior during different phases of the cycle.

Howard Marks on the US Dollar, Three Ways to Add Defense, and Good Questions | Brought to you by LinkedIn Jobs and "5-Bullet Friday." More on both below.

"Move forward but with caution." — Howard Marks

Howard Marks (@HowardMarksBook) is co-chairman and co-founder of Oaktree Capital Management, a leading investment firm with more than $125 billion in assets under management. He is the author of the books Mastering the Market Cycle: Getting the Odds on Your Side and The Most Important Thing: Uncommon Sense for the Thoughtful Investor, both critically acclaimed bestsellers.

Warren Buffett has written of Howard Marks: "When I see memos from Howard Marks in my mail, they're the first thing I open and read. I always learn something." Marks holds a BSEc degree from the Wharton School of the University of Pennsylvania with a major in finance and an MBA in accounting and marketing from the University of Chicago.

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