Eugene Fama Quotations

People are always saying that prices are too high. When they turn out to be right, we anoint them. When they turn out to be wrong, we ignore them. They are typically right and wrong about half the time.

I don't believe anyone wants to hear what I have to say.

People don't walk away from their homes unless they can't make the payments. That's an indication that we are in a recession.

I'm an extreme libertarian, but I realize we're in a democracy, and in a democracy, people can have views of all stripes, and there's no reason to argue about it.

I don't know what a credit bubble means. I don't even know what a bubble means. These words have become popular. I don't think they have any meaning.

Economies typically do not function well in hyperinflation. The real value of government debt might disappear, but the economy is likely to disappear with it.

After costs, only the top 3% of managers produce a return that indicates they have sufficient skill to just cover their costs, which means that going forward, and despite extraordinary past returns, even the top performers are expected to be only as good as a low-cost passive index fund. The other 97% can be expected to do worse.

An investor doesn’t have a prayer of picking a manager that can deliver true alpha.

I don't think the Federal Reserve has any role in how high rates are right now. I don't understand why everyone is paying attention to this tapering. The Fed is using one kind of bond to buy another kind of bond. What's the big deal, and why is anyone taking the Fed seriously?

The distribution of the market is fat-tailed relative to the normal distribution... For passive investors, none of this matters, beyond being aware that outlier returns are more common than would be expected if return distributions were normal.