Keynesian Approach
General Information

Keynesian Approach

The “Keynesian” approach places far less emphasis on the “adjustment” nature of investment. Instead, they have a more “behavioral” take on the investment decision. Namely, the Keynesian approach argues that investment is simply what capitalists “do”. Every period, workers consume and capitalists “invest” as a matter of course. This leads Keynesians to underplay the capital stock […]

Buffett
warren buffett

Buffett on the trouble with stockmarkets

The very liquidity of stock markets causes people to focus on price action. If you buy an apartment house, if you buy a farm, if you buy a MacDonald’s franchise you don’t think about what it’s going sell for tomorrow or next week, or next month, you think about how is this business going to […]

thinking about investment
Thoughts

There are effectively two ways of thinking about investment

At the risk of annoying some people, we shall refer to these as the “Hayekian” and “Keynesian” perspectives. The Hayekian perspective conceives of investment as the adjustment to equilibrium and thus the optimal amount of investment is effectively a decision on the optimal speed of adjustment. A firm may decide it needs a factory (the “capital stock” […]

John Burr Williams

John Burr Williams

Charlie Munger

Charlie Munger

Capitalism

Capitalism

charlie munger

Charlie Munger

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Mental Model

Mental Model

Pattern Recognition or “Functional Equivalents” Keith Holyoak, a UCLA professor of psychology and one of the world’s leading thinkers on analogical reasoning, recommends people ask themselves the following two questions in order to hone their skills: By constantly looking at objects in your environment and material you read and asking yourself these two questions, you […]

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Guest Posts

Understanding Risk and Uncertainty

A Short Paper on Risk & Uncertainty by Ernie Risk as it relates to investing is an event that unfolds to induce impairment or loss of capital. There are many types of risk. To name a few, there are financial, market, economic, systemic and portfolio risk. Generally speaking, risk causes volatility in the stock market, […]

valueandprices

Most influential investment thinker of all time

valueandprices

Here are some of Bogle’s words of advice:

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Avoid Envy and Jealousy; zero upside and infinite downside