Financial quotes multiply online faster than anyone checks them. Most collections are patched together from quote databases where the same lines drift from one author to another for decades, until the name that sounds best is the one that sticks.
This collection is built differently. Each quote comes with its source and the context in which it was said, because a quote without context is only decoration. And at the end you will find a section you will not get elsewhere: the best-known financial quotes their supposed authors never uttered.
Investing
The investor’s chief problem — and even his worst enemy — is likely to be himself.
— Benjamin Graham, The Intelligent Investor, introduction to the 4th revised edition (1973)
Graham opens the whole book for lay investors with it. His thesis is that results are destroyed by temperament and emotion, not by a lack of analytical skill, which is why he devotes more space to investor behaviour than to picking stocks.
Price is what you pay; value is what you get.
— Benjamin Graham, quoted by Warren Buffett in the 2008 shareholder letter
Buffett used it in the middle of the financial crisis while explaining why he was buying into a falling market. He explicitly credits Graham with the words — “Long ago, Ben Graham taught me…” — so it should not be quoted as Buffett’s own.
It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price.
— Warren Buffett, 1989 shareholder letter
He wrote it in a stocktaking of his own mistakes over the first twenty-five years, describing how he moved away from Graham’s “cigar butt” approach towards quality businesses. He added a line that gets quoted far less: “Charlie understood this early; I was a slow learner.”
When we own portions of outstanding businesses with outstanding managements, our favorite holding period is forever.
— Warren Buffett, 1988 shareholder letter
The context is the purchase of Coca-Cola shares. Shortened versions usually drop the condition the whole sentence rests on — “forever” applies to outstanding businesses with outstanding management, not to whatever happens to be in the portfolio.
Investing without research is like playing stud poker and never looking at the cards.
— Peter Lynch, One Up on Wall Street (1989)
Lynch is attacking retail investors who spend hours choosing a refrigerator and then buy a stock on a neighbour’s tip.
Don’t look for the needle in the haystack. Just buy the haystack!
— John Bogle, The Little Book of Common Sense Investing (2007)
Bogle’s shorthand for index investing. The book came out a year before the 2008 crisis, which only strengthened the argument.
Value investing is at its core the marriage of a contrarian streak and a calculator.
— Seth Klarman, Margin of Safety (1991)
Klarman’s summary of the fact that going against the crowd without doing the maths is a gamble, and doing the maths without the willingness to go against the crowd gets you nowhere.
The market and its moods
In the short-run, the market is a voting machine, but in the long-run it is a weighing machine.
— Warren Buffett, 1993 shareholder letter, summarising Graham’s idea
This is the most frequently misattributed quote in the whole collection. It is routinely credited to Graham and to Security Analysis, where in fact the opposite formulation appears. The punchy aphorism is Buffett’s; the idea is Graham’s.
We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful.
— Warren Buffett, 1986 shareholder letter
The original is more modest than the internet version “Be fearful when others are greedy”. Buffett used it to explain that Berkshire does not time the market, it simply leans against the mood of the crowd. He repeated the thought in his article Buy American. I Am. in the New York Times in October 2008.
The investor who says, “This time is different,” when in fact it’s virtually a repeat of an earlier situation, has uttered among the four most costly words in the annals of investing.
— John Templeton, 16 Rules for Investment Success (World Monitor, January 1993), rule 11
The widespread shorthand “the four most dangerous words in investing” is a later reworking; Templeton wrote about the most costly ones.
Bull markets are born on pessimism, grow on skepticism, mature on optimism and die on euphoria.
— attributed to John Templeton
A description of the market’s psychological cycle that Templeton used alongside his rule about buying at the point of maximum pessimism. We could not trace a specific primary publication, which is why it comes with a caveat.
Worldly wisdom teaches that it is better for reputation to fail conventionally than to succeed unconventionally.
— John Maynard Keynes, The General Theory of Employment, Interest and Money (1936), chapter 12
Keynes explaining why managers of other people’s money stick with the crowd even when they know the crowd is wrong. He described career risk before there was a term for it.
Risk and speculation
It’s only when the tide goes out that you learn who’s been swimming naked.
— Warren Buffett, 1992 shareholder letter
He wrote it commenting on Hurricane Andrew, which showed that a number of insurers were catastrophically under-reserved. The point is that hidden risk is revealed only by a shock.
Confronted with a like challenge to distill the secret of sound investment into three words, we venture the motto, MARGIN OF SAFETY.
— Benjamin Graham, The Intelligent Investor, chapter 20
The closing chapter condenses the whole book into a single concept, on which Buffett and Klarman later built their practice.
An investment operation is one which, upon thorough analysis, promises safety of principal and an adequate return. Operations not meeting these requirements are speculative.
— Benjamin Graham and David Dodd, Security Analysis (1934)
Still the most-cited definition of the line between investment and speculation. Graham formulated it after the 1929 crash, when anything bought on an exchange was routinely called an investment.
It’s not whether you’re right or wrong that’s important, but how much money you make when you’re right and how much you lose when you’re wrong.
— attributed to George Soros
The tersest statement of the fact that a win rate is a meaningless number without the ratio of gains to losses. We give it with a caveat — it is quoted from interviews and no primary source could be documented.
It never was my thinking that made the big money for me. It always was my sitting.
— Edwin Lefèvre, through the voice of Larry Livingston, Reminiscences of a Stock Operator (1923)
The book is a fictionalised portrait of the speculator Jesse Livermore, which is why the line is usually credited to him directly. Formally it belongs to Lefèvre’s narrator.
There is nothing new in Wall Street. There can’t be, because speculation is as old as the hills.
— Edwin Lefèvre, same book
Being too far ahead of your time is indistinguishable from being wrong.
— Howard Marks, memos to Oaktree clients
Marks’s summary of why timing decides the outcome even when the analysis is right.
Money and life
Time is your friend; impulse is your enemy.
— John Bogle, The Little Book of Common Sense Investing (2007)
Aimed at retail investors who destroy their own returns by churning funds according to the mood of the market.
Pain + Reflection = Progress.
— Ray Dalio, Principles (2017)
Dalio framed it as a principle, not as consolation — without the second term in the equation, pain stays just pain.
Buy shares, take sleeping pills and stop looking at the papers.
— attributed to André Kostolany
The best-known piece of advice from the legend of Central European stock markets. We give it with a caveat, as it circulates in many wordings and the exact source is disputed.
Quotes that are attributed to the wrong people
This is the section this collection was written for. The lines below are among the most quoted financial sayings in existence — and their supposed authors did not say them.
Compound interest is the eighth wonder of the world.
Attributed to Albert Einstein. Einstein has nothing to do with it. The oldest documented appearance is an advertisement for The Equity Savings & Loan Company in the Cleveland Plain Dealer in 1925. Einstein’s name was only attached to it in 1988 — before that, the same line was “confirmed” by Rothschild and Rockefeller.
Buy when there’s blood in the streets, even if the blood is your own.
Attributed to Baron Rothschild, usually dated to the eighteenth century. The oldest version found is an anecdote in Toronto’s The Globe from December 1893, where the advice is given merely by an unnamed “one of the Rothschilds”. Both the dating and the identification of a specific person are wrong.
The market can stay irrational longer than you can stay solvent.
Attributed to John Maynard Keynes. It does not appear in Keynes’s writings. The oldest documented occurrence comes from the analyst A. Gary Shilling in a column for Forbes in February 1993.
Give me control of a nation’s money supply and I care not who makes its laws.
Attributed to Mayer Amschel Rothschild. Without any original source whatsoever. The Rothschild name was first attached to it in a book from 1935, more than a century after his death.
It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.
Attributed to Henry Ford. These are not Ford’s words but somebody else’s paraphrase, which repetition turned into direct speech. It first appears in the Congressional Record in March 1937.
If you owe the bank a hundred dollars, that’s your problem. If you owe the bank a hundred million, that’s the bank’s problem.
Attributed to J. Paul Getty, elsewhere to Keynes. Neither. Keynes himself referred to the turn of phrase in a memorandum to the British War Cabinet in May 1945 as an “old saying” — in other words, as something already in circulation.
It ain’t what you don’t know that gets you into trouble. It’s what you know for sure that just ain’t so.
Attributed to Mark Twain. The closest documented original was written by the American humorist Josh Billings in 1874.
I’m more concerned about the return of my money than the return on my money.
Attributed to Will Rogers, elsewhere to Twain or Franklin. The wordplay originated in investment advertising, not with a humorist — the oldest documented appearance is a bond advertisement.
You can’t predict. You can prepare.
Attributed to Howard Marks. Marks did title his November 2001 memo that way, but he states in it that he borrowed the line from an advertising campaign by the insurer MassMutual.
Conclusion
A good financial quote does not work like a motivational poster but as shorthand for an idea somebody earned through practice. That is why the context is worth knowing: Buffett’s line about the tide is about insurers after a hurricane, not about life in general, and Graham’s warning about the investor himself opens a book about behaviour, not about stocks.
And when a quote arrives without a book, a letter or a speech attached, assume nobody has traced it. For the most famous line of all, the one about compound interest, that holds without exception.