Long-run averages gleam like beacons, or perhaps like sirens, continually luring the investor to a long-run future that is expected to resemble these average returns, more or less. [The wide variations in returns that take place in the interim] tend to diminish over the long run, and so average returns define our expectations. But these variations are not a pool of inconsequential happenstances, nor are the individual episodes a set of accidents. Each episode is equally telling and significant in helping us understand how markets function. Each episode is also the consequence of the preceding
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As Mr buffet says if long run averages had to repeat then all the librarians would have been billioniares.
