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Howard  Marks

“Put simply, if both a U.S. Treasury note and small company stock appeared likely to return 7 percent per year, everyone would rush to buy the former (driving up its price and reducing its prospective return) and dump the latter (driving down its price and thus increasing its return). This process of adjusting relative prices, which economists call equilibration, is supposed to render prospective returns proportional to risk.”

Howard Marks, The Most Important Thing: Uncommon Sense for the Thoughtful Investor
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The Most Important Thing: Uncommon Sense for the Thoughtful Investor (Columbia Business School Publishing) The Most Important Thing: Uncommon Sense for the Thoughtful Investor by Howard Marks
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