Soros on Soros Quotes

“On the abstract level, I have turned the belief in my own fallibility into the cornerstone of an elaborate philosophy. On a personal level, I am a very critical person who looks for defects in myself as well as in others. But, being so critical, I am also quite forgiving. I couldn't recognize my mistakes if I couldn't forgive myself. To others, being wrong is a source of shame; to me, recognizing my mistakes is a source of pride. Once we realize that imperfect understanding is the human condition, there is no shame in being wrong, only in failing to correct our mistakes.”
― George Soros, Soros on Soros: Staying Ahead of the Curve

“The prevailing wisdom is that markets are always right. I take the opposition position. I assume that markets are always wrong. Even if my assumption is occasionally wrong, I use it as a working hypothesis. It does not follow that one should always go against the prevailing trend. On the contrary, most of the time the trend prevails; only occasionally are the errors corrected. It is only on those occasions that one should go against the trend. This line of reasoning leads me to look for the flaw in every investment thesis. ... I am ahead of the curve. I watch out for telltale signs that a trend may be exhausted. Then I disengage from the herd and look for a different investment thesis. Or, if I think the trend has been carried to excess, I may probe going against it. Most of the time we are punished if we go against the trend. Only at an inflection point are we rewarded.”
― George Soros, Soros on Soros: Staying Ahead of the Curve

“My peculiarity is that I don't have a particular style of investing or, more exactly, I try to change my style to fit the conditions.”
― George Soros, Soros on Soros: Staying Ahead of the Curve

“Perhaps you were too idealistic.
I admit it. But I don't believe I overestimate the importance of ideals. Only when people believe in something can they move the world. The
trouble is that people simply don't believe in open society as a goal worth fighting for.”
― George Soros, Soros on Soros: Staying Ahead of the Curve

“How do you see your own Jewish identity?
I am proud of being a Jew-although I must admit it took me practically a lifetime to get there. I have suffered from the low self-esteem that is the bane of the assimilationist Jew.
This is a heavy load that I could shed only when I recognized my success.
I identify being a Jew with being in a minority. I believe that there is such a thing as a Jewish genius; one need only look at the Jewish achievements in science, in economic life, or in the arts. These were the results of Jews' efforts to transcend their minority status, and to achieve something universal. Jews have learned to consider every question from many different viewpoints, even the most contradictory ones. Being in the minority, they are practically forced into critical thinking. If there is anything of this Jewish genius in me, it is simply the ability to think critically. To that extent, Jewishness is an essential element of my personality and, as I said, I am very proud of that.”
― George Soros, Soros on Soros: Staying Ahead of the Curve

“But I don't like working. I do the absolute minimum that is necessary to reach a decision. There are many people who love working. They amass an inordinate amount of information, much more than is necessary to reach a conclusion. And they become attached to certain investments because they know them intimately. I am different. I concentrate on the essentials. When I have to, I work furiously because I am furious that I have to work. When I don't have to, I don't work.”
― George Soros, Soros on Soros: Staying Ahead of the Curve

“We are accustomed to think of events as a sequence of facts: one set of facts follows another in a never-ending chain. When a situation has thinking participants, the chain does not lead directly from fact to fact. It links a fact to the participants' thinking and then connects the participants' thinking to the next set of facts.”
― George Soros, Soros on Soros: Staying Ahead of the Curve

“Tell us about the crisis of 1981.
It started much earlier, around the time I spelled out my three-stage strategy. Here I was, extremely successful, but I made a point of denying my success. I worked like a dog. I felt that it would endanger my success if I abandoned my sense of insecurity. And what was my reward? More money, more responsibility, more work-and more pain-because I relied on pain, as a decision-making tool.”
― George Soros, Soros on Soros: Staying Ahead of the Curve

“But in order to become noticeable it must be at least initially self-reinforcing. If a self-reinforcing process goes on long enough it must eventually become unsustainable because either the gap between thinking and reality becomes too wide or the participants' bias becomes too pronounced. Hence, reflexive processes that become historically significant tend to follow an initially self-reinforcing, but eventually self-defeating, pattern. That is what I call the boom/bust sequence. Reflexive interactions that correct themselves before they reach boom proportions don't become historically significant; yet they may occur much more frequently than full-fledged booms that result in busts.”
― George Soros, Soros on Soros: Staying Ahead of the Curve

“Financial markets are characterized by a discrepancy between the participants' perceptions and
the actual state of affairs.”
― George Soros, Soros on Soros: Staying Ahead of the Curve

“I set up a model account with $100,000 of the firm's money, divided it into 16 parts, and invested one or two units into any stock that I considered to be especially attractive. I wrote a short memo explaining the reasons why I bought each issue, and I followed up with monthly reports reviewing the portfolio and discussing developments within the portfolio. I also provided a monthly
performance record. I used this model account as a sales tool to develop business with institutional investors. This was a very successful format, because it put me in contact with the investment community. During the years when I had been writing my philosophy, I had lived in a vacuum. Now, I was able to test my investment ideas on potential investors. If I got a good response, I realized that I was onto a good idea; if I got a negative response, I had to seriously question whether I was on the right track. I got some very valuable feedback.”
― George Soros, Soros on Soros: Staying Ahead of the Curve

“A boom/bust process occurs only when market prices find a way to influence the so-called fundamentals that are supposed to be reflected in market prices.”
― George Soros, Soros on Soros: Staying Ahead of the Curve

“I had a very interesting experience with P.C.Chatterjee, one of my investment advisors. His concept was to look at technology companies as asset-rich companies, where the customer was treated as an asset. If a company had a strong customer base, it could be worth a lot even though it had a lousy management and a lack of products.
And he felt that with a little push, these values could be unlocked. It proved to be a valid concept.”
― George Soros, Soros on Soros: Staying Ahead of the Curve

“How is it that you stay ahead of the game?
As I have said already, I look for the flaw in every investment thesis. When I find it, I am reassured. As long as I can see only the positive side I worry. Again, don't misunderstand me. I don't reject an investment thesis just because I can't see the negative side; I just remain leery. On the other hand, I am particularly keen on investment theses that the market is reluctant to accept. These are usually the strongest. Remember the saying, "The market climbs on a wall of worry.”
― George Soros, Soros on Soros: Staying Ahead of the Curve

“What is there to say? Risk taking is painful. Either you are willing to bear the pain yourself or you try to pass it on to others. Anyone who is in a risk taking business but cannot face the consequences is no good.”
― George Soros, Soros on Soros: Staying Ahead of the Curve

“In addition to going against the herd, you've said one of your techniques is to set yourself outside the process. What do you mean exactly? How do you get outside?
I am outside. I am a thinking participant and thinking means putting yourself outside the subject you think about. Perhaps it comes easier to me than to many others because I have a very abstract mind and I actually enjoy looking at things, including myself, from the outside.”
― George Soros, Soros on Soros: Staying Ahead of the Curve

“To others, being wrong is a source of shame; to me, recognizing my mistakes is a source of pride. Once we realize that imperfect understanding is the human condition, there is no shame in being wrong, only in failing to correct our mistakes.”
― George Soros, Soros on Soros: Staying Ahead of the Curve

“I recognize that I may be wrong. This makes me insecure. My sense of insecurity keeps me alert, always ready to correct my errors. I do this on two levels. On the abstract level, I have turned the belief in my own fallibility into the cornerstone of an elaborate philosophy.”
― George Soros, Soros on Soros: Staying Ahead of the Curve

“How would you describe your particular style of investing?
My peculiarity is that I don't have a particular style of investing or, more exactly, I try to change my style to fit the conditions. If you look at the history of the Fund, it has changed its character many times. For the first ten years, it used practically no macro instruments. Afterwards, macro investing became the dominant theme. But more recently, we started investing in industrial assets. I would put it this way: I do not play according to a given set of rules; I look for changes in the rules of the game.”
― George Soros, Soros on Soros: Staying Ahead of the Curve

“Second, since our understanding of reality is imperfect, the criterion by which choices may be judged is not fully within our grasp. As a result, people will not necessarily make the correct choice and, even if they do, not everybody will accept it as such. Moreover, the correct choice represents merely the better of the available alternatives, not the best of all possible solutions. New ideas and interpretations may emerge at any time. These are also bound to be flawed and may have to be discarded when the flaws become apparent. There is no final answer, only the possibility of a gradual approximation to it. It follows that the choice between alternatives involves a continuous process of critical examination rather than the mechanical application of fixed rules.”
― George Soros, Soros on Soros: Staying Ahead of the Curve

“Let's deal first with your general theory of reflexivity.
Essentially, it has to do with the role of the thinking participant, and the relationship between his thinking and the events in which he participates. I believe that a thinking participant is in a very difficult position, because he is trying to understand a situation in which he is one of the actors. Traditionally, we think of understanding as essentially a passive role, and participating is an active role. In truth, the two roles interfere with each other, which makes it impossible for the participant to base any decisions on pure or perfect knowledge.
Classical economic theory assumes that market participants act on the basis of perfect knowledge. That assumption is false. The participants' perceptions influence the market in which they participate, but the market action also influences the participants' perceptions. They cannot obtain perfect knowledge of the market because their thinking is always affecting the market and the market is affecting their thinking. This makes analysis of market behavior much harder than it would be if the assumption of perfect knowledge were valid.”
― George Soros, Soros on Soros: Staying Ahead of the Curve

“Yes. I never claimed credit for it. I was involved in the process. As coach, I said to him that this is a once-in-a-lifetime opportunity, the risk-reward relationship is extremely favorable, and therefore we should play it on a larger scale than normal. And he took my advice.”
― George Soros, Soros on Soros: Staying Ahead of the Curve