Warren Buffett on investment advice from Keynes

John Maynard Keynes essentially said, don't try and figure out what the market is doing.  Figure out a business you understand, and concentrate.

~ Warren Buffett

John Maynard Keynes on the power of ideas

The ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than commonly understood.  Indeed the world is ruled by little else.  Practical men, who believe themselves quite exempt from any intellectual influences, are usually the slaves of some defunct economist.  Madmen in authority, who hear voices in the air, are distilling their frenzy from some academic scribbler of a few years back.  I am sure that the power of vested interests is vastly exaggerated compared with the gradual encroachment of ideas.

~ John Maynard Keynes, The General Theory

John Maynard Keynes on capitalism and the invisible hand

Capitalism is the astounding belief that the most wickedest of men will do the most wickedest of things for the greatest good of everyone.

~ John Maynard Keynes

John Maynard Keynes anticipates supply side economics

Nor should the argument seem strange that taxation may be so high as to defeat its object, and that, given sufficient time to gather the fruits, a reduction of taxation will run a better chance than an increase of balancing the budget.

~ John Maynard Keynes, 1933 Essay: The Means to Prosperity, section I: The nature of the problem, p. 338, The Collected Writings of John Maynard Keynes, Macmillan Cambridge University Press, 1972

John Maynard Keynes on learning and ambiguity

I’d rather be vaguely right than precisely wrong.

~ John Maynard Keynes

John Maynard Keynes on crowd behavior

Worldly wisdom teaches that it is better for the reputation to fail conventionally than to succeed unconventionally.

John Maynard Keynes

John Maynard Keynes on The Road to Serfdom

In my opinion it is a grand book ... Morally and philosophically I find myself in agreement with virtually the whole of it: and not only in agreement with it, but in deeply moved agreement. ... What we need therefore, in my opinion, is not a change in our economic programmes, which would only lead in practice to disillusion with the results of your philosophy; but perhaps even the contrary, namely, an enlargement of them. Your greatest danger is the probable practical failure of the application of your philosophy in the United States.

~ John Maynard Keynes

Buffett on the wisdom of Keynes

I especially recommend Keynes' essays on persuasion.  Reading Keynes will make you smarter about securities and markets.  I'm not sure reading most economists would do the same.

~ Warren Buffett, the Oracle of Omaha, Outstanding Investor Digest, June 23, 1989

John Maynard Keynes: "no more crashes in our time" (1927)

We will not have any more crashes in our time.

~ John Maynard Keynes, 1927

Jim Cramer flip-flops on his Dow 9,000 price target, embraces change

This morning several people asked me if my Dow 9,000 price target was still on because I did hint about that last week and the answer is: no.

See, remember what I said, I said, we could go back there if Trichet, the head of the European Central Bank, continued to do nothing to solve the euro's problems and the disaster that is Greece. But that's not what happened. I said I was negative because Trichet had left the building, remember I had said he had left the building-- he came back in Friday night! Dragged by other countries' ministers, particularly France and Germany.

He and his fellow European finance ministers did something, and not just anything. They did amazing things this weekend along with the EU and in coordination with our Fed Chairman Ben Bernanke and Treasury Secretary Geithner, they understand these problems we're facing better than any other people in the world. And you know Ben Bernanke is the best central banker in the world, I said that on Friday.

Now, when that European contagion risk is taken off the table, what am I supposed to do, just stay negative? I can't! When a plan that basically delivers all the things I was calling for and crying for on Thursday and Friday comes along, I can't fight it and say, "Uh uh, nope, it's not what I want, gotta stay negative, uh uh!" I can't. The plan was exactly what I wanted.

In the words of the late, great economist and investor, maybe the best of both, John Maynard Keynes, who would have absolutely approved of Europe's solution, and I quote, "When the facts change, I change my mind. What do you do, sir?"

~Jim Cramer, "Embracing Change", Mad Money, May 10th, 2010

Keynes on Lenin and inflation

Lenin is said to have declared that the best way to destroy the Capitalist System was to debauch the currency. By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose.

~ John Maynard Keynes, The Economic Consequences of the Peace

John Maynard Keynes on economic stimulus

If the Treasury were to fill old bottles with bank-notes, bury them at suitable depths in disused coal-mines which are then filled up to the surface with town rubbish, and leave it to private enterprise on well-tried principles of laissez-faire to dig the notes up again (the right to do so being obtained, of course, by tendering for leases of the note-bearing territory), there need be no more unemployment and, with the help of repercussions, the real income of the community, and its capital wealth, would probably become a good deal greater than it actually is.

~ John Maynard Keynes, The General Theory of Employment, Interest and Money (1936), p. 129

Keynes on government deficits and taxation

It is common to speak as though, when a Government pays its way by inflation, the people of the country avoid taxation. We have seen that this is not so. What is raised by printing notes is just as much taken from the public as is a beer-duty or an income-tax. What a Government spends the public pay for. There is no such thing as an uncovered deficit.

~ John Maynard Keynes, famous British economist, in his Tract on Monetary Reform published in 1923

John Maynard Keynes on bankers

A sound banker, alas, is not one who foresees danger and avoids it, but one who, when he's ruined, is ruined in a conventional and orthodox way along with his fellows, so that no one can really blame him.

~ John Maynard Keynes, 1931

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1875-1950