John Templeton on humility and knowledge

If we become increasingly humble about how little we know, we may be more eager to search.

~ John Templeton

Ben Bernanke: stock market is fairly valued

[T]he markets currently seem to be broadly within the metrics of market valuation- valuation seems to be broadly within historical ranges. The financial system is strong. The key financial istitutions are well-capitalized.

~ Federal Reserve Board Chairman Ben S. Bernanke, Brookings Institute speech, January 16, 2014

Carl Icahn: "Apple is a no-brainer"

I think Apple is a no-brainer.  You don't need to be a genius in technology to understand [that it's trading at 9 times 2014 earnings.]

~ Carl Icahn, CNBC, January 22, 2014

(Icahn owns roughly 1% of Apple's shares and wants them to buy back $150 billion in stock.)

Frank Veneroso on bubble in focusing on operating profits

The market looks only at the operating profits fiction. Last April in preparing a power point for a Ford Foundation Levy Institute conference I asked an assistant to go to the Bloomberg and get me the data on S&P operating profits and S&P reported GAAP profits. She came back and told me she could only find one series. I berated her and told her to contact the Help Desk. She came back and told me the Help Desk could only find one series. I got on the phone with the Help Desk. She was right; they had no notion of S&P GAAP profits. I sent them the data from the S&P web site. They were perplexed. Eventually all six Bloomberg technicians were on the phone with me saying they would find the GAAP series. Two months later they called me and said Bloomberg does not have on its pages the GAAP series.

The message from this story is not that Bloomberg was somehow deficient. It is that years and years had passed and none of the endless Bloomberg subscribers – basically the whole world of market professionals – ever called and drew this to their attention, as I had.

So, operating profits are a fiction, and literally everyone in today’s financial markets ignore generally accepted accounting principles and live and breathe this fiction.

As long as that is the market’s convention its participants can engage in another absurd and dangerous bubble. But some how, some way, reality will eventually surface – as it always does – and such market foolishness will end badly – as it always does.

~ Frank Veneroso, "More on the Unreality of U.S. Corporate Profits," RCM, January 21, 2014

Jim Cramer on the next Berkshire Hathaway (2007)

I think every portfolio has to take the risk/reward here of finding the next Buffett.

A selloff in a healthy environment, where inflation is under control and interest rates are stable ... is a great opportunity to pick up leadership names like a Sears or a Brookfield or a Goldman.  These are asset managements -- that's why I like them. They aggressively manage their assets, and that's what you should be buying.

Eddie Lampert is a terrific investor, and he's the brains behind Sears. ... I am urging patience. I don't want people to quit Sears.

~ Jim Cramer, June 21, 2007

(On TheStreet.com TV's Wall Street Confidential Web video Thursday, he nominated Brookfield Asset Management (BAM) as an international Berkshire Hathaway; Sears (SHLD) is a domestic Berkshire Hathaway, he said.)

Jim Chanos on stock buybacks

Corporate CEOs, with their massive share-buyback programs are in effect investing in the stock market rather than in expanding business opportunities at their companies.  Either they expect higher returns from the market, or lower returns in their business, or some combination of both. Given their questionable track record in timing the market, this may be a cause for concern.

~ Jim Chanos, "Does IBM Love or Hate Itself? Stock Buybacks Make Firms Look Attractive, but Also Deprive Them of Capital for Real Investment," WSJ, January 22, 2014

Bill Gates on "these Google guys" (2003)

These Google guys (co-founders Larry Page and Sergey Brin), they want to be billionaires and rock stars and go to conferences and all that. Let us see if they still want to run the business in two to three years.

~ Bill Gates, World Economic Forum in Davos, January 2003

(As recalled by DealBook's Andrew Ross Sorkin before the 2013 forum)