Howard Marks: Memos: Most Investors Will Not Implement My Investing Secrets

In this interview with David Perrel, Howard Marks explains that while he gives away a lot of investing secrets in his memos, most investors still won’t be able to successfully implement them. He also discussed what it is that he likes about Warren Buffett’s annual shareholder letters. Here’s an excerpt from the interview:

Marks: Well, I really believe that I can tell people what’s important, but most of them are still not going to be able to do it.

So I’m not putting myself at risk, because some people are going to say, “Well, that’s what he says. I’m not into that.”

Some people will say, “I’m into it,” but they won’t be able to do it. The secret to success in these areas is not knowing these concepts, but it’s being able to implement them.

And a lot of people who say, “Yeah, that’s good. I’m going to try to do that,” they’re just not going to get there.

So the benefits of writing, in my opinion, in this case, outweigh that risk. I’m not giving that much away, and I get so much out of it.

What’s Great About Warren Buffett’s Annual Shareholder Letters

Marks: I admire and strive to emulate his turn of phrase, Warren Buffett things like, back in ’09, when the wheels were coming off the economy and the financial sector in the global financial crisis, I think that’s when he said it for the first time, he said, “It’s only when the tide goes out that we find out who’s been swimming naked.”

What a great image.

In other words, this goes back to the luck thing, there are lots of people who appear to have been skilful, but until they’re tested by adverse circumstances, we don’t know if was really skill or just a bunch of good luck.

But look how many words it takes me to say that, and he said it in 15.

The other thing is he’s funny, and I like to be funny. I like to make people laugh. My dad told a lot of jokes when I was little, and it’s a habit I got into.

So I like to be funny, and I think that his writing is folksy and accessible, and I try to make mine accessible rather than standoffish.

And that’s why I’ll use a simple word instead of a sophisticated word if I can without diminishing the communication value, and especially I’ll use conjunctions.

You can watch the entire interview here: