John Maynard Keynes, born 1883, was a British economist.
His theories and ideas changed the practice of macroeconomics and the economic policies of governments in particular. He was also a keen investor.
Below is a compilation of his best quotes revolving around the subjects of economics, finance, and investing. Enjoy reading.
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There is no intrinsic reason for the scarcity of capital.
If, however, a government refrains from regulations and allows matters to take their course, essential commodities soon attain a level of price out of the reach of all but the rich, the worthlessness of the money becomes apparent, and the fraud upon the public can be concealed no longer.
The difficulty lies not so much in developing new ideas as in escaping from old ones.
Capitalism is the extraordinary belief that the nastiest of men, for the nastiest of reasons, will somehow work for the benefit of us all.
Americans are apt to be unduly interested in discovering what average opinion believes average opinion to be.
The market can stay irrational longer than you can stay solvent.
The central principle of investment is to go contrary to the general opinion, on the grounds that if everyone agreed about its merits, the investment is inevitably too dear and therefore unattractive.
The difficulty lies, not in the new ideas, but in escaping from the old ones.
By this means (fractional reserve banking) government may secretly and unobserved, confiscate the wealth of the people, and not one man in a million will detect the theft.
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I'd rather be vaguely right than precisely wrong.
It is a good thing to make mistakes so long as you're found out quickly.
Ideas shape the course of history.
When the facts change, I change my mind.
It is the long term investor who will in practice come in for the most criticism. For it is the essence of his behaviour that he should be eccentric, unconventional and rash in the eyes of the average opinion. If he is successful, that will only confirm the general belief in his rashness; and if in the short run he is unsuccessful, which is very likely, he will not receive much mercy. Worldly wisdom teaches that it is better for reputation to fail conventionally than to succeed unconventionally.
The avoidance of taxes is the only intellectual pursuit that still carries any reward.
Long run is a misleading guide to current affairs. In the long run we are all dead.
The important thing for Government is not to do things which individuals are doing already, and to do them a little better or a little worse; but to do those things which at present are not done at all.
The social object of skilled investment should be to defeat the dark forces of time and ignorance which envelope our future.
There is nothing so disastrous as a rational investment policy in an irrational world.
The master-economist must possess a rare combination of gifts. He must reach a high standard in several different directions and must combine talents not often found together. He must be mathematician, historian, statesman, philosopher - in some degree. He must understand symbols and speak in words. He must contemplate the particular in terms of the general, and touch abstract and concrete in the same flight of thought. He must study the present in the light of the past for the purposes of the future.
Capitalism is the astounding belief that the most wickedest of men will do the most wickedest of things for the greatest good of everyone.
Should government refrain from regulation (taxation), the worthlessness of the money becomes apparent and the fraud can no longer be concealed.
By a continuing process of inflation, government can confiscate, secretly and unobserved, an important part of the wealth of their citizens.
Conservatism leads nowhere; it satisfies no ideal.
Practical men who believe themselves to be quite exempt from any intellectual influence, 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.
The importance of money flows from it being a link between the present and the future.
Investing is an activity of forecasting the yield over the life of the asset; speculation is the activity of forecasting the psychology of the market.
Most men love money and security more, and creation and construction less, as they get older.
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. By this method they not only confiscate, but they confiscate arbitrarily; and, while the process impoverishes many, it actually enriches some. The sight of this arbitrary rearrangement of riches strikes not only at security, but at confidence in the equity of the existing distribution of wealth.
If you owe your bank a hundred pounds, you have a problem. But if you owe a million, it has.
As time goes on, I get more and more convinced that the right method in investment is to put fairly large sums into enterprises which one thinks one knows something about and in the management of which one thoroughly believes. It is a mistake to think that one limits one's risk by spreading too much between enterprises about which one knows little and has no reason for special confidence. . . . One's knowledge and experience are definitely limited and there are seldom more than two or three enterprises at any given time in which I personally feel myself entitled to put full confidence.
The outstanding faults of the economic society in which we live are its failure to provide for full employment and its arbitrary and inequitable distribution of wealth and incomes.
The markets are moved by animal spirits, and not by reason.
Whenever you save five shillings you put a man out of work for a day.
Capitalism is the extraordinary belief that he nastiest of men, for the nastiest of reasons, will somehow work for the benefit of us all.
Words ought to be a little wild, for they are the assault of thoughts on the unthinking.
Experience shows that what happens is always the thing against which one has not made provision in advance.
It is the duty of the long-term investor to endure great losses with equanimity.
A conventional valuation which is established as the outcome of the mass psychology of a large number of ignorant individuals is liable to change violently as the result of a sudden fluctuation of opinion due to factors which do not really make much difference to the prospective yield; since there will be no strong roots of conviction to hold it steady.
If farming were to be organised like the stock market, a farmer would sell his farm in the morning when it was raining, only to buy it back in the afternoon when the sun came out.
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