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Howard Marks Releases Memo: 'Uncertainty II'

In one of his famous "memos" released on Thursday, Howard Marks (Trades, Portfolio), co-chairman of multibillion-dollar asset management firm Oaktree Capital, followed up on his previous discussion of the unknown.


The paper, titled "Uncertainty II," starts with a revelation that Marks' wife, Nancy, brought an "important article" to his attention shortly after the publication of his last memo. The article, titled "No One Knows What's Going to Happen" was written by Mark Lilla, a professor of humanities at Columbia University, and was published in The New York Times.

After providing a few excerpts from the article, Marks highlighted that Lilla brings together a number of themes from several of the guru's recent memos in his article. These themes include:

  • The very human hunger for forecasts to help us navigate the future.
  • The conditionality of the future on multiple future developments.
  • Our own ability to influence the future through the decisions we make.
  • The unpredictability of each development, thus the futility of forecasting.
  • The importance of accepting our ignorance of the future.
  • The general importance of intellectual humility.



"Articles like this one and those cited in my last memo should drive home these points to everyone's satisfaction," Marks wrote. "But rarely will people fully accept that we must make decisions regarding the future without knowing it."

The guru then goes on to discuss the future and what expert voices investors and the general public should listen to in regard to not only the Covid-19 virus, but investing as well. He also discussed how the outcome of a risk, whether it is minor or severe, is ultimately unknown, but what truly matters are the tail-end consequences.

Marks ended his missive on a cheerful note:

"That line of reasoning suggests a glimmer of good news: we may not be able to predict the future, but that doesn't mean we're powerless to deal with it."

Read Marks' full memo here.

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This article first appeared on GuruFocus.