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The prevailing wisdom is that markets are always right. I take the opposite position. I assume that markets are always wrong.

George Soros

Market prices are always wrong in the sense that they present a biased view of the future.
GEORGE SOROS

Future Market Present Price View Wrong
My conceptual framework, which basically emphasizes the importance of misconceptions, makes me extremely critical of my own decisions. I know that I am bound to be wrong, and therefore am more likely to correct my own mistakes.
GEORGE SOROS

Concept Criticism Frame Important Mistake Myself Wrong
If the bubbles contain a misconception, as they always do, then it can’t be maintained forever.
GEORGE SOROS

Concept Forever Maintain
I fancied myself as some kind of god or an economic reformer like Keynes.
GEORGE SOROS

Economics Fancy God Kind
The reality is that financial markets are self-destabilizing; occasionally they tend toward disequilibrium, not equilibrium.
GEORGE SOROS

Marketing Reality Science
I rely a great deal on animal instincts.
GEORGE SOROS

Animal Greatness Myself
An open society is a society which allows its members the greatest possible degree of freedom in pursuing their interests compatible with the interests of others.
GEORGE SOROS

Greatness Interest Member Open Possible Society
Start by assuming the market is always wrong, so if you copy everybody else on Wall Street, you’re doomed to do poorly.
GEORGE SOROS

Assumption Poor Start Wrong Yourself
The sovereignty of states must be subordinated to international law and international institutions.
GEORGE SOROS

Institution International Law State
It is sort of a disease when you consider yourself some kind of god, the creator of everything, but I feel comfortable about it now since I began to live it out.
GEORGE SOROS

Beginning Comfortable Creation God Kind Live Myself Sick
As I discovered, there is a great deal of similarity between a boom-bust process in the financial markets and the rise and fall of the Soviet system.
GEORGE SOROS

Discover Greatness Marketing Rise Similar System
Every bubble has two components: something – some real trend, and a misconception about that trend.
GEORGE SOROS

Component Concept Reality Trend
When a long-term trend loses it’s momentum, short-term volatility tends to rise. It is easy to see why that should be so: the trend-following crowd is disoriented.
GEORGE SOROS

Crowd Follow Lose Momentum Rise Time
Hedge funds are a very efficient way of managing money. But there are clearly some risks. Hedge funds use credit and credit is a source of instability. Transactions involving credit should be regulated.
GEORGE SOROS

Instability Management Money Regulation Risk Transaction Way
What works for Germany can’t work for the rest of Europe: No country can run a chronic surplus without others running deficits.
GEORGE SOROS

Country Resource Run Work
I am not well qualified to criticize the theory of rational expectations and the efficient market hypothesis because as a market participant I considered them so unrealistic that I never bothered to study them.
GEORGE SOROS

Criticism Myself Qualification Reality Study Theory

The prevailing wisdom is that markets are always right. I take the opposite position. I assume that markets are always wrong.

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The prevailing wisdom is that markets are always right. I take the opposite position. I assume that markets are always wrong.

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