Baupost 2007 year end letter excerpt

Seth Klarman

Financial Market Cycles: When Virtuous Circles Become Vicious.

The capital markets, the economy, and Wall Street firms all experience cycles. For capital markets, the cycles consist of bull and bear markets; for the economy, boom and bust. For Wall Street firms, the cycles are of financial innovation, risk-taking, limit-pushing, and hefty compensation, followed by retrenchment, revulsion, write-offs, and layoffs.

Direct Link - Baupost 2007 year end letter excerpt. (PDF)

No comments: