🩻 The Forgotten Lessons of 2008 by Seth Klarman Summarized — A Must-Read for Every Serious Investor

In 2010, Seth Klarman described 20 lessons from the great financial crisis of 2008 that he felt “were either never learned or else were immediately forgotten by most market participants.”

Seth Klarman is a highly respected American investor and hedge fund manager, known for his successful application of value investing principles.

He is the founder and CEO of the Baupost Group, a Boston-based private investment partnership that has delivered unprecedented returns under his leadership.

His 20 lessons, summarized

1. Expect the Unexpected:

   • Things that have never happened before occur with surprising regularity. Always be prepared for the unexpected.

2. Beware of Lax Lending Standards:

   • Lax lending standards can lead to dangerous excesses in the market. Stay vigilant and cautious.

3. Prioritize Risk Management:

   • Never let the consideration of risk take a backseat to the pursuit of returns. Always factor in potential risks.