With less regulation, I think you would see growth come back. Of course, there are situations where you need regulation. Antitrust regulation, for example, is a good idea because you want competition. But beyond that, it gets very difficult.

Eugene Fama

After costs, only the top 3% of managers produce a return that indicates they have sufficient skill to just cover their costs, which means that going forward, and despite extraordinary past returns, even the top performers are expected to be only as good as a low-cost passive index fund. The other 97% can be expected to do worse.

Eugene Fama

In an efficient market, at any point in time, the actual price of a security will be a good estimate of its intrinsic value.

Eugene Fama

Active investment is a zero-sum game. Passive managers don't play the game. They buy something resembling the market as a whole, or some segment of the market, and they don't respond to the actions of active managers.

Eugene Fama

With less regulation, I think you would see growth come back. Of course, there are situations where you need regulation. Antitrust regulation, for example, is a good idea because you want competition. But beyond that, it gets very difficult.

Eugene Fama

State constitutions typically provide that the state first has to service its debt, then make it pension payments, and then pay for services. What we don't know is whether that order will be enforced. And ultimately, the busted state is going to be looking to the federal government for a bailout. Think Greece, but on a much bigger scale.

Eugene Fama

I don't believe anyone wants to hear what I have to say.

Eugene Fama

The investors who generate big returns over five years, the guys they write books about, are supposed to keep winning, right? Well, they don't.

Eugene Fama

Economies typically do not function well in hyperinflation. The real value of government debt might disappear, but the economy is likely to disappear with it.

Eugene Fama

An investor doesn't have a prayer of picking a manager that can deliver true alpha.

Eugene Fama

Market timing doesn't work. If all the bubbles and all this mispricing really exist, how come so few people see it before it turns out that way?

Eugene Fama

All the central banks are doing is substituting one form of debt with another form of debt. They're issuing short term debt and using it to buy long term debt. In finance, we tend to think that's a neutral activity, even though those stimulus programs are huge.

Eugene Fama

I'm an extreme libertarian, but I realize we're in a democracy, and in a democracy, people can have views of all stripes, and there's no reason to argue about it.

Eugene Fama

I don't know what a credit bubble means. I don't even know what a bubble means. These words have become popular. I don't think they have any meaning.

Eugene Fama

The proposition is that prices reflect all available information, which in simple terms means since prices reflect all available information, there's no way to beat the market.

Eugene Fama

Everybody wants the world to be a better place, and some think that government actions can bring that about. But they don't take into consideration that government actions can often do more harm than good.

Eugene Fama

People are always saying that prices are too high. When they turn out to be right, we anoint them. When they turn out to be wrong, we ignore them. They are typically right and wrong about half the time.

Eugene Fama

I buy the market through index funds. Since I'm getting older, I buy TIPS.

Eugene Fama

In my junior year in college, I was getting kind of tired of French. So, I took an economics course, and I loved it. The rest of my two years in college I spent in economics.

Eugene Fama

After 2008, my brand of finance got a bad rap.

Eugene Fama

The problem that people don't understand is that active managers, almost by definition, have to be poorly diversified. Otherwise, they're not really active. They have to make bets. What that means is there's a huge dispersion of outcomes that are totally consistent with just chance. There's no skill involved it. It's just good luck or bad luck.

Eugene Fama