Billionaire investor Howard Marks welcomes periods of panic, touts contrarian thinking, and says market excesses have faded. Here are his 10 best quotes from a recent podcast and new memo

• Howard Marks discussed bargain hunting, paying the right price, and the current state of markets.
• He touted contrarian thinking and conviction, and cautioned against bouncing between ideas.

Howard Marks trumpeted periods of turmoil as the best times to find bargains, emphasized the importance of paying the right price, and asserted that speculative excess has faded from financial markets in a recent episode of the "Exchanges at Goldman Sachs" podcast.

The billionaire investor and Oaktree Capital Management boss also touted the value of contrarian thinking, unwavering conviction, and staying the course even if a crash or recession is coming, in a memo to clients this week.

Here are Marks' 10 best quotes from the podcast and memo, lightly edited for length and clarity:

1. "We never know where we're going, but we sure as hell ought to know where we are." (Marks was arguing that understanding the current backdrop is vital, while forecasting the future isn't.)

2. "Rampant pessimism is the great, necessary condition for tremendous bargains."

3. "Our conditioning is that a crisis or a meltdown is an opportunity for bargain hunting, not something to be afraid of."

4. "Good investing is not about buying good things. It's about buying things well. You have to understand the difference. It's not what you buy, it's what you pay."

5. "Buffett says, 'I like hamburgers. And when hamburgers go on sale, I eat more hamburgers.' Nobody likes to see their portfolio values go down. But it is the equivalent of things being put on sale. And you're upset to see the losses. But hopefully that won't paralyze you, and you can swing into action and say, 'You know what, they're cheaper. I'm going to buy more.'"

6. "Bullish factors were in the ascendancy for a long time. And the bulls made money. And conservatism was not rewarded. Now, the people who are the most bullish, the people who had the best returns in 2020, are back down to earth. Nobody's writing fawning articles about them anymore. These factors are in balance. We're in a reasonable place. The excesses have been corrected."

7. "Anyone who thinks there's a formula for investing that guarantees success (and that they can possess it) clearly doesn't understand the complex, dynamic, and competitive nature of the investing process." (Marks underlined his point by quoting Charlie Munger: "It's not supposed to be easy. Anyone who finds it easy is stupid.")

8. "Good investment decisions made at the best opportunities - at the most overdone market extremes - invariably include an element of contrarian thinking."

9. "The possibility - or even the fact - that a negative event lies ahead isn't in itself a reason to reduce risk; investors should only do so if the event lies ahead and it isn't appropriately reflected in asset prices."

10. "If you wait at a bus stop long enough, you're guaranteed to catch a bus, but if you run from bus stop to bus stop, you may never catch a bus." (Marks was underscoring the danger of constantly switching strategies in search of something that works.)

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