A timely point to remember
Lance on Feb 11 2008 at 2:02 pm | Filed under: Risk, Valuation
In the insurance business, there is no statute of limitation on stupidity.
-Warren Buffett
If only the monolines (that survive) credit default swap investors, and others could keep this in mind going forward. Risk has to be priced not on the basis of the current environment, but on what that environment might be down the road. In a mean reverting world, good times are not a reason to accept lower premiums for risk.
