Among my greatest disappointments about the mutual fund industry - in addition to excessive costs and excessive focus on the short-term - is that fund managers have been passive participants in corporate governance.

The fund scandals shined the spotlight on the fact that mutual fund managers were putting their interests ahead of the fund shareholders who trusted them, which had much more substantial consequences in the form of excessive fees and the promotion - as the market moved into the stratosphere - of technology funds and new economy funds which were soon to collapse.

It's amazing how difficult it is for a man to understand something if he's paid a small fortune not to understand it.

While the apostles of the new so-called "behavioral" theory present ample evidence of how often human beings make irrational financial decisions, it remains to be seen whether these decisions lead to predictable errors that create systematic mispricings upon which rational investors can readily and economically capitalize.

Speculation leads you the wrong way. It allows you to put your emotions first, whereas investment gets emotions out of the picture.

Sure there are some companies at the margins of our society that probably do that and I think we all have the responsibility as consumers and as investors to avoid them like the plague. If we do, they won't last very long. Doing what's right is the only possible formula for long-term - I emphasize long term - business success.

If you have trouble imagining a 20% loss in the stock market, you shouldn't be in stocks.