Yesterday, Howard Marks, founder of Oak Capital, wrote his memorandum on tariffs for this year 📕 《Nobody Knows (Yet Again)》， A few days ago, after being interviewed by Bloomberg, he sighed, and then the market plummeted. As early as January, his memorandum on AI's foam again met the market's concerns and uncertainties earlier. The memorandum of "Nobody Knows" reviewed the global financial crisis in 2008, the investment environment at the beginning of the outbreak of the 20 COVID-19 epidemic, and the uncertainties faced in 2025 and beyond (especially issues related to trade policies, tariffs, and geopolitics), which is worth reading. The original article is in the comment area. The comparison between the financial crisis in 2008, the COVID-19 in 20 years and the current trade tariff: ✅ Similarities: Uncertainty+Panic 1. The market is experiencing severe turbulence and panic is rising In 2008, Lehman Brothers collapsed, trust in the financial system collapsed, and liquidity dried up. 2020: Epidemic outbreak, global shutdown, sudden economic brake. Current situation: Geopolitical tensions (China US game, Ukraine Russia conflict, Middle East situation), high inflation pressure, prolonged high interest rates, and increasing trend towards deglobalization. 2. Strong government intervention and high policy uncertainty All three were accompanied by strong policy interventions, such as the Federal Reserve, fiscal stimulus, and regulatory relaxation/tightening, but the effects often decoupled from expectations. 3. Looking at the flowers in the fog at the bottom of the market There is a lack of consensus in all three periods: no one knows if the bottom has arrived, investors are generally worried that the 'knife is still falling', and the market may 'break through again' at any time. ❌ Differences: Structural environmental changes 1. Different interest rates and liquidity environments In 2008, the Federal Reserve significantly reduced interest rates, initiated QE, and zero interest rates plus unlimited easing led to asset rebound. 2020: Rapid interest rate cuts+unprecedented fiscal stimulus, leading to a strong "V-shaped" rebound. 2024-25: Interest rates remain high, anti inflation is the main policy line, the Federal Reserve hesitates to cut interest rates, the market no longer expects strong stimulus, and the rebound lacks confidence. 2. Different types of crises The year 2008 was a systemic financial crisis, rooted in the imbalance of bank balance sheets. 2020 was a liquidity crisis with temporary and external shocks. The current situation is more like a combination of structural weakness and lack of confidence, a "chronic recession" or "fragmented downward trend", no longer a single explosive point, but multiple pressures: global debt, manufacturing reflux, and industrial chain restructuring. 3. Differences in Valuation and Market Structure In 2008/2020, the overall valuation reached an extremely low level, the risk premium was extremely high, and buying ETFs with closed eyes made money. Currently, certain assets (such as US technology stocks and bonds) still have high valuations, and opportunities for bottom fishing are scattered, which further tests stock selection and timing abilities. 4. The dominant forces of AI and high-frequency trading are different The current market is more algorithm driven, with fragmented liquidity and high-frequency amplification of macro news or expected changes by the market system, making volatility more difficult to predict. 🎯 Core concept: No one knows the future, but decisions must be made one ️⃣ The future cannot be analyzed Max repeatedly emphasized that 'analyzing the future' is a contradiction, as the future is shaped by countless unquantifiable, unknown, and changing factors. We can think and speculate about the future, but we cannot accurately analyze or predict it. two ️⃣ Most of the time, the end of the world doesn't really come During the most severe crisis (such as 2008), investors are prone to falling into post apocalyptic panic, often resulting in missing out on important long-term investment opportunities. No one knows if we can prevent the collapse, but if we wait for certainty, we may never take action. three ️⃣ Not taking action is also a choice Max reminds us that keeping our investment portfolio unchanged (not operating) is actually an "action" that should also be carefully considered, rather than just out of fear or numbness. 💡 Investment advice: Maintain rationality and courage in uncertainty When the time comes to buy, you won't want to buy The best investment opportunities often come with the greatest fear. When you want to buy, the market price often has already rebounded. Excellent investment requires taking rational action when others are panicking. The probability perception of prediction is important Not only do you need to make predictions, but you also need to have judgment to evaluate the likelihood of predictions being right or wrong. In extremely uncertain environments, accuracy is lower, so one should be more cautious and humble. Investment opportunities do not wait for certainty to arrive The memo clearly stated that during the market crash in 2008 and later, he could not "confirm" that the bottom had arrived, but he could not give up the opportunity because of it. So he and his team chose to continue deploying funds during the crisis. 🌐 Regarding Policies and Tariffs: Simple Motivation vs. Complex Consequences Max deconstructed the economic motives behind the Trump administration's trade war. He acknowledges that these goals themselves are reasonable (such as protecting manufacturing and reducing trade deficits), but criticizes them: Neglecting the second and third order effects (such as retaliation, price increases, supply chain disruptions) Overestimating the leverage role of tariffs in the complex global economic system • Underestimated actual production capacity and technological labor gap Neglecting the "cost-effectiveness" logic of consumers' long-term choice of imported goods • Neglecting the disturbance of political factors on the sustainability of policies He pointed out a key economic principle: "Economics is a science of trade-offs." Protecting 1000 steel jobs and losing 75000 steel consuming jobs is a typical case of losing more than gaining. Finally, Max stated that the greatest certainty in the market is uncertainty. We must maintain a sense of awe towards uncertainty, constantly acknowledge that "we don't know," and make the most rational judgments even when "no one knows." As Max said in the article, "The future becomes less predictable, so beliefs can no longer be based on predictions, but only on rationality and valuation. Valuation+common sense+courage to bet bring opportunities after a crisis! 🧐