Assets Quote by Seth Klarman
“Beware leverage in all its forms. Borrowers - individual, corporate, or government - should always match fund their liabilities against the duration of their assets. Borrowers must always remember that capital markets can be extremely fickle, and that it is never safe to assume a maturing loan can be rolled over. Even if you are unleveraged, the leverage employed by others can drive dramatic price and valuation swings; sudden unavailability of leverage in the economy may trigger an economic downturn.”
About This Quote
Source Book: Margin of Safety, 1991
Leverage magnifies risk; match asset duration with liability duration to avoid crises.
In simple terms: Match asset and liability timelines.
Key Takeaway
Align financing terms.
Themes
finance
risk
leverage
Mood
analytical
prudent
Type
instructional
cautionary
When to use this quote
- corporate borrowing
- government debt
- personal loans
- investment strategies
Key Concepts
duration matching
market volatility
systemic risk
Questions to Reflect On
- Do you assess duration mismatch regularly?
- What buffers protect against sudden credit tightening?
A Different Perspective
Leverage can be useful when carefully managed; blanket avoidance may limit growth.
![“[When I die], I will decidedly not be regretting missed opportunities for a good time. My regrets will be more along the lines of a sad list of people hurt, people let down, assets wasted and advantages squandered.” quote by Anthony Bourdain](https://sms4smile.com/quotes/img-quotes/ba3/anthony-bourdain-649_advantage_when-i-die-i-will-decidedly-not-be-regre_24502.jpg)
