In one of his famous “memos” released on Sept. 19, legendary investor Howard Marks (Trades, Portfolio) reflected on the laws of economics.
The paper, titled “Shall We Repeal the Laws of Economics?” began with Marks commenting on the upcoming U.S. presidential election, noting candidates are touting their vision for the economy. He emphasized his goal was to not promote or dismiss any candidate, whether it be former President Donald Trump or Vice President Kamala Harris, but “rather to illustrate that there is no ‘free lunch' in economics, despite candidates' assertions to the contrary.”
He recapped memos he wrote back during the 2016 election cycle and in 2019 that addressed how, regardless of what economic promises a politician may make, “the laws of economics are incontrovertible.”
Marks then went on to dissect Harris' promise to ban price gouging and Trump's tax cuts and tariffs proposals and how they would be impacted by the free market and other economic realities.
To conclude, he wrote:
“What I discuss above are the economic facts of life, and some of their ramifications may be less than ideal. But idealists' wishes don't govern economies; these realities do. Foremost among them are the power of incentives and the influence of supply and demand. The rules must be respected; they can't be ignored, wished away, or overridden without consequences.”
Read Marks' full memo here.
