-->Von John Hussman:

...As soon as an investor begins to believe that the market will follow a specific scenario or prediction, and takes positions on that basis, that investor takes off on a roller coaster of hope, pride, elation, fear, greed, insecurity, and ultimately frustration. From that point on, rather than simply acting on the basis of a clear-headed appreciation of reality at each moment, the investor pits reality against a preconceived expectation of it; begins looking for evidence to support a particular outlook; faces each setback with confusion about whether to dig in or bail out. Instead of focusing on what the investor can actually control - present actions based on present realities as they unfold, the entire investment plan rides on a scenario that the investor can only hope for. That's a great recipe for insomnia, but not a great plan for investment success.

Our discipline doesn't require us to disregard the future, but simply to recognize that the future will be made from a series of present moments. You can set goals, create strategies for how to respond to various events, take account of the big picture, study and learn from the past, and plan for the future. But the only point at which action can be taken is in the present, and the only basis for those actions should be reality as it actually exists. The way to properly understand reality is to give up preconceptions, to look deeply and from all sides, and to consider evidence you would prefer to ignore. Then, as the Buddhists teach, by taking good care of the present, with a clear understanding of reality, you already take good care of the future.

I write a great deal about the daily actions that I take in managing the Funds, because as investors, as well as as humans, we are what we habitually do. By design, for instance, many of the daily actions I've defined for our approach have the effect of buying short-term weakness, selling short-term strength, buying undervalue, selling overvalue, buying market action that conveys favorable information, selling market action that conveys unfavorable information, and managing risk throughout. I never imagine that the actions I take on a given day will necessarily produce a positive short-term result. In the markets, as in life, the consequences of both good actions and bad ones go far beyond what we immediately observe. Whatever consequences we enjoy or suffer over time are the fruits of countless seeds planted day after day. So we focus on choosing and tending to those seeds rather than demanding a daily harvest. But those seeds make a difference. Whether the seeds are discipline or carelessness, kindness or hate, moderation or extremism, peace or war, justice or revenge, the seeds determine the fruit. Our actions are the only things that we control; that we own; that we are; that we become.