Merton Miller
Merton Miller
Merton Howard Millerwas an American economist, and the co-author of the Modigliani–Miller theorem, which proposed the irrelevance of debt-equity structure. He shared the Nobel Memorial Prize in Economic Sciences in 1990, along with Harry Markowitz and William F. Sharpe. Miller spent most of his academic career at the University of Chicago's Booth School of Business...
NationalityAmerican
ProfessionEconomist
Date of Birth16 May 1923
CountryUnited States of America
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My research interests since then have shifted strongly towards the economic and regulatory problems of the financial services industry, and especially of the securities and options exchanges.
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When I started worrying about stocks, it was the late 1930s and early 1940s and it didn't seem like a good way to make money then, either.
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What happened after publication of our paper was that, for the next 40 years, people said, all right, we now know the answer to the capital structure question under ideal conditions.
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My main interest, however, was in economics, not law.
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Of course. I favor passive investing for most investors, because markets are amazingly successful devices for incorporating information into stock prices.
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Another is, if you take money out of your left pocket and put it in your right pocket, you're no richer.
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Diversification is your buddy.
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You only need to make one big score in finance to be a hero forever.
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Junk bonds prove there's nothing magical in a Aaa bond rating.
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Everyone recognizes that's a joke because obviously the number and shape of the pieces doesn't affect the size of the pizza. And similarly, the stocks, bonds, warrants, etc., issued don't affect the aggregate value of the firm.
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Arbitrage proof has since been widely used throughout finance and economics.
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As an economics undergraduate, I also worked on a part-time basis in Cambridge, Massachusetts, for a company that was advising customers about portfolio decisions, writing reports.
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But in practice, if often comes down to not suffering a loss as big as the huge gain you made a while ago.
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I should mention that I am a member of the board of directors of Dimensional Fund Advisors.