"The perspective that law enforcement is presenting seems to be a very narrow one that's focused very, very heavily on investigations of past crimes rather than on preventing future crimes. It's very important for policymakers to take that broader view because they're the ones who are trusted to look at the big picture."

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The big picture is: the main thing you should be concerned about in the future are incremental returns on capital going forward. As it turns out, past history of a good return on capital is a good proxy for this but obviously not foolproof. I think this is an area where thoughtful analysis can add value to any simple ranking/screening strategy such as the magic formula. When doing in depth analysis of companies, I care very much about long term earnings power, not necessarily so much about the volatility of that earnings power but about my certainty of "normal" earnings power over time.

— Joel Greenblatt