Value Investors are Still Rolling Stones July 6, 2021

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Most millennials have never seen an era where value has done well. The last 12 months seem like an aberration in their careers relative to the booming growth markets of the 2010’s. The investors that have witnessed value do well time and time again are more than likely baby boomers, not to count Charlie and Warren out (we never do). However, the silent generation is fewer by the day, though they have seen the tug-of-war in the value-versus-growth continuum more than future generations.

Mick Jagger, of the Rolling Stones, is a silent generation member himself (born in 1943). We bring up age because experience is one of the most likely things that age gives you. Millennials have never witnessed the intensity of value outperformance that we have seen over the last 12 months. They have no frame of reference for what they have seen and our advice to investors tells them they will likely continue to see. Now that books aren’t read by most people, much of our society has trapped themselves out of knowing what has happened in the past. They are only interested in the now. We love that Buffett and Munger say the secret to life is weak competition (thank you).

What got us going on this thought process of age and experience is the Lauren Daigle song, “Still Rolling Stones.” The words we believe typify what value investors felt last spring and foreshadow what millennials are likely to tell themselves in the future as they gain experience.

Value in March of 2020

The bear market of 2020 was swift and destructive. It punished many stocks. It felt like it put value to death as we watched a cascade of cheap stocks getting cheaper. Then the bottom was found, and value has been rising ever since. Ms. Daigle lyrics tell the story:

Out of the shadows. Bound for the gallows. A dead man walking. Till love came calling. Rise up (rise up). Rise up (rise up)

Six feet under. I thought it was over. An answer to prayer. The voice of a Savior. Rise up (rise up). Rise up (rise up)

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