“Judge a man by his questions rather than by his answers.” ― Voltaire
Questions. We got ’em. This week we published another edition of Blogger Wisdom. It’s always a surprise (and pleasure) to ask a bunch of smart and accomplished bloggers (hopefully) provocative questions. I want to thank all the bloggers who participated and those of you who stopped by to read their thoughts. Without any further ado here is my own take on this week’s questions. (Click on the question to read the original post.)
Monday: Is value investing dead? Seriously, it’s been quite some time since it had any meaningful outperformance. Josh made the case that maybe the world has fundamentally changed. Or is this just the kind of talk you hear at a turning point?
You always need to be wary of “this time it’s different” talk. That being said something has changed in the world. My guess is that simple representations of value are not going to generate outperformance going forward. Our current accounting system simply doesn’t accurately capture economic value these days. At some point we will have a better handle on these things AND some more meaningful measure of value will generate outperformance.
Tuesday: Traditional active management is dying a slow, painful death. Is the introduction of non-transparent, active ETFs a potential turning point or simply a finger in the dike of an unstoppable trend?
Finger, thumb, big toe. Some small percentage of active managers will make the transition to ETFs with this, or some other, structure. But that will do very little to change the high fee-low performance calculus of active managers as a whole.
Wednesday: I am intrigued by the idea of the Long-Term Stock Exchange. Do you think it has the potential to open up the capital markets in new and meaningful ways? Or is the LTSE up against entrenched interests who simply too powerful?
I think everyone agrees that companies are, by and large, coming public later than necessary. Part of this has to do with the current rules in place, more importantly it has to do with the changing nature of private capital. Whether the LTSE can be a bridge of some sort, I am just not sure.
I used to be a completist when it comes to media consumption, i.e. start a book, then finish it. I am much more willing to abandon a book, movie, show, podcast etc. before its finish if I feel I have gotten what I will out of it. A book doesn’t know you haven’t finished (or skimmed) it.
Friday: Hey, how’s your podcast doing? It seems that most bloggers if they don’t already have a podcast, have toyed with the idea. As a blogger how do you view podcasting? Does it supplant blogging, support it, or is it something different altogether?
At Ritholtz Wealth Management we are experimenting with a number of different formats outside of the blog. Not everyone wants to sit down on read your post. Some people want to listen to a couple of smart people talk about a topic while they are on their way to work or at the gym. That being said, my guess is that the rate of abandonment for podcasts will ultimately be similar to that of blogs. In short, easy to start, hard to maintain.
We will get back to our regular publishing schedule tomorrow. Cheers.