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Bill Miller

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2016-11-04

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2016-11-04

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1. “Of people like John Giannacopoulos at Yale, for example, or Gary Gordon at Yale. I think we'd have done really well coming through that 08. So if we have 08 type thing again, which I don't think we're going to have probably once in a generation, but I think we'd be able to deal with it, and that would have made a big difference.”

   2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

2. “Well, I'd say I'd bring it a little bit more up The current, and I'll answer that in two ways. I wish when I'd started that I had had a better understanding of how value is created by businesses, I had a good understanding of how people in the stock market have invested and done that kind of stuff, but really understanding, I'd say the economics of various businesses in a way that Buffett seems to have a natural tendency to do. I think I've developed that over the years, but it would have been nice to have it if I was 25 or 30. Second thing would be, I mean, the big thing, the big changer for me would have had to understand the difference between asset-based crisis and a liquidity-based crisis. So if we have those are the only two possible kind of crises that there are, except for world wars and stuff like that. And so had I had that understanding that I have today as a result of reading the academic literature in the...”

   2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

3. “And I'd also ask if they want to be a fund manager which fund managers do you admire and why? Questions like that. And in terms of advice, it's a tough business to get into. Having a business school degree from a good business school has pluses and minuses, but one of the pluses is you're more likely to get a job in finance with that. But again, I don't have that in a lot of other people that I know don't have that. But just getting into a money management firm. So if you can get a job anywhere at Leg Mason or T-Row Price or Fidelity or that I think is the key. Once you're inside, then your ability to maneuver and to make friends and to figure out where you can go is much greater than it is trying to have your nose pressed against the window.”

   2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

4. “The first thing I started asking some questions like, why do you want to be, how is your interest stoked in this? It's the people that I've found that have been the best at this have tended to be people that have been interested from a young age, not surprisingly, Tiger Woods, you know, started golfing at age two. So the younger you start, I think the better off you're likely to be. I agree mostly with Charlie Munger. I always ask people what they're reading, whether it be markets-related stuff. Charlie says that he's never met a great investor who wasn't a great reader. I'd say that's mostly accurate in my experience. Then in terms of what I tell him is that one of the things you really want to do is just invest. So do you invest right now? What do you do with, even if you have a small amount of money, what do you do with it? I started investing $25 a month when I was in the Army as a lieutenant in the Templeton funds. And I read the quarter.”

   2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

5. “I have a bulldog that always said English bulldogs, so he's always a source of amusement. And then, you know, it's a. Psychologically, you know, patting the dog is relaxing. But it's one of those things where I'm lucky that I'm lucky that the market is both a hobby and a profession. And so I spend a lot of time just reading about economics, markets, that sort of thing.”

   2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

6. “No, it's moving away from. I mean, we're getting redeemed this year. We're not having a great year. But after five years of the number one fund, you would think they would be getting a lot of inflows. We're not, right? My friend Will Danoff, who runs the Contra Fund, right? He's got a 25-year record of being the right outflows every day Chris Davis, same thing. Mason Hawkins, same thing. So I think it's a shift from active just in general. And so it's not so much that people don't know that of all the manners I just mentioned, all of them have a record of beating the market over long periods of time. So it's not that people don't believe that they can't beat the market, it's people don't want the market, they don't want the drawdown and the risk that comes with anybody who's truly an active manager.”

   2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

7. “Early 1990s, I guess it was, and he said to me, and we were an owner of Citibank at the time, and he said to me, you know, you have a very tough job because you have to actually beat the market. If you don't beat the market for some period of time, people take all your assets away. And he said, on our side, on our side of the business, he said, in terms of managing people's money, he said, all we have to do is not look bad. So, we don't really have to beat it as long as we don't underperform by too much because he said it's a different mindset that people, different people's mindset have with money being run by a bank versus being run by a mutual fund company. But I think that the closet indexing an academic told me that by his count, over 70% of active managers aren't really that active. They're pretty much closet industry.”

   2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

8. “It's a lot less because the fees are lower compared to hedge funds. But again, people have thought for some reason or other in a mental accounting mistake that some other hedge funds were magical and they deserve these higher. higher fees, I think the problem in active to passive is twofold number one fees to Jack Bogle has said and that's money directly that doesn't belong to the customer anymore. But second and more importantly, I think it's closet indexing. And closet indexing is driven by a combination of risk management and also fear of tracking error. So people can take some underperformance. I remember having a conversation with John Reed when he was running Citibank. I think it was probably late 1980s or something like that.”

   2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

9. “That much. Yeah, over time. And then we're halfway through that. I think we're just at the beginning of a massive hedge fund shakeout to where the fee structure in hedge funds just makes no sense whatsoever in a low nominal rate of return world. I mean, having a fee structure in an equity hedge fund of roughly equal to the 10-year treasury just makes no sense whatsoever. And if you're going to make 5% a year in stocks, which we think is a reasonable number, then having that level of fees and then taking 20% of any profits takes almost all the profit unless you have a hurdle rate in there and gives it to the manager, which again doesn't make any sense.”

   2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

10. “I think we're about halfway through the secular. Change in the industry away from active management and away from traditional mutual fund industry, which is under great secular pressure both from ETFs as well as from passive. And I think passive is right now about 30 to 40 percent. of the industry, I think that probably goes to 70.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

11. “Yeah, I spend a lot of time reading. I wish I spent as much time as Mr. Buffett does, who says it's all he does all day is read, but I have other things to do.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

12. “Dig it up. Yeah, you mentioned science fiction, which I don't read a lot of, but I actually have just started Olaf Stapleton's book Star Maker, which is a famous book in the science fiction pantheon. He was a philosopher by training who... He didn't even regard as science fiction, just called it speculative fiction. That's a book that's gotten. An exceptional influence on other science fiction writers, and I haven't read it.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

13. “I finished that, but he has a new book out. It's called Homo Deus. Yes. And I'm about halfway through that. And it's great. It's great. Yeah.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

14. “It's brand new. It's an 800-page. 800-page book. And it's good. It's very good. I've read Manchester's book on MacArthur and. But this is good. Let's see. This year, always trying to read some classics. So I read Robinson Crusoe in Frankenstein.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

15. “Really? I think his other book, one of his other books called The Varieties of Religious Experience, also very interesting book, Mind and Cosmos is a recent book by Tom Nagel, a philosopher. Okay. Again, I went to grad school and philosophy. So Hume's treatise of human nature is Hume Kant. I'm reading Schopenhauer right now, the two volumes of the world is will and representation. Some stuff that I'm reading right now. I'm just about done with the brand new biography of Douglas MacArthur. There's a new one of Ulysses S. Grant that just came out that'll be. Who rose them?”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

16. “In the market or business realm, Fortune's formula by Bill Poundstone is a great read because what it is, it's about Claude Shannon, the guy who created information theory and JL Kelly, who came up with the Kelly criterion, which is how you allocate assets in any type of an environment. But Shannon made a fortune in the stock market. And that book points out that the differences between standard financial theory and the type of theory and behavior that Kelly and Shannon use. And it's just a great intellectual read. Two books that things that have influenced my thinking greatly, William James Pragmatism, 1907. I think that's the most important document in American intellectual history.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

17. “I kind of read I read very widely, let's just say it's so, I'm always reading stuff that people are kind of surprised to hear about.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

18. “Mentioned? Well, certainly, I mean, people that, you know, I tried to get to know and pay attention to all the prominent value investors. So certainly Warren Buffett, John Templeton have been big influences. On how I think about things.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

19. “His personal account was just so gone up so much and the broker that was dealing with him said this guy is in his 60s and he's going to retire from the telephone company and we need to get him here because this guy can really pick stocks and that's how and he came and joined the firm really yeah after retiring from the telephone company that's amazing”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

20. “So those were some, my partner Ernie Keeney, who died in 2010 at the age of 92. I worked with him, worked with him every day for however many years that was 20 plus, you know, 20 plus 25 plus years. So he was a big influence on me. And the major influence that he had was he was probably the most optimistic person, certainly most optimistic person I've ever met. And so no matter what, no matter how terrible things looked, he would say, well, they'll get better. Things will turn up. Everything's going to be okay. And he was also extremely patient as an investor, just owned stocks forever and was a deep value kind of a guy. And in fact, he got to Leg Mason. He came to Leg Mason and headed up the research effort there after he'd spent his career at the telephone company. And the reason he got to Leg Mason, which is a very small firm at the time, he came in 1968 was because that...”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

21. “The follow on to that super money where actually he introduced the world to Warren Buffett. So I started reading about Buffett, read Ben Graham at the time, reminiscences of a stock operator is something that up until a couple years ago, I read it every year because it's such a great lesson in psychology and how psychology works through the market, how markets behave.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

22. “I would say because I got interested in stocks at a fairly young age and I read a lot on stocks, but I'd say that the stuff that influenced me the most was probably Adam Smith's The Money Game, which came out in 1968 or 1969.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

23. “That October November. Yeah, in January, what happened when they talked about nationalizing the banks, the preferred stock of Citibank, Bank America, Wells Fargo, was trading at like 50 cents on the dollar when it was Paris-Passeu with the government's name. So we bought those preferreds at the time. And then what happened was that the government caused those preferred to be converted into common stock at roughly par. So I think our cost on our city bank was like 70 cents a share and stuff. So that was part of it we did so well in 2009 was those things took off like a rocket.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

24. “We actually got back in after TARP. So we weren't out for that long. And what really helped was when the government came in with TARP, and again, we shouldn't have gone in as quickly as quickly after that as we did. But in January”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

25. “And nothing happened from March till September, then Lehman failed. And to me, the answer is Lehman failed because Fanny and Freddie were seized the week before. And they were seized even though all their capital met all the statutory capital requirements. They were seized preemptively. And I came in that Monday morning and I said, if the government is going to seize and wipe out the shareholders preemptively, not when the company runs into liquidity trouble, like Bear Stearns did, then we can't own any financials. We have to get out of every financial, which we did. And I think people who had their same thing, who's the most levered next to Fannie and Freddie? Lehman. Let's get out of that one. And then who's the most levered after that? Merrill Lynch, Wamu, etc. So you liquidated.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

26. “Yeah. And that effectively disappeared during that point in time. So I think from our standpoint, what we, the big break for us in that financial crisis was when the government took over Fannie and Freddie that Sunday. In September. And my personal view is that people, when people say, well, the letting Lehman Brothers go was the mistake that caused the cascade of, you know, then the breaking the buck and the credit markets coming unhinged. And my personal view is, or the question I ask people to say that is, well, why did Lehman Brothers fail in September? Bear Stearns failed in March.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

27. “It was more the latter because what we did as the economy and the market got worse is we moved up what we thought we were doing was moving up the quality spectrum and buying the larger and stronger financials. As it turned out, so we bought AIG, which was at one point a AAA-rated company.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

28. “In the future, probably, yeah. But the thing I think is more interestingly possible is that the only time that we saw money going into stocks was in 2013 during the so-called taper tantrum. Right. When yields went from 160 to 320 in four months or five months. And that's the only time that money has gone out of bond funds and into stocks because people were losing money in bonds for the first time. And now money's gone back into bonds. So, what did the market do that year? It's up 30 because money flowed into stocks, not out of stocks. And I think that's a potential that most people aren't focused on, which is if we have a bear market in bonds, it doesn't have, if bonds go from 175 to 225, right? When people start losing money and that goes into stocks, the stock market could go up 20-30% easily.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

29. “Well, I think it's much less accurate with respect to equities. And so just for example, if it were all just low interest rates that's driving the rally, right, what's the most interest-sensitive part of the economy? Housing. How's housing done? Well, housing stocks have been underperforming, and the housing market itself is half, half of what it was in 2005 in terms of new home deliveries. So that hasn't been, you would expect that would be blowing the doors off if it was just interest rates. How much have interest rates helped Amazon, for example? None. Google, none, Facebook, none. Those are among the largest companies in the overall market. How have interest rates helped JP Morgan and Bank America? No, they hurt them. So it's a much more complex situation than just the stocks are marked up. And as I said, I believe the market's already discounting 3% to 4% 10-year rates”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

30. “And BlackRock's got the ETFs and stuff like that. But I'll just say from the people that I know in the industry, in the business, at big firms, every one of them tells the same story about risk and about having to have risk mitigation strategies. And I think that's part of what you're seeing in the overall. You're seeing in the overall market.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

31. “I'm not familiar with the details of all of their strategies. Many of those firms you mentioned are passive, many of their assets are passive.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

32. “Absolutely. I mean, I think, you know, when people talk about volatility and they're worried about risk, put your money all in cash, just sit there and look at you. It won't do anything. Right. So my colleague Samantha is fond of saying that volatility is the price you pay for performance. And I think that's.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

33. “Because it's risky. But you iterate that across the entire market. And what happens is that stocks go down a lot more than they would otherwise do so because at each different level there are people who are selling just because they hit the threshold, down 5% to 10%.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

34. “Mostly mostly just a reaction to the crisis is the layers of risk management and the way people manage risk. That's what's making the market, I think, much more difficult and problematic. And the reason for that is that now that everybody is so risk phobic and people are, when they see drawdowns, they run and sell. But at Lake Mason, we had, since the crisis, three additional layers of risk management that were added to the overall firm. And what all risk managers want to know is what's your risk mitigation strategy. And they don't ask what your risk mitigation strategy is if you're outperforming or the market's going up. It's only when you're underperforming or the market's going down. So what that does is it bifurcates the notion of risk to only focus on stuff that's going down. And as I've said many times, I've never met a risk manager anywhere in the world that believes you should own more of an asset that's falling in price. You should be selling an asset that's falling in price.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

35. “It doesn't make much difference to us because we're longer-term investors. I think there's a real issue of the front running and the stuff that can affect shorter-term traders. To us, the market structural change, which is...”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

36. “So trying to decide in advance how strong is the investment case and when will we know that we're wrong. And one of the things that we have learned over the years is you don't let the stock price tell you if you're wrong. The stock price might tell you something is going to go wrong, but the stock price by itself doesn't contain any information. Especially in this environment where 70% of the stuff is algorithmic, where prices are being marked against each other every day.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

37. “And people thought it was going to be another 2008. Then the year was going, they thought the year was going to come apart, which would have been a catastrophe. So, but in 2008, if we looked at the individual names in our portfolio, 2007 and 2008, generally speaking, they were not meeting our expectations in terms of fundamentals. They would miss a quarter here, a quarter there. The stock would sell off. We're like, well, okay, it's marked to market on that. But there was this sort of a continual slippage of what we expected the fundamentals to be. And in 2011, there was no slippage at all. The companies continued to do really well, even if the stocks weren't doing well. So that's a big one for us. Then second is just when you go in, when we go in on a name, one of the things that we ask ourselves once we've decided to buy it is what will make us wrong.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

38. “I think that's a very difficult thing because when you're doing poorly relative to the market, then the question is always, is the market wrong or am I wrong? And that's a very difficult thing to answer because the future isn't knowable to anybody. And the market is sort of a collective intelligence machine. So it's easier to do at the individual stock level, and give you a good...”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

39. “There were no significant failures after TARP. And that was what allowed the system to stabilize. As late as January of 2009, people were still talking about nationalizing the.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

40. “And housing is most people's largest asset. It's the asset that secures most of the debt. A lot of that debt was undocumented loans, liars, loans, and stuff like that. So when that edifice came down, what we thought was when the Fed began to really inject liquidity, you could go back in again. And as it turns out, that's correct in a liquidity-based crisis. It's not correct in an asset-based crisis. An asset-based crisis, similar to what we saw in Japan and what we saw certainly in the US in 2008, is you only go in in that when the authorities get together and try and stabilize asset prices. That was TARP. That's what TARP. Up until TARP, every time there was a problem of bank failed, the shareholders were wiped out. And TARP came in and it stabilized the asset values of the banks and therefore the banking system. And that was the bottom. October was the bottom when most stocks made their bottom, when most asset prices made their bottom, the final bottom was...”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

41. “Companies cut back, you have a recession, then the Fed comes through the other way. Even the crash in 1987, same thing, which was that when the market crashed, you had interest rates that got to 10% in October, you had a 2%, 2.5% yield on the market. And that just sucked all the money right out of the stock market. But when it crashed, the Fed cut rates dramatically. Liquidity went in and the market came back and the economy came back. In this case, it was an asset-based crisis. So basically housing related.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

42. “This was up until that point in time, the academic literature did not really distinguish between the types of financial crises and then how you deal with those crises. And so what we got, what I got wrong, what we got wrong in that was I thought we had a pretty robust strategy for dealing with financial panics and upsets. And in fact, we went through an exercise where we said, let's make sure that we have a strategy for dealing with anything that happened in the post-war period since World War II. So high inflation, Watergate, wars, panics, all that kind of stuff, inverted yield curves. And so that's why we've did pretty well for many, many years. This particular crisis was different because it was an asset-based crisis and not a liquidity-based crisis. And most financial crises are liquidity-based in that the Fed will raise interest rates, the discount rate goes up, the savings rate goes up.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

43. “Well, it works very well. We don't have a formal split of duties. We both are trying to pay attention to everything in the portfolio all the time. She's in the office a lot more than I am because I've split my time between Florida and Maryland and New York. And so she will tend to take more meetings with sell side analysts, take more meetings with companies than I would just because she's in the office more. And then her office is right next to mine and my son's is right next to hers. So when we're there, we're talking all the time. And when we're not there, we're emailing back and forth or talking on the phone.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

44. “So all those things are important. I tend to be a high output idea generator, not in the sense of constantly putting new names in the portfolio, but in the sense of constantly looking at names. And after 35 years of doing this, I have a fairly good extensive experience with all kinds of different companies and industries. And my son's been doing this for eight years and Samantha's been doing it for 15 years. We have a new young analyst and a more senior guy that we just brought on. So there's a mix where people are all looking for things that we think are mispriced on a longer term basis.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

45. “It's a little bit like the Zen doing, not doing in the sense of. What we're trying to do is always think about how things could be improved, assess it. But we're long-term investors, and that's rare in this market. But we own Fannie Mae for 15 years at one point. So it's the case that our average holding period is three to five years. And so we're looking through the stock price fluctuations. We're trying to look through the noise. And we're always trying to filter out the signal from the noise. But the core part of the process doesn't change, which is trying to figure out the intrinsic business value.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

46. “Yeah, he was great when he was working for us. He was a great teacher of security analysis to the analyst and always looking for ways to improve, looking at the academic literature.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

47. “I got that actually from the late Sir John Templeton. Was asked why he followed this value investing approach. And he said, we don't follow it out of any special reverence for that approach. We follow it because we keep looking at all different ways to do things, looking at ways to improve all the time. And it just so happens that this is the one that we found most effective. And so I think that was that. And I talked to him about this when he was alive. And that was one of the things that stayed with me is you're always looking to try and improve the process. So if it turns out that even for a brief period of time, that looking at charts. So it's a process of really trying to continuously improve. And again, I think you had Mike Mobison On here, and he was”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

48. “Emphasis on a company's ability to earn above its cost of capital, to generate free cash flow, and to reinvest that on a sustainable basis.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

49. “I'll come at the two different ways. One of them was that from roughly 1980, well, 1989 and 1990, we had two bad years in the value trust. And I took over at the end of 1990 solely managing the fund. And part of what I did then was I went back and looked at the history of value investing and the academic research on value investing. And it became clear to me that a lot of what people thought about value investing wasn't supported by the evidence and that when I looked at our own mistakes, they were generally speaking caused by putting too much emphasis on past data and past valuation stuff and past growth rates and not enough on the future and not enough on what companies could do. And so that got to that point of where I came up with that particular quote. And we changed our approach at that point in time to put a lot more.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source

50. “It's really interesting because you have these old cliches that they would have on the bulletin boards of loose-lip sink ships and stuff like that. And it's true because you could look at something that apparently was meaningless. And have a little bit of information, but then there was something over here, and something over here that were unrelated on their own, but you could put them together and get the beginning of a picture with each individual piece by itself didn't tell you anything.”

    2016-11-04 · Masters in Business · Barry Ritholtz's Masters in Business: Bill Miller Interview · IDENTIFIED FROM THE TRANSCRIPT · source