We commented on a blog article entitled “The First Million” on MicroCapClub.com, as below.
Here is our comment:
“Great article, Ian, which provides a historical perspective.
Not at all intending to take the credit away from Buffett or Munger or anybody else, but in their heyday (1950s, 1960s), were companies being tracked by investors as widely and as vigorously, as they are today? In other words, were there far more “low-hanging fruit” in those days, than there are today?
How were the US markets in those days? Were there so many sell-side analysts, churning on reports on hundreds of companies? Did companies use to hold earnings conference calls or analyst briefings, regularly, the way they do today?
Can Buffett’s stupendous returns be attributed in part to his “early start” and there being “lesser competition” from other investors? I have not tracked US markets that well, and I might be totally wrong on this. But just a thought that crossed my mind.”
Here is how the website responded:
“Thanks Nitiin. In short you are absolutely correct. The amount of information at investors finger tips today versus fifty years ago (even 20 years ago) makes it a lot harder for investors to gain a quantitative edge. If anything it forces investors of today to do more qualitative analysis because you can’t get away with just doing quantitative. I believe one of our members on MCC summed it up really well in this response on our forums:
This said, I do feel that microcaps represent one of the last truly inefficient markets left. Why? Large, smart money can’t buy microcaps until they are larger. The smaller smart investor has a real edge.”