Quality Growth Investor Conference

Quality Growth Quarterly Issue 3

Quality Growth Quarterly

To mark the launch of the Quality-Growth Investor Conference we have launched Quality-Growth Quarterly. We also publish "Value Investor Digest" which was started in 2011 and is now in its 50th issue. In the third issue of QGQ we feature our interview with Martin Hermann from Berenberg, a Money Maze Podcast interview with financial historian Niall Ferguson, a Lindsell Train article titled "Lost in the Supermarket" plus 15 other articles below, including those on Bill Ackmann, John Malone, Rajiv Jain, Benedict Evans, Michael Burry plus from speakers at the rescheduled London Quality-Growth Investor Conference in 2021.

London Quality-Growth Investor Conference

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Interview with Berenberg's Martin Hermann

The latest Outstanding Investors Online interview with Martin Hermann from the Global Focus Fund at Berenberg includes a discussion of valuations and analysing the moats for big tech companies, including Alphabet and Facebook - plus stock ideas on Wix, Netcompany, Xero and Ryman Healthcare.


The Money Maze Podcast: Niall Ferguson (Part 2)

"The impact of the internet, particularly the rise of the network platforms like Facebook and Google and so forth, posed as big a challenge to our societies because of their impact on the public sphere as the printing press when it began to spread through Europe in the late 15th century…the printing press was the vector of the spread of religious conflict all over Europe and indeed beyond Europe to the new world. I think we are in a much more 17th century world than we realise." (These comments at 28.30)


Lindsell Train: Lost in the Supermarket

“Although aware of the potential for permanent loss of value within certain types of consumer packaged goods, at Lindsell Train we do of course own a number of companies in this space - Mondelez, PepsiCo, and Unilever being the most significant holdings. So we wanted to deepen our knowledge of the challenges facing certain branded packaged products, and find out whether or not the “centre store” - the aisles of shelf-stable packaged foods found in the middle of supermarkets - is really a lost zone in terminal decline."


Visual Capitalist: The Soaring Value of Intangible Assets in the S&P 500

"Intangibles as a portion of total assets in the S&P 500 have reached unprecedented levels. As of 2020, 90% of all assets in the S&P 500 are now intangible."


GQG Partners: The Gravity of the Growth/Value Debate

“GQG Partners’ is not one of value nor growth, we’re simply focused on compounding and teasing out a process that works. Having said that, we do believe a company needs to be growing in order to be worth the work as we believe avoiding value traps is critical to long term returns. But we also think that areas of the market, particularly in the high growth camp, those that have directly benefited from the current virtual revolution or those that are perceived as “revolutionizing the planet” in some other way have gotten a bit ahead of themselves."


Bill Ackman says 'go long': 2021 Will be 'Very, Very Good Year'

“It's probably the single greatest time in history to open a restaurant. You've got low rates, you've got likely stimulus, you could see infrastructure spending, you've got still very well capitalized banks, you've got access to capital. So I think 2021 could be a very, very good year in markets, so go long I would say."


Moore’s Law Is Ending. Here’s What That Means for Investors and the Economy

“Intel co-founder Gordon Moore’s eponymous law about growth in computing power has been hurtling toward a technological boundary for years, with major implications for the economy if chip makers can’t revolutionize production...The technology powering modern computers is getting closer to an unbreakable physical limit. That has already been responsible for a big chunk of the slowdown in economic growth since 2000, but the situation is poised to get much worse unless the world’s chip manufacturers invent an entirely new way to crunch numbers."


The Money Maze Podcast: Niall Ferguson (Part 1)

“I’d rather be the US in this situation than anybody else...I think ultimately the US has more room for manoeuvre than anybody else and I think the US can sustain a debt to GDP ratio of 200% relatively comfortably - although the lesson from British history is that after a certain point that constrains you. Britain’s problem in the 20th century was that the debt burden after 1918 was such that it was really hard to maintain British Imperial defence at the levels that would have been necessary to deter Germany. The American problem will be that the defence budget will get squeezed because the interest payments will eat such a large chunk of the Federal budget. That’s going to be the weakness that ultimately gets exposed by the Chinese challenge."


Baijiu's Award-winning Spirit

“Nine thousand years ago, in a small village along a tributary to the Yellow River; early Neolithic people fermented a mixture of rice, honey, hawthorn fruit and/or native wild grapes into wine. In terms of value, culture and complexity of production, baijiu has few equals. Kweichow Moutai is by far and away the world’s most valuable liquor brand. It’s not even close. Yet in terms of internationalization, the story of baijiu is just beginning."


John Malone says Platforms like Apple, Amazon and Roku will Dominate Streaming

“I think these global platforms will be enormously powerful...The consumer’s not going to want to buy from a broad number of subscription services. They’re going to tend to want to go to one convenient supplier. It looks increasingly like that’s going to be, you know, Amazon...or it’s going to be Apple, or it’s going to be Roku. Or it could still be a Google effort."


Why Off-Price Won't Change Much, Even After a Pandemic

“Consumers at all income levels flock to these stores, pawing through racks in search of marked-down treasure...When the economy is poor, a glut of unsold merchandise from department stores and brands ends up in off-pricers' supply chains. More recently, e-commerce growth, with its surge in returns, has padded and diversified off-price assortments...TJX (whose major banners are Marshalls and T.J. Maxx) runs 3,309 in the U.S. alone. Ross Stores has opened 100 new stores annually lately (scaling back somewhat this year) and now runs 1,869. Burlington operates 739. Nordstrom runs comparatively few at 248 off-price Rack stores, but that's more than twice as many as its full-line fleet (which it is shrinking)."


A Vaccine for COVID Derangement Syndrome

“COVID Derangement Syndrome (CDS) is a nasty affliction that causes investors to misprice stocks. Some sufferers have it so bad they will buy or sell without regard to price. Symptoms include selling low, buying high, regret and FOMO. Even mild cases can result in sleepless nights."


arsTechnica Review of Apple Ditching Intel Chips on Mac

“Apple is crazy, right? The Mac just had its best year of sales ever, and Cupertino is hitting the platform with a shock like it hasn’t had in nearly 15 years—back in a time when the Mac was not having such a good year. Apple is beginning the process of replacing industry-standard Intel chips with its own, custom-designed silicon...The M1 is amazingly fast. More importantly, it's a compatibility slam dunk."



Benedict Evans: Are You a Seal?

“There is a theory that when a shark bites a surfer, this is because they look like a seal, especially from 50 feet underwater...What does it mean to look like a ‘seal’, in this analogy, or indeed to be one? Well, a trillion dollar company with tens of thousands of engineers runs lots of projects and experiments, and there are lots of things that theoretically they could do, and that they might explore. But you have to ask not ‘would it be a problem for me if they got into my industry?’ but rather ‘would it make any sense for them to get into my industry?’ How do you tell if it would make sense for them? I’d suggest a few overlapping questions."


Lockdown Takes ecommerce to 40% of Retail

“The growth of ecommerce has always fit the old line about a frog in boiling water...In the UK, where we have monthly data that makes the picture clearer, penetration was already 20%, spiked to over 30% and now seems to be stabilising in the high 20s."


The Bid to Dismantle Facebook is Economic Illiteracy

“The FTC thinks that WhatsApp and Instagram could have been competitors. If so, they are just two among thousands. There are countless services that allow people to share, connect and communicate, from Twitter and YouTube to WeChat, TikTok, and Zoom. Each one of these are competing for our attention, along with many more dorm room startups – for which the internet has very few barriers to entry. If anything we are living in a golden era of online competition."


France Attempts to Tax Google to Subsidise Publishers

The new law “requires Google to negotiate with publishers and news agencies the remuneration due to them under the law regarding related rights for the re-use of their protected contents...In practice, the vast majority of press publishers have granted Google licenses to use and display their protected content, without possible negotiation and without receiving any remuneration from Google."


Ryanair Orders 75 More 737-Max Jets from Boeing

"So far this year, customers have canceled orders for 448 Max jets and Boeing has raised doubt about another 782 orders because of the airlines’ pandemic-weakened financial health...Michael O'Leary said 'The one issue that's going to come up here today is safety, so let's get it out front...This is the most scrutinized, most audited aircraft in history. It's also going to be one of the safest.'”


Elon Musk at WSJ CEO Summit

"I think there might be too many M.B.A.s running companies...There’s the M.B.A.-ization of America, which I think is maybe not that great. There should be more focus on the product or service itself, less time on board meetings, less time on financials.”


Steve Jobs Video from 2010: "Apple Is The Biggest Startup on the Planet"

“You know how many committees we have at Apple? Zero - there are no committees. We are organized like a startup. One person is in charge of iPhone OS, one person is in charge of Mac hardware, one person is in charge of iPhone hardware engineering...we are the biggest startup on the planet. We all meet for 3 hours once a week and we talk about everything we are doing - the whole business."


Michael Burry Tells Elon Musk to Cash In

"So, @elonmusk, yes, I'm short Tesla, but some free advice for a good guy ... Seriously, issue 25-50% of your shares at the current ridiculous price. That's not dilution. You'd be cementing permanence and untold optionality."




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  • ““Growth is always a component in the calculation of value, constituting a variable whose importance can range from negligible to enormous and whose impact can be negative as well as positive”

    Warren Buffett
  • “Growth and Value are joined at the hip”
    Joel Greenblatt
  • “I don’t love Ben Graham and his ideas the way Warren does…Ben Graham had a lot to learn as an investor”
    Charlie Munger
  • “Growth and Value are joined at the hip”
    Joel Greenblatt
  • “I am so tired and fatigued with this ‘growth versus value’ argument”
    Robert Hagstrom
  • “Graham & Dodd investors are people who place a very high price on having the last laugh. In exchange for that privilege they have missed out on a lot of laughs inbetween.”
    Michael Lewis

  • “By what principle is it that when we see nothing but improvement behind us, we are to expect nothing but deterioration before us?”

    Thomas Babington Macaulay

  • “The stock of a growing company, if purchasable at a suitable price, is obviously preferable to others.”

    Benjamin Graham

  • “It is natural and proper to prefer a business which is large and well managed, has a good record, and is expected to show increased earnings in the future. But these expectations, though seemingly well-founded, often fail to be realized. Many leading enterprises of yesterday are today far back in the ranks. Tomorrow is likely to tell a similar story.”

    Benjamin Graham and David Dodd
  • Questioner:
    “I keep hearing people like Doug Kass say that buy and hold
    investing is dead. Do you think that’s true?”
    Warren Buffett:
    “Well, it depends what you buy and hold.”
  • “The Stock Market is designed to transfer money from the Active to the Patient.”
    Warren Buffett
  • “As time goes on, I get more and more convinced that the right method in investment is to put fairly large sums into enterprises which one thinks one knows something about and in the management of which one thoroughly believes.”
    John Maynard Keynes
  • “The whole ‘growth and value’ debate I personally feel is nonsensical in a way because why would you consciously overpay for anything?”
    Rajiv Jain
  • “Rapid growth can be a misleading indicator of added value because it can be generated simply by pouring capital into a business.”
    G. Bennett Stewart
  • “Investment is most intelligent when it is most business-like”
    Benjamin Graham