Review – The Medici

The Medici: Power, Money and Ambition in the Italian Renaissance

by Paul Strathern, published 2017

The history of the Medici family might best be summarized with the phrase “from dust to dust.” As if to emphasize how they were destined for greatness and nobility, the family started out as a bunch of Tuscan hillbillies who could trace their lineage to a legendary knight of the Holy Roman Empire who settled near Florence in the 8th or 9th Century. From there and then, no one heard much of these people until some of the clan moved into Florence proper in the early 1300s and formed a small money-changing business.

Using conservative business practices and investing in roles of civic responsibility, eventually a Medici was elected to the position of gonfaloniere, the primus inter pares of the Florentine Republic. From this position the dice were carefully loaded in the favor of subsequent Medici generations by artfully forming governing coalitions that cemented their public position while creating leverage across their business and investment portfolio through the tactical use of subsidy, official privilege, insider information and regulatory capture wielded against competitors and opponents.

The story of the “overnight success” of the Medici begins here. The first great head of the Medici family and Medici bank, Giovanni de Medici, had jockeyed for favor with the newly appointed (anti-)Pope John XXIII in order to secure a role as the personal banker to the Papal Curia upon his ascendancy, which was then granted. For much of the 14th Century and Renaissance period in general, the papal revenues and banking needs were equivalent to managing the treasury function for the modern era’s most wealthy and complex multi-national corporations. To gain this trust was not only a measure of unique esteem valuable in and of itself, but a responsibility that carried with it priceless information and irreplaceable business franchises throughout European Christendom and even the Levant.

However, Pope John XXIII soon became embroiled in the Great Schism in which he and 2 other rival popes were called before the Holy Roman Emperor and summarily dismissed, to be replaced with his appointment, Pope Martin V. At his son Cosimo’s urging (whom he had sent to be his representative at the delegation attending the papal conference) the Medici’s continued to support the defrocked pope, even helping to pay his ransom for his release from imprisonment. Rather than being a financial disaster, this loyal support of the former pope led to a new lucrative banking relationship under Martin V, because in return for bartering his release the former Pope John XXIII agreed to support the nomination of Martin V and participate in the reconciliation of the Schism, leading to greater legitimacy for the new pope.

As a major political player on top of his business responsibilities, Giovanni left three apocryphal warnings for his descendants:

  1. focus on business, not politics
  2. do not be ostentatious
  3. don’t oppose popular will, unless it is aimed at disaster

It seems as if it should be unnecessary to say that in time this advice was forgotten and eventually, so, too, were the Medici.

But the dissolution of the Medici was a ways away yet. After Giovanni came Cosimo as head of the family and the Medici bank. He faced a disastrous and unpopular war between Florence and Lucca (backed by Milan) which threatened to ruin the Florentine treasury and which had pitted the various leading families against one another. Subscribing to Rule #3, Cosimo opposed the conduct of the war and worked to hide the bank’s assets outside of Florence to avoid expropriation in the war’s aftermath.

For these maneuvers and others, Cosimo was recalled to Florence and imprisoned in the bell tower of the Palazzo Vecchio by a faction led by the rival Albizzi who had plans to execute him for treachery. However, Cosimo’s far flung banking business and participation in the geopolitics of Western Europe had led him to a series of alliances and power relationships with foreign entities such as the Venetian Republic and the Papal States which he utilized to create a kind of diplomatic protection for himself, pressuring his enemies to choose exile over execution as his fate.

In the meantime, he used bribes and the threat of invasion of the city by his own mercenary forces outside its walls to add to the diplomatic pressure and engineer a favorable outcome for himself, all while behind bars.

Shaken but not stirred, Cosimo came to rule Florence through the intervention of the Pope and Venice, but vowed that “he would rule, but he would not be seen to rule” going forward. He had learned his lesson about bearing personal responsibility when it came to matters of state. Further, he was coming to understand that it was easier to wield power when others weren’t watching.

According to one supporter, “Whenever he wished to achieve something, he saw to it, in order to escape envy as much as possible, that the initiative appeared to come from others and not from him.” One policy he pushed for through his crony network was the use of the “catasto”, which had originally been levied to pay for the war, as a punitive tool to crush his political and business opponents through ruinous taxation. While he was forcing his enemies into exile to avoid financial ruin, purchasing and redistributing their former property to his supporters on a bargain basis, he simultaneously used inflated personal balance sheets to hide his income and appear to be bearing the heaviest personal tax burden on a relative basis.

But Cosimo was far from poor:

Between 1434 and 1471, Cosimo spent 663,755 gold florins supporting public works, by comparison, total assets of the Peruzzi bank at its height were 103,000 florins from Western Europe to Cyprus and Beirut.

If he was able to spend 6X the total assets of a well-known competitor at the height of its powers on public works, his total assets and wealth must have been a multiple of that amount. Normal banking and family secrecy aside, the Medici wealth at this time seems to have been nearly incalculable. It is no wonder, then, that one of Cosimo’s key strategies in building and wielding power was to always return favors with favors.

Following Cosimo, who was once to have said that “Trade brings mankind together, and casts glory on those who venture into it” his son Piero and Piero’s son, Lorenzo began to venture the family increasingly beyond the scope of banking and business and into the realm of politics and social standing via nobility. Depending upon how you interpret the events that followed, Piero and Lorenzo were either some of the most “magnificent” leaders of the Medici banking and political enterprises or they were equivalent to the decadent dissipators of the true talent and generational thrift of their greater ancestors.

Either way, the local power of the Medici in and around Florence was successively traded for inter-regional power and influence within the royal families of Europe. As the Medici gained a queen mothership in France, they lost their rule over the Florentine Republic to foreign invasion and intervention and increasingly squandered the capital of their banking and related enterprises. By the early 18th Century the Medici had failed to produce a male heir and had ceded their Grand Duchy of Florence to the Holy Roman Emperor and ceased to be a meaningful business or political entity forever.

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Review – Leonardo and The Last Supper

Leonardo and The Last Supper

by Ross King, published 2013

In the late 1400s, Leonardo da Vinci was commissioned by Lodovico Sforza, Duke of Milan, to complete a large bronze equestrian statue to honor himself and his late father and cement his authority over the people of Milan and northern Italy. It was to be one of the greatest equestrian statues of the era and one of the most technically challenging, single biggest pieces of cast bronze in the history of sculpture which would also fix Da Vinci’s reputation as a craftsman, artist and virtuoso.

But like many of Da Vinci’s projects and ambitions, it was not to be. After a series of unfortunate events that cascaded from Sforza’s unpredictable realpolitik, the duke was forced to melt down the bronze assigned to the project to form cannon to defend Milan from the invading forces of France’s Charles VIII.

Although Leonardo Da Vinci is known to history as an artist and mechanical genius (or at least, a philosopher of theoretical mechanical devices) his great personal ambition was to create outstanding weapons of war. He hoped the equestrian statue would be his entree into a world of defense industries assignments for the notoriously pugnacious Sforza clan. Instead, he spent most of his time in their employ designing parties, feasts and pageants and lamenting himself at age 42 as some one who could not positively reply to his own request, “Tell me if I ever did a thing.” He had struggled unsuccessfully in his 30s to learn Latin, a standard achievement of the scholarly and intellectual in his era, and as a result ended up a uomo senza lettere or “man without letters”, almost like a person today who failed to go to college. However, it was not the external standards of brilliance or achievement he failed against but rather the “extremely high standard he set for himself in his quest for a new visual language” that brought him the most self-doubt and personal pain.

And so it seems fittingly ironic then that his pinnacle achievement and the work of art he would come to be most famous for beyond even the mysterious Mona Lisa was not a weapon of war on a field of conquest or a bold statue in a central plaza but a fresco-style painting of a commonly depicted scene throughout Italy, found in many a dining hall of a local convent– The Last Supper.

There are many details of the painting that ended up making it remarkable and that have to do with the finished output, such as we know of it today in its highly degenerated and damaged form from the original. But it is what went into the painting that are the details most worthy of consideration.

First, this being a common subject matter in a humble, dingy room in a less-than-spectacular Dominican church, Da Vinci considered the work beneath him and like many of his projects he had trouble bringing himself to complete it. One of the art world’s masterpieces almost never happened out of simple spite and disinterest.

Second, Da Vinci combined the urban with the urbane in painting the portraits of the individual saints. To capture interesting “grotesque” expressions, he spent weeks hanging around the lower class parts of town studying the bodies, stances and gestures of various commoners. But for the visages of the saints themselves who are, along with the face of Jesus, lost to history in terms of any factual depictions, he selected from well-known friends and courtiers of the Ducal Palace in Milan. Thus these characters are both realistic, ahistorical and anachronistic simultaneously.

Third, the work of fresco is time and labor intensive and large scale murals are very much a team sport.  Many materials such as certain paint colors and sealants had to be developed in a proprietary fashion by each workshop through a method of experimentation similar to laboratory chemistry. Most great art works were made by the master and his apprentices, but contracts at times specified certain portions which must be completed by the master himself. And the work itself was not necessarily quiet and contemplative but perhaps closer to today’s modern construction sites replete with boombox jamming. Although, Da Vinci is reputed to have worked to the sound of musicians or readers speaking from philosophical books, a Renaissance-era Spotify/podcast listening approach to productivity.

While the Last Supper is an act of inspired genius, it did not simply leap out of the head of Da Vinci through his paintbrush fully-formed. It was a team effort and followed a thorough process in which the final “draft” was first broken into constituent parts, practiced and rehearsed (“studies”, “carbons”) before being recomposed piece-by-piece as a fresco. The process is similar to writing a long history or novel (see Paris Review Interview No. 5 w/ Robert Caro) and has parallels in sports and investment analysis– from the parts to the whole.

While Leonardo Da Vinci found himself disappointed in his inability to produce a volume of highly anticipated works, his ability to nonetheless achieve global notoriety for just two works of art over the course of a longer, fully life perhaps gives double-meaning to his quip that “men of genius sometimes accomplish most when they work the least.”

Review – Brunelleschi’s Dome

Brunelleschi’s Dome: How a Renaissance Genius Reinvented Architecture

by Ross King, published 2013

The cathedral of Santa Maria del Fiore, known far and wide as Florence’s Duomo, took nearly 150 years to construct, beginning in 1296 and ending in 1436 with the completion of its massive dome under the direction of capomaestro Filippo Brunelleschi. The quinto acuto arch of the dome was an engineering marvel constructed without stabilizing buttresses and without a wooden centering to hold it in place as it was built. It defied the imagination of the civic leaders responsible for building the cathedral at the time and the methods and architectural rationale behind it were made purposefully obscure by the paranoid and secretive master “Pippo”.

Fast forward over 500 years of history and the principles by which the dome was constructed appear to be no less mysterious. From the post-war era onward numerous attempts at magnetic imaging and other sounding methods have been made to try to ascertain the precise materials and methods used with most returning a Magic 8-Ball-esque  answer of “Reply hazy, try again.” Many lesser domes had been constructed in earlier history in the West and the East, but Brunelleschi’s dome was the greatest span and the highest height achieved since the Hagia Sophia in Constantinople and before that the Pantheon of Rome. Few have attempted anything nearing its proportions since and it seems apparent from the text that even if some modern had an inkling to they’d be hard pressed to figure out how to accomplish it without “cheating” in some way by use of innovative new materials or other supportive techniques.

But the grandiosity and secrecy of the dome’s construction is just one of the many wonders involved. Another is that Brunelleschi was not a trained architect but a goldsmith. Of course, goldsmiths of his era were considered the master craftsmen and technicians of their time (the book mentions how most significant architectural works in the West predating the Florence cathedral failed to record the name of the architects responsible for designing and raising them, so lowly was their perceived status) and the task before Brunelleschi was not simply to design the dome but to coordinate its construction via teams of specialized handiwork guild members as well as to manage the logistics of supplying the building materials, much as a film producer is responsible for pulling together writers, actors, financiers, set locations, film teams and so on. Still, it seems to demonstrate the virtuosity of the man’s mind that he was responsible for building something which was essentially an amateur attempt given his background.

Another wonder of the raising of the cathedral and the dome is the fact that this was one of many simultaneous grand public works built over the time. The city had organized a well-financed oversight committee, the Opera del Duomo, led by the most esteemed woolen cloth guild (a key pillar of Florence’s economy and regional importance), the Arte della Lana, which hired contractors to complete the cathedral and numerous other churches, sculptures and edifices around the city. Today we might think of an economic boom period lasting a decade but it seems that Florence’s skyline was littered with cranes, booms and scaffolds for the better part of two centuries.

Besides innovating architecturally, Brunelleschi also created numerous ingenious tools and machines to aid the construction process. One was an enormous ox-powered materials hoist which rose to the height of the roof of the cathedral from the floor of the nave and had changeable gearing such that the ox team could raise and lower materials in a controlled fashion without being removed from harness and changing direction, an enormous time savings over the life of the project. He also invented specialized cranes, pulley systems and other machines for traversing materials across the expanse of the open dome while it was under construction. Getting multiple hundred-ton slabs of marble, hardened timber beams and iron chains and clasps up the 20-story height of the cathedral was only half the battle as once there they needed to be moved across numerous axes in a precise, controlled fashion before being lowered into place, all while gusts of wind, rain and sometimes even snow obstructed the workers’ efforts.

As impressive and awe-inspiring as structures like Santa Maria del Fiore are and were, I couldn’t help thinking about the monumental waste of these projects compared to alternative uses for the materials and labor and ingenuity involved. Most of the space created by the cathedral is empty by design– this heightens the sense of majesty of the house of God. And this is partly why the building was so complex and expensive to create. The mere fact that the people of this era could construct something like this is a demonstration of their wealth, organizational capabilities, technical know-how and culture of productivity. I just wonder if they weren’t filling up multiple city blocks with empty temples made of the finest construction materials, what could they have built instead that isn’t there?

Ironically, it was these “wasteful” decisions that are the primary source of Florence’s modern tourist economy, so in that sense it was a far-sighted decision by the early city masters to invest in their descendant’s future well-being. And some have even made the case that the splendors of Florence’s Renaissance urbanity were enough to protect it from destruction during World War II.

Florence in the Renaissance was something like New York City today, a wealthy center of commerce and banking, confident in its own power and influence, a great patron of culture and the arts and continually raising great structures in honor of itself. But whereas you can walk amongst the streets of Florence today and see a Medici palazzo or a fine church built half a millenium ago, it’s hard to imagine walking the streets of New York City five hundred years from today and finding the remains of yesteryear still standing and still full of wonder and delight.

 

Review – The First Tycoon

The First Tycoon: The Epic Life of Cornelius Vanderbilt

by T.J. Stiles, published 2010

How and why did Cornelius Vanderbilt, steamship and railroad entrepreneur, become America’s “first tycoon” and in the process earn a fortune worth an estimated $100M in the 1870s? The simplest answer provided by this lengthy biography is that Vanderbilt was able to think about abstract entities such as corporations as representing competitive business opportunities in an age when most other people controlling them thought of them as profitable grants of privilege from the State (which they were). The result was that Vanderbilt thought strategically about his acquisitions in the sense of actively seeking to own things with identifiable competitive advantages (the best route, the lowest operating costs, network effects) which he would then exploit while slashing prices, while his competitors were stuck playing defense until they gave up and offered to buy him out in self-defense.

But the book really doesn’t offer enough specific and concrete evidence to validate this thesis, it’s really just a hunch and an attempt to read between the lines of what is offered. Like most biographers and historians, Stiles consistently fluctuates between the two extremes of failing to provide the necessary evidence to actually understand what was happening and why, and forcing a tortured narrative metaphor of “the capitalist as king/general” that ends up just confusing the issues. Vanderbilt is constantly in “rate wars”, is “battling” for control of companies and finds himself with an “empire” after yet another “conquest.” But we never hear this language in Vanderbilt’s own quotations (based upon written correspondence, newspaper interviews and courtroom testimony) which are numerous.

How Vanderbilt saw himself as a businessman and operator, and how Stiles chooses to depict him with his jarring anachronistic fadism are even more incongruous because Stiles himself spends much of the time arguing against his own descriptions! It is a puzzling choice. Perhaps books about old tyme capitalists don’t sell well without a not so subtle nod to the villainous Robber Baron laying in wait inside of all of them, but it’s a shame because the much more interesting story would’ve been the one told through Vanderbilt’s own eyes. Not to mention the fact that the Robber Baron myth is a lie perpetrated against Vanderbilt, not because he was a horrible monopolist but because he was such a pain in the ass to the horrible monopolists!

[The NYT] attacked him for, as he wrote elsewhere, “driving too sharp a competition” [… deriding] “competition for competition’s sake; competition which crowds out legitimate enterprises… or imposes tribute upon them” [… and called on] “our mercantile community to look the curse of competition fully in the face.”

Similarly, there are constant references to “the world Vanderbilt helped make” with reference to markets and businesses, the city of New York and the emergent nation of the United States of America. And while certainly the man’s actions and decisions were influential and impactful, Vanderbilt was not a statesman and never saw himself as anything more than an ambitious private citizen. There is not one example in the book of Vanderbilt plotting to remake the world in his own image. This is just another forced biographical trope that dopey readers, editors and authors seem to think makes a story ten times better to insist upon when the world just doesn’t have that many psychopaths in fact.

Other information missing from the story that seems essential to charting Vanderbilt’s rise: what he paid for various business assets and how he financed them, what he earned from them and what he paid in taxes, when he controlled an asset and when he was a minority partner, etc. Especially, we should like to know his leverage over time and how he was able to benefit from the various money panics that occurred repeatedly throughout his business career. One thing is for certain, he seemed to always be a buyer in such scenarios, never a seller, and he seemed comfortable being in control of his investments and making and enforcing operating policy, rather than being a mere financial speculator such as a partner like Daniel Drew might.

There are many charming bits of early American social and business vernacular we learn sprinkled throughout the book and its strength is in providing so many direct quotations from primary sources, especially the business media of the day, which really help to flavor the narrative and transport the reader to the place and time described. But this can also be a weakness, when the author ends up name-dropping a litany of capitalists involved in some deal or scheme and dribbling their worries and anxieties from private correspondence over several pages as the deal unfolds. I found it difficult to follow and mostly tuned out what I assume are supposed to be the action-packed moments of the story.

I first read this book shortly after it was published in 2010. I since decided to re-read it and while I wish I had had a bit more energy and focus when I did, I am glad of it. I took a new and different appreciation from some of the book’s events than I did on first pass, which suggests I’ve either improved my mental framework or at least changed it in meaningful ways over the last 7 years. Vanderbilt still comes across as a unique and heroic figure, a true titanic will. The narrative is as confused and cluttered as ever, and while I think there were the makings of a better, more concisely argued book here, and the author certainly has done his research, I am not convinced he did the right research or even fully understood what lessons he was taking away from it. The result is I’ve since downgraded the value of this particular work in my mind and think it belongs to a pretty standard class of historical biographies. Vanderbilt the man himself though is easily a five out of five as far as members of humanity are concerned!

I’ve got far more I’d be willing and able to discuss about this work and Vanderbilt as an example in private correspondence than I think I could fit into a short, coherent blog post, so really ruminating on this story will have to wait for another time and a different occasion.

Review – The Rational Optimist

The Rational Optimist: How Prosperity Evolves

by Matt Ridley, published 2011

Why, for the last 300 years, has “everything” been getting better and better in terms of just about any human outcome you can come up with? Human beings are getting better at exchanging ideas and thus generating new and better ideas. In addition, the total stock of life improving ideas humanity can build from is compounding at an increasing rate. The benefits of free exchange extend beyond the economic realm and into the philosophic, and then back again.

The author charts a surprising course through humanity’s shared hunter-gatherer history. He argues that it was economic trade which allowed the division of labor to develop, and the division of labor which allowed for the transition from hunter-gatherer subsistence living to agricultural subsistence, and from there to a compounding of capital and an increasing division of labor and economic specialization that allowed for mankind to finally break free of the Malthusian trap in many parts of the globe (and more every year).

In addition, he says we are never going back. The genie is out of the bottle and rather than the division of labor being fragile, it is far more robust than any social structure yet experienced and gets stronger the more specialized it becomes.

Because of this, and because when surveying history up to this point in the broadest terms possible there is evidence of things getting better and better for more and more people, not the opposite, the author concludes that the rational thing is to be an optimist and expect this trend to continue.

There are several convenient leaps of logic built off flimsy premises that would startle and upset an opponent of markets and industrialized societies, but there is such a preponderance of hard logic and even harder evidence that there isn’t enough here to tip over the apple cart. But the value of this book is less in its rhetorical force for free markets and industrial development and more in its sweeping survey of a number of seemingly unrelated historical data and economic phenomena into a coherent picture of hopefulness about humanity’s future. I found myself joyfully surprised by the idea that in the chicken-egg quandry of agriculture and trade, the author contends that trade came first and produced all the surplus we moderns have enjoyed since then.

Going “back to the land” or seeking out de-urbanized, atomized communities seem to be doomed to bring their proponents a lower standard of living overall, idealizing a past reality that never actually existed or rejecting the very thing (the division of labor) which is necessary to enjoying a desirable standard of living with modern securities and comforts.

News Media Can Not Be Objective

A friend in the financial industry sent over an article that began,

Hedge funds run by women have outperformed a broad benchmark of alternative asset managers over the past five years, raising fresh questions about why there are so few female portfolio managers.

This is a great example of the “fake news” phenomenon and will serve to illustrate why news media is not and can not be objective in its presentation of facts.

First, news gathering and publishing is part of the discipline of history– it deals primarily with events and information that have already taken place, even while commenting on or attempting to predict events yet to happen. When you open up a newspaper, you are reading articles about things that happened in the past, albeit the recent past. The only difference between what you read in a history book and what you read in a newspaper is how much time has passed between your present reality and the events portrayed in the book or article. In a news article, that time period may be hours, days, weeks or even a few years; in a history book, it may be decades, is often centuries and is sometimes millennia.

Second, as a specimen of history, news gathering and publishing suffers from the same philosophical problem that history in general does, namely, developing a criterion for selecting meaningful facts and data to tell a particular story from the essentially infinite quantity of such facts and figures available. To write history, you first need a person (the author) who has a set of values or curiosity that dictate his desire to explore a particular historical topic. Once he has selected a topic, he has to come up with a theory about the topic and then use the theory to select from and interpret the available data to tell a story about the topic. The news journalist works the same way– start with a person, the journalist (or their editor, advertiser, owner or other primary influencer) who uses their values and judgment to determine what stories need to be told, then, using pre-existing theories of how the world works, select and interpret relevant data to tell the story that needs to be told.

History does not write itself, and neither does the news. Historians write history, journalists write the news, and some innate values and beliefs are necessary in each to cause sufficient motivation to inspire the act of writing and publishing in the first place. Given the motivation, pre-existing logical theories of cause and effect are necessary to determine which facts and data belong to the story and which do not and how they are relevant. At no point in this process up to this point, or after it, is any “objectivity” involved.

Returning now to the example of the story my financial friend shared with me, what can we make of it? A few questions and observations come to mind, using the framework above:

  • Why (what theory/value) is the proportion of female versus male money managers a story that needs to be told?
  • Why was a five year period of data used for observing the phenomenon of relative outperformance?
  • How did the female active managers perform against a genderless, passive index strategy?
  • Were any male active managers able to outperform the broad benchmark used? Were they able to beat the female managers’ performance?
  • Do women want to run hedge funds?
  • Is there is a systemic reason for female fund managers outperforming a benchmark that is persistent and not attributable to luck?

Of course, none of these are addressed in this news story. That is because the job of interpreting the news falls on the consumer of the news, not the news itself– for the news to attempt to interpret itself would be a highly problematic and morally suspect enterprise!

The Greatest Time To Build A Fortune Is Now

From Is Value Investing Broken? by Geoff Gannon:

There’s a tendency for people – people of any time – to see the time they live in as unique, dangerous, different, unlike any other age. In some ways, they are always right. Some things really are different this time from all other times. But, mostly, they’re wrong. And what they are wrong about is reading a golden age of stability into the past. I was talking with a value investor once and this value investor said that sure Ben Graham’s ideas worked in Ben Graham’s times. But Ben Graham invested in simpler times.

Here are the times Ben Graham invested in: the 1910s through the 1950s. He invested during Two World Wars, the start of the Cold War, the atomic bombings of Nagasaki and Hiroshima by the U.S. and then the testing of nuclear weapons by other countries, The Great Depression, a big explosion (reportedly a terrorist bombing) on Wall Street, and the longest shut down of trading in Wall Street history that I can remember at least (right as World War One started). People talk about political risk today. Political risk in Ben Graham’s time meant Marxists and Fascists. Investors saw hyperinflation in Germany after the war and then they saw deflation after the 1929 crash. These were not simple times. If you go back and read the newspapers from the time – you can see how not simple they were.

Now, yes, they were different from today in some ways. Much of the period investors and economists in the U.S. study were more regulated than today. So, you either had the Gold Standard or Bretton Woods. You had much greater belief in planned and insular economies in a lot of countries. With the benefit of hindsight – and seeing the entire sweep of history – many of these decades seem simple to us. They rarely were. Try to find a decade without too much inflation, too much deflation, too much war, the mania of some bubble, or the bursting of that bubble. At any point in that past, people could have believed value investing was dead. And yet, buy and hold investors – business owners and the like – have been compounding fortunes in the U.S. from the 1800s through today. If there are companies that can make founders and their families billionaires – there are companies that can make shareholders very rich if they buy and hold.