I don't disagree with the conclusion that but there more stuff hidden into 'cheap stocks' than is explained in the paper.
Berkshire receives substantial advantage from the structure it's business and I'm sure it's not an accident.
Bershire is basically insurance and re-insurance operation that uses its steady income and substantial float to finance investing business. It shortcuts banks and external financing and the markup they take.
Compare BRK.A to SP500TR (SP 500 Total return is good comparison because BRK is not giving dividends). BRK matches SP500 when everybody has access to the cheap money. But when downturn or market crash hits and the money is tight BRK starts to shine.
TL;DR: buying cheap stocks is easier when you have constant access to cheap money during those times when others don't.
Berkshire receives substantial advantage from the structure it's business and I'm sure it's not an accident.
Bershire is basically insurance and re-insurance operation that uses its steady income and substantial float to finance investing business. It shortcuts banks and external financing and the markup they take.
Compare BRK.A to SP500TR (SP 500 Total return is good comparison because BRK is not giving dividends). BRK matches SP500 when everybody has access to the cheap money. But when downturn or market crash hits and the money is tight BRK starts to shine.
TL;DR: buying cheap stocks is easier when you have constant access to cheap money during those times when others don't.