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Ben Inker, GMO – Dispelling Myths in The Value vs. Growth Debate (The Best Investment Writing Volume 6)

The Meb Faber Show - Better Investing

CHAPTER

Slower Growth Could Lead to Better Returns for Value Stocks

Correlation may not prove causality, but it is foolish to dismiss an argument that correlates decently well with what has occurred without a reasonably thorough analysis. The obvious way slower growth could lead to sustainably better relative returns would be if the gap between the growth of growth stalks and the growth of value stalks became larger. But as we saw on exhibit ten, that growth gap has been almost exactly what it had been in the previous period of values out performance.

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