Thread by @FrederikNeckar

Some additional resources to @B3_MillerValue's recent profile

"I’m just trying to understand the present."

"supercharged his personal bet on AMZN during the financial crisis, loading up on call options as the stock plunged"
barrons.com/amp/articles/h…

On Bitcoin
"It’s Economics 101. The supply grew 2.5% last year; it’s growing 2% this year. Is demand growing faster or slower than 2%? It’s that asymmetry between supply and demand that is leading to what’s going on."

Here is a profile from 2001, when Miller had just beaten the S&P ten years in a row.

Stocks were falling, Miller was buying:
"If you want to boil down everything we do, it's this: The guy with the lowest average cost wins."

archive.fortune.com/magazines/fort…

Started early: "barely 9 years old...His father "bought a few stocks."

"He said, if you own this thing, and it goes up, you make 25 cents."
As a teenager, he bought his first investment book, How I Made $2 Million in the Market, by a dancer-turned-speculator.

Not your average value manager:

Many value managers, Miller says, "sound like Old Testament prophets," speaking as if their approach to investing "corresponds to some deep structure in the way the world works." Miller wants to be less "theological"

"Willingness to look wherever the values appear" led him to tech in mid-1990s

'Tech was more predictable than Buffett believed. Microsoft and Intel had achieved total dominance. There were "winner-takes-all markets" he concluded. The key was to identify the future monopolists.'

"Dell could be the Wal-Mart of the PC industry. It had a sustainable competitive advantage, and the market didn't understand it."

Even as Dell's P/E rose above 70, Miller held the bulk of his stake, watching as it ballooned to $1 billion.

"So long as Dell is generating superior returns on capital and its superior business model is intact, I won't sell"

AOL was down 60%.
"People were telling us that it was a massively stupid thing to do."

He thought AOL had a strong chance of becoming a monopoly with already 50% of US consumers. "There wasn't a chance in the world anybody else" could catch up.

"We made 50 times our money."

Met 'Amazon execs' at Santa Fe Institute in 1999.

Amazon "has incredible economies of scale, which will eventually become apparent. It doesn't have to keep inventory in stores, which is hugely expensive. So its cost of operations is much lower."

Bought from $80 all the way down, 15% stake.
"We were clearly wrong in buying when we did."

'If he's wrong, it will be the most public failure of his career.'

"If we're right, we think we'll make 50 times our money over ten years."

"Amazon symbolizes what people hate about the Internet: a young man like Bezos making a billion dollars, these companies losing vast amounts of money."

The challenge for investors is to set aside "preconceived notions" and focus on "the long-term reality, not the perception."

Extremely competitive about his track record:
"Every day he's staring at the screen saying, 'Goddamn it. A minute ago I was 20 basis points ahead, now I'm 20 behind."

"There's a very reasonable chance that it's pure luck going on here," he says. "One can't conclude anything about my record before it's over."

"If we were to have some spectacular flameout, it could easily wipe out the entire record."

His open-mindedness and willingness to go against the grain stand out. Both in tech and when there was blood in the street - buying stocks on the way down.

Careful with that in the case of highly leveraged companies, particularly financials.

"If we were to have some spectacular flameout, it could easily wipe out the entire record."

brontecapital.blogspot.com/2017/01/when-d…

Miller in 1987, bullish after the crash:
"Investors systematically misperceive the risk in financial markets"

More from 1997-2001:
"I'll easily trade no rate of return in the near term for higher confidence that a stock will outperform in the long term"

"Mr Miller has insisted he can indeed be both a card-carrying value investor and a holder of tech stocks including AOL and Amazon"

Swapped Amazon stock for converts:
"Issues surrounding Amazon's financial condition reflect either poor understanding or overly pessimistic assumptions about ecommerce growth"

"When people say it's time to buy growth or time to buy value, that just makes it easier to ignore the complexities of the market"

"Value is not a static concept. Value of good, growing companies rises."

"The key to Amazon's future is the potential return on its invested capital"

Link to his old fund letters:
"Most value funds have minimal tech exposure. Sometimes the reason is valuation More often, a lack of familiarity or an unwillingness to try and analyze what appears to be a complex group."

"I've been on the top and I've been on the bottom," the 64-year-old Mr. Miller says. "And the top is better."

Amid the stress, Mr. Miller gained 40 pounds, couldn't sleep for more than a couple of hours at a time and suffered through many other changes.

2005 meeting with Ben Bernanke. In their discussion about the U.S. economy, Mr. Miller says he was told: "Look, the job of the Fed is to prevent the worst case from happening. We think we know how to do that." A spokeswoman for Mr. Bernanke says he doesn't recall the meeting.

If there was a big drop somewhere, he got out of bed, put on pants and usually a Santa Fe Institute T-shirt, went downstairs to his home office, and began the workday in the middle of the night.

"It is relatively hard to get back to sleep when everything is falling apart."

"True to form, he sold the yacht in 2009 to plow more money into the pummeled stock market. He says he had spent only about two weeks on "Utopia," which he bought mostly for his wife. They are now divorced."

Mr. Miller also hired a consultant to analyze trading patterns in Value Trust and Opportunity Trust for ideas on improving performance in another crisis. The consultant recommended waiting for signs of a turnaround before swooping in to buy a battered stock.

Santa Fe Institute, where he is chairman emeritus and one of the largest donors. A visit here in the mid-1990s helped persuade Mr. Miller to load up on technology stocks.

"You don't come here to get an answer to something. You come here to understand things in a different way."

"Chip" Mason, the Legg Mason co-founder who hired Miller in 1981, recalls his confidence AOL in the mid-1990s when the browser kept crashing.

"What are you doing with AOL? It may just evaporate. The system may just explode."

Mr. Miller replied: "Oh no, the system will be fine. I bought some more today." He reasoned that the crashes happening as users tried to log on were a sign of AOL's popularity.

Bitcoin in 2014:
"Mr. Miller says he made "not an insubstantial investment" of his own money in bitcoin, calling the virtual currency an "interesting intellectual and technological experiment."

He bought after Mt. Gox tumbled into bankruptcy."

2014 WSJ article: 'Mutual-Fund King Bill Miller Makes Comeback'

wsj.com/amp/articles/m…