Elroy Dimson

Then the next inch on the page will be the 10 becoming 10 times as big as a hundredfold and so forth.

So when you see a series and you're asking me about one particular series and you see one is winning a great deal compared to others, it needs quite a lot to send them to the back of the queue.

Absolutely.

If you know in advance that a country is going to have high economic growth, if you've got a crystal ball, if you can foresee these things accurately, that would be a good case for buying the stocks.

Unfortunately, we don't have a reliable crystal ball.

We typically extrapolate from the past.

When we first started looking at emerging markets and comparing them to developed markets,

There was a wave of interest in emerging markets as being the future, the growth opportunity.

And we don't really argue with that.

The question is whether as a shareholder, you will benefit from that.

And as a shareholder, a stockholder, an investor, if you know that there has been a lot of growth in the past,

Everybody else knows it'll be in the price.

And so you will pay more for a growth opportunity.

And so people who buy into an emerging market, which has done well, are coming along too late.

So the long-term record of emerging markets is surprisingly disappointing.

They've got left behind.

What were the big disappointments if you lose a global war?

that can wipe a great deal off your stock market.

The history of Japan, for example, is one in which a huge amount of financial value disappeared during the Second World War.

If we stood back from that and we asked, well, what happens if we begin our index series not in 1900, not in 1940, but in 1960 or some point in the 60s,