Ian Lance

At $180, it was doing $4 of earnings.

So people were paying 40 times earnings for Nike just ahead of a period in which the earnings went from $4 to $1.50.

So, and, you know, that is a fantastic example, isn't it, of where both of those bits went wrong.

So, in other words, the earnings were not as great as you originally thought they were going to be and you were paying too much for those earnings in the first place.

You put both of those things together and you just get this horrific, you know, combination of derating on lower earnings.

That's the story across lots and lots of these.

Another example, Starbucks earnings has gone from $350 to $230.

People are still paying 40 times earnings for that.

There are examples in the UK, Reckitts.

Reckitts did 320 of earnings back in 2018.

They're forecast to do three this year.

So again, you know, the earnings for a lot of these things have just not been nearly as good as maybe people anticipated and you paid the wrong price at the start.

Yeah, it is.

And actually coming back to this point about the fact that we rotate around the market to where the value is, people often laughed at the fact when we joined RWC, as it was in 2010, we owned Microsoft.

We were value investors when Microsoft.

Why?

Because in 2010, all the tech guys would tell you that Microsoft was basically, it was like old technology was going to get disrupted by all the new entrants and so on and so forth.

Microsoft was trading on eight times earnings back in 2010.

It had net cash on the balance sheet.

There's a fantastic example, I guess, of what you're talking about.