Rear view mirrors don’t always offer the best view. Especially when the chart highlights an historic equity bull run post GFC.

Our insurance float and cash are sources of optionality. And yeah, a static low return assumption forever is a tempting assumption. Just look at those numbers.

Most of the time they earn—yes modest returns, but their real value lies in the ability to act when extraordinary opportunities appear. A long bull market since 2009 has severely limited these moments, which might make recent returns look representative of the future.

In truth, the optionality embedded in durable, low-no cost float means that when markets dislocate or acquisitions become attractive, we can deploy large amounts of capital at returns well above “normal”.

Over decades, those rare moments dominate compounding, one reason why we maintain liquidity far beyond what day-to-day operations require. Simply looking at average forward returns misses this structural advantage—float is both (for us, free) leverage and flexibility, and that optionality is a central driver of our long-term value.

Optionality has real VALUE.

Our cash, obviously, is worth MORE today than it was 2 days ago. What it buys at the “market store” is more than what it could buy at the market store just 2 days ago. Same with Float. I don’t assume low return float forever.