Thanks, Jason! Always appreciate your thorough follow-up.

You have nailed it in regards to the middleman. In choosing to cater to the consultant, the manager trades the direct relationship for access to larger asset pools.

I had a comment made to me by a manager of managers to the effect: "It takes three years [for the manager] to get hired with us, one and a half to be fired." It stuck me as shortsighted, particularly given the source, which I consider to be respectful. If you have committed to a manager for the right reasons, there is no reason to fire someone for failing to produce superior results by following the right strategy (what they state they are competent in). By the same token, I would actually be more in favor of firing someone for producing a superior return but deviating from their stated core competency, because it is arguably random and not expected to persevere.

Another issue I have with the sacking of managers is that a high water mark is the client's asset (Leon Cooperman is fond of saying this). By firing a manager after a bad period, a consultant or manager of managers may be depriving clients of the ensuing recovery, during which the manager is essentially managing money for free (without incentive fee).

We could go on and on on this fascinating topic, but in the end we come to your conclusion: for managers to mind their investment and not their marketing. The AUM will follow.