The youth policy is long ingrained in Palio's mind remember CBT etc. Conversely he won't support any form of second team as growing youth players is seen as unfeasible (probably correctly under the current English rules). Regardless, the lack of match practice does undermine the first team.
Tranmere consistently carry dead weights often shortly after they signed.
Take the centre halves. He failed to hang onto the local ageing Clarke, when he wanted to, a loss I reckon is now historical. He recruited the excellent Turnbull and got an excellent Simeu, whilst retaining the dependable Davies. None of whom will ever boost the bank balance but are good at football.
Jamieson couldn't hold down a place at woeful Oldham who along with Byrne, a non-leaguer really, won't do anything at the bank or on the pitch. Hockenhull is the real head scratcher, a Prem club player who has now played one senior match in his life pizza at Crewe just as he turns 22. He is currently breaking no pots at old Cheshire League level.
In hindsight you could scrap the thinking behind the last three and seek another Turnbull level signing. Quality over Quantity and on pitch over fantasy transfer fees.