Set forth below is the text of my October 28, 2009, e-,mail to Mike Piper (author of the Oblivious Investor blog) in response to the e-mail sent by Mike to me that was set forth in yesterday’s blog entry.
My way of making the point is to point to the historical data showing that the claims that Passive Investing can work are false.
You are of course correct that in ordinary circumstances it would not be necessary to make these claims more than one or two times. In ordinary circumstances, your response would be to stop making the claims once you became aware of the errors in them. You have not done this. You continue to make the claims that have been demonstrated to be false at numerous boards and blogs for seven years now (there is a long historical record of these discussions available for your review and material summarizing the findings developed from them are available at my site). Thus, I am obligated out of concern as to what these false claims will do to you and your blog community to repeat the explanations of why they are false.
Some of your readers are uneasy because they are being told two opposite things. The situation calls for a resolution of the differences. This is what you should be pursuing. You should be writing on and reflecting on these issues until you have figured them out. If you come to a conclusion that Passive cannot work, that obviously would resolve any problems. If you develop responses to my claims that are clear and strong, that also would obviously resolve the problems.
Until now you have been ducking these questions. It would make all the sense in the world for you to take things to the next natural step and get about the business of trying to resolve them. I will obviously do everything that I can possibly do to make such an effort succeed. That’s the best solution for you, for all your readers and for the indexing community in general.
I will continue to applaud you when you get it right (in my assessment) and I will continue to point out your errors when you get it wrong (in my assessment). That’s the job of an honest commenter at your blog community. If you do not see it that way, you should be asking yourself what you have gotten yourself mixed up in that has caused you to feel the way you do about it.
What if you are wrong and I am right, Mike?
Have you given thought to how many lives you will have destroyed through your words in that event? There are responsibilities that come with opening up a personal finance blog. Serious questions have been raised about claims that you put forward at your blog. You have a responsibility either to explore those questions or to stop making the claims that have been questioned. I have a responsibility to point out how wrong you are to fail to meet those responsibilities in the event that you do indeed fail to meet them.
I need to be able to face the man in the mirror when I wake up in the morning, Mike. That’s the bottom line re all this. Millions of retirements have been positioned to fail in years to come because of the failure of the Passives to acknowledge their mistakes for 28 years now. Millions of businesses are positioned to fail. Millions of marriages are under strain. Our political system is feeling the strain.
Marketing considerations are important. Marketing considerations should not be primary for those putting forward advice on how people should invest their retirement money.
That’s my sincere take re all this.