“One of the Most Ridiculous Is That Buy-and-Hold Led to the Depression and to the Current Crisis”

Edwin Ivanauskas, owner of the Finantage blog, wrote me an e-mail on May 11 detailing his plans for writing a series of articles re my criticisms of the Buy-and-Hold investing strategy and his reactions (both positive and negative) to those criticisms. Set forth below are his words. I will post the text of my response in Monday’s blog.

Last week we had a brief back and forth on your guest post at popeconomics.com.  I promised to write a lengthy response in my own site.  

I wanted to stick with just the meat of the topic (value informed investing vs. buy and hold) and give a strong overview of the two to my readers. Well, I’ve been unable to do that in such a short time frame because of the amount of research required.  I’d like to run the numbers in scenarios before committing to any definite positions on the subject.  

I will likely publish on the topic in multiple posts over time.  For example, giving an overview of the flaws in buy and hold, discussing valuations, etc.  

One part I’m having issue with is you.  You have a style of argumentation that I take some issue with, as I’ve already posted in the comments of Pop Economics.  

You tend to take a long time to come to an answer, and often times don’t even answer the person’s question.  You also make some assertions that are not consistent with reality.

First, you tend to use a lot of straw man arguments to portray others, for example harping on how price doesn’t matter to buy and hold investors.  

One of the most ridiculous is that buy and hold led to the depression and to the current crisis.

Anyway, I don’t want to go line-by-line responding to things I disagree with as that would be far from productive.  But I think those types of statements really turn people off and you should reconsider them if you want to get a larger audience for your ideas.

Comments

  1. sadface says

    Heh, I wonder how many people its going to take before Rob figures out how big of an online jerk he is.

    I think infinite.

  2. Rob says

    Edwin didn’t call me an “online jerk,” Sadface.

    But I think your suggestion that his words send pretty much the same message is not an entirely unfair one.

    I’d like to see Edwin (and many others, to be sure) address this question directly. Does he see me and the thousands of community members who have expressed a desire for a lifting of the Ban on Honest Posting as “jerks”? Or does he see the Goons who insist that the Ban on Honest Posting be maintained as “jerks”? Or is his view somewhere in-between those two possibilities or some mix of these two possibilities?

    We don’t solve the problem by ignoring the problem. We solve the problem by talking about the problem and figuring out as a community how best to proceed. I have long referred to this one as the Elephant in the Living Room Phenomenon. The elephant doesn’t go away when you close your eyes.

    My take.

    Rob

  3. sadface says

    I think you are the only online jerk. I don’t see thousands of people – just you. Can you get maybe 10 out of these thousands to post on your website – which obviously allows ‘honest’ postings?

    Then we can see if they are jerks or not.

  4. Rob says

    When you are a buggywhip manufacturer, everyone who drives a car is a “Jerk” in your eyes, Sadface.

    I’m not so different from the thousands who have expressed a desire for honest posting. I saved a lot of money for years so that I could do this full-time. That’s the primary difference. They humiliate themselves by pretending that they “can’t understand” what the Goons are doing because they don’t think they have any other choice. I can’t do that because if I post dishonestly on the numbers that people use to plan their retirements, I don’t have a business anymore (or at the very least I certainly don’t have the right to have one).

    In the heart I am the same as the thousands who have given up a piece of their personal integrity because of their fear of the Goons. We all want our retirements to work. We all want to learn how to invest effectively. We all want to see our country recover from its economic crisis.

    The buggywhip manufactuers are coming from a different place, But you know what, Sadface? There’s a place deep inside you where you want the things that all the rest of us want too. You need to put aside the buggywhip business and get in touch with those deeper feelings. That’s how you find peace re all this.

    I’m sure of it!

    Rob

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