Site Administrator Says I Represent a “Threat to the Community”

Alex Frakt, site administrator for the forum, acknowledged in a recent post to that forum that I was banned from posting there even though I never violated any of the site’s posting rules. He said that I was banned because I represent a “threat to the community.”

Frakt offered his comments on this thread. The post referring to me (I posted as “hocus” in that community) is the one put forward on January 13, 2011, at 4:14 pm. After saying that the norm in the community is to ban only those who violate posting rules, Frakt writes: “Hocus is the great counterexample, of course. Which is part of the reason why we have an Advisory Panel: to give us the flexibility to deal with threats to the community that do not clearly fall under one of our posted guidelines.”

The history that explains the banning dates back to the morning of May 13, 2002. On that morning, I put a post to the Motley Fool’s Retire Early board asking whether the valuation level that applies on the day a retirement begins needs to be taken into consideration in calculations of the safe withdrawal rate (the inflation-adjusted percentage of his portfolio value that a retiree may use each year to cover living expenses with virtual certainty that his retirement plan will survive 30 years, presuming that stocks perform in the future at least somewhat as they always have in the past). Extensive research was done on this question in the following years in both the Retire Early and Indexing communities and every analysis showed that a valuation adjustment is indeed required. Background on the safe withdrawal rate matter is available at the Google Knol that I wrote on this topic.

I have seen two reactions to my advocacy of  New School (valuation-adjusted) safe withdrawal rate research at every community in which I have posted on this topic. Many community members respond with excitement to learning for the first time how retirement planning (and, by extension, stock investing in general) really works. Thousands of community members have expressed a desire that honest posting on safe withdrawal rates and other important investing topics be permitted at our boards (an article setting forth of the comments of 101 community members expressing this desire is here).

However, there has also always been intense opposition to the idea put forward by individuals who have written books or prepared studies or calculators rooted in the Buy-and-Hold Model of understanding how stock investing works (Buy-and-Hold is rooted in the research of University of Chicago Economist Eugene Fama and posits that investors do not need to change their stock allocations in response to valuation swings). Discussion of the implications of the research of Yale Economics Professor Robert Shiller, who found that valuations affect long-term returns and thereby discredited Fama’s Efficient Market Hypothesis, has been banned not only at the Bogleheads forum but at every large investing board on the internet as well as at numerous influential personal finance blogs. The result of the Social Taboo that has developed since The Stock-Selling Industry elected to spend hundreds of millions of dollars promoting the now (but not then) discredited approach is the investing crisis we are living through today (for more on how the promotion of Buy-and-Hold caused the economic crisis, please check out this article).

I had a long reputation for posting honestly in support of the Shiller model (Valuation-Informed Indexing) even in the face of brutally abusive posting by those seeking to “defend” the Buy-and-Hold Model at the time I put my first post to the Vanguard Diehards forum (the community that meets now at the Bogleheads forum met at the Vanguard Diehards forum before moving to the new site to avoid my postings). My first post generated a hostile response and the site administrators failed to take action to rein in the hate and anger and contempt that came from Buy-and-Holders as discussions over whether valuations matter in stock investing came to dominate the forum over the next several years (I am not able to recall a single time in which a Valuation-Informed Indexer posted abusively).

Matters came to a head in February 2007. Vanguard Founder John Bogle planned to speak at the indexing community’s annual conference. I announced plans to attend. Many expressed excitement that I would be able to put to Bogle the questions that had caused such controversy among indexers for so many years. At this point, the Lindauerheads (Mel Lindauer, the co-author of the book “The Bogleheads Guide to Investing” was the leader of the Goon posters seeking to intimidate those who dared to post their honest view that valuations matter in stock investing) formed a new site where they could be free of the relatively even-handed site administration policies of Thus was the Bogleheads forum born. Posters who oppose honest posting have remarked on numerous occasions in the time since how lucky the board community was that their desire to escape my posting freed them from the reach of responsible site administrators. Those advocating Buy-and-Hold at the Bogleheads forum no longer have to deal with those annoying questions about the 140 years of historical stock-return data showing that Shiller is right and Fama is wrong!

Is what Frakt says so? Am I a threat to the Bogleheads community?

By no means. A community that closes itself to questioning is a community in the process of experiencing a slow and painful death. There has never in the history of the indexing community been an issue that has generated even a small fraction of the genuine interest that we saw generated by our explorations of the effect of valuations on long-term returns during the years when such explorations were tolerated. Community members have now suffered huge losses because of the ban and many feel even stronger doubts about Buy-and-Hold today than they felt in the days when questioning of the strategy was permitted. Even Taylor Larimore, another co-author of  “The Bogleheads Guide to Investing,” at one point shortly after the crash acknowledged that he had abandoned Buy-and-Hold in favor of a mysterious “Plan B” because of concerns that his retirement would be in jeopardy if he stuck with the strategy he had advocated for many years at the board (Larimore today has at least for a time returned to generally favoring Buy-and-Hold strategies). Allowing honest posting by all community members would save the community, not do harm to it. It is the ban that is killing the indexing community.

That said, I do represent a threat of a different kind. I represent a threat to Buy-and-Hold. Another way of saying it is that I represent a threat to Get Rich Quick. A strategy that tells investors that they do not need to change their stock allocations even at times of insane overvaluation is a Get Rich Quick scheme no matter how it is promoted in the marketing materials. Where do the Buy-and-Holders think that the money used to send stock prices so high in the late 1990s came from? Was it printed up by Milton Bradley? The money was being borrowed from future investors (Today’s investors! Us!). The unwillingness of the Buy-and-Holders to acknowledge the need to pay back the $12 trillion debt incurred during the Buy-and-Hold years is typical of Get Rick Quick thinking.

I am no threat to indexing or to any indexing community. I aim to become the greatest threat to Buy-and-Hold and to all other Get Rich Quick investing schemes that I can possibly be. Why? Because I don’t believe in Get Rich Quick. Because I believe in long-term investing, data-based investing, intelligent and honest and realistic investing,  investing rooted in the academic research. Why do I believe in these things? Because of the persuasive arguments advanced in support of these preferences put forward by people like John Bogle, Eugene Fama, Burton Malkiel, William Bernstein, and many, many other Buy-and-Holders.

John Bogle does not object to discussions of Valuation-Informed Indexing. He has said publicly that he believes that the concept can work. To be sure, Bogle has shamed himself by failing to stand up to the Lindaurheads in defense of the community that meets at a board bearing his name (and, yes, I have made a personal plea to him to do so). But Bogle himself is not a Lindauerhead, at least not according to his public statements. It is of course absurd that discussion of an investing strategy that Bogle himself says can work is prohibited in a community bearing his name. I think it is fair to say that Bogle’s name is being dragged through the mud each day that the ban remains in place. It casts doubt on all his good work for those who claim to post in his name to make a daily implicit statement that Bogle is not up to the task if defending his investing advice in civil and reasoned discussion.

He’s not up to it, of course! The Lindauerheads are right to be alarmed at the prospect of Rob Bennett asking John Bogle questions re his longstanding investment advice in a public forum. But that should not be such a big deal. The mistake that Bogle and Malkiel and Fama and all the others made is not the first mistake that has ever been made in the history of humankind. There are procedures that we all learn about in kindergarden that we know to follow when we make mistakes that harm so many of our friends in such serious ways. We acknowledge the mistakes! We apologize for the human misery caused by the mistakes! We vow to do better! We move on with our lives!

And do you know what happens when we follow those procedures? The people harmed by the mistakes forgive us. And in time they come to recall that it is not only our mistakes that define us. The humans who make the biggest mistakes are often the same humans who bring about the greatest advances in human knowledge. Why? Because they stick their necks out. Because they take chances in going where none have gone before them. Because they are pioneers.

Bogle is a pioneer. Fama is a pioneer. Malkiel is a pioneer. The thousands of others who have advocated Buy-and-Hold are pioneers. How does the indexing community insure that these pioneers ultimately obtain the respect and gratitude and affection they merited through their hard and well-intentioned work despite the huge losses they have caused through their inadvertent advocacy of the purest and most dangerous Get Rich Quick scheme in history? We insure it by turning the focus away from the ugliness and deception and intimidation and word games we have seen during the Campaign of Terror against our board communities and by placing it instead on a constructive and healing and life-affirming transition from the failed Buy-and-Hold Model to the investing model of our future, Valuation-Informed Indexing.

Valuation-Informed Indexing could not exist but for the contributions of Bogle and many other Buy-and-Holders. But the longer the ban on honest posting on safe withdrawal rates and other critically important investment-related topics remains in place at our boards, the more difficult it becomes to make the case for Bogle and the other Buy-and-Holders to the millions of middle-class investors who have been done such harm by the failure of The Stock-Selling Industry to back down on its dogmatism for three decades after the academic research showed that there is precisely zero chance that Buy-and-Hold could ever work for the long-term investor.

No one posting honestly on what the academic research of the past 30 years says about the dangers of Buy-and-Hold represents any sort of threat to the indexing community. It is the ban on honest posting that represents a threat to us. The ban on honest posting makes us look absolutely awful in the eyes of the millions whose financial futures have been destroyed by our too easy acceptance of Get Rich Quick thinking during a time when it seemed to be paying off (Get Rick Quick of course always performs like gangbusters during out-of-control bulls).

I pray that I will over time come to represent a huge threat to the continued promotion of Buy-and-Hold. I represent zero threat to the promotion of indexing or to the advocacy of any of the many powerful insights through which Bogle and the other Buy-and-Holders have been enriching all of our lives for many, many years. I am the true Boglehead. Lindauer represents only the man’s dark side (at least this is so at the times when Lindauer is playing the role of Enforcer of the Buy-and-Hold dogmas). The future of indexing lies in the promotion of Valuation-Informed Indexing, not Buy-and-Hold.

This is my sincere take re these important matters, in any event.

Hang in, there True Bogleheads! We see signs of a growing interest among middle-class investors in learning the realities of stock investing as revealed in the academic research of the past 30 years on an almost daily basis. As famed portfolio strategist Sam Cooke once put it: “It’s been a long time coming, but Lord I know that someday soon now A Change Is Gonna Come.”


  1. Rob says

    One reason is that they fear what the internet sewer rats will do to them if they do, Critter. The sewer rats have not hesitated to employ threats of physical violence to block honest discussions. We do not pay community members to post at our boards. There aren’t too many people who are willing to put their lives in jeopardy to be able to post their sincere views for free at a discussion board.

    The other important reason is that, while many favor the idea of permitting honest posting (an argument can be made that there is a universal consensus re this one since every community member clicked the “I Accept” button re posting rules that permit and even encourage honest posting), few understand the full implications of Shiller’s research. It’s clear that the general take of many is “Yeah, Rob is clearly on to something, but I doubt that it’s too much of a big deal.”

    How do we change that, Critter?

    We change that by permitting honest posting.

    Every new idea in the history of the planet began with one person believing in it. Then it became two. Then four. Then eight. Then sixteen. Then, not too much time later, sixteen million. People learn about new ideas by talking them over with their friends, by asking questions about them and by pondering the answers they hear to those questions.

    The sewer rats have short-circuited the Learning Together process that we need to have in our communities if they are to survive.

    Are you aware of what many said about Bogle’s indexing idea when it was first put forward? Bogle was smeared by the voices of ignorance just as those expressing a desire that honest posting in our communities have been smeared. There was a day when indexing was widely viewed as “Un-American.” Indexing was one of the biggest breakthroughs in investing history. We are all lucky that Bogle did not back down to the Mel Lindauers and John Greaneys of his time but remained loyal to his fellow community members and to his own love for the middle-class investor and to the advancement of knowledge of how stock investing works in the real world.

    There is not one person alive who does not benefit from learning how to invest effectively, Critter. That includes you and the other abusive posters. But there are limits to what garbage people are willing to walk through to get their questions answered. When we give the sewer rats the old heave-ho, I can assure you that we will have zero problem getting lots of community members to participate constructively at every board.

    It’s your hate and anger and contempt for your fellow community members and for the historical data that is causing the trouble, Critter. Please think over whether this is really the way in which you want to spend your life energy. We all get one go-around in the game of life. When you are old and grey, is this ugliness the thing you want to look back at as your most impressive accomplishment of earlier years?

    I wouldn’t want to be left for those memories for all the money in the world. I don’t want to see you placed in that horrible sort of position either, my internet sewer rat friend.


  2. Evidence Based Investing says

    The sewer rats have not hesitated to employ threats of physical violence to block honest discussions.

    Could you back that claim up with a link to a threat of violence?

  3. Rob says

    I could but I am not going to waste my time doing so, Evidence.

    Those who feel some respect and affection for the thousands of good people who post in our communities do not need to see a link to want to help them out.

    Those who feel such contempt for their fellow community members and for themselves that they would tolerate people putting forward threats of physical violence in their presence and not take action to stop them are not going to develop respect and love for their fellow communities or for themselves by being exposed to a link.

    What you need is a heart, Evidence, not a link.


  4. Evidence Based Investing says

    I do want to help out and I do want to stop them. However if I ask a site owner to stop the threats of violence that owner will ask me “What threats?” and I will have to answer “I don’t know, hocus refuses to disclose that information.

    I could but I am not going to waste my time doing so, Evidence.

    Producing a link would have taken less time than writing that response.

  5. Rob says

    if I ask a site owner to stop the threats of violence that owner will ask me “What threats?” and I will have to answer “I don’t know, hocus refuses to disclose that information.

    What a prepicklement!

    I mean — What a Predictomot!

    I mean — What a Persnicketyocumeter!

    I mean — What a Potnogotter!

    Oh, you know what I mean!

    Producing a link would have taken less time than writing that response.

    That’s so.

    You not asking for a link in the first place would have saved us both even more time.

    The Get Rich Quickers speaking up when the threats of physical violence first appeared would have saved entire board communities even MORE time.

    Bogle and the others correcting their mistake in 1981, when the research first showed that Buy-and-Hold can never work in the long term, would have saved ALL INVESTORS even MORE time and whole big bunches of MONEY too.

    It’s a good thing that the humans are 100 percent rational and 100 percent efficient. I hate to think where we would be if it were possible for any of them ever to mess up.


  6. Evidence Based Investing says

    You not asking for a link in the first place would have saved us both even more time.

    The great advantage of internet discussion boards is the ability to interact with other community members, to ask and answer questions. I should have realized by this time that answering questions is not your strength.

    The Bogleheads are great at exchanging information and opinions and hence have a strong and thriving community.

    You have not yet developed those skills and hence “No Comments” is most often seen under the title of your blog posts.

  7. izod says

    All I can say is the moderators of Bogleheads are slightly demented in their views. As noted by the author they allow personal to vile attacks against those who question orthodoxy and will not allow even the slightest retaliation. I was victimized by one of the many pets of the moderators and banned because I privately chided the moderator for selectively editing my posts and while allowing her pet’s direct personal attacks to remain. That got me permanently banned.

    There is a lot of useful information in that forum. However understand that there is an almost religious fervor that courses through that forum. It really is disturbing.

  8. Rob says

    You stated things well, Izod.

    I like it that you said: “There is a lot of useful information in that forum.” That is true. And it is important to point that out. Complaints about the Bogleheads Forum often leave the impression that it is the entire community that is lacking. No! The majority of community members at the site are wonderful; they are smart and good and generous people. The entire community should not be blamed for the actions of a few. There were a number of surveys taken during the time I posted there and a number of posters famous for posting honestly on the peer-reviewed research in this field were shown to be among the most popular posters at the site. I was Public Enemy #1 to the “leaders” of the site from the first day I posted there but there were many community members who directed very kind words to me in gratitude for my efforts to turn things around.

    Yes, the moderators are demented. To suggest that they are only “slightly demented” is to be exceedingly charitable. You are to be applauded for your kindness but people listening in need to know the full realities. The moderators at the Bogleheads Forum are not slightly demented, they are 100 percent demented. There was a poster there who summed things up well with the statement that: “There are a bunch of trolls running around calling everyone else trolls!”

    People who care about stock investing should want to figure out what is causing this problem. It is an exceedingly odd phenomenon. The strategy promoted at the board is Buy-and-Hold. Buy-and-Hold is marketed as a research-based strategy. The benefit of following a research-based strategy is that doing so helps investors avoid making emotional decisions. For those following research-based strategies, investing is pretty much a mathematical puzzle. Math is not known as an emotional subject. So what the heck is going on here?

    I never went to investing school and I never managed a big fund. But I am world’s leading expert on this one! I am the person who discovered the errors in the Old School safe-withdrawal-rate studies. I reported what I knew on the morning of May 13, 2002. The reaction of a guy (John Greaney) who had prepared one of the Old School studies was to threaten to kill my wife and children if I continued to “cross” him by posting honestly on SWRs. 200 of my fellow community members (most of these people had become friends with me over the course of my three years of posting at the board) endorsed this guy’s death threats. They didn’t say that I was wrong and publications like The Wall Street Journal have confirmed in the days since that I was right. They just couldn’t bear to hear me report accurately and honestly what the historical data tells us about SWRs.


    People are following a research-based strategy and they don’t want to know what the last 33 years (it was only 21 years at that time) of research says? That doesn’t make sense.

    It doesn’t make LOGICAL sense. It DOES make EMOTIONAL sense.

    The mistake that the Buy-and-Holders made was to ignore valuations. Both overvaluation and undervaluation are caused by investor emotion (the rational thing would be for investors to set stock prices properly). The research of the past 33 years shows that investor emotion is about 80 percent of the story. Get that one right and you cannot lose in the long term. Get that one wrong and you cannot win in the long term.

    The Buy-and-Holders got that one wrong. So they cannot win in the long term (according to the last 33 years of research). How do you think that makes them feel?


    That’s why you see what you see at that board, Izod. The Buy-and-Holders are HURTING.

    The best thing for them to do would be to acknowledge their mistake. But the bigger a mistake it is that is made, the harder it is to acknowledge. The Buy-and-Hold Mistake is the biggest mistake ever made in the history of personal finance. There are now millions of middle-class people who are in the process of experiencing failed retirements because of this mistake. The Buy-and-Hold Mistake was the primary cause of the economic crisis, which caused millions to lose their jobs. The Buy-and-Holders have hurt their friends and neighbors and co-workers and fellow community members in very serious ways. They are feeling a burning shame over their mistake. How would you feel in those circumstances?

    What makes things worse is that most of us who are aware of the mistake are afraid to speak out about it. Robert Shiller knows. He tells some of what he knows but he keeps a lot of what he knows buttoned up because he knows how much it upsets the Buy-and-Holders for anyone to tell the plain, honest truth about what the last 33 years of peer-reviewed research teaches us about how stock investing works in the real world. It’s the same with Bill Berntein. It’s the same with Larry Swedroe. It’s the same with Scott Burns. It’s the same with Todd Tresidder. It’s the same with Wade Pfau. Its the same with Jack Bogle. It’s the same with Mike Piper. And on and on and on and on and on.

    The mistake is so big that hardly anyone dares to point it out and demand that it be corrected. You have heard of companies that are too big to fail? The mistake made by the Buy-and-Holders is The Mistake Too Big to Correct.

    So the suffering continues.

    The millions of middle-class investors being tricked by the Buy-and-Holders suffer. And the Buy-and-Holders themselves suffer. And of course all the people who work in this field and who would like to be doing productive and meaningful and honest and important work suffer. Bloggers suffer. Academic researchers suffer. Journalists suffer. Economists suffer. Investment advisors suffer. It’s too, too sad.

    Anyway, thanks for stopping by and sharing your thoughts re our friends at the Bogleheads Forum. I have hopes that all of this is going to swing in a better direction following the next price crash. I intend to take over ownership of the Bogleheads Forum as part of the litigation settlement. You will receive a warm welcome when you return to the forum that improperly banned you in its dark days, Izod. Hang in there, my new friend!



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