My Second E-Mail to John Bogle: “I Haven’t Been Banned at Any New Boards or Blogs for Six Months!”

Set forth below is the text of an -mail (with the subject heading “More Defamation/Intimidation/Deception at Bogleheads Forum)  that I sent to Vanguard Founder John Bogle a few moments ago:

John:

This is Rob Bennett, the fellow who has been pushing that crazy, newfangled approach to indexing (Valuation-Informed Indexing) that has caused our mutual friend Mel Lindauer and a few others to go off their rockers in recent years.  I wrote you on July 9, 2009, asking for your help with the problem of abusive posting employed at the Bogleheads Forum to discourage community members there from making an effective case pointing out the dangers of Buy-and-Hold Investing (and to get those who don’t pay heed to the warnings removed!). I believe that the time has come for a follow-up report.

The problem has gotten both a bit better and bit worse in the time since. It has gotten better because the stock crash and the economic crisis have helped many middle-class investors appreciate the dangers of Buy-and-Hold (if you do not today possess a good understanding of why Buy-and-Hold is the purest and most dangerous Get Rich Quick approach ever, I invite you to read the material at the links set forth in the blog entry referred to below or to send me a return e-mail asking any questions you are struggling with re this matter). I haven’t been banned at any new boards or blogs for six months now! We are gradually seeing the changes we need to see to take your many powerful insights to a far better place that we have been able to take them in earlier days.

However, things have also gotten worse as those who have participated in defamation and deception and intimidation and word games in “defense’ of Buy-and-Hold have become even more defensive as it has begun to hit them how much financial damage they have done with their advocacy of this now-discredited but once very promising idea (fated to achieve its promise as we all move together to the Valuation-Informed Indexing Era, to be sure).

The optimistic and pessimistic signals recently met in one strange Bogleheads thread reporting on exciting research by Wade Pfau, Associate Professor of Economics at the National Graduate Institute for Policy Studies in Tokyo, Japan, showing that Valuation-Informed Indexing beat Buy-and-Hold in 102 of 110 30-year periods. That of course is breakthrough stuff that we should all be working together to spread to every middle-class investor alive. The crazy, insane, sad, pathetic part of the thread (about half of the posts put forward rationalizations for not doing all we can to get this wonderful news out to middle-class investors as quickly as possible), is summed up in the words of a post put forward by Site Administrator Alex Frakt.

Here are Fract’s words: “We’ve had to remove a couple of comments and posts from this thread regarding Rob Bennett. I have been in contact with the OP offline and he is now fully aware of hocus’ modus operandi, so there is no further need for these posts. Let’s continue to keep this forum a hocus-free zone. P.S. For anyone confused by this message, I suggest googling “hocomania.’”

Huh?

And — Yucko!

We need your help, man! Really!

We need it now. By the close of business today if at all possible!

I wish you luck in all your future endeavors and look forward to working with you to bring your many wonderful and powerful insights from earlier days to fruition as we move from the discredited Buy-and-Hold strategy to the investing model that we all know you would have put forward in the first place if only Shiller’s research showing that valuations affect long-term returns had been available to you back in the 1970s.

Take a sad song and make it better, John. Please?

Here’s a link to my blog entry reporting on Frakt’s words (there are 12 links to background materials contained therein):

http://arichlife.passionsaving.com/2011/01/25/site-administrator-alex-frakt-doubles-down-on-defamationintimidationdeception-strategy-at-bogleheads-forum/

Rob

Comments

  1. Evidence Based Investing says

    It is obvious from the tone and content of your email that you realize there is no chance of Jack taking you seriously.

  2. Rob says

    That’s not so. Evidence.

    It is certainly fair for you to observe that I took a light and jocular tone in the e-mail. It doesn’t follow that I don’t expect to be taken seriously. I take a light tone because the subject matter is so darn heavy and intense that it all becomes just TOO MUCH if I come on strong and condemning and filled with scary warnings of the Darkness that is about to descend on us if we do not act quickly.

    I go light because I think light is more likely to work.

    Would I bet $1,000 that Our Friend John (there I go again!) is going to respond? I would not. But I sincerely believe that the odds are better than zero. And a response from Our Friend John would be such good news that it is worth taking a shot that has a better than zero chance of bearing fruit.

    I’ll let you in on a little secret, Evidence.

    Deep in his heart, Our Friend John wants to do the right thing. It’s the same with Our Friend Mel. And with Our Other Friend John (Grrrrr….). And with Our Friend Evidence. That’s been my assurance of long-term victory going back to the first day.

    It’s almost like it’s not really a fair fight. But WhaChaGonDo? As Dylan put it in his song “Idiot Wind”: “I can’t help it if I’m lucky.”

    Rob

  3. Evidence Based Investing says

    I go light because I think light is more likely to work.

    It doesn’t matter if you go light or you go heavy. It is the name at the end of the email that is the surest sign that failure is to come.

    You have been very good about documenting your email correspondence with the great and the good of the investing world over the years. And your track record is one of complete failure.

    Sure, from time to time you get a positive response, but sooner or later you alienate even those who are initially responsive to you or sympathetic to your ideas.

  4. Rob says

    Coming up with the biggest advance in our understanding of how stock investing works in history is not a “complete failure” in my book, Evidence.

    You are of course right that many have elected not to respond and that some who have responded have either become “alienated” or at least come to feign some measure of “alienation.” Big forward jumps are scary. There’s nothing I can do about that aspect of the thing. It is what it is.

    Thousands of books need to be rewritten. Hundreds of calculators need to be reformulated. Lots of big names need to get up on a stage and say the Three Magic Words.

    I’ve done nothing to make that harder for them than it has to be. I’ve gone out of my way to make it as easy for them as possible. I feel for these people. I care for these people. I respect these people. I know what they need to do and I tell them. They don’t listen.

    I had a thing when I was a stupid kid (even more stupid and more of a kid than I am today) where there was a second tooth growing in where one tooth had already taken up residence. I didn’t want to have to go to the dentist so I didn’t tell my parents. Eventually, I had to go anyway and by letting it go for so long I ended up needing to have braces.

    That’s John Bogle today.

    John Bogle started out as a little boy, just like all the rest of us, Evidence. There’s still some scared little boy in him after all the honors and all the books and all the money and all the blah, blah, blah. Our job (I said “Our,” not “my”) is to make him less scared, to help him see that this is all for the good and that there is no bad in it for anyone alive.

    I have extended the hand of kindness, both to John Bogle and to Evidence. It’s not a time-sensitive offer. Our friend John will work up the courage to take advantage of the offer when his fear of not acting becomes greater than his fear of acting. So will our friend Evidence.

    My job is to be honest to the point of becoming unloving and to be loving to the point of becoming dishonest. Each day I wake up and handle whatever appears before me on the computer screen that day and then go to bed and get rested to do it all again when the morning comes.

    I do my best, Evidence. I love John Bogle and I think that any fair-minded person would pick that up from the wording of the e-mail. You will say you don’t. But then you’re a frightened little boy too, aren’t you?

    Aren’t we all?

    Rob

  5. Evidence Based Investing says

    Coming up with the biggest advance in our understanding of how stock investing works in history is not a “complete failure” in my book, Evidence.

    If you had “come up with the biggest advance in our understanding of how stock investing works in history” then we wouldn’t see “No Comments” beside the majority of your blog entries.

  6. Evidence Based Investing says

    Each day I wake up and handle whatever appears before me on the computer screen that day and then go to bed and get rested to do it all again when the morning comes.

    And therein lies the problem. Every day you just “do it all again”. Despite the catastrophically unproductive results of your efforts so far, you do not seem to have taken on board any of the advice that you have received from multiple sources.

  7. Rob says

    If you had “come up with the biggest advance in our understanding of how stock investing works in history” then we wouldn’t see “No Comments” beside the majority of your blog entries.

    It’s just the other way around, Evidence.

    If I were putting up the same old Get RIch Quick garbage that you see in hundreds of other places, I would be flooded with comments. Not this boy. No can do. Not my particular cup of tea. Please try to find someone else.

    Have you read any history? Do you know what the reaction was to the people who invented the airplane and to the people who discovered that the earth revolves around the sun and on and on? The Beatles were a “fad,” right? What would anyone ever need with a personal computer?

    You Goons are in good company, my old friend. I think I’ll take the other path all the same.

    Rob

  8. Rob says

    Despite the catastrophically unproductive results of your efforts so far

    Um — good point, Evidence.

    Truly outstanding!!!!!!

    Rob

  9. Rob says

    And I’ve got 80 comments running down the left side of this page in which many experts and ordinary people give my work the highest praise imaginable.

    Some get it quicker than others. Primarily because some feel more threatened than others by new ideas. It’s been that way ever since the world began, Evidence.

    You don’t hear Goons yapping after the Wright Brothers today, do you? All the garbage put forward by the internet sewer rats gets blown away in the wind in the long run. It’s the work done by the hundreds of community members who took the time to put forward honest and constructive and meaningful and life-affirming comments that lasts forever.

    Thank God our communities are comprised primarily of Normals! Imagine how it would be if the Goons were more than a small number of outlier personalities. Yowsa!

    Rob

  10. Evidence Based Investing says

    Imagine how it would be if the Goons were more than a small number of outlier personalities.

    And yet you spend an inordinate amount of time concerning yourself with “the Goons”.

  11. Rob says

    Not by choice, Evidence. I put up a thread urging Greaney’s removal on November 23, 2002.

    That’s in the Post Archives.

    Rob

  12. Evidence Based Investing says

    And you have called for his removal on many occasions since. But it always seems to be you that gets removed. And yet the message never sinks in and you do it all again in your catastrophically unproductive way.

  13. Rob says

    It’s a fact that he’s never been removed and that I’ve been removed about 15 times.

    You’ve got me on that one, Evidence.

    Rob

  14. Evidence Based Investing says

    Have you ever given any thought to how you could do things differently in the future?

  15. Rob says

    I have spent some part of every day for nine years thinking over how best to proceed, Evidence.

    I have never for two seconds given any consideration to going along with the demands that have been made on me that I post dishonestly on safe withdrawal rates. The Goons have never made any other offer. So I have never had any options to consider.

    My policy is to be honest up to the point where it becomes unloving and to be loving up to the point where it becomes dishonest. That’s the two-prong test by which I consider each move I make.

    I have offered the hand of kindness to every Goon and hereby do so once again. But I would be giving them false hope if I were to put forward even a tiny hint that I am open to posting dishonestly on safe withdrawal rates. I am not.

    I have many friends in all of the communities. I view a failed retirement as a serious life setback.

    No can do.

    Rob

  16. Evidence Based Investing says

    I have spent some part of every day for nine years thinking over how best to proceed, Evidence.

    And have these periods of reflection led you to make any changes in the way you go about things?

  17. Rob says

    I’ve answered that question above, Evidence.

    If I ever get an offer that does not require me to post dishonestly on safe withdrawal rates, I’m going to sign it so fast it is going to make your head spin.

    If I never receive such an offer, I guess I never receive such an offer. I can ask. I cannot make it happen by magic.

    We don’t always get everything we long for in this life, Evidence. I am not required to like the idea. I think it would be fair to say that I am pretty much required to accept it whether I like it or not. So I do my best to accept it.

    Rob

  18. Evidence Based Investing says

    Why must it be an offer from someone else? I was asking about the “some part of every day for nine years” that you spent “thinking over how best to proceed”?

    In all that time did you come up with anything yourself?

  19. Rob says

    I’m in favor of opening every investing board and blog on the internet to honest posting, Evidence. That’s my proposal.

    I have a funny hunch that you already knew that.

    Rob

  20. Evidence Based Investing says

    I was aware of that. It isn’t really what I asked about. I asked had you come up with anything different that you would do in the future.

    It looks like the answer to that is no.

  21. Rob says

    I’ve never given any consideration to the idea of posting dishonestly on the numbers that my friends use to plan their retirements. That’s so.

    It’s not my particular cup of tea, Evidence.

    I like to think that’s an understatement.

    Rob

  22. Evidence Based Investing says

    So over nine years of thinking about this every day all you have managed to come up with is “I will not post dishonestly on safe withdrawal rates”.

    Maybe if you think about it for another nine years you may come up with a second idea to go along with that one.

  23. Rob says

    My thought that it is wrong to post dishonestly on safe withdrawal rates is responsible for every investing insight advanced at this site, Evidence. That is the thing that opened the door.

    Get Rich Quick is always dishonest. That’s by definition. Overvaluation is always dishonest. That’s by definition. Consider what the word means. Overvaluation is mispricing. Mispricing is dishonest pricing.

    I don’t say that Buy-and-Hold is the first investing strategy rooted in dishonesty. Not by a long shot. I say something much, much, much more encouraging than that. I say that Buy-and-Hold is the last dishonest investing strategy.

    It is the Buy-and-Holders who came up with the idea of rooting their strategies in the historical data and in the academic research. That’s what turned the key.

    When you root your strategies in data and research, you have a means of checking yourself, finding whether you are telling lies to yourself or not. If the numbers don’t add up, you know you have a problem.

    The SWR numbers don’t add up. We learned that in May 2002. That was our tip-off that there was a problem with this Buy-and-Hold business.

    If the numbers had been corrected within 24 hours of the time we discovered the errors in the studies, that would have showed that the problem was confined to the calculation of SWRs. That’s not what we saw. We saw a mass freakout on the part of the Buy-and-Holders. Why? Because they sensed that this wasn’t just a SWR thing, this was a Buy-and-Hold thing.

    Buy-and-Hold handed us the gun we needed to kill Get Rich Quick dead once and for all. We all should be grateful to the Buy-and-Holders for that. That will go down in history as being their greatest accomplishment of all.

    Buy-and-Hold went to its death bed when Greaney refused to correct his study. All the jibber-jabber we’ve been hearing in the nine years since is just the cries of pain of a dying model (and perhaps some cries caused by the birth pains associated with the new model as well). There is no Buy-and-Hold anymore, Evidence. It’s a ghost. A model that can’t get the retirement numbers right is a model that cannot stand.

    That doesn’t mean that we did not learn many wonderful things from the Buy-and-Holders. We did. And we will of course make use of all those wonderful insights in the new model, Valuation-Informed Indexing. VII is Buy-and-Hold with the Get Rich Quick element removed. VII is the investing model of the future.

    You can fight it. You can’t stop it. Get Rich Quick in the long run causes too much financial misery for too many millions of people for it to survive all that much longer. You can live in the dark past or you can live in the bright future. Your choice.

    I made my decision on the morning of May 13, 2000. Nothing I have seen in the past nine years has caused me to feel that it was a mistake to have worked up the courage to put forward that first fully honest post to the Retire Early board. We need honesty in our investing discussions, Evidence. Permitting (and someday I hope even encouraging) honesty is a huge advance.

    And the Buy-and-Holders helped us get there with their focus on data and research. Take that, Goons!

    Love wins in the end, Evidence. I took a peek at the last page before daring to put forward that first post, so I know. I didn’t think it would be fair not to let you in on the secret.

    Rob

  24. what says

    Rob,

    You claim to have the first honest post on this topic ever?

    You might want to try reading some of your posts out loud from time to time – they sound silly.

    One thing I don’t understand about VII is that it focuses on stock returns…what if bond returns are worse than stock returns (even though the PE/10 of stock returns is very high)? Wouldn’t we still want to invest in stocks because its the best alternative in this scenario? What about other asset classes? I don’t see much of a concrete strategy here.

  25. Rob says

    You claim to have the first honest post on this topic ever?

    I believe that what I said is that I put forward the first fully honest post at the Motley Fool’s Retire Early board, What.

    John Greaney founded that board. He began promoting his SWR study on the first day of the board’s existence. He first employed intimidation tactics to silence effective challenging of the methodology used in the study the first time he saw effective challenges appearing at the board.

    Do you think it was fully honest for all of us who failed to speak up to fail to speak up?

    I do not.

    I believe that once intimidation tactics are employed to scare away community members who might post in a way that would further the purposes for which a board is formed, the board becomes a corrupt enterprise.

    I believe that it is fair to say that I put the first fully honest post to that particular board, What. I am proud that I am able to say that today.

    Rob

  26. Rob says

    You might want to try reading some of your posts out loud from time to time – they sound silly.

    Any commentary relating to the Ban on Honest Posting is going to sound somewhat silly, What. The thing making it sound silly is not the commentary. It is the idea that honest posting needs to be banned. That idea is 100 percent bonkers nutso.

    I oppose the ban. If you have any doubts re that one, please check the Post Archives. You will see.

    Rob

  27. Rob says

    what if bond returns are worse than stock returns (even though the PE/10 of stock returns is very high)? Wouldn’t we still want to invest in stocks because its the best alternative in this scenario? What about other asset classes?

    You should invest in whatever asset class is likely to provide the highest return at the lowest risk.

    That’s my sincere take re this one, in any event.

    Rob

  28. Rob says

    I don’t see much of a concrete strategy here.

    You are emotionally invested in stocks and in Buy-and-Hold, What.

    I can point that out to you. I cannot personally solve the problem for you. That’s an inside job.

    Rob

  29. Rob says

    No honest person will ever be able to present a single strategy that will work for every investor, What. We all need to take into consideration our life goals, our financial circumstances and our risk tolerance.

    So we need millions of strategies, not one.

    Every single one of those millions of strategies needs a component that tells the investor how to change his or her stock allocation when stock prices reach insanely high levels. Get Rich Quick is the one thing that can never work.

    Common sense tells us that. So does the entire historical record available to us. So that’s out.

    We cannot stop our friends and neighbors and co-workers and fellow community members from following Get Rich Quick strategies if they care to. That is of course their right. But it is our responsibility to point out the dangers.

    To retain our personal integrity, we need to insist on (not just ask for!) our right to do that. When most of us agree to give up our personal integrity so as not to hurt the feelings of those who have come to believe in a Get Rich Quick fantasy, we cause the entire economic system to topple.

    Not good.

    Once the Ban on Honest Posting is lifted at all of the boards and blogs, you won’t have any trouble learning about strategies that work, What. That’s all anybody will be talking about at every investing site and blog. The ban on discussion of effective investment strategies that has remained in place throughout the Get Rich Quick Era (we never could have had a Get Rich Quick Era without a Ban on Honest Posting — each and every one of us wants to know how to invest effectively) has created a pent-up desire within millions of us to learn what works and to share what we learn with all of our friends and neighbors and co-workers and fellow community members.

    Learning what works is the easy part of all this. The hard part is getting those darn Internet Sewer Rats to be responsive to the thousands of community members who have expressed a desire that honest posting be permitted. Grrrrr….

    360 words. This is getting easier all the time!

    Rob

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