Yesterday’s blog entry reported on an e-mail that I sent to Academic Researcher Wade Pfau on April 5, 2012. Wade sent his response later the same day.
He said: “I don’t have any hard feelings toward you, but it is hard to have public communications with you after all the attacks you made toward me at your blog following the Bill Bengen incident. You strongly misinterpreted what I wrote at your blog and attacked me so thoroughly, and that makes it hard to see any paths forward in communicating with you publicly.”
I argued in the blog entry to which Wade here refers that Bill Bengen, the author of the first of the Old School safe withdrawal rate studies, should correct his study now that he has publicly acknowledged that it is in error and gets the numbers people use to plan their retirements wrong. Wade at an earlier time agreed with me that retirement studies that get the numbers wrong should be corrected and he wrote the authors of the Trinity Study, another Old School safe withdrawal rate study, about this. John Greaney and some of the other Goons then threatened to get Wade fired from his job by sending defamatory e-mails to his employer. Wade sent me several e-mails at the time saying that he was concerned that he would indeed lose his job a a result of the smear campaigns of the Goons. He has known about the smear campaigns against me since before we began out e-mail correspondence and has told me on numerous occasions how he is fearful of saying positive things about me and my work at the Bogleheads Forum because of the brutal attacks that he knows will be visited on him if he posts honestly on these questions. Here is a link to the blog entry in which I argued that Bengen should correct his study and the 100-plus comments that were posted to it:
I presume that that is the thread that Wade was referring to. That was the one in which I became aware that the Goons had flipped him. It is likely that he is referring to this one as well, which focuses on Wade rather than on Bill and which refers to the position Wade adopted in the Bengen thread (that there is no need for those who author retirement studies that get the numbers wildly wrong to correct those studies when they learn of errors made in them, even though the false claims are going to cause millions of middle-class people to suffer failed retirements):
The e-mail stated: “Related to this, I do wish to kindly request that you don’t use my name so much on your blog, as I would prefer that when people Google my name they didn’t see claims that I’ve joined the Darkside and am posting dishonestly and am causing failed retirements and so on. None of that is true anyway, and it could really hurt if I ever try to find a job and return to the United States one day. Perhaps, if you must keep writing about it, could you please call me WDP or something like that?”
Wade continued: “Regarding that January 2011 blog post, it was very preliminary with ugly graphs and I re-wrote it in March 2011. I didn’t understand why you kept referring to the outdated version anyway. My changing the contents to refer readers to the newer version had nothing to do with wanting to remove your name. I mostly didn’t like the graphs for the old one. If you really care more about seeing your own name than seeing the best presentation of the results, you can still find that original version in the Bogleheads thread on long-term market timing, since I posted it at both places at the same time. I didn’t edit it at Bogleheads. And your name still appears in the research article versions, including in Journal of Financial Planning and still forthcoming in Applied Financial Economics, which in my view is what matters most. Also, in January 2011 I still thought that Valuation-Informed Indexing I was all your creation, and it was only later that I internalized that this is old stuff since the stock formula plans of the 1940s and 1950s. VII is Lucille Tomlinson’s variable-ratio plan from 1953. I have no idea what you mean when you mention including me in lawsuits, as I’ve been nothing but supportive of you.”
He further explained: “I do believe I am still on the Good Side. Planners have been receptive to the idea that 4% is not safe in recent years. I’m getting the message out. More broadly, I am tackling this from the angle that people need complete retirement income strategies that move beyond just considering a safe withdrawal rate. You might be surprised that outside of this small circle of safe withdrawal rate research, there are many people who think that the whole idea of 4% being a safe withdrawal rate is just ridiculous. Retirement income plans must work by construction, it is not enough that they just would have happened to work historically. Drawdowns from a volatile portfolio are inherently risky. There is no safe withdrawal rate from a volatile portfolio. It all goes back to arguments about investing made by Paul Samuelson as far back as the 1960s or earlier. He discovered the “errors” of the old school SWR studies (in the sense of projecting those results forward for future retirees) before they were ever written. Your insight about valuations is important and useful and I still discuss it, but it is ultimately just one piece of a much broader story.”
The e-mail concluded: “So please don’t worry so much about me. I’m still working to help Americans achieve sustainable retirements.”