Former Financial Analysts Journal Editor Rob Arnott to Rob Bennett: “I’m Too Embroiled in My Own Controversies to Magnify Them Further With Collaboration. Your Ideas [About Valuation-Informed Indexing] Are Sound.”

My last two blog entries reported on e-mail correspondence between Former Financial Analysts Journal Editor Rob Arnott and I in which we discussed the brutal (my word) intimidation tactics that have been employed by Buy-and-Holders in recent years to block the publication of academic research revealing the deficiencies of the “status quo” (Arnott’s phrase) thinking on how the stock market works. He reported that he has had difficulty finding journals to publish his more controversial work and that articles of his that challenged the conventional thinking of today have generated hate mail. In fact, he has not yet been able to find a journal to publish an article on an important topic that he co-authored with Nobel Laureate Harry Markowitz! (I checked his e-mail three times when writing these words to be sure that I did not just imagine this part while experiencing a fever.) I expressed my shock at this report and noted that I believe that the reason why I feel a greater sense of urgency re solving the problem is that  my perspective is that of a journalist rather than that of an investing expert and I thus tend to focus on the public policy implications of the 30-year cover-up of Yale Economics Professor Robert Shiller’s “revolutionary” (Shiller’s word) findings showing how stock investing really works (not at all how the Buy-and-Holders have been for many years now telling millions of middle-class investors it works).

Late in the afternoon of December 6, 2012, Arnott replied to my e-mail of that morning. He wrote: “I am very pleased that you were not offended at my frank advice.  I’m too embroiled in my own controversies to magnify them further with collaboration.  Your ideas are sound.  Your stridency is unhelpful to your cause.  Anyway, all the best.”

I immediately sent back the following words: “I understand. I hope that I am not guilty of stridency. You are certainly not the only person who has said that I am. So I am going to need to work harder to examine my own behavior. I wish you all the best as well.”

I then sent an e-mail to Vanguard Founder John Bogle, Four Pillars of Investing Author William Bernstein, and Academic Researcher Wade Pfau saying: “Since the three of you were copied on the e-mail that I sent to Rob Arnott this morning, I wanted you to see the resolution of our conversation as set forth in his e-mail to me this afternoon and then my response to him. And I of course wish the three of you all the best that this life has to offer as well. Please take good care.”

The following afternoon I received a final e-mail from Rob Arnott containing the following warm message: “Have a wonderful holiday season!”

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  1. Evidence Based Investing says

    So I am going to need to work harder to examine my own behavior.

    How has that been going?

  2. Rob says

    It is a daily process, Evidence.

    It is a lifetime project.

    If you have any thoughts re getting quick results, I would be grateful to hear them.


  3. Trebor Martin says

    “Your stridency is unhelpful to your cause”

    The understatement of the year. From how many sources have you heard some variation of this advice and have chosen to ignore it?

  4. Rob says

    I’m not able to estimate the number, Trebor. It is a big number.

    I’ll give you an example that I think makes the case in compelling fashion. John Walter Russell devoted eight years of his life to researching Valuation-Informed Indexing without receiving a dime of compensation in return. John was a personal friend and he thought this stuff was very important. He obviously possessed zero bias against me. Yet I recall a thread at the FIRE board at which he commented (this is a paraphrase): “The Goons like to hold up a red flag to Rob because they know he will never fail to charge.”

    John was saying something along the same lines as Rob Arnott, no? John was my partner in the development of the calculators at this site. He was never once banned from a site and I was banned at 15 different places. That’s what Rob was getting at.

    I’ll give one more example. Before I was banned from the Early Retirement Forum, there was a community debate on whether I should be banned or not. There was one fellow there who generally agreed with my thinking on investing issues and he made a case that I should not be banned. A post by me responding to a comment made by someone else followed his and, after he read it, he said something to the effect of: “I take it back.”

    I get this reaction over and over and over again. Even the Goons say all the time “it’s not what you say, it’s how you say it.” There was a fellow who used to post a lot of comments here — Arty. Arty loved my stuff. But, when I posted the articles about the Wade Pfau matter, Arty said that he was leaving and would not be back. And indeed he has not been back.

    I do not agree with what Rob Arnott said. But I acknowledge that there are many people, including a good number of people who see value in my work in this area, who share his view of the matter. People make the general point made by Rob all the time. The majority of people who hear my case do NOT like the way I present it. This has been established beyond any reasonable doubt at this point, in my assessment.

    Thanks for taking time out of your day to post this helpful question.



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