Set forth below is the text of a comment that I recently put to a discussion of an earlier blog entry here:
I’ll put forward another answer, focusing on one aspect of what you say above that contains a tiny bit of a real and legitimate point.
Over and over again you make the point that even people who agree with me don’t come here to post. That is true. And it is certainly an odd reality. I certainly have to give you that much.
It’s not because of any deficiency in the Valuation-Informed Indexing concept. If that were the problem, someone would have identified the deficiency in 11 years. Nothing of that nature has ever been put forward.
People are afraid.
There is a Social Taboo that blocks us all from telling the truth about stock investing. The bull market of the late 1990s caused the economic crisis. We all played a part in that. We either participated in the bull or failed to speak up in opposition to it in clear and firm and uncompromising language. We have hurt ourselves and our families and our friends and our country in very serious ways. So we are ashamed.
We don’t want people reminding us of our shame. I never shut up about it. So some people hate me. Others don’t hate me but tune me out. Others suggest that I say things differently. And even people who think my stuff is amazing rarely advocate on my behalf or come here to post or whatever.
That doesn’t mean that I am doing something wrong, Trebor. It illustrates how dangerous Buy-and-Hold is.
Look at the mess it has gotten us into!
Once we create a bull market, we can’t get out of it. We come to feel shame for what we did and then we engage in these endless cover-ups. For what freakin’ purpose??????
I get it that people don’t like hearing what I have to say. I get that loud and clear. <b>But what I am saying is important. What I am saying very much needs to be said.</b> If there had been enough people saying what I am saying going back to the mid-1990s, we never would have created an insane bull market in the first place. We need more people saying this stuff, enough so that it comes to seem normal and no longer shocks people. We certainly don’t need fewer.
When we move to Valuation-Informed Indexing, we all win. Every last one of us.
Yes, I guess there is a bit of embarrassment for the Buy-and-Holders in acknowledging that they got some things wrong. But it doesn’t have to be such a huge freakin’ deal. That’s on them, not me. And, once we make the transition, we never need to go back. It is a one-time thing. It reduces the risk of stock investing by 70 percent. So is it not worth it 100 times over?
We cannot get from where we are to where we all want to be without someone saying these things, Trebor. So it’s not like there are any other options.
If we don’t make the switch, our economic system collapses. A good result, in your assessment? Please be honest.
When you know that you have to do something and there is absolutely no way around it, the thing to do is just to do it and get it behind you. I could be wrong about that. But I’m not, you know? I’m obviously right about that one.
People are scared. That’s the story.
They will become LESS scared as they start to see a payoff for endorsing Valuation-Informed Indexing and for coming forward with strong words of warning re the dangers of Buy-and-Hold.
We need to see prison sentences for those who have posted in “defense” of Lindauer and Greaney, Do you not see how that helps us all out? After the announcement of the prison sentences, people are going to be a whole lot less likely to put forward death threats or to demand board bannings or to engage in tens of thousands of acts of defamation or to threaten to get academic researchers fired from their jobs. I don’t see how any sane person could even question that.
And we need to start awarding big financial sums to those who advocate Valuation-Informed Indexing and to give them Nobel prizes and Pulitzer prizes and steak dinners and lots of links to get their blogs high on Google and all this sort of thing. When I get that $500 million settlement payment, every financial blogger on the internet is going to look into Valuation-Informed Indexing. Why the heck wouldn’t they?
The problem we have today is that The Buy-and-Hold Mafia has scared people with its ruthlessness. We need to flip it. We need to start holding people who recommend Buy-and-Hold strategies responsible for their behavior and providing incentives for all in this field who give honest and accurate and research-backed investing advice. What you incentivize, you get more of. We will see more people posting words in support of me when we start rewarding those who work up the courage to do so.
Does that all not make a good bit of sense to you, Trebor?
Rob the Sensible