Set forth below is the text of a comment that I recently put to another blog entry at this site:
Why do you focus so much on the “Buy and Hold Mafia” here at your own blog? It seems you choose to post about the “goons” pretty much every day rather than using your own blog to post about your own theories.
I focus on the Buy-and-Hold Mafia and our failure as a society to shut it down because that story is the biggest political and economic story of any of our lifetimes, Sensible.
We are the luckiest generation of investors that ever lived. We are the first generation of investors that has available to it the opportunity to reduce the risk of stock investing by 70 percent while increasing returns enough to be able to retire five to ten years earlier than we ever imagined possible in the Buy-and-Hold years.
Have you ever heard more wonderful news?
That news is wonderful for Democrats as well as Republicans. It is wonderful for women as well as men. It is wonderful for Christians as well as atheists. It is wonderful for blacks as well as whites. It is wonderful for lovers or jazz as well as for lover of rock. It is wonderful for the young as well as for the old. It is wonderful for Buy-and-Holders as well as for Valuation-Informed Indexers. It is wonderful for Goons as well as for humans. It is wonderful for haters as well as for lovers.
So the job is to get this wonderful news out before people.
One thing stands in our way.
The Buy-and-Hold Mafia. There are a number of people who made names for themselves promoting the pure Get Rich Quick approach and now that they have ruined millions of middle-class lives by doing so they want us all to agree to go along with their 11-year cover-up. It’s a terrible mistake to do so. Those who commit acts of financial fraud in support of the cover-up will be going to prison following the next price crash. Huh? When you find yourself promoting a strategy with so little support in the academic research that the only way it’s defenders can think of to “defend” it is to engage in criminal acts, I think it is fair to say that it is time to question the merit of that particular strategy.
And so thousands and thousands of people have done. We had hundreds expressing a desire for honest posting at Motley Fool. We had hundreds more expressing a desire for honest posting at Early Retirement Forum. We had hundreds more expressing a desire for honest posting at Morningstar. We have had academic researchers express a desire to be permitted to publish honest research. Even big-name Buy-and-Holders have mixed in honest words along with the smelly Get Rich Quick garbage that has made them so rich at the expense of the millions of middle-class investors who have assumed that these “experts” might be sharing their honest beliefs about how stock investing works with us all.
Bogle was honest enough in his book for me to learn that the Old School safe withdrawal rate studies got the numbers wildly wrong. Bernstein was honest when he said that anyone using one of the Old School studies to plan a real-world retirement would have to be out of his or her mind. Swedroe was honest when he put forward words that caused Lindauer to expel him from the Bogleheads Forum. Burns was honest when he said that I was right about safe withdrawal rates. Pfau was honest when he wrote to the authors of the Trinity study saying that they should correct the errors in their study before it caused even more failed retirements.
But all of these people want to continue making a buck by pretending to be investing “experts.” And all of these people know what the Buy-and-Hold Mafia will do to them if they dare to offer honest investing advice, advice consistent with the 32 years of peer-reviewed academic research showing that there is precisely zero chance that a Buy-and-Hold “strategy” could ever work for a single long-term investor.
What to do, what to do?
I could focus on the intellectual case, which every person even slightly knowledgeable in this field already understands on at least one level of consciousness.
Or I could focus on the Buy-and-Hold Mafia, which is the force that stops Wade Pfau and Larry Swedroe and Bill Bernstein and Jack Bogle and Scott Burns and all the others from sharing with us what they truly believe and thereby helping us all to become more effective investors rather than encouraging our most sick and twisted Get Rich Quick/Buy-and-Hold fantasies.
I think I’ll continue to focus on the role played by the Buy-and-Hold Mafia, Sensible.
I think that might be where the leverage is.
I think we might be able to bring this economic crisis to an end within six months of the day that Jack Bogle gives his “I Was Wrong” speech, thereby opening the way for thousands of “experts” to start posting their honest views rather than the smelly Get Rich Quick garbage that has come to pass for “expert investing advice” during the Buy-and-Hold Era.
Just another one of those crazy hunches that I have been known to experience from time to time.
Please take good care.
Rob
Rob,
There really is no value in this site. All you do is sit around telling us about your hate for buy and hold and for those that don’t agree with you (that you describe as goons). You throw in a bit of hate with your prison talk and lawsuits along with your bending of the truth on what you say are accomplishments.
Is it really any wonder why you don’t have much of an audience? Wake up and smell the coffee.
Swedroe was honest when he put forward words that caused Lindauer to expel him from the Bogleheads Forum.
Can you provide us with evidence that Lindauer expelled Swedroe from the Bogleheads Forum?
I could if I were willing to take the time to look it up, Evidence.
This happened before I posted there. Several community members made reference to Swedroe’s banning. It’s not hard to figure out what caused it. Swedroe talks about the importance of valuations all the time. During the time I was posting there, he never once posted in support of those of us who were saying that honest posting should be permitted on safe withdrawal rates. But I’ve seen that he has in recent days written an article that points out the errors in the Old School SWR studies. When he is not on the Bogleheads Forum, he is willing to post honestly on SWRs. Perhaps it was that.
But it could have been any of a hundred things. Valuations affect every aspect of the stock investing project. So it could have been just about anything. What I know from reading posts that others put up is that Larry was banned for a time and then he agreed not to post honestly and he was let back on.
People said that he did this because he wanted to use the forum to promote his books. I suppose that that is speculation. No one can know the precise motive. But it certainly is a reasonable guess. Say that it’s not that. Say that Larry just wanted to be able to talk things over with other people. It’s still wrong to demand that he post dishonestly as the price of admission to the forum, no? It’s degrading. And it’s dishonest. And its fraudulent.
The people who demanded that he post dishonestly should cover the loses of all those who lose money as a result of the ban, no? It certainly does not make sense to have those who followed advice offered at a forum where the one thing that is banned is honest posting on what the last 33 years of peer-reviewed research says pay the price for those acts of fraud. Those people did nothing wrong. How could they ever suspect that honest posting was banned at an investing forum? The published rules of the site suggest that honest posting is PERMITTED. So how would they know?
We all should be speaking up against this sort of thing EVERY TIME WE SEE IT. Bogle should be speaking out against it in the strongest possible terms. Wade Pfau too. Scott Burns too. Bill Bernstein too. Mike Piper too. EVERYONE. That’s how we bring Buy-and-Hold down and put the first true research-based strategy (Valuation-Informed Indexing — which is Buy-and-Hold with the dishonest Get Rich Quick part removed) in its place.
I have a file where I keep copies of hundreds of threads from the Bogleheads Forum (which was called the Vanguard Diehards forum in an earlier day). When the time comes to testify, I can go to that file and pull up the posts at which Swedroe’s banning was discussed. I am not going to go to the trouble today because anyone who spends a little but of time at this site gets it that Buy-and-Hold is today a 100 percent discredited strategy promoted through corrupt means. Those who pretend otherwise aren’t going to start posting honestly because I provide the links to the threads where Swedroe’s banning was discussed. But, if a jury needs to see them for some reason, I have them.
We are not talking about a simple cover-up today, Evidence. We are talking about a cover-up of a cover-up of a cover-up of a cover-up. As times passes, it gets worse and worse and worse. It can never get better until my good friend Jack Bogle walks to the front of a room and says those magic words “I” and “Was” and “Wrong.” It is by Jack’s speaking of those magic words that we all come clean and gain the ability to bring this economic crisis to an end, show millions of middle-class Americans how to reduce the risk of stock investing by 70 percent, and bring on the greatest period of economic growth in our history.
My best wishes to you, Evidence.
Rob
There really is no value in this site. All you do is sit around telling us about your hate for buy and hold and for those that don’t agree with you (that you describe as goons).
It’s not possible that I sit around talking about my hate for Buy-and-Hold or for my many Buy-and-Hold friends, Anonymous. It’s not possible because I do not FEEL hate for Buy-and-Hold or for my Buy-and-Hold friends.
I am the world’s most severe critic of Buy-and-Hold as it is promoted today. I say that it is a big pile of smelly garbage. I say that the relentless promotion of Buy-and-Hold strategies caused the economic crisis. I say that millions of middle-class people are going to suffer failed retirements because my good friend Jack Bogle has not yet worked up the courage to walk to the front of a room and say the words “I” and “Was” and”Wrong.” All of that is so, and, yes, because all of that is so there is one sense in which I suppose it would be fair to say that I hate Buy-and-Hold.
But hold on.
Is all that ugly stuff what Buy-and-Hold really is?
I say no. I say that Buy-and-Hold is something very different from what you Goons (and, yes, even my good friend Jack Bogle) today claim it to be.
Buy-and-Hold is two things. It is the thing that was put forward in the days before Nobel-Prize-Winning-Economist Robert Shiller put forward his “revolutionary” research showing that valuations affect long-term returns. In those days Buy-and-Hold was all about using the peer-reviewed academic research to guide one’s investing strategies. But today there is a new version of Buy-and-Hold that is something very different. The phrase “Buy-and-Hold” today signifies an investing “strategy” that calls for the investor to possess a burning hatred for discussions of the last 33 years of peer-reviewed research and to employ all forms of trickery and deception and intimidation to keep all investors (including one’s self) from learning how stock investing really works in the real world.
Everyone alive hates one of the two forms of Buy-and-Hold, Anonymous. Those of us who feel a passionate love for what the Buy-and-Hold project was in its early days (a quest to help millions of middle-class investors invest more effectively) naturally hate to see the Buy-and-Holders of today drag the concept through the mud with their deception and intimidation tactics. We want Buy-and-Hold to work. So we naturally want to update the concept to reflect the last 33 years of peer-reviewed academic research. Those who are emotionally addicted to the Get-Rich-Quick version of Buy-and-Hold naturally hate those of us who argue that exploration of the peer-reviewed research should be permitted. There’s no support in the academic research for Get Rich Quick. It makes the Buy-and-Holders who are in the Get Rich Quick camp “look bad” for millions of middle-class people to find out what the research really says.
Which Buy-and-Hold is the real Buy-and-Hold?
That’s the question here. If the ugly form of Buy-and-Hold is the real form of Buy-and-Hold, Jack Bogle is the Frank Underwood of Personal Finance. Jack has caused more human misery than anyone who has ever worked in this field. That’s objective fact. Millions of people have already lost their jobs in the Buy-and-Hold Crisis. Millions more will lose their jobs following the next price crash. When you suggest that the ugly form of Buy-and-Hold is the only legitimate version of Buy-and-Hold, you suggest that Jack Bogle caused this economic crisis by intent You suggest something very, very, very horrible. When you suggest such horrible things, you speak in hate.
I speak in love. I suggest something very different.
I argue that Jack Bogle is a good man who allowed his pride to get too caught up in a highly promising but ultimately flawed idea and who today suffers from a horrible case of cognitive dissonance as a result. I say that, when Old Saint Jack wrote in one of his books that, were he ever to be found to have made a mistake that hurt millions of investors, he would want his friends to point it out to him, he was speaking from the heart. I am Jack’s truest friend. So I have done what my friend asked of me. I will continue to do it until my friend’s heart melts and he works up the courage to do the right thing. I believe that after the next price crash he will do it. We will see. In any event, my actions are rooted in a deep love of the man that I call “friend.”
Your actions are rooted in hate, Anonymous. Every day that the Ban on Honest Posting continues, more lives are ruined. Every day that the Ban on Honest Posting continues, more people cross the lines that lead to prison sentences down the road. Every day that the Ban on Honest Posting continues, the prison sentences that will be imposed on those who crossed those lines years ago grow more lengthy. Bad stuff piled on top of bad stuff piled on top of bad stuff. Hate piled on top of hate piled on top of hate.
That’s the real Buy-and-Hold?
I say otherwise.
I hate the hate. That much is fair to say. But the reason why I hate the hate is because I love the true Buy-and-Hold Project, I love what Buy-and-Hold stood for in earlier days and I love what Buy-and-Hold will stand for again after my good friend Jack works up the courage to walk to the front of a big room and say The Three Magic Words. I love the true Buy-and-Hold, not the b.s. version pushed by the sorts of individuals who have put up posts in “defense” of Mel Lindauer and John Greaney.
This site is of immense value.
There has not been any intellectual support for the phony version of Buy-and-Hold for 33 years now. We are on the one-yard line. The one thing that the millions of good people who today reside in the United States need to bring this economic crisis to an end and to bring on the greatest period of economic growth in our history is the courage to stand up to you Goons and to insist on the recognition of the right we all possess to post anywhere we please on the internet in accord with what the last 33 years of peer-reviewed research tells us about how stock investing works in the real world. We know that there are millions of people who possess a great desire to hear the realities. We need one venture capitalist or one large site owner or one big-name journalist or one economist or one policymaker to work up the courage to take on you Goons and the entire Buy-and-Hold house of cards comes crashing to the ground.
This site gives those people what they need to steel themselves against your Campaign of Terror.
People worry that the Wall Street Con Men will employ their huge financial resources to destroy them through phony lawsuits. It’s pretty hard for the Wall Street Con Men to do that when the materials collected at this site are available for use in any trial. The Wall Street Con Men obviously don’t want the Wade Pfau matter getting public attention. The threat of lawsuits that have held many honest people from speaking up against the Get Rich Quick garbage for 33 years now has been neutralized by the materials collected at this site.
People worry that you Goons will attack their sites and that other site owners will not step in to help them because they feel that the number who want to hear the realities of stock investing is so small. But that number is NOT small. We know that by what the materials at this site tell us. Those people are AFRAID to speak up. But they are not small in number. I wouldn’t have over 200 expressions of intense support at the “People Are Talking” section of the site if the number favoring honest posting was small. Again, the intimidation tactics engaged in by those seeking to “defend” the b.s. version of Buy-and-Hold have been neutralized by the materials collected at this site.
I win, Anonymous.
You Goons lose.
I knew it all the time!
Rob
Rob:
I don’t expect or ask for you to publish this comment, but I do hope you will read it and participate: please view the following two links, then consider. For a while. Then consider some more. In particular, consider how these two links might be related to each other. Specifically, consider how these two links might be related to you, in particular.
That is all.
Thanks in advance.
1) Engineer vs marketing:
http://www.cnet.com/news/this-is-how-an-engineer-feels-when-hes-surrounded-by-idiots/
2) NPR creates an April Fool’s day masterpiece:
http://www.uproxx.com/filmdrunk/2014/04/npr-april-fools-day-prank-facebook/
Engineers add value, Open.
But engineers are not known for their keen appreciation of human psychology.
And Shiller showed that it is human psychology that is the most important factor affecting stock prices.
We need more non-engineers in this field.
There is a reason why the book I am working on will be titled Investing for Humans. It’s the human element that the Buy-and-Holders missed. That was the mistake that caused all the trouble.
Re the second link — Backatcha!
We all have an inclination to hear what we want to hear and to disregard the rest.
That’s why all of our boards and blogs have rules forcing us to hear the other guy out. We have to work to resist that unfortunate inclination to tune the other guy out if we are to advance in our knowledge of the subject matter.
This is especially so when new ideas are involved. New ideas can be shocking and troubling. But they can also be very rewarding. Sometimes we have to force ourselves to give them a chance. We have to work through our initial discomfort to get to the point where we realize why doing that is so important. It is harder to listen to the other guy when he is advancing a new idea. But that’s when it is most important that we do so.
We couldn’t do it without the engineers. And we cannot do it with only the engineers. Engineers know what they know. But they don’t know it all. The engineers who THINK they know it all are fools.
My take.
Rob
People need to understand that Rob is always right and others are always wrong. Also, only Rob knows what other people really think and really meant instead of the words we read. We need Rob to distinguish between what was said and what is really the truth. We need Rob to help us redefine what honest really is. Honest doesn’t mean the truth, it means what Rob believes it should be. When it comes to experts, only Rob is the ultimate expert. Rob is on the top level and everyone else is on different levels below Rob. Rob will tell you which experts are on which levels, but they are all on levels below Rob.
The safe withdrawal rate is the product of a mathematical calculation, Anonymous. The numbers say what the numbers say. There can be different opinions about how to make use of the numbers generated. But there cannot be any legitimate differences of opinion about the calculation of a number.
There is one and only one reason why the Old School numbers are so different from the New School numbers. The Old School methodology does not contain an adjustment for the valuation that applies on the day the retirement begins. It is not just my opinion that the Greaney study lacks this adjustment. The Wall Street Journal found that the Old School studies lack this adjustment. The Economist magazine found the same thing. Smart Money Magazine found the same thing. Everyone who has ever looked at one of the Old School studies found the same thing.
I have a funny hunch that the reason why for 12 years now no one has been able to find a valuation adjustment in any of the Old School studies is that there is no valuations adjustment in any of the Old School studies.
It’s just one of those crazy ideas that have been known to pass through my mind from time to time.
Rob
In all fields of human endeavor other than stock investing, it is considered a good thing to get numerical calculations right. It is only in this field that honest reporting of the results of a numerical calculation will get you banned from discussion boards and blogs.
The Buy-and-Hold Mafia has huge amounts of power and money and influence and has earned huge profits by tricking millions of middle-class people into believing that there is some magical, mystical alternate universe where there is a study somewhere supporting the idea that it is not necessary to practice price discipline when buying stocks.
I wonder if there might be a connection.
Rob
People need to understand that Rob is always right and others are always wrong.
I was the first person to report honestly on the errors in the Old School safe-withdrawal-rate studies.
Guilty as charged.
No apologies whatsoever.
Rob
We need Rob to help us redefine what honest really is.
Once prison sentences are announced for you Goons, that changes, Anonymous The story about the prison sentences will go viral and there won’t be one person left who will want to “defend” a strategy discredited by 33 years of peer-reviewed research.
So this is a temporary thing. I didn’t go looking for the job of letting people know about the biggest case of financial fraud in U.S. history. I posted honestly on safe withdrawal rates at the Motley Fool board and all the rest just followed.
Rob
Also, only Rob knows what other people really think and really meant instead of the words we read.
Anyone can read the same words that I can, Anonymous.
When Bill Bernstein says both that the Old School safe-withdrawal-rate studies are analytically valid and that anyone giving thought to using such a study to plan a retirement taking place in the real world would have to be out of his or her mind, he is both telling the truth and protecting himself from ruthless attacks by the Buy-and-Hold Mafia. If he told the truth clearly, there would be no Buy-and-Hold today. Get Rich Quick strategies hurt investors, they never help them.
Once the prison sentences are announced, we ALL gain the freedom to post clearly and honestly. I can’t wait!
It’s not just about making a buck. There are RESPONSIBILITIES that go with giving investing advice. The best way to insure that people honor those responsibilities is to bring lawsuits for financial damages against them when they fail to do so. In extreme cases, we need to put Goons like you in prison for committing financial fraud. We adopted those laws as a society to protect us from people like you.
I am proud to have helped build the case against you. The announcement of your prison sentence will help millions of middle-class people while freeing thousands of”experts” to do clean work once again. If you were able to think objectively about this, I think you would agree that that’s no small thing.
Rob
When it comes to experts, only Rob is the ultimate expert.
Personal integrity trumps everything else, Anonymous.
You could be the smartest guy in the room and, if you know how much money there is in pushing Get Rich Quick garbage and that the Buy-and-Hold Mafia has your back, your advice would be dangerous. All that intellect does in the hands of a person acting unethically is make it more likely that his efforts at trickery will succeed.
Rob
Rob will tell you which experts are on which levels, but they are all on levels below Rob.
We needed to have SOMEONE take on this job, Anonymous.
The investing advice field is today 100 percent corrupt. I pointed out the errors in the Old School SWR studies on the morning of May 13, 2002. Today’s date is April 6, 2014. Not one of those studies has been corrected as of today.That tells the tale.
I believe that one more price crash will put us on the road to cleaning up the wreckage caused by the Buy-and-Hold Mafia.
It had better!
Rob