Set forth below is the text of a comment that I recently posted to another blog entry at this site:
you’ve tried to suspend the financial market’s equivalent of the laws of thermodynamics.
The idea that we suspend the financial market’s equivalent of the laws of thermodynamics when we show that long-term timing is required of every investor seeking to have a realistic hope of long-term investing success is not just Goon Talk. There are millions of good and smart people who believe this with their hearts, minds and souls.
I don’t see that as a bad thing. I see it as a good thing. It indicates the massive scope of the opportunity presented to us. The peer-reviewed research-paper that I co-authored with Wade Pfau shows us all how to reduce the risk of stock investing by 70 percent. That’s discovering the Fountain of Youth! That’s the biggest advance in the history of personal finance. We all are on the verge of living richer lives than we ever imagined possible in earlier times.
Changing our understanding of how stock investing works in a fundamental way is a wonderful thing. The only thing holding us back is that the people who built their careers promoting the understanding of how stock investing works that was dominant before we learned what we needed to learn to know what really works feel human emotions of embarrassment at having gotten some important things very, very wrong.
We need to be doing all we can to make those people feel better. We do that by pointing out how they built the foundation that made these huge advances possible. There would be no Valuation-Informed Indexing today if it had not been for the contributions of Bogle and Bernstein and Burns and Swedroe and all the others.
We do NOT make these people feel better by ignoring acts of financial fraud in which they are involved. That makes them feel worse! We must hold these people to the standards that they would be holding themselves to were they capable of thinking clearly about these matters today.
And we must all pull together to launch a national debate on these issues. The Buy-and-Holders have important things to teach us. We must provide them a means to make their points in civil and rational ways. The Valuation-Informed Indexers also have many important things to teach us. We must provide them a means to make their points in civil and rational ways as well. And then we must listen with open minds to the wonderful back-and-forth discussions that will follow when everyone feels safe about giving voice to his or her sincere views.
We’re on the one-yard line. We need to see the owner of one major investing site to work up the courage to open his site to honest posting on safe withdrawal rates and many other critically important investment-related topics. Then it’s over. Then all the ugliness is behind us and we find ourselves on the other side of The Big Black Mountain, the place where we all deep in our hearts have been longing to find ourselves for a long time now.
Then it (the good stuff) begins.
We are the luckiest generation of investors ever to walk Planet Earth. We should start tapping into the amazing wealth of investing insights that has been bestowed on us and that we have been reluctant for a time to talk about because it all seemed just too good to believe.