Set forth below is the text of a comment that I recently posted to another blog entry at the site:
| Rob, Shiller never called it a Ponzi scheme. |
| >
You’re wrong, Anonymous. You need to read the book. And lots of others need to start talking more frankly about the difference between the model rooted in Fama’s research (Buy-and-Hold) and the model rooted in Shiller’s research (Valuation-Informed Indexing). Both Fama and Shiller were awared the Nobel prize. They teach opposite things. So they can’t possibly both be right.The most important economic and political issue before us today is the question of whether Fama or Shiller is right. We should be discussing that at every board and blog on the internet every day. We all need to know the answer to this one. The only possible way to figure it out is to talk it over. Say that Bogle truly believes in Buy-and-Hold (I believe he does). He should get up on stage, talk about the arguments that Shiller and I make as to why Buy-and-Hold is a Ponzi scheme and then respond to them. Then all the people listening in get to decide who is right and how to invest their retirement money. That’s how our system works. Shiller identifies his findings as “revolutionary.” Please tell me one way in which Buy-and-Hold has changed as a result of these revolutionary findings. There is not one. Buy-and-Hold today is the same thing as it was before Shiller published his research or wrote his book. Going by how you Buy-and-Holders act, one would think that nothing has happened. Your claim that Shiller has not identified Buy-and-Hold as a Ponzi scheme lacks credibility because you cannot identify any way that anything that Shiller has said has had any effect on anything. So far as the Buy-and-Holders are concerned, Shiller has never said anything that wasn’t known to the Buy-and-Holders long before Shiller published his research. I say otherwise. I say that Shiller is right that his findings are “revolutionary.” I say that Shiller’s research has changed everything we know about how stock investing works in a fundamental way. I say that Buy-and-Hold needs to be entirely redone to reflect the last 33 years of peer-reviewed research in this field. And I say that I have every right to talk about the implications of Shiller’s findings on every discussion board and blog on the internet. The continued promotion of investing strategies that have been entirely discredited by the academic research for three decades now is killing us. We need to move on. There are millions of people whose lives have been ruined by the Buy-and-Hold Crisis and we all need to start pulling together to help them. If we don’t, we will be getting a taste of what it is like to be in their circumstances when the continued promotion of Buy-and-Hold brings on the next price crash. Do you ever stop to think that maybe you are wrong, Anonymous? Rob |
No one has to do a thing to please you. We can’t help it if you are too stupid to understand things. We have significant data and facts supporting a buy, hold and rebalance strategy and don’t need some market timing scheme. We are big boys and girls and can make our own judgements and have plenty of information to make up our own minds. You need to take responsibility for ourself and family, which you failed to do up to this point, and we will take care of our own. Stop blaming other people for your own failings in your investment strategy.
Do you live in the United States, Anonymous?
If you do, you are subject to the laws of the United States.
That’s the rub.
I didn’t write the laws of the United States. They were written by lawmakers, who represent the people of the United States.
Take it up with the lawmakers. Or take it up with the people. Take it up with whomever you like.
But please do not expect me to be responsive when you demand that I participate in your huge act of financial fraud.
I do not want to go to prison. Zero interest.
You are going to have to try to find somebody else. This boy is not interested.
I wish you the best of luck in all your future life endeavors. I can give you that much.
But not the committing-acts-that-constitute-felonies-under-the-laws-of-the-United-States thing.
It’s not my particular cup of tea.
No can do.
Rob
There is no fraud, Rob. Stop acting like a child.
We disagree re this point, Anonymous.
I naturally wish you all the best that this life has to offer a person.
Rob
Sounds like you are already in prison Rob. Prisoner of your own delusional obsessive thoughts. Confined to your basement with constant nonsense swirling around in your head:
“GOONS, BOGLE, WADE, PRISON SENTENCES, MY FAMOUS 2002 POST, ROSA PARK, 500M CHECK, BOGLE, WADE, GOONS,BUY AND HOLD BAD, VII GOOD, BOGLE, MY FAMOUS POST, PRISON, GOONS, BOGLE, BAD BUY AND HOLD, CIVIL RIGHTS, GOONS, 500M CHECK, BOGLE”
Seems like hell on earth.
Oh, sure.
Make that all sound like it’s a bad thing!
Hang in there, my old friend.
Rob
Rob, if you actually had evidence of financial fraud I’m sure you would have brought it to a court of law by now.
Why did Madoff get away with his fraudulent fund for so long, Sensible?
Do you think it was hard to see that it was fraudulent? It wasn’t. There was a CPA who did the numbers and showed with 100 percent certainty that the Madoff fund was fraudulent. He wrote to the SEC and told them. They did nothing.
Then the fund collapsed. People lost most of their retirement money. THEN the authorities acted.
I am 100 percent in favor of having this matter addressed in a court of law TODAY. That’s better for every single person involved. Doing it today would mean your prison sentence would not be as long. Doing it today would mean that all the Wall Street Con Men could move on to doing productive work again. Doing it today would mean that we could bring this economic crisis to an end and enter the greatest period of economic growth in our history. Doing it today would mean that I could get my $500 million settlement check in hand and take over ownership of the Bogleheads Forum and all that good stuff. It’s a win/win/win/win/win.
Guess what?
IT IS NOT UP TO ME.
I can say that I think it would be better to do it today. And I do. But I cannot make it happen by myself. We need to get lawyers involved. We need to get prosecutors involved. We need to get journalists involved. And on and on.
For that to happen, people need to feel safe about posting honestly.
Wade Pfau almost made it happen. Wade and I together could have gotten this 12-year saga written up on the front page of the New York Times. That would have been the end of Buy-and-Hold. The entire Get Rich Quick house of cards would have come tumbling to the ground in six months.
But it turns out that Wade is one of those darn humans! He is responsible for two small children. He didn’t take to the idea of losing his job. He noticed how brutally abusive you Goons are and how unwilling Bogle is to get involved and he took a pass on seeing his career destroyed for the “crime” of co-authoring the most important piece of peer-reviewed research published in the last 3o years.
I am 100 percent in favor of going to court TODAY, Sensible. It’s not my call.
That’s not how Get Rich Quick schemes work. Get Rich Quick schemes are POPULAR until they bust. That’s what pulls people like you in! You are in the process of losing most of your money. But it does not make you happy to lose most of your money. You are lying to yourself. You are deceiving yourself.
You will be mad like everyone else when the bubble bursts. Perhaps you will demand your own imprisonment! That would be a Twilight Zone twist, would it not?
I wish that I could spare you the pain. I wish that I could spare Bogle the pain. I wish that I could spare millions of middle-class investors the pain.
But I am not superman, my old friend. I am some guy whose only claim to expertise in this field is that I figured out how to get my words posted to the internet.
I am going to bring the thing to court on the day it becomes possible for me to do so successfully. I am not going to lollygag. I am going to act with great dispatch. But I need freakin’ lawyers who will take the case on a contingency basis to proceed with the civil suits. And I need freakin’ prosecutors to proceed with the criminal actions.
I get your point. The cases should have been brought YEARS ago. I am 100 percent with you re the core point. I contacted lawyers in September of freakin’ 2002!
But it is not my call.
The Buy-and-Hold Crisis hurts everyone alive on the planet today. We all need to pull together. This is not a one-man job. I didn’t see that in September of 2002. I sure as heck see it today.
I will do my part to get this thing going as soon as humanly possible. You have my pledge.
But there are limits to what I can pull off. This is bigger than just me.
I will continue to seek people willing to help out. But I cannot do this alone. It is just too big.
So you are going to need to be a bit patient, whether you like the idea or not and whether that makes sense to you or not. It’s one of those darn realities that we all just have to accept.
I hope that helps a bit.
My best wishes to you and yours.
Rob
It’s a win/win/win/win/win.
I see we’ve inflated up to five wins. Each new “win” strengthens your argument – is that how it works?
There are five real wins:
1) When I take over the Bogleheads Forum, all posters (both Valuation-Informed Indexers and Buy-and-Holders) will feel safe posting their honest views. That provides a great learning experience for every one of us;
2) Once we open up the internet to honest posting, we can bring the economic crisis to an end. A 65 percent price crash is going to hurt a lot. But that 65 percent crash is optional. It is crazy for investors to value stocks at one-half of their fair value. We should tell people the truth about what the last 33 years of peer-reviewed research says. Then it would be impossible for the P/E10 level ever to drop much below 15. We would still suffer a price drop. But not anything near as devastating as what we will see if the Ban on Honest Posting remains in place;
3) The prison sentences for those who have put up posts in “defense” of Mel Linduaer and John Greaney are obviously going to be shorter if they come clean prior to the crash. It is the extent of the anger felt by the millions of middle-class people who are seeing their financial futures destroyed that will determine the length of the prison sentences. People are obviously going to be a lot less angry if we avoid a big price crash;
4) The Wall Street Con Men make out a LOT better if we permit honest posting. They want to sell stocks. That’s how they make money. The last 33 years of peer-reviewed research is the biggest boon to those trying to sell stocks ever seen. We can now tell people how to reduce the risk of stock investing by nearly 70 percent. The biggest objection people have to buying stocks is the risk associated with it. We now have the ability to pretty much eliminate the risk! That’s huge.
5) Bloggers benefit big time if we open the internet to honest posting. There are huge opportunities to write articles on the 33 years of research that we so far have not been permitted to discuss and to develop accurate calculators and on and on and on. We will be seeing many millionaires made because of these huge advances. That’s a good thing, no?
It’s a win/win/win/win/win.
If anything, I undersold it. If I spent some time on this, I am confident that I could ADD some wins to the count. Perhaps it is an 8-win thing or a 12-win thing. It’s a five-win thing at a minimum!
This is truly good stuff, truly exciting stuff.
That’s my sincere take, in any event.
Rob
And, yes, the more wins, the better.
That’s basic.
Go for the wins!
Rob
1) When I take over the Bogleheads Forum, all posters (both Valuation-Informed Indexers and Buy-and-Holders) will feel safe posting their honest views. That provides a great learning experience for every one of us;
You could start your own forum right here where all posters will feel safe posting their honest views.
But you won’t.
I want to have thousands of people participating at that board every day, Evidence.
I’ll start it after I have won control of the Bogleheads Forum. There are a lot of great people at that board and they deserve better than they are getting today. I want them all to feel safe posting their honest views.
We can have many, many honest boards. I’d like to open the Early Retirement Forum to honest posting as well. And the Morningstar.com boards. Why the heck not?
There is room in the world for more than one honest investing board. There is room for hundreds, perhaps thousands.
The first step is getting your prison sentence announced. That’s what flips everything. The announcement of your prison sentence is going to go viral and from that point forward there is simply no problem. I think it would be fair to say that, once people see that committing financial fraud gets you thrown in prison, we will all feel safe pulling together to bury the smelly Buy-and-Hold garbage 30 feet in the ground, where it can do no further harm to humans and other living things.
Does all of that not make good sense?
Rob
IT IS NOT UP TO ME.
What a cop out. The biggest crime in history, and do you even bother to report it to the proper authorities? No. All you do is babble about it in a dim, dusty little corner of the web.
If I witnessed a crime as heinous as you believe this one to be, I would call the police, the FBI, newspapers, TV stations, everyone. You just sit, waiting for other people to do something.
So either this fraud thing isn’t such a big deal, or you’re a cowardly little wuss. Which one of those would you like to go with?
Does all of that not make good sense?
No. It starts with “Rob says” so that is a sure sign that what follows is not good sense.
I’ll start it after I have won control of the Bogleheads Forum. There are a lot of great people at that board and they deserve better than they are getting today. I want them all to feel safe posting their honest views.
Then show them show them “better than they are getting today”. Start your board by close of business today. Then you will be able to add another win to your list.
If I witnessed a crime as heinous as you believe this one to be, I would call the police, the FBI, newspapers, TV stations, everyone. You just sit, waiting for other people to do something.
I’ve filed several police reports. I’ve spoken with the FBI. I’ve contacted many newspapers. I haven’t contacted any TV stations, but TV stations often look to the major newspapers to determine what is news so I think it makes sense to start with newspapers. I’ve done everything you recommend here, X.
And I will continue doing it. It is a rare day that goes by in which I do not contact someone re this matter.
You need to look at the math. The relentless promotion of Buy-and-Hold strategies caused the market to be overpriced by $12 trillion. Do you have any idea how much money that is?
That $12 trillion was essentially marketing money for Buy-and-Hold. The money wasn’t real. It was temporary, pretend money. But the Buy-and-Holders told people it was real. And they took credit for it! They told people that they could use this money to finance their retirements! That is why we are in such a mess today.
Now —
Which newspaper do you think wants to be the one to tell people that the money they were planning to use to finance their retirements is Pretend Money?
Which investment advisor do you think wants to do that?
Which policymaker wants to do that?
And, after we experience an economic crisis because of the relentless promotion of this Get Rich Quick garbage, who do you think wants to spill the beans by telling people that it was caused by the Buy-and-Holders?
The newspaper that ran articles saying Buy-and-Hold might work?
The investment advisor who advised his clients to consider Buy-and-Hold “strategies”?
The policymaker who did nothing while he saw the Buy-and-Holders promote their Get Rich Quick con 24/7 everywhere investors turned to for advice?
Everybody wanted to be on the gravy train for so long as it was running.
And now that it is not running so hard anymore few want to make the world angry at them for telling them the truth.
Get Rich Quick sells, X. It never, never, never works in the long run. But, man, does it sell! That’s why Buy-and-Hold is so freakin’ popular. The Buy-and-Holders cannot provide a URL to a single study that supports it. But millions don’t care. They love them some Get Rich Quick and they are happy to give their business to anyone who pushes Get Rich Quick extra hard. And I think it would be fair to say that no one pushes Get Rich Quick harder than the Buy-and-Holders.
Now —
There’s a snag in all this Get Rich Quick nonsense.
The snag is that Buy-and-Hold always causes financial devastation for everyone taken in by its claims. The collective losses are always large enough to bring on an economic crisis. So we all end up in the soup in the end. Some funny joke, huh?
That’s when prison sentences are announced for people like you, X.
We KNOW that Get Rich Quick is bad for us. We also know that it is insanely profitable in the short term. So we adopted laws to stop people from pushing it too hard. We made financial fraud a felony. We did that for a good reason. We did it because otherwise people like you would destroy our economic system. We wanted to create a DISINCENTIVE for the use of all the insanely abusive practices that you have engaged in over the past 12 years to stop people from learning what the peer-reviewed research really says.
You ignored those laws, X. Your bad.
The good news here is that we did not have 33 years of peer-reviewed research showing us how dangerous Buy-and-Hold is after the earlier three economic crises. We now have that. So we never have to go through this again.
There won’t be any reason for people to be reluctant to hear the truth following the next crash. Most of their money will already be gone! The abusive tactics just won’t work anymore.
Emotions will be the opposite of what they are today. Today people are desperate not to hear that they were conned. Following the next crash, they will be angry as can be. They will be looking to hang those who have advocated Buy-and-Hold strategies from a tree. The internet will supply them with the names of the people they are looking for.
Do you see?
I have spoken to the police and to 30,000 academic researchers and to all the big names in this field. I will continue to do so.
What will soon be changing is the REACTION that I will be obtaining when I tell people about this massive act of financial fraud.
I hope you understand. This is a society-wide problem and it is going to take an entire society to solve it.
Get Rich Quick is not the answer. Get Rich Quick is the problem.
We are on our way to solving that problem. The research that I co-authored with Wade Pfau shows that 70 percent of the risk of stock investing comes from the temptation to believe the Wall Street Con Men and follow Buy-and-Hold “strategies.” All that is coming to an end. No one likes a Ponzi scheme after it busts.
I naturally wish you all of the best that this life has to offer a person regardless of what investing strategies you elect to pursue.
Rob
Then show them show them “better than they are getting today”.
The announcement of your prison sentence brings an end to the death threats and the demands for unjustified board bannings and to the ten of thousands of acts of defamation and to the threats to get academic researchers fired from their jobs.
On the morning of May 13, 2002, there was 21 years of peer-reviewed research showing that there is precisely zero chance that a Buy-and-Hold “strategy” could ever work for a single long-term investor. Things were so bad that the only way you Goons could keep Buy-and-Hold alive was through the use of insanely abusive (even criminal in many cases!) practices.
With the announcement of your prison sentence, even that option is lost to you.
I think it would be fair to say that we are today living in the last days of Buy-and-Hold/Get Rich Quick. We are the luckiest generation of investors ever to walk Planet Earth.
You will be able to share in that when your prison cell comes to a close. You are a very lucky (but also exceedingly foolish, to be sure) man. Please try to focus on the positive.
My best wishes.
Rob
I’ve known that I was holding a winning hand going back to Day Six, the day that John Walter Russell posted his sensitivity analysis of the Greaney retirement study.
I never thought it would take this long. You guys got me re that one. You got me one-hundred times over re that one.
But I knew how it would end going back to the first week of our discussions. I never experienced a moment’s doubt re the general ending point after I saw the Russell sensitivity analysis way back in May 2002. I believe in research. I believe in numbers. I believe in objective truth. I believe in science.
It was the death threats of August 27, 2002, that caused me to abandon Buy-and-Hold. I believed from May 2002 through August 2002 that the Old School SWR studies could be corrected and Buy-and-Hold reformed. It was the death threats that told me that we needed to replace Buy-and-Hold with a new model rooted in Shiller’s research. But I knew the general ending point going back almost to the first day.
Even on the very first morning, the anger of the Buy-and-Holders set off my spidey sense. But I wasn’t sure whether to trust my spidey sense until I saw John’s sensitivity analysis. From that point forward, it’s just been a question of going deeper and deeper and deeper.
Hang in there, Goons. There is someone out there in this world who cares about your welfare a whole big bunch more than you care about your own welfare.
And he works it hard! Yowsa!
Rob
Say Rob,
Let’s assume you get your wins tomorrow — how does the world avoid the 65% crash you say is imminent?
The P/E10 value is in the mid-20s. Fair value is 15. We cannot avoid the fall to 15. It is the market’s purpose to price things properly. We all should want stocks to be priced properly. Any efforts to avoid the drop to 15 are just a delaying action. So we are going to take a hit no matter what.
But we can survive a drop to 15. It won’t be perceived as good news by a lot of people. But we can handle it. It is not the end of the world.
A further drop to 8 is MUCH, MUCH worse. As people’s accounts are depleted, each new dollar of loss hurts more. Once we get down to 15, we should want the pain to stop. Drops below that will be devastating.
Now —
A P/E10 of 8 is just as crazy as a P/E10 of 30. It’s insanity. There is no rational reason for us to price stocks at half of fair value. Especially at a time when we need to get the economy going. When we go to 8, we will be deliberately tricking ourselves into believing that we possess less wealth than we really possess. Huh?
When we open the internet to honest posting, we can show people what an amazing deal stocks offer once prices go down to fair value levels. That will cut off the feelings of panic that people will feel if they don’t understand why we have fallen to 15. And then we should show them how the value proposition gets even stronger when we fall below 15. That will encourage people to buy as prices drop and thereby end the drop.
Do you see?
STOCK PRICES ARE SELF-REGULATING SO LONG AS INVESTORS ARE PERMITTED ACCESS TO THE INFORMATION THEY NEED TO INVEST IN THEIR OWN SELF-INTERESTS.
Recessions and depressions are caused by the widespread promotion of Buy-and-Hold strategies. Once we let people know what the peer-reviewed research says, we have solved the problem of the boom/bust cycle.
It’s all about getting good information out to people.
Rob
Got it.
How is the markets fair value impacted by interest rates? Just like anything, markets aren’t priced in a vacuum.
“STOCK PRICES ARE SELF-REGULATING SO LONG AS INVESTORS ARE PERMITTED ACCESS TO THE INFORMATION THEY NEED TO INVEST IN THEIR OWN SELF-INTERESTS.”
THE INFORMATION IS ALL OUT THERE FOR ANYONE TO ACCESS.
How is the markets fair value impacted by interest rates? Just like anything, markets aren’t priced in a vacuum.
Interest rates are incorporated into the market price.
Fama showed that. If you feel that you can outguess the market by making some jumps in and out because of changes in interest rates, please feel free to do so. But there is now 50 years of peer-reviewed research showing that this does not work.
What Shiller showed is that there is one exception to the general rule of market efficiency. The exception is valuations.
The reason why valuations is an exception is that all mispricing is the product of irrationality. All of the other factors (such as interest rates) affect stock prices through a rational means. Mispricing cannot possibly affect prices through a rational means. If it did so, the mispricing would disappear! Whenever a mispricing remains in place for more than a few hours, you have irrationality (investor emotion) present.
To know the real price, you need to adjust for the irrationality. P/E10 is the metric that identifies the amount of the adjustment required.
Determining the accurate price of the market is a two-step process, not a one-step process. You first identify the nominal price, which incorporates all effects other than valuations. Then you adjust for valuations, which incorporates the one irrational factor, the one factor that is ignored in any analysis assuming rationality (which is what the efficient market theory does).
When Fama’s findings are combined with Shiller’s findings, you have something real and powerful and accurate.
When Fama’s findings are not combined with Shiller’s findings, you have a smelly pile of Get Rich Quick garbage.
Once you elect to root your investing strategies in peer-reviewed research, you are required to acknowledge errors that are brought to your attention by research published after the date at which you formed your first tentative conclusions.
Rob
THE INFORMATION IS ALL OUT THERE FOR ANYONE TO ACCESS.
No it isn’t.
Go the Bogleheads Forum and check how many threads there are today on Valuation-Informed Indexing. There are zero. That’s because Valuation-Informed Indexing is rooted in the peer-reviewed research of the past 33 years and if people participating at that forum find out how they have been lied to for years, the owners of that forum will be going to prison. They don’t want to go to prison. So they deny the readers of the forum the information they need to invest effectively.
Academic Researcher Wade Pfau and I co-authored peer-reviewed research showing investors how to reduce the risk of stock investing by 70 percent (avoid Buy-and-Hold strategies at all costs!). Wade should have been awarded a Nobel prize for that research. It is the most important research published in this field in the past three decades. You Goons threatened to send defamatory e-mails to his employer FOR A REASON. You wanted him to stop telling people about the Bennett/Pfau research because many posters at Bogleheads showed that they very, very much wanted to learn about that research.
So, no, the information is not out there. In a hyper-technical sense, it is. The Bennett/Pfau research is available at this web site. But millions of people would be investing pursuant to that research had it been featured on the front page of the New York Times, as it would have been had you Goons not threatened to destroy Wade’s career as his “punishment” for exposing your massive act of financial fraud.
The information WILL be out there soon after your prison term is announced. That’s the right way to say it. The announcement of your prison term will go viral and the problem will be solved. From that point forward, we will all be able to live in a world in which the risk of stock investing has been reduced by 70 percent.
We live in a great country, Anonymous. You hate the core principles of our way of life with a burning hate. But you are wrong to do so. We live in a great country. We have always prevailed over Goons like you in the past and we will prevail again this time.
I am sure.
Rob
Your
Lucky VII is out there. It doesn’t have to be on every site. Shillers work is discussed there, but it doesn’t have to involve YOU since you are a troll. There is no investing site that has every opinion on the world represented and there is no requirement to be that way.
You are wrong, Anonymous.
The peer-reviewed research of the past 33 years needs to be discussed at every site.
In fact, the peer-reviewed research of the past 33 years needs to be discussed in every THREAD in which Buy-and-Hold “ideas” are advanced.
If they are not, people reading those threads are led to the false conclusion that there might be some mystical, magical research supporting Buy-and-Hold strategies.
What possible good purpose could ever be served by permitting people to push a pure Get Rich Quick approach and not to correct them when they say that their approach is rooted in peer-reviewed research?
Why would we want millions of middle-class people investing pursuant to a “strategy” that has caused a mass wipeout every time in history in which it has become popular? Why would we want to keep quiet about a “strategy” that has caused an economic crisis on each of the four occasions in which the Wall Street Con Men have been successful in convincing a large number of people that the pure Get Rich Quick approach is the cat’s pajamas?
Why not tell people the truth?
We permit honest posting on the internet re every other subject discussed. Why must the investing advice field be so different?
Do you think it might have something to do with the massive amounts of money brought in to the people pushing the Get Rich Quick/Buy-and-Hold approach so recklessly and so relentlessly and so ruthlessly?
Do you think it might have something to do with the shame they feel for having destroyed the financial futures of their friends and co-workers and neighbors and fellow community members?
Do you think it might have something to do with their fear of spending the rest of their lives in prison cells?
Yeah, I sorta thought it might be one of those too.
There is no requirement that any investing site have every opinion in the world represented. But there IS a requirement that any site that purports to be promoting research-based strategies permit exploration of the implications of the last 33 years of peer-reviewed research in this field. The owners of those sites who make the false claim that they are promoting research-based strategies while in fact doing just the opposite are guilty of the crime of financial fraud. A felony. Prison time.
We adopted the laws against financial fraud for a good reason. This isn’t the first time the Wall Street Con Men blew up our economic system for their personal profit. I have a deep hope and deep belief that it will be the last. I intend to see to it.
I wish you all good things.
Rob
Let’s play Jeopardy.
Answer: the peer-reviewed research of the past 33 years needs to be discussed in every THREAD in which Buy-and-Hold “ideas” are advanced.
Question: Why has Rob Bennett been banned from every major finance board?
That’s a super comment, X. You cut through a lot of b.s. and got straight to the heart of things with that comment. Good for you.
I understand the point you are making.
And I stand by what I said.
The findings of the last 33 years of peer-reviewed research need to be discussed in EVERY FREAKIN’ THREAD in which they are relevant. That is indeed the Rob Bennett position.
And, yes, I think it would be fair to say that that is a big part of the explanation of why I am banned at every major finance board. What you are saying is true enough in that it explains the reality. But I am right on the ethical matter.
You Goons are correct in a hyper-techncal sense when you say that Shiller’s ideas are discussed at the Bogleheads Forum. There are people there who believe in Shiller’s ideas. And they post. And the posts stay up. And people read them. All of that is so.
But the comments they make are superficial. When the comments go deep (as they must if people are to be persuaded of the merit of Valuation-Informed Indexing strategies), the Buy-and-Holders step in and send out signals that these posters have “gone too far.” If the poster pulls it back, he remains to post another day. If the poster ignores the warning, he is removed. That’s the way it works.
The Valuation-Informed Indexers have been placed in a ghetto. It’s a ghetto in which they do not possess the same rights as Buy-and-Holders. It’s a ghetto in which they keep their most powerful insights to themselves. It’s a ghetto in which they do not say “Buy-and-Hold is dangerous” or “that claim is wrong” or “Bogle is contradicting himself.” It is a ghetto in which they watch their step and are careful not to offend their betters.
Not this boy, X.
Not ever. Not by a long shot.
Do Buy-and-Holders feel free to post in every freakin’ thread?
Has that ever been in question? Has there ever been any controversy about it?
Then why are there questions and controversies about whether Valuation-Informed Indexers should be permitted to do the same?
You have hit the mark with this comment. The question you raise here is the question that has been on the table for 12 years now.
I post honestly or I post not. If I see someone asking for a link to a retirement calculator and then I see some Buy-and-Holder link to FIRECalc, I am going to respond with a link to The Retirement Risk Evaluator. I’ll do it every time. I will never offer any apology whatsoever. If asked, I will explain that the reason why I post honestly re these matters is that I do not want to see my friends suffer failed retirements. I will add that I look forward to the day when we ALL post honestly and when Buy-and-Hold has been buried 30 feet in the ground, where it can do no further harm to humans and other living things.
No apologies whatsoever. None.
Now —
The Buy-and-Holders have the same right. The Buy-and-Holders believe what they believe and they have every right to share what they believe with others.
So what do we do?
Both sides have to respect the other side.
That’s how this ends.
The reason why it upsets people when I post about Valuation-Informed Indexing insights on every thread on which they are relevant is that many investors HAVE NO IDEA that there is 33 years of peer-reviewed research showing that Buy-and-Hold cannot work. I know this to be so because I had no idea of this myself prior to May 13, 2002. People don’t even know that there is a controversy. So it upsets them to find out that there are DOUBTS about this Buy-and-Hold stuff that they are using to finance their retirements.
The Buy-and-Holders are playing a very, very, very dangerous game. They are tricking people. They are leading people to believe that there is a consensus that Buy-and-Hold works when in reality there is now 33 years of peer-reviewed research very much cutting the other way.
EVERY INVESTOR ON THE PLANET NEEDS TO KNOW THAT THERE ARE TWO ACADEMIC SCHOOLS OF THOUGHT AS TO HOW STOCK INVESTING WORKS, NOT ONE.
When that is out in the open, we won’t see the ugliness that has characterized the first 12 years of our discussions. At that point, Valuation-Informed Indexers will be commenting on every thread at every board and no one will blink an eye about it. Everyone will understand that that’s just what we all should expect given the 33 years of peer-reviewed research supporting the new model.
And that’s when we will start to see the popularity of Valuation-Informed Indexing grow by leaps and bounds. People are not going to risk their retirement money on a strategy until they have heard it explored from many angles and in great depth. It is when as a society we acknowledge that those promoting research-based strategies have EVERY RIGHT IN THE WORLD to post at every thread on every board and blog on the internet that VII will take off on its way to becoming the dominant model for understanding how stock investing works.
Bogle has to give an “I Was Wrong” speech. Or, at the very least, he needs to give an “I’m Not Sure” speech. That will get written up on the front page of the New York Times. And then the ugly side of this comes to an end. From that point forward, it’s good stuff piled on top of good stuff piled on top of good stuff. For every last one of us. We are all on the same side in the final analysis, to be sure.
Every freakin’ thread, X.
That’s what I ask.
And that’s what I will get.
The length of your prison term will be determined by how long it takes me to pull it off. I vote for the close of business today, the timing choice that produces the shortest possible prison sentence for you and your Goon pals.
Don’t let the bad guys get you down, man.
Rob
Get over your butt hurt, fat boy. You are making a clown of yourself.
Buy-and-Hold is Science!
Rob
But I don’t live in the USA! I guess you have no hope of sending me to prison.
I’m not going to send anyone to prison, A. I have no such powers and I possess no desires to ever have such powers.
I am going to tell the story of why millions of people lost their retirement money. If those people want to send people to prison (my strong hunch is that they will), they will do so. If they don’t, I am not going to carry a sign around saying “Send the Goons to prison!” I’ve got more important things on my To Do list, you know?
As for people outside the U.S., I guess that is all part of the wonderful game. Whether you end up in prison or not, we all still learn from the experience, no? That’s what matters.
We have your comments saved here and those comments show what believing in a Buy-and-Hold strategy does to a person. That’s what people need to know. That’s what the “experts” in this field should be telling people. That’s the future of investing advice.
That’s certainly my sincere take re this terribly important matter, in any event.
I wish you all good things, my non-U.S.-dwelling Goon friend.
Rob
Somehow I think any reader that might worry even for a moment about you suing them or shooting them now has his mind at ease. U cannot even tell what country they r in.
You misunderstand the reason why I regularly repeat the point that people will be going to prison following the next price crash, A.
You are under the impression that I have some desire for people’s minds not to be at ease. Nothing could be farther from the truth. I want people’s minds to be TOTALLY at ease.
The Buy-and-Holders have put themselves into a trap. They were excited about Fama’s findings. They built an investing strategy (Buy-and-Hold) that reflected them. They promoted it. They intended to do good and thought they were doing good. They were excited and pleased about the work they were doing.
Then new research was published showing that this strategy could never work. They were shocked. They were dismayed. They were confused. They elected not to acknowledge that they had been proven wrong or even that the research now showed that they MIGHT be wrong. They just ignored the new research.
Then, as the mountain of evidence showing that they were wrong grew larger and larger, they became AFRAID to say those Three Magic Words. If they were to say them today, 33 years after the research showing that they were wrong was published, that would look very bad to a lot of people who have lost a lot of money as a result of their false claims. Some of them would be sued for large amounts of money. Some of them would be going to prison. So they keep it zipped.
That hurts them. And it hurts me. And it hurts you Goons. And it hurts millions of middle-class investors. It hurts EVERYONE. We are all in this together. And we are all getting hurt.
I want to stop the hurt. That’s all.
I cannot stop the hurt by being dishonest and playing along with the fiction that Buy-and-Hold can work. And I cannot stop the hurt by being cowardly and failing to point out that there are going to be people going to prison following the next crash. It’s an important part of the story that needs to be told. That’s why I say it. And that’s the only reason why I say it.
I don’t sit around wishing for people to go to prison. The reality is quite the contrary. I have offered to do what is in my power to get the prison sentences reduced. I want SHORTER prison sentences. But I sure don’t think we are going to get shorter prison sentences by continuing this moronic cover-up. So I am careful never to do anything to lend support to the cover-up. I do everything I can think of to EXPOSE the cover-up. Because that is how we bring it to an end and that is how we shorten those darn prison sentences.
I don’t doubt that there are some people who have participated in the cover-up who are going to avoid going to prison because they live outside the United States. What of it? It’s not my doing. That reality has nothing to do with me.
I want to solve the problem.
When prison sentences are announced for people who DO live in the United States, that will be a huge step forward. The announcement of those prison sentences will go viral. People will want to know how this happened. I will tell the story. People will see the dangers of Buy-and-Hold. They will see what it does to the investors who try to believe in it. They will see how cruel it is of the Buy-and-Holders to tell lies to millions of people about what the peer-reviewed research says just to turn a quick buck. We will act as a society to bury the smelly Buy-and-Hold garbage 30 feet in the ground, where it can do no further harm to humans and other living things.
And we will move on to Valuation-Informed Indexing. The New Buy-and-Hold. Buy-and-Hold 2.0. The version of Buy-and-Hold that works in the real world. The first TRUE research-based investing strategy.
It is not my job to keep track of everybody who tells lies on discussion boards. I accept that there are going to be some people who commit financial fraud who are not going to prison. Perhaps that is not a good thing. But it is not my problem. I am busy trying to see that the word gets out about the last 33 years of peer-reviewed research so that the number of people who do go to prison is as small as possible and so that the prison terms they serve are as short as possible, given the realities that apply.
That’s where I am coming from re this matter.
As for the lawsuits, I can identify where a LOT of people who I will be suing live.
Motley Fool is based in the United States.
Morningstar is based in the United States.
Mike Piper’s blog is based in the United States.
Index Universe is based in the United States.
I will be suing anyone who lends support to the Lindauerheads and Greaney Goons or who lets individuals who have posted in “defense” of Mel Limdauer or John Greaney participate at their web sites. It may be that some of those people don’t reside in the United States. I know that lots of them do and I will be able to supply addresses to the lawyers.
I naturally wish you the best of luck in all your future life endeavors, my soon-to-be-named-in-litigation friend (unless you happen to be one of the Goons whom I will not be able to track down and who will thus “get away” with it!).
Oh, my!
Rob
now has his mind at ease.
Right.
That’s why you will stop posting here today.
I believe you, A.
No — Really!
Rob
Ok, i will stop.
I STILL believe you.
Um — Kinda, Sorta.
Rob