Set forth below is the text of a comment that I recently posted to another blog entry at this site:
I am certain that Jack has devoted a good bit more than one minute’s thought to my demand that every board and blog on the internet be opened to honest posting on SWRs and many other critically important investment-related topics and to my request that he get the ball rolling by walking to the front of a large room and giving an “I Was Wrong” speech.
Certain based on what evidence?
1) The question of whether honest posting should be permitted on the safe-withdrawal-rate matter dominated discussion at the Vanguard Diehards board for the 18 months during which I posted there. There were some days in which there were four or five different threads examining some aspect of this general question. Jack said that he visited that board weekly to check out what was being said. It is impossible to imagine that he was not exposed to NUMEROUS threads discussing this matter.
2) Jack obviously reads the Wall Street Journal. A few years after the ban was imposed at Vanguard Diehards (which became the Bogleheads forum), the Journal published an article saying that I was right all along re the SWR matter. Jack obviously saw that article and regretted the many acts of financial fraud that had taken place at a discussion board bearing his name.
3) Before honest posting was banned, there were community members arguing both for and against the ban who contacted Morningstar, Vanguard and Jack Bogle.
4) When Morningstar refused to ban honest posting at Mel Lindauer’s urging, Lindauer asked the entire board community to move to a private board where he and his Goons could control who was able to speak and what they were able to say. Bogle obviously noticed that the entire board community was moved to a different location.
5) After the board community was moved, a number of community members who liked the idea of honest posting being permitted remained at the Morningstar site and asked that honest posting be permitted there. Lindauer hotly opposed the idea. Again, both sides contacted Morningstar, Vanguard and Bogle.
6) Lindauer had been using threats of physical violence to intimidate community members who tried posting honestly for years before I came on the scene. It is all but impossible to imagine that some of these incidents did not come to Bogle’s attention.
7) I wrote Bogle three times asking him for help with the Lindauer matter.
8) Larry Swedroe was banned for a time for the “crime” of posting honestly. This would obviously be brought to Bogle’s attention.
9) When Wade Pfau posted honestly about the research that I did with him, Lindauer accused him of engaging in unethical research practices. This was obviously both a crime (financial fraud) and a tort (defamation). It is hard to imagine that Linduaer would engage in this behavior without first having assured that Bogle would be backing him up.
10) You Goons have yourselves interpreted Bogle’s failure to act re your numerous acts of financial fraud as an indication of his support. Why would Bogle permit his reputation to be damaged in this way if he was not aware of the threat to Buy-and-Hold represented by my call to permit honest posting on safe withdrawal rates?
11) Bogle knows about the Bennett/Pfau research showing the superiority of Valuation-Informed Indexing over Buy-and-Hold. He obviously would be doing all he could to make every investor alive on the planet aware of it if he were not involved in the cover-up himself.
12) At the first meeting of the Vanguard Diehards held after the Ban on Honest Posting was adopted, numerous questions about the effect of valuations were asked of Bogle. He obviously would be curious as to why this had suddenly become such a hot topic.
13) Bogle obviously saw the article by Bret Arends in the Wall Street Journal pointing out that the Buy-and-Holders have “left out half the story” re what the research says about how stock investing works. Again, he made no effort to publicize this hugely important article. If he were not involved in the cover-up, he obviously would have done so.
14) Bogle gave an interview to the Index Universe site in which he referred to my claim that the need to change one’s stock allocation in response to big valuation shifts is a strategic need rather than a tactical need. I am the only one who has said that. He picked up that language from listening in on the discussions held at the various forums.
15) In that same interview, Bogle said that allocation shifts are needed six times in an investor’s investing lifetime, three times when valuations are stupidly high and three times when valuations are stupidly low. Again, this is a claim that I had been making for years that he picked up from our discussions.
16) Bogle included language in his book that helped me understand that the Old School SWR studies got the numbers wildly wrong. He obviously read his own book.
17) Bogle gave an endorsement to Bill Bernstein’s book, in which Bill said that two percentage points needed to be subtracted to get the accurate safe withdrawal rate at the time he was writing the book because of the high valuation that applied at that time. Bogle would not have endorsed the book without reading it. So he knew all along (Berntein’s book was published in April 2002) that the Old School SWR numbers were wildly wrong.
18) Bill Bernstein said in an e-mail to Ataloss that it was his view that anyone who used the Old School studies to plan a retirement would have to be out of his or her mind. Bernstein and Bogle are friends and the cover-up of the errors in the Old School studies is the biggest act of financial fraud in U.S. history. It is impossible to imagine that Bill did not let Jack know of his views on the SWR matter, given that the errors in those studies are in the process of causing millions of failed retirements.
19) Shiller’s book is available in public libraries and was widely reviewed when it was published. Bogle either read the book himself or had someone who had read it describe its contents to him.
20) Shiller was awarded the Noble Prize in Economics for his “revolutionary” (Shiller’s word) findings. Bogle obviously would have been curious to know how Shiller’s revolutionary findings discredited Bogle’s investing ideas.
21) Rob Arnott copied Bogle on his e-mail to me in which he told me that my investing work is “Solid.” Arnott is a personal friend of Bogle’s. So he obviously read the e-mail.
22) Arnott’s e-mail referred to the article that I wrote on The Silencing of Academic Researcher Wade Pfau by the Buy-and-Hold Mafia. Bogle obviously would have felt a responsibility to learn all he could about this massive act of financial fraud given that it was conducted by people who follow and promote his investing strategies.
23) One of my e-mails to Bogle described unethical practices being followed by the owners of the Bogleheads Forum. Again, Jack would obviously want to know about felonies being committed by people who owned a board carrying his name.
24) Michael Kitces told me following the 2008 crash that many practitioners where talking amongst themselves about the need to come clean about the dangers of Buy-and-Hold strategies. Word of this would obviously have gotten to Bogle given that he is viewed as the lead advocate of this strategy.
25) Arnott’s e-mail described acts of intimidation by Buy-and-Holders that have been experienced by Arnott. Again, the e-mail was forwarded to Bogle, who is a personal friend of Arnott’s.
26) You Goons have been trying for 12 years to “persuade” me to post dishonestly re the SWR issue. You are at obvious risk of going to prison for financial fraud. It is more than a little hard to believe that you would put yourselves at such great personal risk without some promises of protection from Bogle.
27) I wrote to 30,000 academic researchers to let them know about the intimidation tactics that the Buy-and-Hold Mafia used to silence Wade Pfau. It is all but impossible to imagine that none of these people alerted Bogle. I even received responses from people who have posted to the Bogleheads Forum. Are we to believe that those people contacted me and not Bogle?
28) Vanguard’s research arm recently published a study showing that valuations (as measured through use of the P/E10 metric) predict long-term returns. Bogle founded Vanguard. It is hard to imagine that he would not be informed of the publication of a study by his own firm that discredited the investing strategy that he has been promoting for decades now.
He knows, Anonymous.
I don’t say that he knows every detail. I don’t believe he does.
And I don’t say that he doesn’t rationalize his bad behavior in his own mind. I believe that he does.
But it is silly to pretend that my good friend Jack Bogle does not possess a basic understanding that there has been a huge cover-up of the errors in the Old School retirement studies and a basic understanding that he has a responsibility to take prompt and effective action re this matter.
We will all learn more when he is put under oath.
Rob
Anonymous says
You think way too much of yourself. You have been told point by point on why you are wrong on each of the topics you have raised above, yet you keep on living your life of delusion and fantasy. Jack doesn’t give you a moments thought.
The fact, Rob, is when the truth and facts are on your side, it doesn’t take 12 years to get your points accepted. Your repeated lies have resulted in continual failure.
Rob says
We disagree, Anonymous.
I don’t think that I think too much of myself. I think that I think a lot of the peer-reviewed research. And that’s something I learned from Jack Bogle and my many other Buy-and-Hold friends.
And I am highly confident that Jack thinks about this stuff all the time. If he doesn’t, he is the Frank Underwood of Personal Finance. And there’s too much in his record pointing in the other direction for me to believe that.
And of course the only reason why Valuation-Informed Indexing did not replace Buy-and-Hold as the dominant model many years back is your Campaign of Terror against our board and blog communities. Most people don’t like to see death threats directed at their loved ones. Surprise! Surprise!
The reason why we adopted laws against financial fraud was to protect ourselves from people like you, Anonymous. I am highly confident that we will be seeing enforcement of those laws following the next price crash.
But we’ll see, you know? You can certainly count on me to do everything in my power to get the word out about what has been done. That’s my pledge to my fellow community members and to my fellow citizens. I can do no more and I can do no less.
Hang in there, man.
Rob
Anonymous says
The deletion of my last post proves my point.
Rob says
Yeah, yeah.
Rob
Anonymous says
Rob,
If VII is so great how come no one rich, successful, or smart uses VII? Checkmate!
Rob says
Shiller published his research in 1981.
The Wall Street Con Men have spent hundreds of millions of marketing dollars promoting Buy-and-Hold over the past 33 years.
You Goons have for 12 years engaged in the most vile tactics that can be imagined by the human mind to keep millions of middle-class investors from learning about the first true research-based approach.
The world is not going to come to an end on the day of the next price crash, Anonymous.
Permitting honest posting on every board and blog benefits everyone. It benefits the millions of middle-class investors. It benefits the academic researchers. It benefits the journalists and bloggers. It benefits the investment advice industry. It benefits the economists. It benefits the policymakers. It is a win/win/win/win/win.
There will be millions of people using and benefitting from VII for many, many years into the future.
The First Great Depression led to adoption of the New Deal. The next price crash, which may well lead to the Second Great Depression, will lead to a Second New Deal. From the day we open the internet to honest posting on what the last 33 years of peer-reviewed research says, we will all be able to learn what we need to know to be able to retire five to ten years sooner. We will all be able to invest in stocks in such a way as to reduce the risk of stock investing by nearly 70 percent. We will no longer need to live in fear of the next economic crisis because we will be permitted to discuss the peer-reviewed research that brings the awful boom/bust cycle to an end.
From that day forward, we will be a richer people in every sense of the word.
We adopted laws against financial fraud for a very good reason, Anonymous. We adopted laws against financial fraud to protect us from people like you.
History always moves forward and never backward. You are standing on the wrong side of the History Train. Buy-and-Hold is the past. Valuation-Informed Indexing is the future.
It all flips on the day following the next price crash.
Or so Rob Bennett believes.
We will see the reality play out before our eyes over the course of the next few years.
I will be honored to stand next to my good friend Jack Bogle and tell the world how we have finally figured out what works and that much of it is consistent with what he has been saying for decades but that the Get Rich Quick element very much needed to be removed and that from that point forward we will both be working to let all investors know why that is so important and how that is done.
I prefer living in the future to living in the past.
Call me madcap.
Take it easy, old friend.
Rob
Anonymous says
Just a vast conspiracy, right Rob?
Rob says
No, it’s not a vast conspiracy, Anonymous. We have talked about this many times.
The Buy-and-Holders are trapped. They started out with good intent. They generated many powerful insights that helped us all. They got one thing wrong. Not because they are stupid or bad. Because they are human. Humans make mistakes. It happens.
Shiller discovered the error. Shiller’s findings were revolutionary. Revolutionary findings take some time to absorb. So the Buy-and-Holders rationalized not changing their model. Time passed. More and more evidence accumulated that the Buy-and-Holders had made a critical error. By this time, the Buy-and-Holders were embarrassed to acknowledge the error. So much time had passed since it became public knowledge with the publications of Shiller’s research! So they went into cover-up mode. Where they remain today.
Today there is a MOUNTAIN of evidence that the Buy-and-Holders were wrong to say that price discipline is not required when buying stocks. But it is harder than ever for them to acknowledge the error. They have now caused an economic crisis. There are now millions of people who have lost their jobs as a result of the cover-up. There are millions who will be experiencing failed retirements. They are tens of thousands who have seen their businesses fail. There are many who will be going to prison because they were too afraid to “cross” the Buy-and-Hold Mafia by telling the truth about what the last 33 years of peer-reviewed research teaches us. There are thousands of people who trained all their lives to become academic researchers but who dare not publish honest research because they know that their careers will be destroyed if they do.
Does that sound like a funny joke to you?
What do you propose we do?
The good side of this story is 50 times more good than the bad side of it is bad. We are the luckiest generation of investors ever to walk Planet Earth. We know how to reduce stock investing risk by 70 percent. We know how to invest so that we can retire five to ten years earlier than we ever before dreamed possible. We know how to bring an end to the boom/bust cycle that brings on economic crises. Our system has produced wonderful fruit once again.
Only we can’t talk about it. It makes the Buy-and-Holders feel bad for people to learn that they messed up. So we all have to grin and bear it as the economic crises continues to worsen. We all have to keep it zipped while we head closer to the Second Great Depression.
I say that we should take advantage of our good fortune. I say that we should all pull together and fix our broken economy. I say that we should let the Buy-and-Holders off the hook by INSISTING (not asking!) that they all come clean. I say that we should let Jack Bogle’s boyhood dream of creating an investing strategy for ordinary people that is smart and safe and simple come true. I say that we should all work to get the prison sentences reduced to the extent possible and to have as few people as possible sent to prison in the first place. I say that we should open the investing advice field to people of integrity, just as every other field of human endeavor is open to people of integrity. I say that we should all be as honest as it is possible to be without crossing the line and becoming uncharitable while also being as charitable as it is possible to be without crossing the line and becoming dishonest.
What say you?
Do you have any better ideas?
Yes, there is a “conspiracy” of people who are afraid of Wall Street Con Men and Internet Goon Squads that make use of death threats and demands for unjustified board bannings and tens of thousands of acts of defamation and threats to get academic researchers fired from their jobs in an effort to continue the most massive act of financial fraud in U.S. history. This surprises you? Why do you think we adopted laws making financial fraud a felony in the first place? We did it to protect us from people like you.
I will not be the one sending you to prison, Anonymous. It is the people of the United States who will be sending you to prison.
For obvious reasons.
The people of the United States have a perfect right to protect themselves from the sorts of individuals who have posted in “defense” of Mel Lindauer and John Greaney.
And they will.
And then we will all start taking advantage of the fact that we are the luckiest generation of investors ever to walk Planet Earth.
And perhaps when your prison sentence comes to an end you will have learned how to live in a community of people.
There are times when a person needs to know how to pronounce the words “I” and “Was” and “Wrong.”
If you learn that lesson, you will have come out of this thing big winners, in my assessment.
I naturally wish you all good things.
Rob
Rob says
The short answer is that the day Bogle gives his “I Was Wrong” speech, the “conspiracy” will come to a quick and complete end.
THOUSANDS of people in this field are looking forward to the day when they can again do honest work.
NO ONE enjoys the feeling of being targeted for career death by the Wall Street Con Men and their Internet Goon Squads.
The most massive act of financial fraud in U.S. history is not only destroying the lives of millions of middle-class investors. It is also doing great harm to everyone who works in this field.
It is a lose/lose/lose/lose/lose.
We should permit honest posting.
Everywhere.
By everyone.
For obvious reasons.
My sincere take.
Rob
Anonymous says
I prefer living in the future to living in the past.
You seem to spend about the same about of time in the delusional past (death threats, uncorrected studies, butt hurt) and in the future (prison terms, $500mm checks). But you don’t spend much time in the present.
The problem, as mentally healthy people know, is that reality is the present, not the imagined past or future.
Rob says
In the present, we have universal acknowledgment that the Old School safe withdrawal rate studies get the numbers wrong. The Wall Street Journal says this. So there is no dispute any longer re the point that I made in my famous May 13, 2002, post.
But we don’t permit posting about the New School SWR studies. We acknowledge that we got it wrong before. But we don’t permit anyone to get it right.
Huh?
In the future we are going to be permitting people to get it right, Anonymous.
The authors of the Old School studies were not wrong about the importance of knowing the SWR. We all need to know the SWR. So that’s where this is headed.
So, yes, I guess it would be fair to say that I live in the future.
It’s my job to take us there.
Someone has to take from this stupid time where we acknowledge having gotten the numbers that millions of people use to plan their retirements wrong to the smart and wonderful time where we all feel free to share the correct numbers and help people by doing so.
I am doing what I can in the present to lead us to a better future.
There are severe limits as to what I can do in the present. That breaks my heart.
But it is what it is, you know? We have to get from the stupid present to the smart and wonderful future. And, if you believe in you country as much as I believe in my country, you believe that we will figure out a way to pull it off.
I wish that someone else was elected to do this job, you know? It’s not a terribly fun job. In the long run, I expect that it will become an amazingly fun job. But in the present, it would be fair to say that it pretty much sucks. WhaChaGawnDo?
Someone has to do this job. I was elected. When I get the $500 million paycheck, some will say that that will make it all worthwhile. I’m not so sure. But whether that will make it all worthwhile or not, the bottom line is that I am not capable of lying to my friends about the numbers they use to plan their retirements. So I am pretty much stuck doing this stupid job in the present until we all figure out a way to move to the smart and wonderful future that we all want to be in and that we all belong in.
If you come up with any groovy ideas about how to get us there faster, please let me know.
Until I hear some better ideas, I am going to continue to make the most of the cards that I have been dealt.
I don’t like the way things have played out. But I don’t have the power by myself to change things. I have asked for help. I believe that a time will come when I will get it. When that time comes, I will be the happiest person on Planet Earth to make the move from our stupid present to our smart and wonderful future.
But the timing is not my call.
So, yes, I guess to some extent I live in the future.
As for the past, it is our stupid past that has created this stupid present for us. I played no role in the cover-up. I didn’t even know about it on the morning of May 13, 2002.
I can’t ignore it. Without some explanation of what happened in the past, no one can make sense of this story. We know how to reduce stock investing risk by 70 percent and we have elected as a society not to tell people about it? Huh?
How do I tell the story that people need to hear without telling them something about what happened in the past?
I am 100 percent happy to spin it in a positive direction for the Buy-and-Holders so long as I don’t have to cross the line into committing financial fraud myself. That’s as far as I can go. For obvious reasons.
So the past matters too.
Anyway, that’s where I am coming from re this aspect of the question.
I wish you all good things.
Rob