Set forth below is the text of a comment that I recently posted to another blog entry at this site:
So an old fat white male with an inheritance is claiming persecution.
I am claiming that I have the right to post honestly re SWRs and scores of other critically important investment-related topics at any discussion board or blog on the internet at which I desire to do so.
And that my good friend Jack Bogle possesses that same right.
And my good friend Bill Bernstein too.
And my good friend Larry Swedroe too.
And my good friend Scott Burns too.
And my good friend Wade Pfau too.
And my good friend Mike Piper too.
And my good friend J.D. Roth too.
And my good friend Todd Tresidder too.
And my good friend Robert Shiller too.
And my good friend Bill Bengen too.
And my good friend Bill Schultheis too.
And my good friend Carl Richards too.
And you Goons have the right to go to prison if you are absolutely doomed and determined to do so (and I think it would be fair to say at this point that you are).
Don’t let the bad guys get you down, Critter.
Rob
Anonymous says
All the people you mentioned do post honestly and are free to post on boards of their choosing. You, on the other hand, can’t post on many of the boards due to your behavior. Those boards have a right to block you, just like you block posts on your board. I would also take issue with what you call “honest” posting.
Rob says
We disagree as strongly as two people could possibly disagree, Anonymous.
I delete posts for the perfectly good reason that this is a personal finance site and there is no place here for death threats and other forms of intimidation. Normal people cannot have civil and reasoned discussions if I don’t block that sort of thing. I have no choice if I want the site to serve its purpose.
The Buy-and-Holders block posts that make research-based challenges to Buy-and-Hold because those posts make research-based challenges to Buy-and-Hold. In an objective sense, that is pure financial fraud. They are telling lies about how stock investing works and making money from it and they block posts that call them out on their lies because they don’t see how they can get anyone to believe the lies if they are exposed and discussed. That ain’t financial fraud? Huh?
It is obvious financial fraud. Nothing could be more clear in an objective sense.
Now —
I add the phrase “in an objective sense” because there is another angle to the story here and that angle is important and needs to be considered. The people who are doing the blocking believe in Buy-and-Hold in one part of their consciousness and indeed follow Buy-and-Hold strategies themselves. And, even if they were personally willing to permit research-based stuff to appear at their sites, they have a marketing problem in that the research-based stuff drives away their readers.
That’s a serious problem. That cuts the other way a bit. So I doubt that all of those people will be going to prison. Some of them no doubt will be going to prison. But not all of them. I don’t think any of us can say how many of them will be going to prison. There’s never been a situation like this before. We are in uncharted territory. But it’s pretty darn remarkable that even one person has put himself in circumstances in which going to prison is even a remote possibility. So I think that the prison thing really must be mentioned from time to time. It is part of our story.
Now —
There was once a post by my good friend Wanderer that has stuck with me through all the years since he advanced it. Wanderer felt bad about the smear campaign that they were directing at me back at the FIRE board. So at one point he said something to the effect of: “It’s not like we are the Amish and are shunning him everywhere in the Amish world. He can always go post somewhere else.”
That’s not true, is it?
I could post somewhere else if I played it the way Todd Tresidder plays it. Todd gives his readers research-based stuff on issues of substance. But he stays far away from telling his readers the truth about the process-oriented questions. He doesn’t explore why the errors in the Old School retirement studies have been covered up for 13 years. He doesn’t tell people how it was the continued promotion of Buy-and-Hold strategies for 34 years after the peer-reviewed research showed that there is zero chance that they could ever work for even a single long-term investor that caused the economic crisis. Todd went so far as to call me on the telephone and threaten to ban me from his site if I continued addressing the process-side questions in comments put to his site.
You Goons would permit me to post at other sites if I dropped the process-side stuff, Anonymous. That is the thing that you do not want to so. You don’t want me to say “the Buy-and-Holders got it wrong” like I did when I showed that Greaney got all the numbers wildly wrong in his retirement study. And you don’t want me to report to people about the death threats and the demands for unjustified board bannings and the tens of thousands of acts of defamation and the threats to get academic researchers fired from their jobs. We are working at cross purposes. The thing that you most do not want to see is the thing that I most DO want to see.
I had a long series of discussions with Mike Piper at the Oblivious Investor blog about these questions. Mike acknowledged that he thinks Valuation-Informed Indexing is a perfectly reasonable strategy. He doesn’t follow it himself. But he sees nothing even a tiny bit wrong with it. If it didn’t upset his readers, he would be happy to permit me to post at his site. But it DOES upset his readers. A LOT. He had readers writing to him to complain about me all the time when I was posting there on a daily basis. I was driving them crazy. I was posting research-based stuff that showed that Mike’s strategies were going to provide horrible long-term results. They very much wanted to believe in Mike’s strategies. So they told him that either I went or they went. Mike didn’t like being put in that situation. But he makes his living from his blog. So eventually I went.
Is Mike liable for the losses that his readers are going to suffer in coming days in the event that the stock market continues to perform as it has unfailingly performed for the 140 years for which we have records available to us?
I like Mike as a person. So there is a part of me that is sympathetic to his circumstances that says “maybe he will not be held liable for those losses.”
But my strong hunch is that I would like a lot of his readers too if I got to know them. So there is another part of me that says “obviously he is going to be held liable. That is an outrage. To ban honest posting is a violation of all this country’s basic beliefs and in fact is a felony under the laws of the United States. How could he possibly not be held liable? How could he not be sent to prison for a long time for doing something like that?”
I am not God, Anonymous. I don’t know with certainty how things are going to turn out.
I know that I don’t want to find myself in the circumstances in which Mike is going to find himself in the event that stocks continue to perform in the future anything at all as they always have in the past.
And I know that I don’t want to find myself in the circumstances in which Todd Tresidder is going to find himself either. Todd is Mike’s friend, as I am. But Todd plays it differently. Todd acts like he thinks there is nothing ethically or legally wrong with Mike’s ban on honest posting at his site. So Todd is not much of a friend, is he? Todd is going to have to live with his conscience if Mike is sent to prison or found financially liable for the losses suffered by his readers.
I don’t want to find myself in those circumstances. So I am not going to play it the way Mike is playing it or the way that Todd is playing it or, heaven help us all, the way that you Goons are playing it.
It’s not even a matter of me deciding not to play it that way. I am physically incapable of playing it that way. I have never given the idea two seconds of consideration in 13 years of posting re these matters. If you never consider something, you can never agree to that something. And in 13 years of discussions about whether honest discussions should be permitted, I have never even considered the idea. So I really believe that even a Goon like you should get the picture at this point.
I have gotten the picture from the other side of the table. I once believed that you Goons would eventually break and permit honest posting if enough pressure was applied. But I believe that we passed the point at which that was possible when you threatened Wade Pfau. At that point it became impossible for any reasonable person to believe that you would not be going to prison once all of this goes public. And people who are going to prison don’t generally permit the stuff that is going to get them sent to prison to get out.
So I am resigned on my side to the idea that we are going to have to wait until the next crash to resolve these matters. I obviously don’t like the idea. And there’s always that tiny bit of hope that causes me to write comments like this one. But I put those odds at about 10 percent at this point. The odds are very long today.
So what do you want from me?
I obviously cannot change course and you obviously don’t feel that you can change course. So we wait for the crash. No?
When you put up comments that may help people in future days understand some aspect of this matter, I will continue to permit them to show up. I am never going to prohibit you from posting here. That one is not in me either. But I cannot say that I understand what purpose is being achieved by you continuing to comment here. You are not ever going to break and I am not ever going to break. So my suggestion is that you find something else to which to direct your posting energies.
I wish you all the best that this life has to offer a person, in any event.
Rob
Anonymous says
You’re welcome to fantasize about the future, or whine about the past, but let’s take a moment to accept reality, shall we?
Today’s reality: I’m not in prison. Socks aren’t quite 65% below their 2010 levels. You’re banned from financial discussions because of your boorish behavior. And my kids are going to Disneyland, while yours aren’t.
Rob says
Today’s reality is that there is 34 years of peer-reviewed research showing that you need to adjust the nominal value of your stock portfolio by the extent of overvaluation or undervaluation in the market (as revealed by the P/E10 value) to know the true value of your stock portfolio.
I believe in using the peer-reviewed research as a guide. So that’s what I am going with.
Non-negotiable.
I wish you all good things, Anonymous. But I ain’t crossing The Felony Line.
Not for you. Not for Lindauer. Not for Greaney. Not for Bogle. Not for anyone.
It ain’t gonna happen.
But I DO wish you all good things.
I hope that works for you. That’s the way it is, in any event.
Rob
Anonymous says
“But I DO wish you all good things.” Really? You want to see a stock drop of 65% and for people to go to prison. Sounds like a sick fantasy.
Rob says
I don’t want to see a price drop of 65 percent, Anonymous. That would be highly emotional stuff. The best thing for all of us is always to have stocks properly priced. That’s a P/E10 level of 15. That’s a big drop from where we are today. But it is a lot less than a 65 percent drop.
The thing that will likely take us to a P/E of 8 is emotion. We wouldn’t have to worry about emotion if we opened the internet up to honest posting. One of the things we should be doing is preparing people for the drop to fair-value levels. If we prepare people, they will not freak out when it comes. And, if people don’t freak out, we will never see a drop to 8.
A drop to 8 is CRAZY. It is every bit as crazy as having prices rise to where they are today. Think what it means to go to 8. It means that every portfolio is priced at one-half of its fair value. At a time at which the economy desperately needs an influx of cash to get on its feet again. Huh? Going to 8 is causing needless suffering in a big way.
There is no one more opposed to going to 8 than me, Anonymous. That’s why I say that we should open the internet to honest posting on what the peer-reviewed research says. You don’t overcome investor emotion by ignoring it, as the Buy-and-Holders do. You overcome investor emotion BY FACING IT, BY ADDRESSING IT, BY COPING WITH IT.
As for the prison sentences, there is a part of me that doesn’t like them. Most of you Goons were friends of mine in the days before I worked up the courage to “cross” Greaney by posting honestly on SWRs. I hate the idea of seeing my friends go to prison. That’s why I have worked so hard for so long to get your prison sentences reduced.
That said, I don’t agree that it is a “sick fantasy” to expect to see people go to prison for playing the lead role in perpetrating the biggest act of financial fraud in U.S. history. If it is always 100 percent horrible for people to go to prison, why do we have prisons? If it is 100 percent horrible for people to be prosecuted for financial fraud, why do we have laws making financial fraud a crime? There’s something that doesn’t add up in your thinking re this matter.
People going to prison should be a rare thing. That’s my take. But there are circumstances where it is absolutely necessary for people go to prison. That’s why we as a people have made financial fraud a felony that calls for a prison sentence. We are the luckiest generation of investors that ever walked Planet Earth. But we are not seeing the benefits of our good fortune because it hurts the feelings of the Buy-and-Holders for people to talk openly and honestly about what the last 34 years of peer-reviewed research teaches us.
We have to get beyond that. No?
That’s where the prison sentences come in. Millions of good and smart people truly believe in Buy-and-Hold. They obviously have every right in the world to share what they believe with others. So do the Valuation-Informed Indexers. That’s how our system works. When you Goons employ 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, you undermine our economic system in a serious way. Prison sentences are needed in such circumstances. When the announcement of your prison sentence goes viral, we will see boards and blogs opening up to honest posting in no time flat.
I’ll let you in on a little secret, Anonymous. There is a part of you that would prefer that you be sent to prison to continuing to terrorize our board and blog communities. There is a part of you that wants people to learn how to invest effectively. That’s part of what makes you so angry when I refer to the peer-reviewed research. It hurts you to see how much harm you have done to yourself and others. That’s why you get so defensive. So there is a part of you that wants all this good stuff to get out.
What I am saying sounds paradoxical. But think of how an alcoholic comes to feel about himself as he loses more and more of what once made his life good. He comes to hate himself. Some alcoholics come close to wanting to kill themselves. That’s where you are today with your addiction to Get Rich Quick. You cannot bear the thought of giving up the addiction. And you also cannot bear to see yourself cause more destruction. Part of the reason why you are so opposed to the idea of coming clean today is that it would mean facing up to all that you have been doing for 13 years now.
The full truth is that we have those sorts of feelings as a society. We should have been helping to see that you would never be in the circumstances that you are in today. We have rules at every board and blog that would have reined you in long before you became at risk of receiving prison sentences that we failed to enforce in a reasonable manner. We failed you, man. That’s part of the story here.
We need healing. Prison sentences are part of the healing process. I think it would be a mistake for any of us to become vindictive toward you Goons. That’s the OPPOSITE of what we should be trying to do here. I am not going to argue against prison sentences. That would be a slap in the face to the millions of middle-class people whose lives are in the process of being destroyed. But I AM going to argue for leniency. I want to see healing. I want to see the nasty stuff put behind us. We don’t get there by looking for revenge. So I am going to be making the case for relatively short prison sentences for my Goon friends.
I hope that makes you feel a little better.
I do not agree, though, that there are no circumstances in which prison sentences are appropriate. These are serious crimes. The crimes have been going on for a long, long time. Millions of people have been hurt. Part of the healing process is for the millions of people who have been hurt to see some justice done by seeing you and your Goon pals sent to prison.
No?
I think if you look deep into your heart re that one you will agree that what I am saying here makes sense.
I certainly wish you the best of luck with it regardless of what investing strategies you elect to pursue, in any event.
Fair enough, my long-time Goon friend?
Rob