I’ve posted Entry #234 to my weekly Valuation-Informed Indexing column at the Value Walk site. It’s called What We Need to Do to Achieve Paradigm Change in the Investing Realm.
Juicy Excerpt: We Must Celebrate Ambiguity. Fama’s ideas and Shiller’s idea cannot be squared. One of them is right and one of them is wrong. We cannot jump from believing in Fama’s ideas to believing in Shiller’s ideas in one day or one week or one month or even one year. There is going to have to be a time where we listen to both sides and compare the models to see which one best stands up to scrutiny. That means that there must be a time when we say “one school of academic thought says that your stock allocation should be 80 percent and another school of academic thought says that your stock allocation should be 20 percent.”