Set forth below is the text of a comment that I recently posted to another blog entry at this site:
Could you point at a non-goon comment that has been posted here? If nothing else, then for the sake of guidance.
You would have to go back a few years, Drftr. It’s been a long time since I can recall seeing a non-Goon comment.
John Walter Russell used to post here almost daily. He obviously was no Goon.
Wade Pfau posted here regularly for a time. He obviously was no Goon (although he certainly feared you Goons and he held back from saying some things because of his fear of you).
There was that fellow Arty. He was a non-Goon. He posted here a good bit for a time. He left when I called out Wade for flipping to the Goon side.
When I was a actively writing Guest Blog Entries, I used to get some of my fellow bloggers to post here on rare occasions.
There are others. But there has never been a large number of non-Goons. And for a long time now there have not been any.
When John Walter Russell was alive, he used to get more comments than I did. That killed me! I obviously was happy to see John get the comments. I think he is one of the best researchers who ever lived. I put him up there with Wade Pfau and Rob Arnott and Robert Shiller. But I had significantly more traffic than he did. So it amazed me that he got more comments.
I say things that drive people away.
That’s not my intent. I love to have people post comments here. But I don’t see what other conclusion a fair-minded person could draw at this point in the proceedings.
The key thing that I do is that I say: “Buy-and-Hold doesn’t work, the Buy-and-Holders got it wrong.” People don’t mind so much if you just say “this is what I think works” and you don’t say what doesn’t work. John used to do more of that. He had a gentle heart and it was not like him to say “Buy-and-Hold doesn’t work.”
I think you have to say what doesn’t work as well as what does. I think it is the journalist in me that causes me to see things that way. Journalists tell people things they don’t want to hear. They report on corruption. They get people mad sometimes. But they see that as the job. I think it is an important job. I am PROUD that I have led the effort to help people understand the dangers of Buy-and-Hold.
But people don’t like it when I do that. Usually, they don’t tell me. They just go away. Sometimes they do tell me. But a lot of people seem to feel that way about things. I don’t ever recall someone saying “Wow, I love how you tell it straight re those darn Buy-and-Holders!” Even people who have grave doubts about Buy-and-Hold don’t applaud me for taking them on.
I was talking to my priest the other day about this stuff (we had him out to the house). He said: “Why don’t you write Shiller and ask him to help you out?” Good question, Father! I’ve written Shiller. He responded when John asked him a technical question re the data. But when I wrote him seeking help with you Goons, he did not reply. Shiller does not want to get involved! That says a lot about why we are in this situation.
I think that EVERYONE should be talking openly about the dangers of Buy-and-Hold, just like everyone talks openly about the dangers of smoking and how it is bad to throw garbage on the ground and how we should make an effort to avoid racism and sexism. Causing an economic crisis is just as bad, in my assessment. But there’s some sort of social stigma that holds people back from pointing out that Buy-and-Hold has caused just as much human misery as lung cancer and destruction of the environment and racism and sexism. People certainly do not feel comfortable talking about it today.
I think it is a shame.
I think people realize on some level of consciousness that Get Rich Quick strategies are not the answer and they also realize that we have all played a role in letting the Buy-and-Hold stuff get so out of hand. We should have all spoken up way back in 1981, when the peer-reviewed research showing that there is zero chance that a pure GRQ approach could ever work for even a single long-term investor was published. The New York Times should have been running front-page articles every day back then about all the doors that Shiller opened for us all by showing that Buy-and-Hold was a terrible mistake.
When we all failed to act, we came to feel ashamed of ourselves for having fallen for a marketing gimmick. Now so much time has passed that we cannot bear to acknowledge what we have done. So now we keep it zipped. We are hoping that somehow we will get through this thing without having to come clean. But we lack confidence that we can pull this off. So the issue has become a super-sensitive one. We try to pretend that there hasn’t been fraud, that there is just a lot of natural confusion about what works and what doesn’t and that there is no need for prison sentences. These rationalizations just end up causing the prison sentences to grow longer, of course!
It’s hard to acknowledge a mistake. That’s human nature. What makes this one worse is that is is so obvious a mistake. Price discipline is the key in all markets other than the stock market. So it is simple common sense that long-term timing would always be 100 percent required. What knuckleheads we humans can be at times!
But it has of course become much worse than that with the passage of 34 years. It’s not just a mistake now. It’s a crime. The biggest act of financial fraud in U.S. history. So now we are really, really, really ashamed. How do we escape this trap? We need to get 10 people to stand up to you Goons and then we are home-free. But of course there WILL be prison sentences. It’s too late to avoid that at this point. People hate that. Did you ever know somebody whose teeth were rotting in his mouth and who was not willing to go to a dentist because he knew it was going to hurt? That person is making the problem worse with more delay. But he just doesn’t have the courage to face the problem he has created for himself. It’s sad.
That’s where things stand. People don’t like it that I talk frankly about this stuff. They tell themselves that it is uncharitable. I see it entirely the other way around. I see it as uncharitable NOT to speak frankly about this stuff. It is by living in denial for so long about what the peer-reviewed research says that we have created this enormous problem.
That’s my sincere take re these terribly important matters, in any event. I hope that these words shed a little light on the question of why we don’t see non-Goons posting here, Drftr. People are ashamed. People are scared. People are confused. The good news here is 50 times more good than the bad news is bad. We are the luckiest generation of investors ever to walk Planet Earth!
It sure would be nice to focus on all the good stuff instead of the prison sentences. But I have a hard time seeing how that is ever going to happen until a reasonable number of us work up the courage to take on you Goons and to do so without fear or apology or hesitation. People need accurate and honest information re how to invest their retirement money. That’s not optional, it’s imperative. I am sure!
My best and warmest wishes to you and yours, Drftr.