Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site:
“What you are describing has never once happened in the 145 years of stock market history available to us for study,”
This was also the data that lead you, in 2012, to believe there would be a 60-70% stock crash by the end of 2015, correct?
It’s the data that led me to believe that, yes.
It’s also the data that led me to include a caveat to the prediction pointing out that precise predictions are not possible.
You insist that we live in one of two worlds: (1) a world in which stock market prices cannot be predicted; or (2) a world in which stock market prices can be predicted with precision.
Both of those worlds are fantasy worlds. The data does not lend support to a belief in either of those fantasy worlds. Stock market prices have always been highly predictable in the long term but precise predictions have never been possible. The data has been telling this same story over and over again for 145 years now.
You hate this reality with a burning hate. It burns your buns.
Please try to understand that I did not create this reality. I am not the author of the 145 years of U.S. stock market history. I am a humble blogger who REPORTS on what the 145 years of data tells us about how the stock market works, nothing more and nothing less.
The data says what it says. The data doesn’t care how emotional you get when someone tells you what the data says. The data doesn’t even know that you exist. Getting angry at the historical stock-return data is like getting angry at a rock or a tree or an ocean. The data is not responsive to your anger. The data doesn’t even freakin’ know that you exist.
Your getting even more angry will not change a thing. The data will just keep on saying what it has been saying for 145 years now. That’s what data does — it tells us the truth about how the stock market works. The data doesn’t need to make you happy so that you will hire it and pay you money. The data is objective. The data isn’t trying to be popular. The data isn’t compromised in the important way that every investing analyst alive is compromised. Your insane rage at the fact that Buy-and-Hold never works in the long run doesn’t even leave a mark on the data that shows this to be so.
I am not without emotion. I held back on what I knew about the data for my first three years of posting at the Motley Fool board. Then I offered a phony apology for telling what I knew on the fourth day of our proceedings after being hit with a hailstorm of hate for having told the tale straight. And even today I don’t work it as hard as I know I should because seeing the humans (both the Goon variety and the non-Goon variety) get angry at me for telling the truth about what the data says brings me down a notch emotionally and I of course can only take so much of that, being a human rather than a tree or a rock or an ocean.
But I TRY to be as much like the data as possible. I try to tune out the hate and just REPORT stuff as it is rather than letting considerations of what message will make me popular or unpopular interfere with transmission of my words or cause me to compromise my words or whatever. I make an effort to rise above that stuff, not to say things stronger than they really are but also not to say things weaker than they are, just to tell the story straight, with no chaser. I doubt very much that I get it 100 percent right every time. But I think it would be fair to say that I work it harder than any of my fellow humans and that I have been doing so in the face of bitter opposition to a greater extent than anyone else around for 14 years running now.
That’s our story. I don’t know everything and I don’t claim to know everything. But I do know with a high degree of confidence that Shiller discovered something of huge importance in 1981 and that my Buy-and-Hold friends have failed to incorporate his finding into their model for 35 years now to the great financial pain and emotional embarrassment of millions.
Every investor alive needs to know that stock returns are highly predictable in the long term. Every investor also needs to know that precise predictions are not possible. And every investor needs to know that the Buy-and-Hold claim that returns are not predictable AT ALL is a LIE. There is zero support for this claim in the peer-reviewed research in this field.
This irresponsible claim was not always a lie. There was a time when it was just a mistake. But a mistake that is covered up for 35 years becomes a lie. A lie that in some cases can lead to the imposition of prison sentences by the members of a society seeking to defend itself from Goons like you, Anonymous.
That’s my sincere take re these terribly important matters, in any event. I COULD BE WRONG. Perhaps you will never spend a day in the clink. Feel free to believe that. Please do so with my blessing.
Please just also understand that I am going to continue to say WHAT I BELIEVE. I believe that this saga is going to come to an end with a prison sentence being announced for you and a good number of your Goon friends. I believe that and my belief re that informs my every post. I care about you. I don’t only care about you, I also care about the millions of middle-class Americans whose lives your lies are in the process of destroying. But I do care about you as well. I believe that you got caught up in something 50 times bigger than what you imagined you were getting caught up in and that makes me sad for you. So I care and I will continue doing what I can to get that prison sentence of yours reduced a wee bit.
Do I believe that my efforts re this particular matter are going to bear good fruit? I do not. I have seen too much to believe that you are going to come clean by the close of business today or even by the close of business tomorrow. If you were capable of such a thing, you wouldn’t be a Goon in the first place and then of course we would not be having this conversation. So please understand that I am not living under the illusion that these words are going to make a difference.
I say them because they make a difference FOR ME. It is going to hurt me to hear your prison sentence announced. I consider you a friend despite it all. I don’t fully understand what makes you do what you do. But I believe that, if I knew everything that has ever happened to you, I would possess a better understanding of what motivates you than I do in fact possess. I make an effort to do what I would do if I possessed a better understanding of your illness than I do in fact possess. I aim to treat you how I would want you to treat me if it were me suffering from the illness. So it is important for me to know that I have put these words forward. My desire to cover all possible bases is what motivates me. I want to be able to sleep in peace after that long-delayed prison sentence of yours is finally announced and the rest of us come to enjoy our Second Independence Day.
That’s the deal.
Don’t let the bad guys get you down, my old friend.
Um — good question!