Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site:
You wrote a lot of words. Most of it seems completely unrelated.
Fact: Middle class people using buy and hold would have had 7.9% return. But mysteriously they own almost no stocks, carry incredible amounts of debt, have shrinking job prospects and real incomes.
Conclusion: If it can be defined as a ‘problem’, which I disagree with, Buy and Hold is the 999th problem of middle class people.
Secondary conclusion: Because it is their 999th problem, Rob will never be successful because middle class people just won’t care as his crusade is not relevant to the things they need to solve first.
I didn’t study investing in school, Laugh. I never managed a mutual fund. I certainly don’t consider myself any kind of “expert” in this field.
It is AMAZING that I am today 14 years ahead of people like Bogle and Shiller and Bernstein and Swedoe and Pfau in my understanding of how stock investing works. There should be zero chance that something like that could happen. Zero.
But it DID happen. That’s the reality.
I didn’t want it to happen. I didn’t volunteer for the job. No same person would voluntarily take on the job that became my life’s work on the morning of May 13, 2002, and that remains my life’s work today and that will continue to be my life’s work until every investing discussion board and blog on the internet has been opened to honest posting on safe withdrawal rates and scores of other critically important investment-related topics.
It was a mix of factors that made all this possible and for me unavoidable.
First, there was the peer-reviewed research that for a long time and for lots of smart and good people really did appear to show the Buy-and-Hold is the answer. It’s not only Robert Shiller who has been awarded a Nobel prize for his work in this area. Eugene Fama got one too. His work is serious and important and exciting and those who follow his work are entitled to the same respect and deference as those who follow Shiller’s work. It is only by understanding the importance of Fama’s “revolutionary” (the word applies for Fama’s research as much as it does for Shiller’s) that one can come to understand all that followed.
Second, an entire industry developed around the promotion of what was then thought to be the first research-based strategy. This was on one level a very exciting development. John Bogle led the effort. Bogle took us from the dark ages when investing advice was mostly subjective and created the path toward development of the first true research-based strategy a number of years later. Bogle also created a company that made index funds available to everyone, making Shiller’s amazing findings of 1981 possible (the reason why Fama missed out on seeing the importance of long-term timing was that index funds did not exist in 1965 and thus it did not occur to anyone that it was even possible to practice price discipline when buying stocks — Valuation-Informed Indexing does not work for those buying individual stocks).
Third, Shiller provided his own revolutionary research, giving us all the missing piece to the puzzle that every last one of us deep in his or her heart has long wanted to see completed, the most important piece of all by far.
Fourth, Bogle and the other “experts” in this field fell victim to cognitive dissonance and thus elected not to explore the implications of Shiller’s amazing research. Because the issue is of such huge importance to millions of people trying to finance their retirements, they came to decide that the most ruthlessly abusive tactics would be needed to block millions from learning things that they very, very much needed to learn. How the heck could you keep Buy-and-Hold alive? Who the heck is going to follow a strategy that is marketed as research-based when the reality is that there are decades of peer-reviewed research discrediting the core ideas on which the strategy is based?
Fifth, the internet and the world wide web were invented. The web made it possible for ordinary people to report on what the peer-reviewed research says. Since the Buy-and-Holders had insured that not one person with expertise would dare to “cross” them by speaking with full honesty re these issues, the only way that word was going to get out is if someone like me would come along and just flat-out refuse to back down un the face of the worst intimidation tactics ever dished out in the history of the United States. This amazing new communications medium made all of the many hundreds of powerful investing insights that we have all developed together over the first 14 years of The Debate About Whether Or Not to Permit a Debate re the Last 35 Years of Peer-Reviewed Research in This Field possible. Thank the heavens for the good side of the Internet (this story shows its power to do good for millions in a very concrete and far-reaching way).
Sixth, I met thousands of people during the years when I was building the Motley Fool’s Retire Early board into the #1 most successful board in that sites history. It was the love that I felt for the thousands of good and smart people who helped me build that board that made me so unwilling to sell out my community (and ultimately my country) by giving in to the pressure tactics employed by you Goons.
Seventh, the fact that Shiller was permitted to publish his book despite the harm it would do to the profits of the Wall Street Con Men if it were taken seriously played a huge role. Without Shiller’s research, I could not have persuaded Wade Pfau that the dominant model was a big pile of smelly garbage and Wade and I would never have co-authored the peer-reviewed research that focuses on the how-to questions that Shiller elected to take a pass on so that his career would not be destroyed by the Wall Street Con Men and their various Internet Goon Squads.
Eight, I think it would be fair to say that God played a role in all this. I never could have done what I did without the efforts of John Walter Russell, a guy that I did not even know on the morning of May 13, 2002. John did the research that allowed us to create the five powerful and unique calculators that will be driving discussions of research-based investing strategies for many years to come. Wow! What are the odds that I would just happen to connect with a guy with an engineering background within weeks of the day that he resigned from his “real” job and was looking for serious and important work to devote his energies to in the remaining years of his life? This one gives me the shivers when I think about it.
Nine, we have the fact that I had created a Retire Early plan when I put up that famous post of the morning of May 13, 2002, that has permitted me thus far to stick to my vow not to agree to post dishonestly re these matters for 16 years since I gave up my full-time corporate employment. How many people can do something like that regardless of how deep their love is for both the subject matter and for their fellow community members? Beat that, you know?
Ten, I just happened to marry a wonderful woman who would “put up” with a husband sticking to his ethical principles while not bringing in a dime for those 16 years. My sense is that this one confounded you Goons more than any of the rest of it. The reason why Goons like you have come to exert a power on the internet so wildly out of proportion to the talents you bring to the table is that few men have such a fine woman standing behind them. Call me blessed! Good for Boo and good for me for having a dim sense that marrying the one with a deeply spiritual nature was the way to go when making a choice that would affect me and my children for many, many years to come. Yikes — it scares me to think of how I might have gone the wrong way with that one, it scares me to think that I might have easily been tempted to ruin my life and to thereby ruin the lives of those millions of middle-class investors whose retirements today are obviously at great unnecessary risk.
Eleven, none of this would have happened without the courage that we have seen evidenced by THOUSANDS of good people who worked up the courage to request that honest posting be permitted on at least one or two occasions. I don’t think that i could have continued this fight without the encouragement and support of those many fine, fine people. When people claim that the fact that you Goons have gotten away with your sick and twisted behavior for so long, I point them to the thousands who made serious efforts to stand up to you over and over and over again. Look at the risks those people took on and tell me that there is no good in the human race! If there were not millions of good people in world, we would not have the laws in place that we will be using in the days following the onset of the next price crash to put your Goon asses in prison for a long, long stretch of time (which is obviously something that all decent people can agree is the only right thing to do at this point in the proceedings and something that is very,very, very much required for our country to get back on track and to bring this horrible Buy-and-Hold Criss to a full and complete stop by the close of business today).
Twelve, we saw a glimpse of what the Buy-and-Hold Crisis will bring when it hits with full impact when our economic system collapsed in 2008 and when large numbers of people both on the left and on the right began to lose confidence in our political leaders as a result of their failure to take effective action either to precent the crisis or to cope with it in a meaningful way. We saw a number of brave community members work up the courage in those days to call out Mel Lindauer and Taylor Larimore on their long histories of abusive and violent behavior and on the mountain of lies that they have relied on to “protect” the smelly Buy-and-Hold “strategy” from effective questioning for so many years. These good and honest people show the course forward for all of us. It is by seeing what humans are capable of that we all rebuild our hopes for the future. Thanks for being the pioneers, guys! You are an inspiration!
A lot of low-likelihood events had to be played out in concert for us all to make the progress that we have made in our transition from the smelly Buy-and-Hold garbage (according to 35 years of peer-reviewed research!) to the first true research-based strategy. All of this tells me that there really is a God up in heaven who loves us all, Laugh. I respect the views of those who believe otherwise. I get where they are coming from and I suppose that one could say that there was a time in my life when I was kinda, sorta in that camp myself. But I have a hard time accepting that this one-in-a-billion-chance saga played out as a matter of pure random chance. If a monkey can type out the words to “Hamlet” all in the right order, I suppose anything is possible. But this one is pushing it, in my assessment. I believe. Right or wrong, I believe at this point in the proceedings of my life.
I hope that helps a bit.
Sure, I expect to make hundreds of millions from this. Not because I see myself as some sort of investing expert. The idea that Rob Bennett is an investing expert is a sick joke.
I expect to make hundreds of millions because the job that I took on 14 years ago will in the days following the next price crash open up the way for thousands of true experts to share their honest views re what the last 35 years of peer-reviewed research shows us about how we all messed up in forming our pre-1981 ideas on how stock investing works. Bogle will be posting with full honesty once your prison sentence is announced, Laugh. Shiller will be posting with complete honesty once your prison sentence is announced. Pfau will be posting with full honesty once your prison sentence is announced. Lots and lots of others will be doing the same.
Why wouldn’t they? What possible motive would anyone have NOT to post honestly once your prison sentence was announced, once they felt that they could do it without seeing the lives of their loved ones threatened and their careers destroyed as their “punishment” for having “crossed” the lowest of the low living in our society? There are hundreds of billions of dollars to be made giving people accurate and honest investing advice in the first time in history in which it became possible to do so (the post 1981 years). I am 100 percent certain that all of the experts in this field will be posting with complete honesty once your prison sentence is announced and the experts feel that people of integrity are as welcomed in this field as they are in all other fields of human endeavor. We will have huge leverage working for us following the onset of the next price crash.
I will make the hundreds of millions of dollars that i have coming to me because I was the first to stand up to you Goons, not because of any particular investing expertise that I possess that is beyond the reach of any of the true experts working in this field. Bogle could have done what I have done had he not created a monster (multiple monsters really) by continuing to push the pure Get Rich Quick approach for 35 years after it was 100 percent discredited by the peer-reviewed research. It is the same with Pfau. It is the same with Shiller. And on and on and on.
Free the investing experts! Announce long prison sentences for the Lindauerheads and the Greaney Goons today!
My sincere take.
And my best and warmest wishes.