Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site:
Yes or No: Are you more important than John Bogle?
I would rate Bogle and me as roughly equal in importance. I obviously could not have developed the Valuation-Informed Indexing concept without the years of important contributions from Bogle that I use to support every aspect of the model other than the valuations-related aspects. But Buy-and-Hold without the valuations-related aspects is an unmitigated disaster; it has caused the biggest economic crisis in U.S. history. So what good is Bogle’s stuff without the elements that I have added over the first 15 years of The Debate About Having a Debate? Just as I am nothing without Bogle, Bogle is nothing without me.
The issue here is that both Buy-and-Hold and Valuation-Informed Indexing are numbers-based strategies. When you root your strategy in numbers, it is important to get the numbers right. Numbers-based models have more power than other models because people trust numbers in way that they do not trust subjective opinions. But what if you get the numbers wrong? And what if the thing you get wrong is 80 percent of the story? When you leave out valuations, you don’t just get little things wrong. You get all of the most important questions WILDLY wrong.
I don’t ever want to try to diminish Bogle’s contributions. He laid the groundwork for the VII strategy. So for me to diminish Bogle is for me to diminish myself, which makes no sense. But I don’t feel comfortable lying to people about what the peer-reviewed research says re the numbers they use to plan their retirements and Bogle lies about that issue on a daily basis. So, yes, my correction of Bogle’s lies is a very, very big deal.
The best way to think about it is that Bennett’s work makes Bogle’s work honest and real. Bogle did work of huge importance but like all of those darned humans he is capable of making a mistake and he made a doozy. To unleash the power of all of the genuinely amazing work that Bogle has done, someone had to come along who absolutely refused to lie about the safe withdrawal rate issue and about scores of other critically important investment-related topics. I am that someone.
My work COMPLETES Bogle’s work. Valuation-Informed Indexing is the investing strategy that Bogle would have gotten behind if only he knew what Shiller showed us in 1981 back when he first started talking about stock investing. Bogle was ignorant of how investing works in his early years because the entire world was ignorant of how investing works in Bogle’s early days. Nothing Bogle has done counts for anything until he corrects the error he made.
But Bogle is deeply ashamed of having destroyed millions of lives and of having caused an economic crisis. He is deep in cognitive dissonance. I am in the process of building a national movement of people who will DEMAND that honest posting re the last 35 years of peer-reviewed research be permitted on the internet. That movement will force Bogle to give up his cognitive dissonance and give meaning to all the good work he has been doing for decades.
Bogle doesn’t work without Bennett and Bennett could never have dreamed of doing what he has done without Bogle. You can’t have one without the other. The two have made contributions of equal importance.
Fair enough?
Rob
Anonymous says
How would you rate yourself against Mel Lindauer, John Greaney and Wade Pfau?
Anonymous says
Once we have the big market crash, you get your story on the front page of The New York Times, the congressional hearings take place, the goons go to prison, you get the $500 million payout and you take over all the major investing boards (including the Bogleheads site), how will this change the leadership of the investing world? Will you become the foremost thought leader in investing, ranking you above Shiller, Bogle and Bernstein?
Rob says
How would you rate yourself against Mel Lindauer, John Greaney and Wade Pfau?
Wade is amazing. The 16 months that I was working with Wade were some of the happiest months of my life.
I also had great times with John. It was a different kind of thing. It was not so much an intellectual bond as it was that we were building that amazing board community together. But I think that his SWR study was an important contribution. I gave it a 5 star review at Soapbox. com because I though that it represented a big advance over the Peter Lynch claim that the SWR was 7 percent. I still believe that. The VII retirement studies are another advance. But we couldn’t have gotten to where we are today without studies like John’s study coming before we did our work. Each generation of research builds on what came before it.
I never had close dealing with Mel. Lots of people whom I respect think highly of him. So I am confident that he has made valuable contributions. I certainly admire what he did in building the Bogleheads community to what it is today.
Rob
Rob says
Will you become the foremost thought leader in investing, ranking you above Shiller, Bogle and Bernstein?
I very, very, very much doubt it. Once the last 36 years of peer-reviewed research can be openly discussed, those three and lots and lots of others will quickly begin incorporating analyses of how valuations affect strategic decisions into all of their thinking. At that point what I do will no longer be so special. My niche is to explore the practical how-to aspects of Shiller’s “revolutionary” (his word) 1981 research findings. There’s no reason why lots of people smarter than me couldn’t do that. Once the internet is opened to honest posting on scores and scores of issues, lots of people smarter than me WILL be doing it. Then I will fade into the background a bit.
That’s healthy. That’s how it should be.
That’s what I want to see happen. You phrase your questions to suggest that I have wanted to grab the spotlight. That has never been even a tiny bit true. I was happier in the days when all I wrote about was saving strategies. It is you Goons who shined the spotlight on me when I questioned whether Greaney’s retirement study contained a valuation adjustment. In my famous post of the morning of May 13, 2002, I didn’t even say that a valuations adjustment was required. All that I did was ask a question. Hundreds of my fellow community members responded by saying that that question launched the most exciting debate that had ever been held at that board. That told me that we needed to explore the question deeper. And that’s what sent us off to the races.
I never set out to become an investing expert. I never thought that I would ever become one. Perhaps it is precisely because I do not see myself as an expert that I was able to see things that those who see themselves as experts and who want to be seen by others as experts have not yet been able to see clearly. I am an expert in only one sense — I incorporate consideration of valuations into every investing question that I examine. I don’t know of anyone else who does that and there is now 36 years of peer-reviewed research showing that it is required. So I am today miles ahead of everyone else. But it certainly is not because I have a bigger I.Q. or because I have more experience or anything like that.
The primary reason why I am so far ahead is because the others worry about their popularity. Some worry about it consciously because they want to make a buck and the best way to sell something is to make people like you. Others are not trying to sell anything but just possess the natural human desire to be liked by their fellow humans and thus have a hard time telling people that they need to divide the number on their portfolio statement by two to know their portfolio value. I know things that others do not know because I have put learning new things about how stock investing works above being liked by my fellow humans. I want to be liked. But not at the price of getting this stuff wrong or at the price of seeing my learning come to a standstill. I LOVE learning new things about the world around me.
I will be less special following the next price crash but also more popular. I can definitely live with that. I will actually be able to learn MORE at that time because all these other smart people will be joining me in the great learning adventure. Lots of them will race past me in their knowledge and that’s just as it should be, just as I want it to be.
Rob
Anonymous says
Does that mean you will let someone else run the Bogleheads board, someone else will be on the stage with a Jack and someone else will be giving the keynote speeches?
Rob says
Once the Goon problem is settled, we return to ordinary business, Anonymous.
Our board and blog communities know how to handle things. We messed up on one thing — we didn’t give Greaney and his Goons the boot when they got out of hand. There were special circumstances that caused us to mess up on that one. We will fix the problem and move on. There’s no reason to believe that there will be problems on an ongoing basis once the Goon matter is addressed.
You are the problem, Anonymous. The community expects it rules to be followed and you have not followed them. I have always followed them and I always will follow them.
Rob
Anonymous says
But why are you banned at boards and I am not?
Rob says
Because you push a Get Rich Quick scheme and I do not.
The emotions will turn following the next price crash, Anonymous.
Then where will you be? In a prison cell. With Bernie Madoff. Big shot.
I can sleep at night with the way I played it. That means something to me. I don’t get a tight feeling in my stomach when I think about what the future might bring. I wouldn’t trade places with you for all the money in the world.
When my days comes, it will be a day that lasts a long, long time. Your day could come to an end any moment now. I prefer living in the future to living in the past.
Rob
Anonymous says
Of course we are all shaking in our boots!
Anonymous says
Will there be enough jails to hold all the goons?
Rob says
Of course we are all shaking in our boots!
You wouldn’t be posting here if you weren’t shaking in your boots, Anonymous.
And there would never have been a single death threat if you did not have a voice within you telling you that the idea of not practicing price discipline when buying stocks makes zero sense.
All of your inner turmoil comes from the fact that you fell for a Get Rich Quick scheme. I never pushed that Get Rich Quick scheme. So you have no gripe with me.
There was a time when I was a Buy-and-Holder myself. But of course at that time I was a victim of my own ignorance, as you are and as millions of others are. Once I learned how dangerous Buy-and-Hold is (this happened for me on the night of August 27, 2002, when Greaney put forward is first death threat, I stopped endorsing it and began working to warn people of its dangers.
I will always do what I can to present you in the best light possible. Whatever prison sentence you end up getting, it will be at least a small bit shorter because of my efforts and perhaps a large bit shorter. I have been your good friend going back to the first day. And, yes, the fact that you are not able to recognize that evidences fear on your part. It is your fear of accepting that you have spent years of your life following an investing strategy that just doesn’t add up that makes you feel so much pain that you cannot permit others to talk over common-sense strategies.
We’re all fearful over certain things. The law requires that we keep our fears somewhat in check. You have failed to do this. That is on you and on those who have encouraged you to destroy yourself, not on me. I care for you. But I also care for the thousands of our fellow community members who have expressed a desire than honest discussions of the last 36 years of peer-reviewed research be permitted. Those people matter too.
Rob
Rob says
Will there be enough jails to hold all the goons?
We will work it out as a society, as we have worked out lots of earlier problems as a society.
I believe that there will be an amnesty letting lots of people off the hook. But it is not for me to say whether you will be covered by that amnesty or not. I will report what happened and the millions of middle-class people whose lives have been destroyed by your 15-year Campaign of Terror against our board and blog communities will make the call re your particular prison sentence. That’s as it should be.
We will find a way to get the word out re the hundreds of exciting implications that follow from Shiller’s “revolutionary” (his word) research findings of 1981. Of that much I am sure. You Goons have done great harm to this country. But we will in the end do what we have to do to move forward as a nation. We always have done so before and we will do so here yet again.
Or at least that is Rob Bennett’s sincere belief re these terribly important matters, in any event.
Rob
laugh says
Rob’s shtick is a deformed and even more demented version of Trumpism.
“I’ve heard people say that you will all go to prison, but I don’t want it to happen”
Rob says
Trump has done many things that I don’t like. But I give him points for his sense of humor. There have been times when he has said something that made me laugh. And it’s been a long time since a politician has been able to pull that off.
Rob