Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site:
If you say Wade is a liar, then nothing he says is reliable. Therefore, you should no longer refer to his work.
We do not agree, Anonymous. Wade is a Hero of the First Order in my book. He called Lindauer out on his abusive garbage at the Bogleheads Forum, with all his Goons in the room. I have never seen anyone else except yours truly do that. I don’t forget things like that. Wade went to bat for the American people in a big, big way. He knew he was putting his career on the line when he did that and he went ahead and did it anyway.
I don’t rank Wade quite as high as Shiller and Bogle. But I rank him very high. He helped us all out in a huge way. And he will get credit for his many positive contributions in days to come, if I have anything to say about it. I will testify that he put his neck on the line for all of us when no one else around had the guts to do so. It will be easy in the days following the next crash to say that Buy-and-Hold is a big pile of smelly garbage. It wasn’t such an easy thing to do back in the days when Wade was doing it.
The stuff that Wade said in the days before he flipped is HIGHLY reliable, in my book. It’s some of the best stuff out there, in my assessment. Please mark me down as saying that Wade Pfau was one of the most highly reliable figures in the field of investing until threats were made to destroy his career and he became worried that if he continued doing honest work in this field he would no longer be able to provide for his family. I don’t think Wade did the right thing when he flipped. But I am highly sympathetic to a man who does the wrong thing because he loves his family and he can see no other way out of a tight spot.
As always, this is my sincere take re these terribly important matters.
My best and warmest wishes to you.
Rob
Anonymous says
If a person is established to be a liar, we can no longer trust anything they say, as we can no longer determine what is actually true. We cannot just pick and choose to suit our purpose.
Rob says
My experience with Wade Pfau is that he is an outstanding person. He is kind, he is hard-working, he is highly intelligent, he possesses a greater-than-ordinary amount of courage, and he is meticulous and careful in the work he does. He is generally honest. You Goons put him in extremely difficult circumstances when you threatened to destroy his means of making a living. He devoted many years of effort to developing the skills he needed to do the work he does. So it is entirely understandable that he would not want to lose his job as a result of your defamatory statements about him. And he had two small children at the time for which he was financially responsible.
All human beings have vulnerabilities. It is a rare person who can stand up to you Goons, who I think can fairly be described as the lowest of the low who have ever posted to the internet (and that’s pretty darn freakin’ low!). I have characterized Wade as heroic for the work he has done in this field. I stand by that characterization. I trust him re all statements that he had made with the exception of those that he made as a result of your threats to destroy his career in the event that he continued doing honest research re safe withdrawal rates in particular and re the Valuation-Informed Indexing strategy in general.
I am 100 percent certain that Wade Pfau will return to doing fully honest work in this field once you Goons have been placed in prison cells, where you belong. It is my expectation that that wonderful day (a second Independence Day for the millions of middle-class people who must invest in stocks to finance their retirements) will arrive sometime not too long after the next price crash.
I hope that helps a small bit, my long-time abusive-posting friend.
I naturally wish you all good things.
Rob
Anonymous says
Wade said his job was never threatened. Was he lying there as well? You seem to pick and choose what suits you.
Rob says
Of course he was lying when he said that he was not threatened.
I worked with Wade for 16 months. We exchanged scores of e-mails. He expressed his view that the Buy-and-Hold retirement studies are “dangerous” on many occasions. He expressed his view that “Valuation-Informed Indexing works” on many occasions.
Financial fraud is a felony under U.S. law. I am happy to help you Goons in any way that I can. But I obviously am not going to cross the felony line myself. If I were to say that I believe that the retirement study posted at John Greaney’s web site contains a valuations adjustment, I would be going to the wrong side of the felony line. That will never happen.
I wish you all good things.
Rob
Anonymous says
“Of course he was lying when he said that he was not threatened.”
So then, he is a liar and nothing can be trusted.
Rob says
We disagree, Anonymous.
Wade is not the only person who has done strange things under pressure over the course of the past 15 years. He is in very good company.
Shiller’s 1981 research findings are truly “revolutionary.” That’s Shiller’s word and that’s exactly the right word to describe the reality. It is hard for a society to absorb revolutionary change in an area as delicate as the investing advice area. People who work in this field know that it would be a catastrophe if they got something wrong and Shiller’s revolutionary findings changed our understanding of how stock investing works in a very dramatic way. People who work in this field are under intense pressures and they are doing the best they can under the difficult circumstances that apply. It does no good to call people “liars” without showing sympathy for the circumstances they are in.
Wade lied about some stuff. That’s for sure. I don’t say different. But he also stuck his neck out in a very big way trying to help us all out in a very big way. That’s part of the story too. And I intend to tell that part of the story as often as I tell the other part of the story. I very much think it would be a good idea if all people of good will (that rules out you Goons!) would make an effort to do the same.
We’ll get there. The good news here is 50 times more good than the bad news here is bad. There’s amazing stuff on the other side of The Big Black Mountain.
I wish the best of luck in all your future life endeavors, old friend.
Rob
Anonymous says
And you have uniquely figured out when Wade lies, when Shiller lies, Bogle lies, etc and can help millions of Americans figure all this out. You will just inform us as to what we should believe and what to ignore.
Rob says
There’s 36 years of peer-reviewed research showing that valuations affect long-term returns. Wade spent months trying to find a single study showing that it is not necessary to practice price discipline when buying stocks. He was not able to find one. He declared openly that “Valuation-Informed Indexing works!”
I haven’t figured this stuff out uniquely. THOUSANDS of our fellow community members have expressed a desire that honest posting be permitted at every discussion board and blog. A committee of smart and good people awarded Robert Shiller a Nobel prize for his work.
Why is it that the Valuation-Informed Indexers have no problem treating the Buy-and-Holders with respect but the Buy-and-Holders cannot return the favor? It’s because only the Valuation-Informed Indexers can point to peer-reviewed research supporting their claims re how stock investing works.
We didn’t always know that valuations affect long-term returns. So Buy-and-Hold was well established before Valuation-Informed Indexing was even possible. There’s a lot of money to be made in this field. So the people who built their careers around Buy-and-Hold dug in their heels and defended their turf and engaged in all sorts of abusiveness to keep people from learning what the last 36 years of peer-reviewed research teaches us about how stock investing really works.
This cannot go on, Anonymous. Millions of people need to know how stock investing works. We are going to have to figure out a way to get the word out to them. This is just reality If Buy-and-Hold cannot be defended without the sort of abusiveness that we have seen from you Goons, then it is not worth defending at all.
You live in a great country. You are going to need to learn how to respect its laws.
This is my sincere take re these terribly important matters, in any event.
Rob
Anonymous says
Isn’t it ironic that you have planned your retirement success around getting a $500 million settlement payment versus your VII strategy?
Rob says
When I was putting together my Retire Early plan, I knew that I wanted to keep working for many years, just at work that I found more fulfilling and that stood a good chance of bringing in a lot more money (but that I couldn’t afford to switch to had I not first become a highly effective saver). I certainly didn’t expect something as big as this to fall into my lap. Is there some reason why I wouldn’t want to take advantage of the huge opportunity. It helps millions of people! What the heck is wrong with helping millions of people while also becoming one of the richest men in the world myself while doing it? Are you joking.
And I of course have invested my money pursuant to what the last 36 years of peer-reviewed research teaches us about what works in the long-term. And I intend to invest the $500 million the same way.
I don’t get the ironic part. These are the sorts of opportunities that turn up for people who save effectively. I;m pretty darn glad I worked it so hard, you know? Money produces money. That’s how it works. As we achieve higher levels of financial freedom, we are less beholden to corporate employers and more able to do work that perfectly fits our skill sets and that is therefore likely to produce a lot more wealth over time.
I think it’s wonderful, Anonymous, We talked about this sort of thing all the time at the old Retire Early board. If you didn’t suspect that you will be heading to prison following the next price crash, you would be able to see how wonderful it is yourself.
And please do not forget that I extended an offer to Greaney to get in on the ground floor. He is where he is because he screwed himself, not because Old Farmer Hocus ever screwed him. I have for 15 years now been the best friend that Greaney ever had on this planet. It’s you Goons who sat back and watched him destroy himself. I tried to help the guy out. I worked it hard.
And if you had an opportunity to pick up a cool $500 million, you would do the same darn thing. Please give me a freakin’ break.
My best wishes to you and yours.
Rob
Anonymous says
“I don’t get the ironic part.”
Why don’t you get it. What we are all talking about is how to invest in order to secure our retirement. Your plan, however, has nothing to do with VII providing for your retirement.
Rob says
VII is what got me here. I couldn’t have done what I’ve done without VII.
How many people do you know who have gone 15 years without collecting a paycheck and are still living a very nice middle-class lifestyle. That’s Valuation-Informed Indexing. Do you think that I could have done that if I had been following an investing strategy that often brings on losses of 50 percent of portfolio value or more?
The peer-reviewed research made what I have done possible, Anonymous. That’s why I studied it before I turned in my freakin’ resignation. I wanted my plan to work, you know?
What a concept!
Rob
Anonymous says
We have seen your spending plan. I would hardly call that a nice middle-class lifestyle.
Rob says
There’s not one thing in this world that can be bought with money that I want and do not have.
I mean, if $500 million were to suddenly fall into my hands, I would come up with ways to put it to good use.
But still….
Rob
Anonymous says
“There’s not one thing in this world that can be bought with money that I want and do not have.”
What about the Disney trip you wanted to take with the family? What about a college education for the boys? Updates to the house?
Anonymous says
“There’s not one thing in this world that can be bought with money that I want and do not have.”
Then why is your wife scared about money? Maybe she wants to buy things that you don’t care about. College tuition for the boys, perhaps.
Rob says
What about the Disney trip you wanted to take with the family? What about a college education for the boys? Updates to the house?
We take a week-long trip to the beach every year. The boys and I are going to New York for a few days before the New Year. We will probably go on more expensive vacations after I receive the $500 million. But no one feels even a tiny bit deprived in the vacation department. My wife and I have been to Disney World. I would be okay with going back. I don’t have the sense that my wife is pining away for a second trip.
My first boy is in college and having a great time. The second is not old enough. But I expect that he will be going in a few years and my hope is that he will have a great time too.
The house could stand some updates that I have not spent the money on because I would like to have the $500 million in hand before giving the green light. So that’s something. But it doesn’t affect our enjoyment of everyday life in any way. If we don’t see the crash for another year or two, we will just go ahead with the home improvements. It’s not like we are going to elect not to do them for financial reasons.
I suppose that it’s easier to incur big expenses when you have $500 million in hand to cover them. But we still live a lifestyle better than 99 percent of the world. I don’t think we have any legitimate gripes re the financial circumstances that we have enjoyed over the years. It’s wrong that you Goons have stopped me from collecting the income that I have earned ten thousand times over. But the remedy for that under the laws of the United States is to bring civil actions for recovery of those amounts and I intend to do that.
What’s the alternative. Keep my mouth shut re this massive act of financial fraud and watch the economic system collapse as a result? I think it would be fair to say that I would have a lot bigger financial problems than putting off some home repairs if I took that unfortunate path, Anonymous. Have you read any books about how much the people who lived through the Great Depression enjoyed their financial circumstances?
What’s good for my country is what’s good for me. That’s the bottom line here. It’s only in the short term that it might make sense for me to sell out my country to appease you Goons. In the long term the same thing that benefits millions of middle-class people benefits me and my family as well. We are all in the same boat re this matter. There has never been more than one “side” re this matter.
The perception that there are two sides is a Goon illusion. It is the product of highly emotional, short-term thinking. Not this boy, you know? I love my country and I am going to do what is right for my county, Goon friends be darned!
Rob
Rob says
Then why is your wife scared about money? Maybe she wants to buy things that you don’t care about. College tuition for the boys, perhaps.
The question that you are asking goes to the heart of all this, Anonymous.
Why do fat people eat too many cookies? Why do smokers smoke? Why do drinkers drink? We do we watch too much television and engage in too little exercise? Why do young people engage in unprotected sex with partners whom they don’t even like very much?
Life is better when you take a long-term perspective. But we are vulnerable creatures always on the look-out for some short-term relief. Buy-and-Hold offers huge amounts of short-term relief. Stocks are today priced at two times fair value. It makes people feel good to believe that they are twice as far along in the job of achieving financial independence as they really are. It hurts them in the long run to fall for the Buy-and-Hold lies. You cannot plan effectively for your future when you have no idea how much in the way of assets you possess today. Buy-and-Hold is a disaster, like eating too many cookies is a disaster or like drinking too much wine is a disaster or like picking up too many strangers in bars is a disaster.
But we humans like our little disasters, don’t we? If you are looking for a quick way to turn a buck, you are better getting into the cookie-selling business than getting into the giving-sound-nutritional-advice business. So it is in the investing realm as well. Buy-and-Hold beats Valuation-Informed Indexing as a marketing proposition. By a country mile.
I got into this because I was studying what it takes to achieve financial freedom early in life. Up until age 35, I did not save money. I had a few thousand in a checking account and spent the rest of whatever came in. I became excited when I learned the power of saving effectively. It wasn’t about doing what the experts said and being a goody goody and all this garbage. It was about opening up possibilities for my life that would not exist if I did not learn to save effectively. Once that click experience went off for me in the saving realm, I became open to having similar click experiences in other areas. The day came when I had a click experience in the investing area. Failing to consider price when buying stocks does just as much to set back your hopes of achieving what you want to achieve with your life as failing to pay close attention to long-term value propositions on the spending/saving side. So here I am.
There are always going to be people who are going to be drawn to Get Rich Quick investing experiences. My guess is that Buy-and-Hold will always be with us. I accept that, just like I accept that lots of the humans (including this one!) eat too many darn cookies. That one doesn’t bother me.
What bothers me is the big distinction between how we handle Get Rich Quick thinking in the investing realm versus how we handle it in all the other realms. There are people in this world who will try to get my boys interested in taking drugs. But there are also people who do the opposite. My boys may end up taking drugs. I cannot control what happens. But I can point them to articles and stories and all sorts of things that make the case that taking drugs is a bad idea. I feel that I have a fighting chance re the drug-taking thing. They can hear both sides of the story and they can make their own decisions. It’s not a perfect situation but it is probably the best that we can do down here in the Valley of Tears.
It’s not like that in the investing realm. I posted honestly on safe withdrawal rates on the morning of May 13, 2002. Hundreds of friends of mine responded with great enthusiasm to the prospect of being able for the first time to learn the realities of how stock investing works according to the peer-reviewed research. I care about those people and I want to help them out. I want to present the anti-drug case to them. I want to show them how much better their lives can go if they resist the Get Rich Quick urge that we all possess. And they want to hear the message? Why should I not be permitted to make that case? Why should they not be permitted to hear it?
The answer is — money. There’s money to be made selling drugs and so the people who sell drugs would no doubt prefer to set up a system in which no one can ever make the anti-drug case. Fortunately, we do not live in such a world. People make the anti-drug case all the time. Those debating whether to take drugs or not get to hear both sides of the story before making their decision. It’s not that way in the investing realm. When Greaney put forward his first death threat, I went looking for sites where people discussed Shiller’s ideas on stock investing so that I could bring in some well-informed, friendly voices to our discussions. There are no such sites. The man has been awarded a Nobel prize because smart people recognize his great achievement. But Goons like you patrol the entire internet and make sure that no one anywhere feels safe telling people what the last 36 years of peer-reviewed research is teaching us.
I don’t buy it, Anonymous. This massive act of financial fraud is killing us. It’s probably more important that we get the non-Get-Rich-Quick word out re stock investing than it is that we get that word out re drug-taking. Even if there were no places on the internet that made the anti-drug case, is is probably only a limited portion of the population that would take drugs. People get caught up in other things as they age and leave their drug-taking days behind. It’s not like that in the investing realm. Every person who wants to retire someday has to invest in stocks. It is all but 100 percent mandatory. Deny people the ability to hear about research-based investing strategy and you are hurting 100 percent of the population. Even poor people who cannot afford to buy stocks are hurt when there is an economic depression because they lose their jobs and because depressions cause wars and wars kill rich people and poor people alike.
We have to find a way as a society to open up access to honest and accurate reports re how stock investing works according to the last 36 years of peer-reviewed research in this field. This is not just a good idea. It is a 100 percent required thing if we are to have any realistic hope of continuing to live in the way that we have always in the past lived in this country. We didn’t know how stock investing worked prior to 1981. So our ignorance was just one of those things. But we learned how stock investing works just in the nick of time. Just about every middle-class person invests in stocks today and these people cannot take the sorts of hits that are delivered to those who follow Buy-and-Hold “strategies.” We have to get the word out. Our economic system cannot survive if we do not. And, ultimately, our political system cannot survive if we do not. If we go into a Second Great Depression as a result of this massive act of financial fraud, there is a good chance that our political system will ultimately fall when millions of people who did all the right things according to the experts learn that they have lost most of their life savings because of a scam pushed relentlessly by our Wall Street Con Men friends and by our internet Goon friends.
If people want to follow Buy-and-Hold strategies, people can follow Buy-and-Hold strategies. If people want to promote Buy-and-Hold strategies, people can promote Buy-and-Hold strategies.n That’s all part of the wonderful game in these here United States of America. But no death threats. No demands for unjustified board bannings. No thousands of acts of defamation. No threats to get academic researchers fired from their jobs. That stuff comes to a full and complete stop. But the close of business today. Farmer Hocus has spoken and so it shall be.
My wife is like everyone else. She would like our country to avoid going through a Second Great Depression. She obviously opposes the Goon behavior that for 15 years now has been threatening to bring one on. But she also possesses that natural human inclination to perceive the short term realities as more urgent than the long-term realities. She sees that others in the neighborhood can repair their porches when they fall into disrepair and she wants that for us. She wants to “buy things that I don’t care about,” in your words.
I care about fixing the porch. I want to pay for that. I have earned more than enough money to pay for that and I want to incur the expense today. But I am not willing to sell out my country to appease you Goons and thereby get my hands on the money today. The very fact that you have concluded that there is no way to defend the Buy-and-Hold strategy without engaging in criminal behavior tells me that this is an investing strategy that is not fit for humans. Someone has to lead the effort to open the entire internet to honest posting re the last 36 years of peer-reviewed research in this field. I wish that someone else had stepped up to do the job. I was elected. Given that reality, I intend to do the job to the best of my ability. I have never once for two seconds considered the possibility of selling my country to appease you Goons so that I can pay for those porch repairs today.
I’m not wired that way, Anonymous. Lots of people say they love their country. But you know what? You never really know how deep a love goes until it is tested. My love for my country has been tested. It remains strong. So we will see how things play out, you know? I am personally 100 percent certain that my country is going to come through for me and for all of us. But the proof is in the pudding. The pudding will be presented to us for our edification in the days following the next price crash. I wish you the best of luck with it. But that’s as far as it goes.
I hope that all that helps a small bit, dear Goon friend.
Rob
Anonymous says
You also mentioned in previous posts that if the $500 million windfall doesn’t come through, you would have financial problems.
Anonymous says
“It’s wrong that you Goons have stopped me from collecting the income that I have earned ten thousand times over. ”
How has anyone stopped you? You have thousands of ways to make money.
Rob says
You also mentioned in previous posts that if the $500 million windfall doesn’t come through, you would have financial problems.
I certainly expect to be paid for the work I’ve done. If you were not paid for 15 years of work, would you have financial problems?
Everything is relative. If I get no payment whatsoever and my work keeps us all out of the Second Great Depression, I will be far, far ahead of where I would be if I agreed to post dishonestly re safe withdrawal rates to appease Greaney and you Goons.
The way to make an intelligent decision is to compare the possible upside with the possible downside. Posting honestly yields upside upon upside upon upside, crossing to the wrong side of the felony line yields downside upon downside upon downside.
Would you cross the felony line if we could go back to May 13, 2002, and have a do-over?
We both know the answer, Anonymous.
So why would you expect me to play it the crazy way you played it 15 years later when we know so much more about the downside of going with the Goon approach?
I am going to stay on the right side of the law. Primarily because I love my country. But also because that is the approach that is almost certainly going to yield the greatest financial benefits in the long run.
Rob
Rob says
How has anyone stopped you? You have thousands of ways to make money.
Exposing the flaws in the Buy-and-Hold strategy — a strategy that has imperiled the financial futures of millions of middle-class investors — is going to make me one of the richest men on the planet, Anonymous. There is nothing else that I could do with my time that would offer 1/100th of the financial payoff.
Are you joking?
Rob