Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site:
“my job is one of the most important jobs in the United States, perhaps the biggest of all.”
Does anyone else, including your wife, agree with that statement?
I am going to add a little bit to that response.
The click experiences come at different times for different people. I have had more click experiences because I have been working it so hard and for so long. It’s not reasonable to expect everyone who was exposed to the discussion to have had the same number of click experiences. If the discussions continued, more and more would have those click experiences over time. But it takes a good bit of time for some insights to hit and different sorts of insights hit at different times for different people.
This is why it is so critical that fully honest posting be permitted at every site. I didn’t know Wade Pfau when this started. So, if I had not soldiered on through a good number of years of abuse before meeting him, I would have missed out on all of his insights. And so would the rest of the world because Wade never would have looked into these questions if he hadn’t learned about my work at the Bogleheads Forum.
Learning new things is a process of discovery. And you just never know what sort of person is going to say things in just the right way to cause a click experience for you. Say that Wade had been awarded a Nobel prize for the research that he co-authored with me a number of years back. Other academic researchers would have noticed that and that would have caused them to develop an interest in exploring new angles of the Valuation-Informed Indexing concept. So today we would all be benefiting not only from Shiller’s insights and from my insights and from Wade’s insights but also from the insights of these other academic researchers who we cannot even name today because we elected to shut down honest posting all across the internet.
There is HUGE leverage in opening every site to honest posting. The thing grows and grows and grows as more people get involved trying to further develop the concept. That’s a big part of what makes my work so important. It is not just that I will be able to spread the word re the hundreds of powerful insights that I have developed over the past 15 years. It is that we will be getting hundreds and hundreds of other smart people involved and those people too will be generating hundreds of powerful insights and thereby helping us all out.
Your abusive posting is like a dam that has been holding up the flood of knowledge of how stock investing works for 15 years now. I am trying to knock a hole in that damn. Once we knock a hole in the dam, we are going to see all kinds of wonderful stuff that we cannot even imagine today. Life is just going to keep getting better and better and better for all of us for many years into the future.
This is our system. This is how freedom works for all of us. This is what the United States is all about — progress for all through the exercise of freedom. This is why I love my country.
Deep in your hearts, I feel confident that you Goons have some affinity for the freedom concept and the progress concept and the research concept although you of course will vehemently deny that this is the case in the safe-withdrawal-rate realm. I believe that you will change your tune following the crash, when the appeal of the pure Get Rich Quick approach will quickly evaporate into thin air.
Rob
Anonymous says
Rob,
Can you please define for us as to what you believe is “honest” posting? When I think of the word “honest”, I would define it as truthful and backed by facts. Can you let us know what you think it means.
Rob says
If I say that I believe that the retirement study posted at John Greaney’s web site lacks a valuation adjustment, that’s honest posting.
If I say that I believe that the retirement study posted at John Greaney’s web site gets the numbers right, that’s dishonest posting.
If I refrain from commenting on the lack of a valuations adjustment in the retirement study posted at John Greaney’s web site, that’s fearful, technically honest but indirectly dishonest posting. By not saying anything, I lead people to believe that the study is okay even though in my heart I know that it cannot be reconciled with the 36 years of peer-reviewed research showing that it is not possible to get the numbers right without taking valuations into account.
I hope that helps a small bit, old friend.
Rob
Anonymous says
“If I say that I believe that the retirement study posted at John Greaney’s web site lacks a valuation adjustment, that’s honest posting.”
No one has ever once asked you whether Greaney’s study lacks a valuation adjustment. You are physically incapable of making it through a comment thread without taking an off-topic shot at him. Even though he hasn’t mentioned you in years.
Why is that? He moved on, and you can’t. Which means he won and you lost.
Rob says
If the last 36 years of peer-reviewed research is legitimate research, there is precisely zero chance that a Buy-and-Hold strategy could ever work for a single long-term investor.
Greaney is not the only person who has ever offered investing advice based on the Buy-and-Hold Model for understanding how stock investing works. There are thousands who have done so. His connection with me is that he and I both posted at the same discussion board, the Retire Early board at the Motley Fool site. I happened to post honestly re safe withdrawal rates (noting that the peer-reviewed research shows that valuations affect long-term returns) and Greaney flipped his lid.
In ordinary circumstances, everyone who looked at Greaney’s insanely and indeed criminally abusive posting would have condemned it. But many condemned me for pointing out the errors in his study rather than condemning him for failing to correct the errors for 15 years now. Bogle did not acknowledge his mistake when Shiller revealed it in 1981. He covered it up. And everyone who makes a living in this field has learned in the 36 years since that, if you don’t want to see your career destroyed by Bogle’s Goons, you will keep your mouth shut about the contradictions you see between the Buy-and-Hold concept and the last 36 years of peer-reviewed research in this field.
I don’t keep my mouth shut. So I am Public Enemy #1 in the eyes of many Buy-and-Holders.
I believe that the Buy-and-Holders will all be supporting me in the days following the next price crash. They are good and smart people. They want to help their clients and their readers. Once they see you Goons put in prison, they will feel safe posting honestly, all the nasty stuff will be brought to a full and complete stop, and we will all be free to live far better lives than we ever thought possible before Shiller published his “revolutionary” (his word) research findings.
I hope that helps a small bit, my dear Goon friend.
Rob
Anonymous says
Honest posting better come soon, before more retirements are ruined by this incredible bull market. Rob, what am I going to do with all this money?
Anonymous says
Rob,
I sure wish I followed your advice in 2010 to get out of the market. Instead, I stayed in the market and now I got all this cash and I just don’t know what to do with all of it. Oh, the agony.
Rob says
Honest posting better come soon, before more retirements are ruined by this incredible bull market. Rob, what am I going to do with all this money?
You are being sarcastic, Anonymous. But I very much agree with the point that you are attributing to me. This is the difference between Buy-and-Hold and Valuation-Informed Indexing, the difference between the peer-reviewed research that was available up to 1981 and the peer-reviewed research including that published from 1981 forward. The Buy-and-Holders believe that all gains are real, that all gains are caused by economic realities. The Valuation-Informed Indexers believe that gains that are caused by overvaluation are temporary in nature and disappear into nothingness in the long run. Since those gains are not real, you are better off not treating them as real. If you treat non-real gains as real, it becomes impossible for you to engage in effective financial planning.
The sarcastic tone reveals the lack of inner confidence that the gains are real. If you were 100 percent confident that the gains are real, nothing I said would worry you one iota and you would not even react to what I say. Buy you do react. You are troubled by the last 36 years of peer-reviewed research. Not enough to change your investing strategy. But enough to advance sarcastic comments on an internet blog. That’s not a good way to cope with your disquiet, in my assessment, Anonymous.
The better way is to discuss your uncertainty in a civil and reasoned way. That approach will eventually take you to one of two places. One is that you might end up no longer feeling the disquiet and having achieved a greater level of confidence in your strategy. Two is that you might give up your strategy. The venting of sarcasm doesn’t get you anywhere. It has kept you spinning in circles for 15 years now.
Anyway, I do indeed believe that more retirements are being ruined every day by this incredible bull market. It makes me sad. But I have done my bit and then some more on top of that and then some more on top of that. I will be back in teaching mode in the days following the next price crash, when being in teaching mode will again be producing good fruit. In the meantime, I will answer your questions if I think that I can put forward answers that will help you or someone else. And I will endeavor always to respond to you with a combination of complete honesty and complete love. And we will both just have to wait to see how that approach to things plays out in the long term.
My best and warmest wishes to you, in any event.
Bull-Market-Critic Rob
Rob says
Rob,
I sure wish I followed your advice in 2010 to get out of the market. Instead, I stayed in the market and now I got all this cash and I just don’t know what to do with all of it. Oh, the agony.
If a doctor had told you in 2010 that, according to all the tests used in medical science to determine such things, you were at grave risk of having a heart attack soon unless you changed your diet, would you ridicule him if you refused to change your diet and yet were still alive today?
I wouldn’t.
And, if I were the doctor, I wouldn’t hold back from giving my honest medical opinion even to a patient who ridiculed it. The patient has a right to hear the honest medical opinion. I wouldn’t do anything to force the patient to follow the science-based opinion. It’s his life, it’s his call. But my job as a doctor would be to present that opinion to him in time for it to do him some good and to respond to any questions he had to the best of my ability. So that’s what I would do. And that is what I have done in this case.
I don’t wish you a heart attack, Anonymous. I believe that you are going to have one. But it’s possible that I am wrong. It’s been known to happen. If turns out that I am wrong, I wish you years of good fortune spending your money. If it turns out that I am right, I will at least be able to enjoy the small consolation of knowing that I gave it my very best shot. That’s not much. But it’s a heck of a lot better than the alternative.
Anyway, I am confident that you will figure out something useful to do with all the cash.
Don’t let the bad guys get you down, my good friend.
Rob
Anonymous says
“But it’s possible that I am wrong.”
That statement that you make so often is meaningless. Because you will never, ever admit you are wrong. You called for a 65% crash in 2010. Instead we’ve had one of the biggest stock rallies in history. You couldn’t get any more wrong than that. Even if we get your now-predicted 50% crash from here, being totally invested since 2010 would still have been far better than listening to you.
Rob, listen carefully: You were WRONG. Face it. Deal with it. Let 2018 be the year that you return to the real world.
Anonymous says
“If a doctor had told you in 2010 that, according to all the tests used in medical science to determine such things, you were at grave risk of having a heart attack soon unless you changed your diet, would you ridicule him if you refused to change your diet and yet were still alive today?”
Rob,
If you were a doctor, you would have lost your license due to malpractice.
Anonymous says
“The sarcastic tone reveals the lack of inner confidence that the gains are real. If you were 100 percent confident that the gains are real, nothing I said would worry you one iota and you would not even react to what I say”
Backatcha, Rob.
Rob says
“But it’s possible that I am wrong.”
That statement that you make so often is meaningless. Because you will never, ever admit you are wrong. You called for a 65% crash in 2010. Instead we’ve had one of the biggest stock rallies in history. You couldn’t get any more wrong than that. Even if we get your now-predicted 50% crash from here, being totally invested since 2010 would still have been far better than listening to you.
Rob, listen carefully: You were WRONG. Face it. Deal with it. Let 2018 be the year that you return to the real world.
The return on stocks from January 2010 through December 2017 was 143 percent. That means that, if you had $100,000 to invest at the starting point, you would have $243,000 at the end point. If you then suffered a 50 percent loss, you would have $122,000. All that you needed to do with a non-stock strategy to beat that was to earn $22,000 over eight years. That’s a return of less than 3 percent real per year. I have been earning 3.5 percent real per year with my TIPS and IBonds ever since I got out of stocks. So I am ahead (as I have been every single time we worked the numbers for 15 years running now).
And of course you are cherry-picking. If you started the count in 2008, the numbers would look a lot worse for Buy-and-Hold and the Valuation-Informed Indexer would be much farther ahead. Or if you looked at a loss of 70 percent rather than 50 percent, which would be consistent with what we have seen every single time in the historical record when prices have reached the levels where they reside today, again Valuation-Informed Indexing would be even farther ahead. And then when you counted the compounding returns on the differential going decades into the future, Valuation-Informed Indexing would not just be far., far ahead but far, far, far ahead.
That’s why Wade Pfau and I did our research. We wanted to show skeptics like you that the research-based strategy has been soundly beating the pure Get Rich Quick strategy for 150 years running. That’s just what you would expect to see happen, no? Our research confirms that that’s just what always really has happened. We thought that that research was so important that we wanted to get it featured on the front page of the New York Times. But of course you Goons didn’t like that idea and so you threatened (with Jack Bogle’s implicit approval) to send defamatory e-mails to Wade’s employer unless he agreed to stop doing honest work in this field. And you “won.” You scared a guy who had two kids to support into joining your massive act of financial fraud by getting one of the most powerful people in this field to endorse your massive act of financial fraud. What an advance!
Wade and I achieved the real advance. And he will be back doing honest work in the days following the next price crash, when you Goons have been placed in prison cells, where you belong. And then every investor on the planet will be able to look at the numbers that they need to look at to see whether it is research-based or Get Rich Quick that really is best. And of course research-based has been running the field with Get Rich Quick for 150 years now. There’s nothing you can do to change that.
You can appeal to people’s emotions during those time-periods when Get Rich Quick APPEARS for a time to be ahead. That tactic has worked for you 500 times better than I ever could have imagined that it would work. That one I give to you. But at the end of the day research-based has always prevailed and I have a funny feeling that it is all going to play out that way once again.
But we’ll see, you know?
Is it okay by you if we just wait a bit to see whether stocks continue to perform in the future at least somewhat as they always have in the past?
Rob
Rob says
If you were a doctor, you would have lost your license due to malpractice.
Good response, Anonymous.
Rob
Anonymous says
“And of course you are cherry-picking. If you started the count in 2008,”
“Or if you looked at a loss of 70 percent rather than 50 percent”
I started the count from the date of your 65% crash prediction. TIPS were paying negative yields in 2010. And we have not had your 50% (or 70 %) crash.
But somehow it’s me who is cherry-picking. Idiot.
Rob says
“The sarcastic tone reveals the lack of inner confidence that the gains are real. If you were 100 percent confident that the gains are real, nothing I said would worry you one iota and you would not even react to what I say”
Backatcha, Rob.
Our situations are not in any way, shape or form parallel, Anonymous.
When I posted at the boards, I has hundreds of fellow community members who wanted to know more about Valuation-Informed Indexing who would ask me questions about it every day. You Goons did not sit silently and permit those interactions to take place. You injected every thread that community members tried to have with heavy doses of your poison.
I never injected any poison into any discussions that Buy-and-Holders were having amongst themselves. If Buy-and-Holders want to have a thread where the premise is that the safe withdrawal rate is always 4 percent, I have no problem with it so long as it is made clear at the beginning of the thread that the idea that the safe withdrawal rate is always the same number is an idea rooted in the Buy-and-Hold Model and that there are two schools of thought as to how stock investing works and that in the other school the safe withdrawal rate varies depending on the valuation level that applies on the day the retirement begins.
If you do it that way, you are leaving it up to the reader to decide which school of thought to subscribe to. Then, if the reader suffers losses, it is on him; he knew what the story was when he made his choice. That’s not the way it is on a board where honest posting re the last 36 years of peer-reviewed research is silenced through the use of criminally abusive posting tactics. A board in which honest posting on the peer-reviewed research is banned is a corrupt enterprise. Readers have no way of knowing that they the board at which they are participating is a corrupt enterprise unless we tell them. There should be no controversy over whether we should all tell them or not. There should be a 100 percent consensus re this point. We should all want our board to be run consistently with our country’s laws.
So I don’t see any parallel at all. I am happy for you to believe whatever you believe. But I am not willing to devote my life energies to building up a corrupt enterprise. Once a board permits posting by the sorts of individuals who have put up posts in “defense” of Mel Lindauer and John Greaney and Jack Bogle, all of us who love our communities have an obligation to speak out. There is all the difference in the world between a board that is run pursuant to the laws of the United States and one that is not. I 100 percent oppose any board that permits the use of death threats or demands for unjustified board bannings or thousands of acts of defamation or threats to get academic researchers fired from their jobs to silence discussions of the last 36 years of peer-reviewed research. I love my country. That runs deep.
I hope that helps a small bit, my longtime Goon-posting friend.
Rob
Rob says
“And of course you are cherry-picking. If you started the count in 2008,”
“Or if you looked at a loss of 70 percent rather than 50 percent”
I started the count from the date of your 65% crash prediction. TIPS were paying negative yields in 2010. And we have not had your 50% (or 70 %) crash.
But somehow it’s me who is cherry-picking. Idiot.
Yes, you are cherry-picking.
The proper way to run the numbers is the way that Wade and I did in our study. Which was published in a peer-reviewed journal.
Have your death threats ever been published in a peer-reviewed journal?
Science produces the same conclusions over and over and over and over again. And death threats and demands for unjustified board bannings and thousands of acts of defamation and threats to get academic researchers fired from their jobs intimidate good and smart people into keeping quiet about what the last 36 years of scientific investigation have taught us all about how stock investing works in the real world.
Will your death threats continue to get the job done for you in the days following the next price crash? I say “no.” I say that the research-based strategy will come to dominate in those days and that we will see the greatest period of economic growth in our nation’s history as a result.
But we will have to wait a bit to watch it all plays out and thereby find out for sure.
I hope that works for you, Goon friend.
Rob