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A Rich Life

The Old Ideas on Saving & Investing Don't Work -- Here's What Does

  • "Valuation-Informed Indexing Is the Same Song We Sing. Glad You Belong to the Same Choir We Do."





    Carolyn McClanahan, Director of Financial Planning
    for Life Planning Partners, Inc.

  • "Retirees Now Frequently Base Their Retirement Decisions on the Portfolio Success Rates Found in Research Such as the Trinity Study.... This Is Not the Information They Need for Making Their Withdrawal Rate Decisions."




    Wade Pfau, Academic Researcher

  • "The P/E10 Tool Could Drastically Change
    How the Entire Investment Industry
    Operates and Measures Risk."





    Larry, A PassionSaving.com Site Visitor

  • "The Your Money or Your Life Book
    for a New Generation."





    Beatrix Fernandex, Book Reviewer
    for Dollar Stretcher Site

  • "A Newer School of Thought Believes That the Safe Withdrawal Rate Depends on How Stocks Are Priced at the Time You Begin Making Withdrawals."





    Scott Burns, Dallas Morning News Finance Columnist

  • "A Fascinating Retirement Calculator."







    Michael Kitces, Maryland Financial Planner

  • "The Evidence is Pretty Incontrovertible. Valuation-Informed Indexing...Is Everywhere Superior to Buy-and-Hold Over Ten-Year Periods."




    Norbert Schenkler,
    Co-Owner of Financial WebRing Forum

  • "Every Detail Shows Rob's Respect
    for His Information and His Reader."






    Audrey Owen, Owner of Writer's Helper Site

  • "You’ve Accomplished Something Radical
    With Your Idea of Passion Saving."





    Mark Michael Lewis,
    Money, Mission & Meaning Talk Show Host

  • "Big Moves Out of Stocks Should Not Be Done at All. But Strategic Asset Allocation Can Be Done At Very Rare Times, Maybe Six Times in an Investor’s Lifetime, Three Times When the Market Is Stupidly High and Three Times When Stupidly Low."



    John Bogle, Founder of Vanguard Funds

  • "Valuation-Informed Investing and Passive Investing
    Share More of a Common Ancestry
    Than It Might Appear at First."





    Jacob Irwin, Owner of Passive Investing Blog Carnival

  • "It Is Great to See a Finance Journalist Who Understands That Valuations Matter. Efficient Market Zealotry Is Rampant in the Journalism Community. I Just Love Your Valuation-Based Return Calculator."




    Rich Toscano, Pacific Capital Associates

  • "There Is Always An Unlimited Supply of Complainers Against Any Good Idea."






    Mr. Money Mustache Blogger

  • "Rob: This Has Been One of the Most Insightful and Helpful Comments I Think Anyone Has Ever Posted. Thank You for This Lesson and for Sharing Your Knowledge on This Subject!"




    My Money Design Blogger

  • "There Is An Extensive Literature About the Predictability of Long-Term Stock Returns. There Is an Extensive Literature About Short-Term Market Timing. My Question Is About Long-Term Market Timing. The Literature Seems Slim."



    Wade Pfau, Retirement Income Professor
    at The American College

  • "Your Ideas Are Sound."







    Rob Arnott, Financial Analysts Journal Editor

  • "For Years, the Investment Industry Has
    Tried to Scare Clients Into Staying Fully Invested
    in the Stock Market at All Times, No Matter
    How High Stocks Go. It's Hooey.
    They're Leaving Out More Than Half the Story."



    Brett Arends, The Wall Street Journal

  • "There Are Time-Periods Where Stocks Are a Terrible Addition to That Portfolio. Yet Inexplicably, We As Planners STILL tend to Suggest That It Is 'Risky' to Not Own Stocks When in Reality the Only Risk Is to Our Business."




    Michael Kitces, Maryland Financial Planner

  • "Valuation-Informed Indexing Provides More Wealth for 102 of 110 of the Rolling 30-Year Time-Periods While Buy-and-Hold Did Better in Eight of the Periods."






    Wade Pfau, Academic Researcher

  • "There Is a Growing Behavioral Economics Movement, But It So Far Has Had Limited Impact. Economists Are Not Fond of the Softness and Imprecision of Psychology. These Notions Are Considered Vaguely Unprofessional and Flaky."



    Robert Shiller, Yale University Economic Professor

  • "I Would Occasionally Get a Response Post
    Saying I Was 'the Best Since Rob Bennett
    Challenged Us to Think.'"




    A Popular Bogleheads Forum Poster Named "Retired at 48" Who Was Banned for Challenging Buy-and-Hold

  • "New Research by Rob Bennett Shows That
    Even a 4% Withdrawal Rate Could Cause Failure
    If You Start Retirement When
    Stock Market Valuations Are High.”




    Bernard Kelly, Consultant

  • "FuhGedDaBouDit!"




    William Bernstein, Author of
    The Four Pillars of Investing
    (When Asked Whether We Can Use the Old School Safe Withdrawal Rate Studies to Plan Our Retirements)

  • "This [The Stock-Return Predictor]
    Is a Very Handy Little Tool."






    Felix Salmon, Market Movers Blog

  • "A Much Simpler Way to Bring
    the Valuation Issue to Focus."
    (Referring to The Stock-Return Predictor)





    Karteek Narayanaswarmy, Blogger

  • "It's Informative, It's Based on Solid Data and It Provides Useful Results." (Referring to The Stock-Return Predictor)






    Political Calculations Blog

  • "Meet Three Couples Who Left the Corporate World to Do the Kinds of Work That Satisfied Them."






    Liz Pulliam Weston, MSN Money Columnist

  • "I Like Rob's Fresh Views and Tips
    on the Subject of Saving Money."






    The Digerati Life Blog

  • "A Very Solid Approach to Investing."







    Michael Harr, Founder of Walden Advisors

  • "Rob Bennett Has Been on a Tear With One Outstanding RobCast After Another."





    John Walter Russell, Owner of
    Early-Retirement-Planning-Insights.com Site

  • "It’s Time for a Different Way to Look at Investing, and Rob Is Onto Something Here."






    Kevin Mercadante, Owner of Out of Your Rut Blog

  • "My Afternoon Train Reading."
    (Referring to Rob's Article titled
    Why Buy-and-Hold Investing Can Never Work)





    Barry Ritholtz, Owner of The Big Picture Blog

  • "What Is It With Guys Named Rob?
    Longtime Index Agitator Rob Arnott Has Now
    Been Joined on These Pages by a
    Vanguard Diehard Agitator Named Rob Bennett."




    Jim Wiandt, IndexUniverse.com Publisher

  • "He Offers a Fresh New Perspective
    that Will Motivate You to Get on Track
    With a Solid Savings Plan."





    Lynn Terry, Click Newz Blog

  • "While Browsing at www.PassionSaving.com the Other Day, I Discovered an Article Featuring Ten Unconventional Money-Saving Tips. Each of These Offers a New Way to See Money."




    J.D. Roth, Owner of Get Rich Slowly Site

  • "Rob Has Ideas About Investing That Many Bloggers Find 'Interesting.' His Posts Are Often Controversial and Always Thought Provoking."





    Miranda Marquit, Planting Money Seeds Blog

  • "Is There a Way to Turn Saving Into Something Fun? If There Was, I Bet a Lot More of Us Would Do a Lot More Saving. I Found a Website Where This Basic Premise Is Explored in Great Depth."




    The Great WeiszGuy Blog

  • "I Have Much More Confidence in My Ability to Understand What Is Happening....I Thank You for Your Public Service, and, In Another Dimension, for the Personal Courage It Took to Make It Happen."




    Elizabeth, A PassionSaving.com Site Visitor

  • "I Was Hooked on the Idea of [Passive] Index Indexing, But Something Inside Made Me Wonder "Too Good to Be True?" and "What's the Downside?" I Happened on to Your Site and Valuation-Informed Indexing Seems to Make Sense."



    Coleen, PassionSaving.com Site Visitor

  • "Reads Like a Casual Conversation
    with a Likable Guy Who Wants Nothing More
    Than to Help Others Experience the Same Joy
    and Happiness He Has Found."




    Kara, Reader of Rob's Book

  • "Your 'Secrets' Are Exactly Like Magic Tricks: Once Revealed, They Look So Simple, Yet You Need Somebody to Show You How It Works."





    Kramerizio, Secrets of Retiring Early Reader

  • "Rob's Da Man! Never in the History of the Diehards Forum Has One Poster, Always Making Civil and Well Thought-Out Posts, Managed to Irritate So Many Without Anyone Being Able to Articulate a Good Reason As to Why."




    Mephistopheles, Bogleheads Forum Poster

  • "I’ve Been Surprised at How Controversial This Idea Is, but If Most People Are Buying and Holding, They Are Emotionally Invested in This Strategy."





    Jennifer Barry, Live Richly Blogger

  • "The Findings for [Long-Term] Market Timing Are So Robust That It Hardly Matters How We Do It."






    Wade Pfau, Asociate Professor of Economics

  • "The Elegant Simplicity of His Ideas Throughout Warms the Heart and Startles the Brain."






    Tom Gardner, Co-Founder of the Motley Fool Site

  • "Mr. Bennett Evidences an Unusual Skill....
    You'll Have to Buy a Copy....Extraordinary....
    A Massive Heap of Crap."




    John Greaney,
    Owner of the Retire Early Home Page Site

  • "By Reading All the Information on Your Website I Was Able to Develop a Part of Me I Didn't Know I Would Be Able to Become."





    Javier, PassionSaving.com Site Visitor

  • "Innovative Financial Thinking."







    No Limits, Ladies Blog

  • "Knowledgeable."







    Hope to Prosper Blog

  • "Holy Toledo! This Is Great Stuff!"






    Bill Schultheis, Author of
    The New Coffeehouse Portfolio

  • ""He Offers Down-to-Earth But
    Nevertheless Eye-Opening Insights About
    the Why and the How of Early Retirement."





    Secrets of Retiring Early Reader

  • "Challenges Unfounded Assumptions."







    Bill Sholar, Founder of the Early Retirement Forum

  • "Seminal."






    John Greaney, Owner of Retire Early Home Page Site
    (Pre-May 13, 2002 Version)

  • "It’s Always Good to Read Something New That Challenges Your Way of Thinking."






    Invest It Wisely Blog

  • "Rob, Thanks for All of Your Articulate, Well-Written and Well-Reasoned Commentary."






    Elle, a Poster at the Joe Taxpayer Blog

  • "Although Rob and I Don’t See Eye to Eye
    on Every Detail, His Site Is a
    Valuable Resource for Research."





    Ken Faulkenberry, Portfolio Manager

  • "Thanks, Rob. I Love Seeing So Many
    Personal Finance Bloggers Who Offer Such
    High Quality Content on Their Own Sites Come Here
    to Weigh In [on Your Ideas]."




    Married With Debt Blogger

  • "A Ton of Tremendously Useful Content."







    Network Abundance Radio

  • "Your Enthusiasm Is Infectious."







    Ruth, a PassionSaving.com Site Visitor

  • "I Woke Up at 4:00 am and Stared at the Wall for 20 Minutes....Thank You for Doing What You Do."






    Tasha, A PassionSaving.com Site Visitor

  • "It Might Just Give You
    a New Way of Looking at Saving."






    Kevin Surbaugh, Owner of Debt Free 4Ever Blog

  • "'Staying Too Long in a Job Where You Don’t Feel Relevant Takes a Toll,' Said Rob Bennett, Who Worked for Years in a Well-Paying Corporate Communications Job Where He Didn’t Have Enough to Do."




    The New York Times

  • "You Have Started One of the Most Interesting
    and Stimulating Discussions This Board has Seen
    in a Long Time."





    Poster at Motley Fool Site

  • "A Respected Author and Commentator, Mr. Bennett has Dedicated Himself to Educating Average Investors to Avoid the Most Common Errors."





    Liberty Watch Site

  • "I've Gone from Shattered Dreams of Early Retirement to Glimpses of Hope to Reassurance from Quantitative Research."





    Patricia, A PassionSaving.com Site Visitor

  • "Some of the Most Helpful and Insightful Market Discussions on the Web Take Place on These Pages."





    A Poster at the Safe WithDrawal Rate Research Group
    (Founded by Rob)

  • "Rob is the Only Person I Know (If Only via Message Board) Who has Completely Opted Out of Participation in the Stock Bubble. And You Know What? He Has Benefited Immensely from Doing So."




    Poster at Motley Fool

  • "Makes the Subject of Saving Edgy and Fresh."







    Maxine, A Reader of Rob's Book

  • "Rob Bennett, the Author of a Book Called Passion Saving, Thinks the Saving Problem Is Partly One of Packaging. So He Prefers to Couch it in the Language of Freedom."





    The Wall Street Journal

  • "This Tip Comes from Rob Bennett
    of the Finance Site PassionSaving.com."






    Lifehacker.com

  • "I LOVE This Article and
    Am Proud to be Publishing It!"




    Chuck Yanikoski, Executive Director of
    The Association of Integrative Financial
    and Life Planning

  • "Rob Bennett: Some People Disagree With Him, and He Rubs a Lot of People the Wrong Way. But He Has Interesting Ideas About Valuation-Informed Indexing, and He Delves Into a Lot of What Makes a Successful Investing Strategy."



    Miranda Marquit, Planting Money Seeds Blog

  • "Rob….Wow…..Your Response Sent Shivers
    Up the Ol’ Pilgrim Spine."






    Neal Frankie, Owner of the Wealth Pilgrim Blog

  • "I Have Counseled My Clients to Allocate a Percentage to Equities Based Upon Market Valuations....I Feel Like I've Found a Kindred Spirit. Fascinating Web Site."





    Tom Behlmer, Financial Planner

  • “A Simple Age-Based Asset Allocation Formula Is Not Appropriate, and Any Sensible Asset-Allocation Formula Should Combine Both Age/Investment Horizon and Market Valuation Levels.”




    RationalInvestor.biz

  • "Had a Guest Post This Week from Rob Bennett, Where He Discusses the Benefits of Value-Informed Indexing, Which I Find Very Intriguing."





    Sustainable Personal Finance Blog

  • "I Can Appreciate Rob's Comments.... Buy-and-Hold?
    For the Most Part, a Long Obsolete Theory."






    Neal Deutsch, Certified Financial Planner

  • "Utterly Brilliant!"







    Secrets of Retiring Early Reader

  • "Your Website Is So Enjoyable That It Is Keeping Me From My Research As I Am So Excited That I Have Found Such a Valuable Resource."





    Stuart, a PassionSaving.com Site Visitor

  • "What We're Talking About Here Really
    ...Is Empowerment."






    Motley Fool Poster

  • "The Return Predictor Is Based upon the Principle that Over the Long Term, Stock Market Prices Will Reflect the Ten-Years Earnings Growth of the Underlying Companies. Prices Return to a Common Growth Pattern."




    Links.com Review of The Stock-Return Predictor

  • "Rob’s Arguments in Favor of Value Investing Actually Make a Lot of Sense In a Way That Should Make Any Rational Buy-and-Holder Uncomfortable."





    Pop Economics Blog

  • "What I Don't Understand Is How Rob Can Correspond in Such a Sweet and Polite Way
    -- Yet He Irritates Me to No End!"





    Financial WebRing Forum Poster

  • "You Go About It in a Manner that is Catastrophically Unproductive by Adding Missionary Zeal that Inflates Your Importance and Demeans Others. The Whole Idea That There is a New School of Safe Withdrawal Rates Reeks of Personal Aggrandizement."



    Scott Burns, Dallas Morning News

  • "Inflammatory."







    Morningstar.com Site Administrator

  • “What Warren Buffett Did Was Essentially Quite Close to What Rob Bennett Has Written. Buffett Has in Fact Been Cleverly Incorporating Long-Term Market Timing Based on Valuation of the Market in His Allocation of Money to Stocks.”



    Investor Notes Blog

  • "This Report Offers A Fresh Perspective That Is Rarely Found In Other Financial Literature."






    Secrets of Retiring Early Reader

  • "Rob Bennett Says That Market Timing Based on Aggregate P/E Ratios Can Be a Far More Effective Strategy. This Claim Is Consistent With Shiller's Analysis and I Can See How It Might Be So."




    Rajiv Sethi, Economics Professor at Columbia Univeristy

  • "Retiring Early Was A Concept I Did Not Entertain. I Was Going to Retire at 65 After Putting in 40 Years. Now I Am Glad To Say That All That Has Changed."





    Secrets of Retiring Early Reader

  • "In a Couple of Days, I Had
    Devoured the Entire Book."






    Reader of Rob's Book

  • "FIRECalc May Not Be the Last Word
    on Safe Withdrawal Rates."






    Jonathan Clements, Wall Street Journal

  • "It Seems to Me That Some on This Board Feel Threatened by the Arrival of Rob and His Ideas. They Feel a Threat to Their Perceived Elite Status."





    Motley Fool Poster

  • "You've Got to Say One Thing for Rob. He Has NEVER Lowered Himself to Ad Hominen Attacks -- Subliminal or Otherwise -- on Any Other Person on This Board. Not Once. Ever. At Least Give Him Credit for That."




    Motley Fool Poster

  • "I Have Never Seen Rob Show Incivility. No Matter What. Truly Amazing. Either He Is Really the Output of an Artificial Intelligence Program, or the Man's on the Way to Becoming a Saint!"




    Early Retirement Forum Poster

  • "You're the Politest Guy on the Internet.
    Such a Soft Touch!"






    Jonathan Lewis

  • "Props for Keeping Your Cool in the Married with Debt Article. Best of Luck Combating Buy-and-Hold."






    Money Mamba Blogger

  • "I Caught Up [at the Financial Bloggers Conference] With a Fairly Controversial Financial Blogger
    Named Rob Bennett, Who Struck Me As the
    Nicest Guy Around. There -- I Said It!"




    Digerati Life Blogger

  • "In Rob Bennett's Case, He Was Banned for No Known Listed Forum Policy. Except His Viewpoint Was Different From Other Bogleheads and [He Was Perceived As] a Threat."




    Investor Junkie Blog

  • "Mr. Bennett, You Are Spot on About Integrating Some Type of Valuation Filter to One's Stock Allocation. Astute Investors Have Incorporated Some Type of 'Valuation Timing' Into Their Investment Decisions Since the Beginning of Time."



    Poster at the Psy Fi Blog

  • "His Insights Into What Is Really Going On In The Stock Market Are Quite Compelling."






    Future Storm Blog

  • "It Was an Epiphany...Valuation-Informed Indexing Beats Buy-and-Hold Over Most Long-Term Holding Periods at Much Lower Volatility."





    Sam, a PassionSaving.com Site Visitor

  • "I Am Intrigued By Your Ideas."







    Adam Butler, Portfolio Manager

  • "I Read the Book and I Loved It.
    The Philosophy Resonated with Me.
    I Am a Believer in Your Concept."





    Dr. Peter Weiss, Author of More Health, Less Care

  • "If Your Investment Ideas Can Do for Investing
    What Weston Price’s Ideas Did for Food,
    You’ve Got Our Attention."





    End Times Hoax Blog

  • "I Have Looked at His Website and Reviewed His Research and Find It Both Compelling and Completely Logical and Common-Sense-Based."





    Poster at Free Money Finance Blog

  • "If Investors Paid More Attention to Valuations, We Would Have Fewer Boom-and-Bust Cycles. The Investing Institutions Are Definitely Going to Avoid It Because It Affects Their Income."




    Hope to Prosper Blog

  • "The Calculators on Your Site Are Great Resources. It Amazes Me How So Many People Can Say 'Valuations Matter' Yet, in the Next Breath, They'll Say That We Should Ignore Valuations."




    John Marlowe, Logistics Analyst at Hess Corporation

  • "Must Read As Per My Viewpoint
    For All Value Seekers."






    Ajit Vakil, Value Investing Congress

  • "His Approach Is Both Mathematically Rigorous
    and Easy to Understand."






    Online Investing AI Blog

  • "There Is Nothing More Doubtful of Success Than a New System. The Initiator Has the Enmity of All Who Profit By Preservation of the Old Institution and Merely Lukewarm Defenders in Those Who Gain By the New One."




    Machiavelli

  • "Difficult Subjects Can Be Explained to the Most Slow-Witted Man If He Has Not Formed Any Idea of Them. But the Simplest Thing Cannot Be Made Clear to the Most Intelligent Man If He Believes He Knows Already What Is Laid Before Him."



    Tolstoy

  • "I Am Not Afraid. I Was Born to Do This."







    Joan of Arc

  • "I Certainly Have Seen the Academic Profession Squelching Unfashionable ideas and Have Often Been on the Wrong Side of It. Kuhn Shows How Most Pathbreaking Scientific Ideas Are Rejected at First, Usually for Decades.”




    Carol Osler, Brandeis International Business School

  • "First They Ignore You, Then They Ridicule You, Then They Fight You, Then You Win."






    Ghandi

  • "We Cannot Assume the Existence of Predictability Just Because There Are No Studies That Fully Reject It."






    Valeriy Zakamulin, Economics Professor

  • "I Am Also Extremely Grateful to Rob Bennett for Motivating This Topic and Contributing His Experience and Encouragement."





    Wade Pfau, Academic Researcher

  • "Rob Bennett Was an Early Pioneer in 3rd Generation Modeling by Advocating (Through Various Online Forums) that Withdrawal Rates Must Be Adjusted for Market Valuations Consistent with Research by Campbell and Shiller."



    Todd Tresidder, Financial Mentor Blog

  • "I Am Fascinated by the Growing Body of Research that Revolves Around the P/E10 Ratio by Robert Shiller, Doug Short, Wade Pfau, Michael Kitces, John Hussman, Crestmont Research, Jim Otar, Mike Philbrick, Adam Butler & Rob Bennett."



    Kay Conheady in Advisor Perspectives

  • "Rob Is an Enigma in the Personal Finance World. He Has Interesting Theories on Investing Based on Market Valuations. But He Weaves a Tale Which Makes the Stories of Alexander Litvinenko & Gareth Williams Seem Tame by Comparison."



    Don't Quit Your Day Job Blog

  • "In Recent Years, the 4 Percent Rule
    Has Been Thrown Into Doubt."






    The Wall Street Journal

  • "A Safe Withdrawal Rate Is Very Dependent
    on the Valuation of the Stockmarket
    at the Retirement Date."





    Economist Magazine

  • "I Have Read Everything I Can About Valuation-Informed Indexing. Buy-and-Hold Is Extremely Problematic. I Respect the Passion, Hard Work and Research That You Have Put Into This Very Important Issue. Your Work Has Huge Value."



    Carl Richards, Owner of Clearwater Asset Management

  • "The World of Personal Finance Blogging Needs More Rob Bennetts. He’s Passionate. He’s Intelligent. He’s Writing Things That Go Against the Grain."





    Financial Uproar Blog

  • "Beyond Awesome."







    Larry, a PassionSaving.com Site Visitor

  • "The Wealth Management Industry Seems Intent on Containing This Discussion for Fear Clients Might Discover that the Emperor Has No Clothes."





    Adam Butler, Portfolio Manager

  • "Recommended Reading."







    Jesse's Cafe Americain Blog

  • “All Who Are Still Holding Equities at Present Levels Because Their Financial Adviser Insists that Timing Market Cycles Is Impossible to Do -- Read This!"





    Juggling Dynamite Blog

  • "The Fact that Aggressive and Short-Term Market Timing Was Unproductive Did Not Mean That There Were Never Times When It Would Be Wealth-Maximizing to Get Out of the Market."



    Scott Burris,Director of the Center for
    Health Law, Policy and Practice

  • "The Amount of Return You Can Expect From a Diversified Equity Portfolio Is Inversely Correlated to the Market Valuation at the Start of the Holding Period. It Is One of the Most Robust Statistical Relationships in Modern Finance."




    Todd Tresidder, Financial Mentor Blog

  • "Why Would Your Job Be Jeopardized
    By Such a Sensible Claim?"





    Marcelle Chauvet, Econmics Professor
    at University of California

  • "Received Worrisome E-Mail from Rob Bennett. Warns of Risk with Buy-and-Hold Investing
    -- I Have No Clue."





    Vivek Wadhaw, Business Week Columnist

  • "As Attorney, Tax Expert and Financial Writer Rob Bennett Told Us, the Problem Is That, By the Time Shiller Published His Research, Many Big Names Had Already Endorsed Buy-and-Hold."




    ZeroHedge.com

  • "This Seems to Me to Be a Fundamental Challenge to Some of the Most Basic Tenets of the Boglehead Paradigm."






    Bogleheads Forum Poster

  • "You Want to be Very, Very Wary of Anything Connected with Rob Bennett, the Most Infamous Troll in the History of Investing Forums on the Internet."





    Alex Fract, Owner of Bogleheads Forum

  • “I’ve Had My Fill of Those Long-Winded Posts that Include Distortions, Unsubstantiated Claims, Misquotes and Comments Taken Out of Context.”




    Mel Lindauer, Co-Author of
    The Bogleheads Guide to Investing

  • "Haven't You Noticed Yet That NO ONE Discusses Your Ideas, NO ONE Mentions Your Name, NO ONE Goes To Your Web Site."





    One of the Greaney Goons

  • "I've Had Similar Experiences. I Know of Two Young Professors Who Wanted to Do Research on Fundamental Index and Reported to Me That Their Colleagues Advised Them That This Line of Research Could Derail Their Career Prospects."



    Rob Arnott, Financial Analysts Journal Editor

  • "As with Drug Studies Funded by Drug Companies, It Would Be Churlish to Suppose that the Chicago School of Business Was in the Bag. But It Would Also Be Idealistic to Assume That There Was No Funding Bias at All."




    Bogleheads Poster

  • "This Sort of Intimidation Is Not Acceptable. The Cigarette and Pharmaceutical Industries Found Research Supporting Their Products By Funding It. But That Was Big Money Supporting Outcomes, Not Dissuading Others."




    Lyn Graham, 25-Year CPA

  • "Financial Economists Gave Little Warning to the Public About the Fragility of Their Models. There Is No Ethical Code for Professional Economic Scientists. There Should Be One."



    Paper Titled The Financial Crisis and
    the Systemic Failure of Academic Economics

  • "The Situation [Referring to the Intimidation Tactics Used to Silence Academic Researcher Wade Pfau's Reporting of the Dangers of Buy-and-Hold Investing Strategies] Seems Well Below Any Professional and Academic Acceptable Standards."



    Albert Sanchez Graells, Law Lecturer

  • Many Academics Can Become Quite Strident When Their Views Are Challenged. Academia Is Often Subject to Self-Serving Bias That Obliterates Ethical Bounds."





    Ted Sichelman, Law Professor

  • "I Don't Like Too Much the Conspiracy Idea. I Am Not Pressured By Anyone in My Research."






    Roberto Reno, Economics Professor

  • "This Is What Investing Should Be -- Calculated, Deliberate, Confident, Informed and Simple."






    Aaron Friday, Owner of Aaron's Blob Blog

  • "It Is Obvious that Rob, in Attempting to Identify New Safe Withdrawal Rate Strategies...Is Goring Your Ox. If Rob Improves on [the] Safe Withdrawal Rate Methodology, the Implication Is Clear: You Are All, Metaphorically, Out of Business."



    Bogleheads Poster

  • "I Applaud His Effort to Inject Another Piece of Objectivity Into a Very Complex, Highly Subjective Topic -- Making Money in the Market."





    Bogleheads Poster

  • "Naturally, I Am Finding That Valuation-Informed Indexing Can Allow You to Reach a Wealth Target With a Lower Saving Rate and to Use a Higher Withdrawal Rate in Retirement Than You Could With a Fixed Allocation."



    Wade Pfau, Professor of Retirement Income
    at The American College

  • "A Careful Examination of Past Returns Can Establish Some Probabilities About the Prospective Parameters of Return, Offering Intelligent Investors a Basis for Rational Expectations About Future Returns."




    Jack Bogle, Founder of Vanguard Funds

  • "The Ability to Estimate the Long-Term Future Returns of the Major Asset Classes Is Perhaps the Most Important Investment Skill That An Indivisual Can Possess."




    William Bernstein, Author of The Four Pillars of Investing

  • "The Stock Market Resembles Roulette. In Both Cases, the Accuracy of Sensible Forecasts Rises Over Time."






    Andrew Smithers, Co-Author of Valuing Wall Street

  • "Returns Are for the Most Part a Matter of Simple Arithmetic...Much of Our Industry Seems Fearful of Basic Arithmetic of This Sort."





    Rob Arnott, Financial Analysts Journal Editor

  • "How Can It Be That One-Year Returns Are So Apparantly Random and Yet Ten-Year Returns Are Mostly Forecastable? In Looking at One-Year Returns, One Sees a Lot of Noise. But Over Longer Time Intervals the Noise Effectively Averages Out and Is Less Important."




    Yale Economics Professor Robert Shiller

  • "The Notion That Rich Valuations Will Not Be Followed By Sub-Par Long-Term Returns Is a Speculative Idea That Runs Counter to All Historical Evidence. It Is an Iron Law of Finance That Valuations Drive Long-Term Returns."




    John Hussman

  • "It's January and the Temperature Is Below Freezing. If You Asked Me Whether It Will be Warmer or Cooler Next Tuesday, I Would Be Unable to Say. However, If You Asked Me What Temperature to Expect on April 9, I Could Predict "Warmer Than Today" and Almost Surely Be Right."



    Michael Alexanfer, Author of Stock Cycles

  • "If the Response Is "Who Knew?", It Won't Be Much Comfort for Retirees in the Employment Line at Wal-Mart. This is Especially True Since a Rational Understanding of History and the Drivers of Longer-Term Stock Returns Can Help Retirees To Avoid That Surprise."




    Ed Easterling, Author of Unexpected Returns

  • "New of the Demise of the Random Walk Has Only Very Slowly Spread, In Part Because Its Overthrow Came as a Shock. If the Random Walk Hypothesis Were Correct, the Most Likely Return Would Be the Historic Average Return. The Evidence, However, Is Strongly Against This."



    Andrew Smithers, Co-Author of Valuing Wall Street

  • "I Don't Think We Can Debate the Merits of This Type of Forecasting [Referring to the Numbers Generated by The Stock-Return Predictor] Unless We Believe 'This Time It's Different.'"



    Poster at Bogleheads Forum
    (Before the Ban on Honest Posting Was Adopted There)

  • "I've Seen Absolutely Nothing From You That I Can Use in a Tangible Fashion to Formulate an Investment Plan. Your Ideas Are So Mushy That It's a Complete Waste of Time to Even Consider Them."




    Bogleheads Forum Poster

  • "Do You Really Think Your Tool
    [The Stock-Return Predictor]
    Is 'Wiser' Than the Market?
    If It Was That Easy,
    Everybody Would Be Doing It."



    Bogleheads Forum Poster

  • "The Expected Return of Stocks [As Reported By The Stock-Return Predictor] Needs To Be At Least the Treasury Inflation-Protected Securities (TIPS) Rate for Stock Investing To Make Sense."




    Bogleheads Forum Poster

  • "I Have Used Valuations to Adjust My Asset Allocation For Many Years With Very Favorable Results."





    Poster at Bogleheads Forum
    (Prior to the Ban on Honest Posting)

  • "I Don't Care If You Do or Don't Believe That the Market Will Behave Similarly in the Future As It Has in the Past. Either Way, This [The Stock-Return Predictor] Is an Excellent Way to Understand What the Market Has Done In the Past."


    Poster at Bogleheads Forum
    [Prior to the Ban on Honest Posting]

  • "My Role Is To Give People Who Don't Like What the Historical Stock-Return Data Says About the Effect of Valuations on Long-Term Returns Somebody To Yell At On Internet Discussion Boards."



    Rob Bennett at Bogleheads Forum
    (Prior to the Ban on Honest Posting)

  • "It Really Is a Shame and Indefensible That So Many Feel the Need to Jump Into It With No Interest of Posting on the Topic But Just to Disrupt. Are You That Insecure? Some on the Forum Have an Interest in This Topic. If You Don't, Stay Out!"



    Poster at Bogleheads Forum
    [Prior to the Ban on Honest Posting]

  • "Irrational Behavior Does Follow Patterns. But How Many Experts in Behavioral Finance Believe That Such Knowledge Can Be Used to Predict Markets? Basically, None. Your Model Cannot Attain the Level of Predictive Value You Claim."



    Poster at Bogleheads Forum
    [Prior to the Ban on Honest Posting]

  • "The Safe Withdrawal Rate Studies Are Based on History. This [The Retirement Risk Evaluator] Shows, Based on the Same History, What the Probabilities Are for the Future at Various Starting Points. If the First Has Value, Then Surely This Does Too."



    Poster at Bogleheads Forum

  • "There Are Hundreds of People Who Contributed to This. This Calculator [The Stock-Return Predictor] Demonstrates in a Compelling Way the Power of This New Internet Discussion-Board Communications Medium."




    Rob Bennett at the Bogleheads Forum
    (Prior to the Ban on Honest Posting)

  • "A P/E10 of'26' Is Bad. Now Look at the 30-Year Return Predicted by the Calculator -- 5.4 Percent Real. That's Not Bad. There Are All Sorts of Strategic Implications That Follow From Understanding That Stocks Provide Different Sorts of Returns Over Different Sorts of Time-Periods."




    Rob Bennett

  • "I Would Never Invest in Anything Without Having Any Idea What the Expected Return Is. For Instance, I Would Not Walk Into a Bank And Say "I'll Take One Certificate of Deposit, Please" WIthout Asking What Rate They Are Offering."



    Poster at Bogleheads Forum
    [Prior to the Ban on Honest Posting]

  • "I've Seen Things Said on Investing Boards That I Have Never Heard Said in Discussions of Any Non-Investing Topic. The Question of Whether Valuations Affect Long-Term Returns Is a Topic That Causes People More Emotional Angst Than Does Abortion or Impeachment Proceedings or the War in Iraq."



    Rob Bennett at the Bogleheads Forum

  • "It's Not Possible For Those Who Have Come to Believe That Stocks Are Always Best to Accept that Valuations Matter. The Two Beliefs Are Mutually Exclusive. If Valuations Matter, There Is Obviously Some Valuation Level At Which Stocks Are Not Best. The Two Paradigms Cannot Be Reconciled."


    Rob Bennett

  • "The Great Safe Withdrawal Rate Is Over. Rob Bennett Has Won.The Technical Evidence Supporting This Assertion Is Rock Solid."




    John Walter Russell,
    Owner of the Early Retirement Planning Insights Site
    [This Statement Was Put Forward on August 3, 2003.]

  • "I Am Afraid that the Emperor SWR [for "Safe Withdrawal Rate"] Has No Clothes."





    A Poster at the Early Retirement Forum
    [This Statement Was Put Forward on October 8, 2003.]

  • "I Cite You and John Walter Russell in My Paper as the Earliest and Strongest Advocates of This Approach [New School Safe Withdrawal Rate Research]."




    Wade Pfau, Professor of Retirement Income
    at The American College

  • "Dear Rob -- I Just Became Aware of Your Past Research in September. Since Then, I've Read Archives From Many Discussion Boards and Websites, and I Always Find Your Writing to Be Very Interesting and Intriguing."



    Wade Pfau, Professor of Retirement Income
    at The American College

  • "I Think Rob Bennett Did Provide An Important Contribution in Terms of Describing a Way for P/E10 to Guide Asset Allocation for Long-Term Conservative Investors. I Also Think He Was Right on the Issue of Safe Withdrawal Rates."


    Wade Pfau, Professor of Retirement Income
    at The American College

  • "What Studies Show This [That Long-Term Timing Doesn't Work]? In Particular, Are There Some Academic Studies That I Haven't Found Yet? That's All I Want to Know."




    Academic Researcher Wade Pfau at the Bogleheads Forum After His Own Search of the Literature Turned Up Not a Single Such Study

  • "Because the Precise Timing of This Mean Reversion Is Not Known in Advance, Expecting the Result to Happen in the Short-Term Will Not Be Possible. But Long-Term Investors Who Can Be Patient Can Wait for This Mean Reversion and Will Eventually Come Out Ahead."




    Academic Researcher Wade Pfau

  • "Your Work Is at Odds with the Ethos of the Board -- Here the Theme is John Bogle's Philosophy, Which Eschews Market Timing. This Board Came Into Existence to ESCAPE One Individual, the Very Individual With Whom You Have Openly Aligned Yourself."




    A Lindaurhead (to Researcher Wade Pfau)

  • "The Problem With Long-Term Market Timing Is That It Takes Too Long to Find Out If You Are Right or Wrong."






    A Poster at the Bogleheads Forum

  • "Why Is It Such an Odious Violation of the Tenets of Bogleheadism to Explore Whether Someone Who Has Enough Patience Might Be Able to Benefit from the Transitory Nature of Speculative Returns (the Idea That the P/E Ratio Eventually Ends Up Where It Started)?"




    A Poster at the Bogleheads Forum

  • "Let Me Explain Why I Posted About This Here. Valuation-Informed Indexing Has Had Critics for Years. But Until Norbert Did It In 2008, Nobody Seemed to Have Provided a Serious Investigation of It. I Couldn't Understand Why. That Bothered Me."



    Researcher Wade Pfau at the Bogleheads Forum
    (Prior to the Ban on Honest Posting)

  • "If You Really Don't Like Market Timing in Any and All Forms, You May Not See Any Point in an Empirical Investigation. You View Me as One of a Long Line of Hucksters Trying to Sell You Some Snake Oil. I Don't Want to Be Such a Person."



    Researcher Wade Pfau at the Bogleheads Forum
    (Prior to the Ban on Honest Posting)

  • "Having a Completely Ineleastic Demand for Equities Is a Bit Bonkers. No One Acts That Way with Life's Other Important Commodities. Campbell Advocates a Linear Valuations-Based Strategy so That You Wouldn't Be Making Big Changes. This Would Be Like Rebalancing But More Flexible."



    A Poster at the Bogleheads Forum

  • "The Whole Idea of Valuation-Informed Indexing Belongs to You. Do You Mind if I call the Paper 'Valuation-Informed Indexing'? I Would Give You Credit. I Have Been Toying With the Idea of Sending the Paper to the Journal of Finance, Which Is the Most Prestigious Journal in Academic Finance."


    Academic Researcher Wade Pfau, in an E-Mail to Rob

  • "I Definitely Need to Cite You as the Founder of Valuation-Informed Indexing, As I Have Not Found Anyone Else Who Can Lay Claim to That. Shiller Pointed Out the Predictive Power of P/E10 But Never Discussed How to Incorporate It Into Asset Allocation, As Far As I Know."




    Academic Researcher Wade Pfau

  • "I Tested a Wide Variety of Assumptions About Asset Allocation, Valuation-Based Decision Rules, Whether the Period Is 10, 20, 30 or 40 Years, and Lump-Sum vs. Dollar-Cost Averaging To Show That the Results Are Quite Robust to Changes In Any of These Assumptions."




    Academic Researcher Wade Pfau

  • "Yes, Virginia, Valuation-Informed Indexing Works!"




    Academic Researcher Wade Pfau
    (Wade Holds a Ph.D. in Economics from Princeton.)
    (The Buy-and-Hold Mafia Threatened to Get Wade Fired From His Job When He Reported His Findings.)

  • "I Wrote Up the Programs to Test Your Valuation-Informed Indexing Strategies Against Buy-and-Hold and I Am Quite Excited. You Say in the RobCast That VII Should Beat Buy-and-Hold About 90 Percent of the Time. I Am Getting Results That Support This."




    Academic Researcher Wade Pfau

  • "Never Underestimate the Power of a Dominant Academic Idea to Choke Off Competing Ideas, and Never Underestimate the Unwillingness of Academics to Change Their Views in the Face of Evidence. They Have Decades of Their Research and Academic Standing to Defend."




    Jeremy Grantham

  • "There's So Much That's False and Nutty
    in Modern Investing Practice."






    Warren Buffett

  • "Following Conventional Wisdom Has Led a Generation of Investors Down the Road to Ruin."






    Steve Hanke

  • "It Is Sad That the Idea That Price Doesn't Matter...Should Ever Have Been Seriously Considered".






    Andrew Smithers, Co-Author of Valuing Wall Street

  • "The Conventional Wisdom of Modern Investing Is Largely Myth and Urban Legend."





    Rob Arnott, Former Editor of
    Fianncial Analysts Journal

  • "Economics Is a Dog's Breakfast of Theoretical Ideas and Alleged Causal Relationships That Are At All Times Unproven and In Dispute."





    Terence Corcoran, Editor of National Post

  • "Since They Did Not Diagnose the Disease, There Is Little Popular Confidence That They Know the Cure. What If Economics Is, Actually, At the Same Level as Medicine Was When Doctors Still Believed in the Application of Leeches?"




    Gideon Rachman, Financial Times

  • "One of the Most Remarkable Errors
    in the History of Economics."



    Yale Economics Professor Robert Shiller
    (Referring to the Logical Leap from the Finding That Short-Term Price Changes Are Unpredictable to the Conclusion That the Market Sets Prices Properly)

  • "Everything Has Fallen Apart."






    Peter Bernstein, Author of Against the Gods
    (Referring to Old Views About How Markets Work)

  • "We Wonder Why Funds and Banks, Full of the Best and Brightest, Have Made Such a Mess of Things. Part of the Reason Is That We Have Taught Economic Nonsense to Two Generations of Students."




    John Mauldin, Thoughts From the Frontline

  • "Perhaps Most Scandalously, the Theory [Behind Buy-and-Hold] Remained Received Wisdom Long After Empirical and Theoretical Arguments Had Demolished It Within the Academic Community."




    John Authers, Financial Times

  • "I Love the Humans Dearly (the Title of the Book I Am Writing Is Investing for Humans: How to Get What Works on Paper to Work in Real Life) But They Can Be a Trial at Times. Hey! Helping the Humans Learn What It Takes to Invest Effectively Is Not All That Different From Being Married!



    Rob Bennett

  • "We Are Going to See Hearts Melt Following the Next Crash. I Will Be Working Side-By-Side With All of My Many Buy-and-Hold Friends to Rebuild Our Broken Economy."





    Rob Bennett

  • "Wow, I Did Not Realize You Had Achieved This Much Success and Had Many Devoted Believers/Followers. That’s Great, Then Ignore the Opposition. It Is Great to Have Opposition: That Means You Are Doing Something Right."




    Robert Savickas, Associate Finance Professor
    at George Washington University

  • "I Do NOT Believe I Know It All. I Believe That Shiller Discovered Something Very Important and It Appalls Me That More People Are Not Exploring the Implications of His Findings. My Aim Is To Launch a National Debate."




    Rob Bennett

  • "I Can See How Many Readers Would Be Put Off by the Somewhat Sensational/Scandalist Tone and Would Not Persevere to Read, Thinking You Are Losing Your Mind."




    Robert Savickas, Associate Finance Professor
    at George Washington University

  • "I LOVE Everything About Buy-and-Hold Other Than the Failure to Encourage Investors to Take Price Into Consideration When Setting Their Stock Allocations. That's a Mistake That Was Made Because Shiller’s Research Was Not Available at the Time The Strategy Was Being Developed."



    Rob Bennett

  • "Valuation-Informed Indexing Sounds Like a Real Thing. If It Is and I Can Thoroughly Understand It, Then It Will End Up In My Classrooms and in My Students' Minds (Of Course, With References to You and Wade)."




    Robert Savickas, Associate Finance Professor
    at George Washington University

  • "I Can Confirm Wade Pfau's Experience. Whenever I Send My Papers to the Financial Analysts Journal or Similar Traditional Journals, I Get Rejected."





    Joachim Klement, CIO at Wellershoff & Partners

  • "As a Fan of Thomas Kuhn's The Structure of Scientific Revolutions, I Know That Progress Can Be Frustratingly Slow and What Is Typically Needed Is Either a Crisis or the Ascent of a New Generation of Scientists Who Did Not Build Their Careers on the Old Models and Theories."




    Joachim Klement, CIO at Wellershoff & Partners

  • "We Trace the Deeper Roots [of the Financial Crisis] to the Economics' Profession's Insistence on Constructing Models That, By Design, Disregard the Key Elements Driving Outcomes in Real World Markets."




    Knowledge@Wharton

  • "Rob Gets Himself So Worked Up Over What Someone Else Is Doing With Their Own Money and Not Bothering Rob in the Least. As Long As They Aren't Knocking on Your Basement Door, What Do You Care? They Are Happy and Content. Leave Well Enough Alone and Focus on Your Own Account."


    Dab, One of the Greaney Goons

  • "I've Been on Forum Since the BBS Days and I Think Rob is Special. He Could Be an Internet Meme If He Put Some Effort Into It. Someday, He Will Realize That the Only Thing He's Good At Is Being an Epic Loser. He Just Needs to Embrace That Idea and Run With It. Watch Out, LOLCats, Here Comes Pathetic Guy!"


    Wabmaster, One of the Greaney Goons

  • "Your Lies Are Not Even in the Realm of the Possible, Much Less Actually Credible, Much Less Actually True."






    Drip Guy, One of the Greaney Goons

  • "I'm Your Friend. I Am Not a Boil on Your Ass."






    Rob Bennett, In a Response Comment
    to One of the Greaney Goons

  • "You Guys [the Greaney Goons] Are the Same Jokers Who Have Done This Before, Sparring with Rob Over Nonsensical Issues On This Site and Others, Leveling Personal Attacks, and You Don't Even Use Real Names! Rob Is Entitled to His Opinion, But the Fact That You Challenge Every Jot and Tittle of What He Says Makes It Clear You Have An Unholy Agenda. Please Take It Elsehwere."

    Kevin Mercadante,
    Owner of the Out of Your Rut Site

  • "Rob, Take This As Friendly Advice. You're a Smart and Articulate Guy and You Could Be Making Valuable Contributions to This Discussion. I've Dealt with the Mentally Ill Before and I've Found That They Sometimes Can Be Reasonable If Gently Redirected."



    Goon Poster

  • "Always Remember Others May Hate You, But Those Who Hate You Don't Win Unless You Hate Them, and Then You Destroy Yourself."





    Richard Nixon

  • "I’m a Numbers Guy. And I Believe I Understand Rob’s Thesis, that Future Returns, Over the Next Decade, Have a Tight Inverse Correlation to the PE10 for the Starting Point. Remember, Correlation Doesn’t Need to be 100%, Only That There’s a Bell Curve of Potential Outcomes that Shift Meaningfully Based on the Input."


    Owner of Joe Taxpayer Blog

  • "What a Difference a Threat to Get the Father of Two Small Children Fired From His Job Has on an Investing Discussion, Eh? Long Live Buy-and-Hold! It’s Science! With a Marketing Twist!"




    Rob, Referring to the Wade Pfau Matter

  • "I Respect Rob and His Analysis. He's Bright, Energetic and Passionate. [The Goon Stuff] Is Really Nonsense. I Enjoy a Thought-Provoking Conversation With People I Respect."





    Owner of Joe Taxpayer Blog

  • "The Fact that Shiller is a Proponent of the Approach Takes it from a Fringe View to Mainstream, in my Opinion."






    Owner of Joe Taxpayer Blog

  • "I Have had Academic Researchers Tell Me That They Dream of the Day When They Will be Able to do Honest Research Once Again. I Have had Investment Advisors Tell me That They Dream of the Day When They Will be Able to Give Honest Investing Advice Again."



    Rob Bennett

  • "Let’s Call a Spade a Spade, Shall We? Wade Pfau Stole Your Research and Put His Name on it, Throwing You Just a Tiny Crumb of Acknowledgement to Ward Off a Lawsuit. He’s Profiting Handsomely By His Theft, Leading a Charmed Life, Widely Published, Widely Respected. While Rob Bennett Continues to Toil in Total Obscurity. It’s So Incredibly Unfair, I Think If It Happened to Me, It Could Actually Drive Me Insane."

    One of the Greaney Goons

Navigation Menu 
  • About Us
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  • Blog
  • Passion Saving
    • 20 Dangerous Money Myths — They Think We’re Stupid!
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  • Valuation-Informed Indexing
    • Why Buy-and-Hold Investing Can Never WorkThe Buy-and-Holders are not evil people. They are smart and good people. They made a mistake. They were so excited about their early findings that they experienced cognitive dissonance when the mistake was revealed. They painted themselves into a corner and now don’t know how to get out. This article explains how the mistake was made and how we came to find ourselves in the trap we are in today.
    • About Valuation-Informed IndexingBackground, Basics and Links to Materials Giving More In-Depth Information
    • The Stock-Return PredictorStocks are NOT always worth buying. That’s a Wall Street lie! This calculator performs a regression analysis on the 140 years of historical stock-return data to reveal the most likely annualized 10-year return for stocks starting from any valuation level. It essentially tells you the price tag for stocks so that you can know whether they are worth buying or not.
    • The Retirement Risk EvaluatorRob pointed out the errors in the Old School safe withdrawal rate studies in May 2002. That post kicked off the biggest controversy in the history of the internet. Today, The Wall Street Journal, Smart Money and The Economist all acknowledge that Rob had it right all along. But they still don’t provide calculators that give the right numbers! The safe withdrawal rate is not a constant number but VARIES with changes in the valuation level that applies on the day the retirement begins. This calculator provides all the details you need for effective planning.
    • The Investor’s Scenario SurferI have run this calculator hundreds of time. it is in my assessment the most powerful tool for learning how stock investing works available today. You have the option of choosing a new stock allocation in each year of a realistic 30-year sequence of returns. You can compare your results with what you would have achieved with a Buy-and-Hold strategy. You will find that Valuation-Informed Indexing strategies yield larger portfolios in 90 percent of your tests of the concept. What matters is what happens in the long term! This tool tells you what strategies give the best results in the long term.
    • The Investment Strategy TesterIf you are worried about losses you have suffered in recent years, you can use this tool to learn what you need to do to get back on the track to early financial freedom. The Strategy Tester lets you design a strategy you want to check out. Then it runs the hundreds of Scenario Surfer tests to see how the strategy compares with other possibilities you identify. The color-coded graphic gives you a good idea of what the odds are of good and bad outcomes for up to four investing strategies at a time.
    • The Returns Sequence Reality CheckerWe all root for price gains in the stock market. Should we? This calculator says “no!” Today’s price increase lowers tomorrow’s price increase. This has been so for the entire history of the market. So the question is whether you should want to pay more for stocks now or later. You are far better off paying more later because that means you get to acquire more gain-producing goodness earlier in life and thus you will enjoy more compounding return magic. This one will blow your mind. It’s a very simple concept but a highly counter-intutive one and one that will someday soon change how we all think about stock investing.
    • Nine Valuation-Informed-Indexing Portfolio Allocation StrategiesThis is the most popular of the 200 hour-long RobCasts that I provide at the site. It explores the nuts-and-bolts aspects of Valuation-Informed Indexing — How often do you change your allocation and by how much?
  • The Buy-and-Hold Crisis
    • Academic Researcher Silenced by Threats to Get Him Fired From His Job After Showing Dangers of Buy-and-Hold Investing StrategiesMy aim is to get this story reported on the front page of the New York Times. On the day that happens, all the nastiness will stop. We will all be working together to bring the economic crisis to an end and to enter the greatest period of economic growth in our history.
    • Academic Researcher Silenced By Threats to Get Him Fired From His Job After Showing Dangers of Buy-and-Hold Investing Strategies — Teaser VersionThis is a briefer version of the same article, the article that I believe is the most important one that I have written in my 30-year journalism career. I believe that the story told at this web site is the most important economic and political story of any of our lifetimes and this article sums up the key points in one little package of dynamite. If Buy-and-Hold were a legitimate strategy, every Buy-and-Holder would be ashamed to learn that even one academic researcher was threatened. We cannot move forward so long as the intimidation tactics of the Buy-and-Holders dominate all discussions of what works in stock investing. I use this short version of the article in my e-mail campaigns aimed at getting researcher and stock advisors and bloggers and journalists and policymakers involved in our effort to open the internet up to honest posting on ALL investing topics. Please help get others involved if you can. We are all in this together!
    • Corruption in the Investing Advice Field — The Wade Pfau StoryThis article provides links to all of my reports on my 16 months of correspondence with Academic Researcher Wade Pfau, the collaboration that produced the research we co-authored that shows millions of middle-class investors how to reduce the risk of stock investing by 70 percent (Ssshh! The Wall Street Con Men don’t want this one getting out!) If you retain doubts re whether Valuation-Informed Indexing is a real thing, looking over the materials available at this page and then reading a few of the reports that strike you as particularly important will dispel them. I believe that Wade will someday win a Nobel prize for the work he did here. The reports show his own skepticism and his transformed into excited BELIEVER in the Valuation-Informed Indexing concept.
    • The Bennett/Pfau Research Showing Middle-Class Investors How to Reduce the Risk of Stock Investing by 70 PercentYou do not have to take on a large amount of risk to obtain good returns. Why should you? When you buy an index fund, you are buying a tin share in the productivity of the U.S. economy. The U.S. economy has been sufficiently productive to support an average annual stock return of 6.5 percent real for 140 years now. So that’s what you can expect if you invest in a sensible way. But you are not being sensible if you follow a Buy-and-Hold strategy. You MUST consider price when buying stocks just as much as you must consider price when buying anything else. This is the most important investing research published in 30 years. It frees all of us from dependence on Wall Street “experts.”
    • Buy-and-Hold Caused the Economic CrisisThe first step to curing an illness is coming up with a correct diagnosis. What we have been hearing thus far about what caused the economic crisis is Democrats yelling at Republicans and Republicans yelling at Democrats. This political attack-game gibberish will not cut it. We borrowed huge amounts of money from our future selves to finance the insane bull of the late 1990s. Now we are our future selves! Now we are paying the price! It hurts to know we caused this. Buy you know what? We never have to suffer through something like this again once we acknowledge the realities.
    • The True Cause of the Current Financial Crisis — Questions and AnswersYale Economics Professor Robert Shiller predicted the economic crisis in his book “Irrational Exuberance,” published in March 2000. How did he know? Shiller knows how stock investing works. He knows that the Pretend Money created during times of overvaluation ALWAYS disappears over the course of 10 years or so. When that money disappears from our portfolios, we cannot afford to spend as much. So tens of thousands of businesses fail and millions lose their jobs. We avoid economic crises by avoiding out-of-control bull markets. We avoid out-of-control bull markets by letting investors know the truth — When stocks are selling at insanely inflated prices, they offer a very poor long-term value proposition. The lies that Wall Street tells about stocks are destroying out free-market economic system.
    • Investing Discussion Boards Ban Honest Posting on ValuationsLots of people hate me. There was a time when I was receiving fresh death threats in my e-mail inbox on an almost daily basis. But lots of people love me too. Thousands of my fellow community members have told me that I am the first person who ever described how stock investing works in a way that truly hangs together. This article offers 101 comments of my fellow community members asking the Buy-and-Holders to knock off the funny business and permit civil and reasoned discussion of the last 30 years of peer-reviewed academic research. This article reveals the emotionalism of the Buy-and-Holders and it is the fact that Buy-and-Hold causes such emotionalism that tells me that it can never work in the long run.
    • Wall Street Journal Calls Buy-and-Hold a “Myth,” Endorses Valuation-Informed IndexingLot of smart people know that Buy-and-Hold is a big pile of smelly garbage. They are afraid to speak out today because they know what will happen to them if they do. But they try to position themselves for the post-next-crash period, when “Buy-and-Hold” will be an obscene phrase. Bret Arends tells us that the Wall Street Con Men “are leaving out half the story.” Precisely so. The purpose of this web site is to let you in on the half of the story that the Wall Street Con Men have been keeping from you for 32 years now.

“Most of Us Don’t Know Enough to Distinguish Real Science from Pseudo-Science”

March 19, 2009 By Rob

Business Day recently published an article reporting on the investment insights developed in the Retire Early and Indexing discussion-board communities during the first seven years of The Great Safe Withdrawal Rate Debate. The article is entitled Why a Common-Sense Approach to Investing Became Unpopular.

Juicy Excerpt: Investing claims backed by objective evidence are better than those from a bunch of guys shooting the breeze. Unfortunately, most of us don’t know enough to distinguish real science from pseudo-science. And much of today’s advice isn’t backed by the real thing.

Related Posts

  • “The Scary Thing Is That Rob Is An Optimist”“The Scary Thing Is That Rob Is An Optimist”
  • Improving Risk-Adjusted Returns Using Market-Valuation-Based Tactical Asset Allocation StrategiesImproving Risk-Adjusted Returns Using Market-Valuation-Based Tactical Asset Allocation Strategies
  • “Wade Pfau Never Wrote Any Words of That Nature Until You Threatened to Send Defamatory E-Mails to His Employer. Words That Are Said As the Result of Intimidation Tactics Don’t Count. Wade Said What He Really Believes About Safe Withdrawal Rates and About Valuation-Informed Indexing and About Me in Hundreds of E-Mails That He Exchanged With Me, Many of Which I Have Reported on at My Site.”“Wade Pfau Never Wrote Any Words of That Nature Until You Threatened to Send Defamatory E-Mails to His Employer. Words That Are Said As the Result of Intimidation Tactics Don’t Count. Wade Said What He Really Believes About Safe Withdrawal Rates and About Valuation-Informed Indexing and About Me in Hundreds of E-Mails That He Exchanged With Me, Many of Which I Have Reported on at My Site.”
  • Valuation-Informed Indexing #135 — My Response to the <i>Seeking Alpha</i> Article Saying P/E10 Doesn’t WorkValuation-Informed Indexing #135 — My Response to the Seeking Alpha Article Saying P/E10 Doesn’t Work
  • “I Developed the Ideas Tested in the Study That I Co-Authored with Wade Pfau. Wade Did Great Work Testing Them and Proving Their Legitimacy. He Never Tried to Hog Full Credit for the Study. He Said Many Times That He Considered Me the Lead Person Behind the Development of the Valuation-Informed Indexing Concept and That He Believed That the Shift from Buy-and-Hold to Valuation-Informed Indexing Is the Biggest Advance That We Have Seen in the Investing Field in Many, Many Years.”“I Developed the Ideas Tested in the Study That I Co-Authored with Wade Pfau. Wade Did Great Work Testing Them and Proving Their Legitimacy. He Never Tried to Hog Full Credit for the Study. He Said Many Times That He Considered Me the Lead Person Behind the Development of the Valuation-Informed Indexing Concept and That He Believed That the Shift from Buy-and-Hold to Valuation-Informed Indexing Is the Biggest Advance That We Have Seen in the Investing Field in Many, Many Years.”
  • Valuation-Informed Indexing #258: It Is Critical to Distinguish Returns-Sequence Risk from Valuations Risk When Calculating Safe Withdrawal RatesValuation-Informed Indexing #258: It Is Critical to Distinguish Returns-Sequence Risk from Valuations Risk When Calculating Safe Withdrawal Rates

Filed Under: Investing Experts Tagged With: Business Day, common-sense investing

Browse Investing Experts

  • "This Is a Field Where People Don't Admit Their Mistakes. The 'Experts' in This Field Feel That They Need to Persuade Their Clients That They Are Super-Human and Thus Incapable of Making Mistakes. It's Not So. And We Are All Suffering in Serious Ways As a Result." 0 Comments

    Set forth below is the text of a comment that I recently posted to the discussion thread for one of my columns at the Value Walk site: By the way, you were proven wrong on SWRs by Wade Pfau and you keep talking about death threats that you refuse to prove. Those are just two more points you bring up to try and explain your failures. I am the person who discovered the errors in the Old School safe-withdrawal-rate studies, Sammy. Those studies should all have been corrected within 24 hours…

  • "If Someone Tells You That You Are Reacting Emotionally, You Are Less Inclined to Like Him and Thus Less Inclined to Buy From Him. But the Experts Who Flatter Us Are Salesmen, Not True Experts. A True Expert Is Someone Who Tells You What You Need to Hear Even When It Is Not What You Want to Hear." 4 Comments

    Set forth below is the text of a comment that I recently posted to the discussion thread for one of my columns at the Value Walk site: Investors overreacted to the banking crisis of 2008? Really? Another joke of a column. I wrote a full column explaining WHY I believe that investors overreacted, Sammy. You just engaged in put-downs. If you don't think that investors overreacted, why do you think prices moved so hard in the other direction in the following days? Did anything happen…

  • "The Three Earlier Crashes Came Before the Publication of Peer-Reviewed Research Showing That There Is Zero Chance That a Strategy Not Calling for the Exercise of Price Discipline (Long-Term Timing) Could Ever Work for Even a Single Long-Term Investor. We Did Not As a People Know What Works in Stock Investing Prior to 1981. From 1981 Forward, We Knew. Or at Least Those Who Claim to Be Experts in This Field Certainly Should Have Known." 2 Comments

    Set forth below is the text of a comment that I posted to the discussion thread for another blog entry at this site: How many people went to prison during previous crashes? I don’t know. I recall Bernstein saying that there were congressional hearings re Wall Street Corruption following one of the earlier crashes. But I don’t know if people went to prison or not. But this is a very different situation. The three earlier crashes came before the publication of peer-reviewed research…

  • "Most of the People In This Field Have Spent Years Learning What Is In the Textbooks. The Stuff In the Textbooks Is Wrong. That's Always the Case When There Is a 'Revolutionary' Advance. So Intelligence and Experience Can Actually Be a Drawback. The More Study a Person Has Directed to the Old Model, the Less Capable He Is of Understand Why It Is Wrong." 17 Comments

    Set forth below is the text of a comment that I recently put to a blog entry at this site: There are extremely smart people in the investment industry and the ability to invest successfully in order to maximize returns would compel those extremely smart people to follow the money. If you really had discovered something so revolutionary, wouldn't you have a strong vocal following by now? Yes and no, Questions. The people who work in this field have high I.Q.s. No dispute there. But…

  • "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." 0 Comments

    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…

  • Improving Risk-Adjusted Returns Using Market-Valuation-Based Tactical Asset Allocation Strategies 0 Comments

    Kenneth R. Solow, Michael E. Kitces and Sauro Locatelli have written an important article for the Journal of Financial Planning titled Improving Risk-Adjusted Returns Using Market-Valuation-Based Tactical Asset Allocation Strategies. Juicy Excerpt: Studies examining the value of active management strategies tend to analyze performance within asset classes against narrowly defined benchmarks; there is little research analyzing tactical asset allocation strategies that change…

  • Kirk Clements: "It Is Very Interesting As a Practitioner to Try to Point Out the Errors of Academic Finance to Professors That Admit It Is All Wrong But Easy to Teach. I Fear That the Advisory Business Lives By That Rule - It Is All Wrong But Easy to Indoctrinate the People Into Buy-and-Hold." 0 Comments

    Set forth below is the text of a comment that I recently posted to the discussion thread for one of my columns at the Value Walk site: It has always been that way. I was brought into the brokerage business because the head office noticed that I was doing arbitrage trades that their research department had not thought of yet. I got to look at the business from behind the scenes until the crash in 87. I was short index futures hedged with index future calls after that Labor Day and did…

  • "I Don’t Think That Investment Advice Should Be Decided by Taking an Opinion Survey." 0 Comments

    Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site: “I know why I am banned.” You just don’t tell people the truth as to why you are banned. It is well documented. It is your behavior. Specifically the behavior in which I say that the Buy-and-Hold retirement studies are in error and should be quickly corrected and in which I say that in general the Buy-and-Hold strategy has been discredited by 37 years of…

  • "The Mountain of Research Showing that Buy-and-Hold Can Never Work for a Single Investor Has Grown So Large That Even the Biggest Names in the Field Can No Longer Entirely Ignore It. So Even People Like Shiller and Bogle and Buffett Offer Occasional Glimpses Into Their Real Beliefs re This Critically Important Subject. But None of These Three (Or of the Hundreds of Others) Dare to Give Voice to the Plain and Obvious and Clear and Provocative and Exciting Truth -- Buy-and-Hold Was a Mistake and Could Be Seen as One By Anyone Following the Peer-Reviewed Research in This Field As Early As 1981." 0 Comments

    Set forth below is the text of a comment that I recently posted to the discussion thread for one of my columns at the Value Walk site: Bogle, Shiller, Buffett, and countless other successful investors say you are wrong. Does any person you can name say you are right? They do not. Bogle, Shiller and Buffett have all made statements suggesting that they believe that there is zero chance that Buy-and-Hold can work. But none of the three have ever explained in any detail either why they do…

  • "The Buy-and-Holders Feel Burned. They Want to Use the Fact That They Root Their Strategies in Peer-Reviewed Research to Shut Everybody Else Down. But, Since They Made a Mistake About What the Research Says, They Ended Up Shutting Themselves Down. This Is What Makes Them Angry." 13 Comments

    Set forth below is the text of a comment that I recently put to another blog entry at this site: “We need to punish…” THERE’S your problem, right there, slick. I don’t say that you are entirely wrong about this particular point, Anonymous. The Buy-and-Holders see it as “unfair” that I talk about the 32 years of peer-reviewed academic research that shows how dangerous their “strategy” is. It’s not really me that is punishing them. It is the academic research…

  • "Until the Buy-and-Holders Are Able to Acknowledge That They Are Capable of Error, We Cannot Get the Accurate Studies Out to People Because it Hurts the Feelings of the Buy-and-Holders for People to See That They Got it Wrong." 0 Comments

    Set forth below is the text of a comment that I recently posted to the discussion thread for one of my columns at the Value Walk site: None of your silly story has anything to do with your lengthy unemployment, failed retirement or failed investment plan.....just more of passing the blame. And all of your anger and shame goes back to Bogle's failure to act in response to Shiller's 1981 research findings for 36 years now. In every other field of human endeavor, people know that, when…

  • Buy-and-Hold Goon to Rob: "Ben Graham Basically Said the Same Thing in His Famous Book That Has Been Read the World Over. And the Market Still Behaved the Same." 0 Comments

    Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site: Ben Graham basically said the same thing in his famous book that has been read the world over. And the market still behaved the same. You are a grain of sand in the ocean. And you are a lot less influential, articulate, congruent, and sensible than Ben. So your crusade is doomed in a very sad way. I hope you saved money for your kids college at least. You are…

  • "The Errors in the Buy-and-Hold Model Are Very, Very, Very Simple and Obvious Ones. We Suffer From Cognitive Dissonance re These Errors Because the Errors Are So Simple and Obvious That We Assume That We Must Be Wrong to Even Think That They Are Errors; If They Were, Surely These Hot Shot Experts Would Have Discovered Them a Long Time Ago." 0 Comments

    Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site: “I put up a post pointing out the error in Greanry’s retirement study on the morning of May 13, 2002. The study has not been corrected as of today. Today’s date is November 1, 2018. You say that my points have been addressed. But the study has not been corrected. Does that reality not tell a tale? People used that study to plan retirements.” Noted…

  • " I Put Up a Post on the Morning of May 13, 2002, Pointing Out That the Buy-and-Hold Retirement Studies Lack a Valuations Adjustment. And Not One Person Has Been Able to Identify One in the 15 Years Since. And Not One of Those Studies Has Been Corrected As of This Morning. And Every Investor Alive Possesses a Great Need for Accurate and Honest Retirement Studies. Freeing People to Do Honest, Good Work Is Not Worth $500 Million? Are You Joking?" 4 Comments

    Set forth below is the text of a comment that I recently posted to the discussion thread for one of my columns at the Value Walk site: Of course, in your mind, it doesn't matter, because you have a "plan", which you have described at your website as follow: "The $500 million is for a settlement of civil claims. It is a separate matter from the criminal charges. I believe that we will likely need a legislatively adopted amnesty to address the criminal side of this because that is so…

  • Rob Bennett's Response to a Goon Claim that "We See Time and Again by Countless Studies That Market Timing Has Been a Failure" -- "Please Show Me the URL of ONE." 16 Comments

    Set forth below is the text of a comment that I recently put to another blog entry at this site: We see time and again by countless studies that market timing has been a failure. Please show me the URL of one. Wade has a Ph.D. in Economics from Princeton. He spent a good deal of time trying to find ONE legitimate study showing that long-term timing is not required. He found nothing. This so shocked him that he did not trust his own finding. He went to the Bogleheads Forum and…

  • "If I Had Never Been Banned at the Various Financial Boards, I Would Be Getting Feedback From All of the Experts in This Field and I Would Be Able to Use That Feedback to Sharpen My Thoughts and My Writings. And All of the Experts Would Be Getting Feedback From Me and From Other Valuation-Informed Indexers and Would Be Able to Use That Feedback to Sharpen Their Thoughts and Writings." 4 Comments

    Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site: So, if we take your comments from here as well as previous comments, here is an overview of what should have happened over the past couple decades if you were never banned from the various financial boards: 1. You would have been one of most popular posters (if not the most popular poster) on all the financial boards. 2. You would become one of the most sought…

  • "This Requires Looking at Things That No One in This Field Has Ever Looked at Before. Most Investment Advisors Don’t Bother to Spend Much Time Studying Psychology Texts or Listening to Songs. They Think That I Am a Fool to Do That. I Think That They Are Fools Not To Do So. I See That Stuff As Being Where the Action Is Today. All of the Non-Emotional Stuff Has Been Studied in Great Depth. There Are Not Many New Insights To Be Developed Looking at That Stuff. But the Emotional Side of the Investing Equation Is Little Studied." 0 Comments

    Set forth below is the text of a comment that I recently posted to another blog entry at this site: “Others still accept the call to serve their country when their country is in greater immediate need of their services.” But I thought you just wrote that: ” So I have pulled back on my activities a good bit over the past few years.” So what do you do everyday? Wake up and hope for a market crash so you can ‘get back to work’? Seems very sad. I do lots of things, Laugh.…

  • Buy-and-Hold Goon to Rob: "It's the Sophisticated Wall Street Firms That Set the Prices. They're Not Getting Emotional. They're Making Cold, Hard, Data-Driven Calculations." 0 Comments

    Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site: And of course none of this matters because it’s the sophisticated Wall Street firms that set the prices. They’re not getting emotional. They’re making cold, hard, data driven calculations. We disagree, Anonymous. The sophisticated Wall Street firms take into consideration what the majority of investors believe in everything they do. They want to make money…

  • "Jack Bogle Has Done Wrong Things. So Have Larry Swedroe, Rick Ferri and Scott Burns. Jack and Larry and Rick and Scott Have Also Done Good Things." 4 Comments

    Set forth below is the text of a comment that I recently put to a blog entry at this site: "Also, I don’t Jack, Larry, Rick or Scott would consider you a friend. You’re wrong, Pink. They don’t want to go to prison. So, yes, they are concerned about my exposure of the 11-year cover-up. But that is only one part of what these fellows are. Jack loved the idea of helping millions of middle-class investors when he started out. His amazing accomplishments testify to this reality.…

  • "The People Who Are Getting Things Right and Thereby Helping Us All Should STOP APOLOGIZING for DOING So." 2 Comments

    Set forth below is the text of a comment that I recently posted to another blog entry at this site: Uh oh, Rob. Take a look at this: http://www.wsj.com/articles/how-to-think-about-risk-in-retirement-1417408070?tesla=y&mod=WSJ_PersonalFinance_Taxes&mg=reno64-wsj&url=http://online.wsj.com/article/SB11186790908283423711204580258532832629458.html?mod=WSJ_PersonalFinance_Taxes Bill, Wade and Michael are showing RESEARCH that adjusts stock allocation on age and not valuation. You…

  • "We Go On Different Tracks When You Suggest That Having Someone Say 'Water Is Wet' In Clear And Uncompromising Terms Isn’t A Super Big Deal In InvestoWorld In The Year 2012" 106 Comments

    Set forth below is the text of a comment that I put to the discussion thread for a blog entry here titled It Breaks My Heart When People Don't Comment on My Investing Posts: you are the one who isn’t educated. It’s like you read a book about the Ocean and think you are the messiah because you learned that water is wet. We’re not all that far apart re this one, What. I never went to Investing School and I never managed a big fund. We agree on that much. All that I have ever…

  • "Most of Us Don’t Know Enough to Distinguish Real Science from Pseudo-Science" 0 Comments

    Business Day recently published an article reporting on the investment insights developed in the Retire Early and Indexing discussion-board communities during the first seven years of The Great Safe Withdrawal Rate Debate. The article is entitled Why a Common-Sense Approach to Investing Became Unpopular. Juicy Excerpt: Investing claims backed by objective evidence are better than those from a bunch of guys shooting the breeze. Unfortunately, most of us don’t know enough to distinguish…

  • Site Visitor: "I Read the ”Intelligent Investor” by Graham. He Mentioned at Least 50 times or More That Before You Invest One Needs To Be Sure That You Are Not Paying Too Much for Stocks. He Recommends a 25- 75% Portfolio, That is 25% When They Are Overvalued and 75% When Undervalued. He Does Not Recommend Buy-and-Hold, He Even Mentioned P/E10. He Also Says It Is Inevitable That Markets Will Always Correct By 50% to 90% at a Certain Point When Overvalued." 0 Comments

    Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site: Hello Rob, I read the ” Intelligent Investor” by Graham last couple of weeks. In his book he mentioned at least 50 times or more that before you invest one needs to be sure that you are not paying to much for stocks. Because you make your money down the road if you buy when stocks are cheap, or undervalued. He recommends a 25- 75% portfolio, that is 25% when…

  • My Obsession 0 Comments

    There's a fellow ("Allan") at the Vanguard Diehards board who describes my interest in knowing whether the stocks that I buy will be able to provide an acceptable long-term value as an "obsession." Is he right? In a way, I guess. There's no question but that I wouldn't think of putting money down on stocks without first taking into consideration the price at which they are being offered. My desire to know the price I pay for stocks, and whether the stocks will be able to provide an…

  • "There Are Hundreds of Thousands of People Who Make Their Living Giving Investing Advice. When a Fundamental Advance Is Achieved, They Are Put in a Tough Spot. It Makes Them 'Look Bad' to Acknowledge to All the People They Have Advised That They Got it Wrong. This Is a Field in Which 'Expertise' Is Highly Valued. So the People Who Would Have Jumped at the Opportunity to Spread Shiller's Ideas Had They Not Previously Promoted Very Different Ideas Instead Ignored Them." 0 Comments

    Set forth below is the text of a comment that I recently added to the discussion thread for one of my columns at the Value Walk site: Yes, it makes a lot more sense versus running around calling people goons, making up stories about death threats, sending out 30,000 emails about Wade Pfau, calling Jack Bogle a con man, expecting $500 million windfalls, etc. It's a process, Sammy. Shiller's "revolutionary" (his word) finding that valuations affect long-term returns changed our…

  • "All of the Pre-Shiller Work and All of the Post-Shiller Work That Ignores Shiller's Findings Is Discredited. The People Who Have Done Discredited Work Are More Concerned With Their Own Careers Than They Are With What Happens to Investors." 17 Comments

    Set forth below is the text of a comment that I recently put to the Goon Central board: it's such a hoot that an old book by Robert Shiller constitutes the totality of academic research on finance on that strange little planet known as HocoWorld. Shiller's work discredited what came before it.Until something discredits Shiller's work, his model remains the state-of-the-art model. In 32 years, no one has found anything wrong with Shiller's work. His work IS something close to…

  • "I've Spoken to Hundreds of Experts in This Field. Nearly Every One Tells the Same Basic Story. In Private, They Say They LOVE, LOVE, LOVE the Idea of Being Able to Tell Their Clients What They Truly Believe About Stock Investing. In Public, They Want No Part of It." 4 Comments

    Set forth below is the text of a comment that I recently put to a discussion at this site's blog: I’ve spoken to hundreds of experts in this field, Deleted. Nearly every one tells me the same basic story. In private, they say that they LOVE, LOVE, LOVE the idea of being able to tell their clients what they truly believe about stock investing. In public, they want no part of it. They have seen the millions of acts of intimidation that the Buy-and-Hold Mafia have employed to keep…

  • "The Biggest Thing That Is Wrong With It Valuation-Informed Indexing That We Have Not Had Enough People Study It In Depth To Have Confidence In It. We Need To Have Lots Of Good And Smart People Doing Their Best To Find Holes In It. That’s How We Learn. " 9 Comments

    Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site: As you are so fond of pointing out, there are post archives: “Rob says December 5, 2014 at 6:03 am You’ve asked me what I will do if there is not another crash within the next two years. I have said that I will write a column saying that that tells me that there is something wrong with the Valuation-Informed Indexing concept and that I will continue studying…

  • "There Are Lots of Good and Smart People Employed in Some Way in Careers That Relate to Stock Investing. Most of Them Feel Threatened by the Huge Intellectual Advances Achieved by Shiller. They Are Going to Have to Go Back and Tell Their Clients That They Didn’t Always Know Everything There Is to Know About How Stock Investing Works." 0 Comments

    Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site: “This is what has happened in cases in which the market is either overpriced or underpriced.” What about the bond market? Can your crystal ball determine times when it’s over or underpriced too, based on its version of the P/E 10 (interest rates)? Treasury Inflation-Protected Securities (TIPS) are government bonds. They are insured by the government, so…

  • "What Do You Want in an Investment Advisor? Do You Want Someone Who Whispers Pretty Lies in Your Ear?" 4 Comments

    Set forth below are the words of a comment that I recently put to the Goon Central board: I now remember why he pissed everyone off. I piss lots of people off, Cut-Throat. It's an established fact. What do you want in an investment advisor? Do you want someone who whispers pretty lies in your ear? Or do you want someone who tells you the way it really is and helps you to retire many years sooner as a result? You won't have a hard time finding someone who will be only too happy…

  • "My Buy-and-Hold Friends Are Good and Smart and Hard-Working People. They are Trapped in Unfortunate Circumstances. But They Want To Be Giving Sound Investing Advice. I Know Because I Have Talked To a Good Number of Them re How They Feel About All This." 0 Comments

    Set forth below is the text of a comment that I recently posted to the discussion thread for one of my columns at the Value Walk site: So you consider it a higher priority to keep Posting on the internet versus providing financial security for your family. I'm doing both at the same time, Sammy. People love learning more about how stock investing works. Shiller's "Irrational Exuberance" was a best-seller. The man was awarded a Nobel prize. On the day when I put forward my first post on…

  • "Did Cooley Include In His Research a Discussion of WHY He Did Not Include a Valuation Adjustment? If He Had Some Intellectual Problem With Shiller's Findings, He Would Have Discussed It. He Was in Denial. He Was in Emotional Pain. He Was Suffering From Cognitive Dissonance." 8 Comments

    Set forth below is the text of a comment that I recently put to a blog entry at this site: Was Cooly (and the other Trinity contributors) ‘addicted’ to buy-n-hold when they undertook their original research? Really? Thank you for asking an intelligent question, Banned. At the time Cooley did his SWR study, Shiller’s revolutionary finding that valuations affect long-term returns had already been public knowledge for a good number of years. So, yes, the fact that Cooley did not…

  • "There Is No Such Thing as an 'Expert' in a Field in Which We Are as a Society Only Beginning to Come to Terms with the Most Fundamental Questions. When Buy-and-Hold Was Developed, There Were Smart People Who Thought That It Was Not Necessary to Change Your Allocation in Response to Valuation Shifts. They Didn't Know." 0 Comments

    Set forth below is the text of a comment that I recently put to this site's blog: Rob said: “Again, these are merely the sincere views of a non-expert who has spent a lot of time trying to understand conflicts and weaknesses in the conventional understanding of stock investing. ” But Rob, you said you are more of an expert than Jack Bogle, William Bernstein, etc. Both things are so, Pink. I never went to Investing School. I never managed a big fund. I am no investing…

  • "We All Lose When Researchers Are Afraid to Research Certain Questions. I Believe That God Put Me on Earth to Make the Case for Opening Up This Field to Honest Research." 2 Comments

    Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site: There’s a point that I need to add that did not hit my brain until a moment after I pushed the “send” button. It is our need as a society for better answers to this sort of question that compels me to soldier on re these matters. We all should want to see the studies that could be produced re this question if every academic researcher alive today felt free to…

  • "I Couldn't Have Done 90 Percent of What I Have Done If I Had Not Been Wiling to Take the Abuse Dished Out by You Goons. So Missing Out on Success in the Crass Terms in Which You Define It Is Part of the Deal Here." 4 Comments

    Set forth below is the text of a comment that I recently posted to the discussion thread for one of my columns at the Value Walk site: This might just be a crazy thought, but don't you think you need to have a track record of success if you want to have any credibility? You know.......how does it sound when you say, "Hi, I am Rob Bennett. My retirement plan was a horrible failure, but you need to listen to me about how to retire successfully." Or, "Hi, I am Rob Bennett. My investment…

  • "Shouldn't We Have a Peer Review Process to Help Us Get Bad Studies Corrected After Errors Are Discovered In Them?" 50 Comments

    Set forth below is the text of a comment that I put to the Value Walk site as part of the discussion thread for a post titled Investing Experts Need to Distinguish Opinion from Truth. That's basic CFA requirement -- analysts must distinguish between facts and opinions in their reports. Thanks, Paddy. That makes sense.I'll give you an example of a place in which this entirely sensible rule does not seem to me to apply in the investing context. When academics publish studies in journals,…

  • "In Future Days It Will Be Widely Understood That It Is the JOB of the Investment Adviser to Help People OVERCOME Their Natural Inclination to be Drawn to Buy-and-Hold Strategies" 2 Comments

    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 Goons are getting hurt by the economic crisis as much as everyone else…” What economic crisis? The stock market has richly rewarded anyone who has stayed the course and stayed invested in the market since the downturn of 2009. Of course, that excludes the narcissistic, passive-aggressive, mentally ill internet troll and Habitual Liar Rob Hocus No Step 2…

  • Buy-and-Hold Goon: "Rob Makes Up Stories About Bogle, Shiller, Buffett. When Pointed to Comments to the Contrary, Rob Says That They Are Lying Or That They Are Afraid of Speaking the Truth." Rob: "That's Absolutely My Message." 0 Comments

    Set forth below is the text of a comment that I recently posted to the discussion thread for one of my columns at the Value Walk site: And, once again, Rob makes up stories about Bogle, Shiller and Buffett. When pointing out comments to the contrary, Rob says that they are lying or that they are afraid of speaking the truth. That's absolutely my message, Sammy. It's the biggest story in personal finance in my lifetime. And the longer it goes on, the harder it is to turn around. The…

  • "There Is Not One School of Thought in the Academic Community As to How Stock Investing Works. There Are Two. Every Investor Alive on Planet Earth Today Needs to Be Educated in Both Models So That He or She Can Choose Which One He or She Will Follow. This Is Not Optional. This Is 100 Percent Imperative." 0 Comments

    Set forth below is the text of a comment that I recently posted to another blog entry at this site: I’ve posted Entry #1 to my weekly Valuation-Informed Indexing column. It’s called Market Valuation Fluctuations Are Implicit in All Investing Advice. But they’re not, Anonymous. The purpose of the Retire Early board at Motley Fool was to help people to prepare for early retirement. One of the things that aspiring early retirees must do is to insure that there are no holes in their…

  • We Need Diversified Incentives for Stock Sellers 0 Comments

    Set forth below is the text of a thread-starter that I posted to the Goon Central board: Yip made a comment about having a "diversified" portfolio. That certainly sounds like a good idea. Diversification reduces risk.The trouble is that there is a huge incentives for those in The Stock-Selling Industry to offer non-diversified advice. If commissions were the same for IBonds and TIPS as they are for stocks, the "experts" in this field would tell us to buy stocks only when they are…

  • "To Believe Everything That People Trying to Get You to Buy Stocks Tell You is NOT Questioning Authority" 1 Comment

    Set forth below is the text of my response to the comment by Marc posted in yesterday's blog entry: Thanks for that super comment, Marc. I am very much a child of the 60s (I’m 54) and I carry around that “Question Authority” attitude with me everywhere I go. It’s been known to get me into a whole big bunch of trouble from time to time! But the admonition to “Question Authority” is one of the things about the 60s that I believe really turned out to be right (my personal thought…

  • "It's Emotionally Painful Pointing Out People's Mistakes to Them. We All Want to Be Liked. Telling People the Truth About Stock Investing at a Time When Prices Are High and They Don't Want to Hear It Is Hard Word. That's Why So Few People Are Willing to Push Too Hard re This Stuff." 23 Comments

    Set forth below is the text of a comment that I recently posted to another blog entry at this site: I think even as late as last year you were taking your “career” somewhat seriously, with website redesigns and videos. Your recent lack of effort shows complete capitulation. There’s some truth to that, Anonymous. I haven’t given up. I see this as the most important economic and political story of my lifetime. I know by the reaction I have seen over the first 12 years that there…

  • Buy-and-Hold Goon to Rob: "If You Had to Name the Top 10 Investing Thought Leaders Today, Who Would Be On That List and How Would You Rank Them?" 26 Comments

    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 had to name the top 10 investing thought leaders today, who would be on that list and how would you rank them? 1) Robert Shiller (Nobel prize winner despite having failed to take his meds for over three decades now) 2) Jack Bogle (it was Bogle’s book that revealed to me the errors in the Buy-and-Hold retirement studies, making possible the post that…

  • "Using Data As a Guide to Understanding Something Leads to More Uncertainty, Not Less." 13 Comments

    Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site: Why is the entire historical record relevant? Take a look at this article, Laugh: http://www.politico.com/story/2016/11/nate-silver-huffington-post-polls-twitter-230815 Nate Silver gets it. Using data as a guide to understanding something leads to more uncertainty, not less. When we are ignorant of how something works, we can delude ourselves into a false…

  • "We Are Living in a Day When Two of the Brightest Lights in the Field, Eugene Fama and Robert Shiller, Who Both Have Been Awarded Nobel Prizes for Their Work, Have Come to 100 Percent Opposite Conclusions re the Foundational Question Involved in Figuring Out How Stock Investing Works. Fama Says That the Market Is Efficient. Shiller Says That Valuations Affect Long-Term Returns. One of These Men Is Right and One of These Men Is Wrong. It Is Not Possible for the Rational Human Mind to Come to Any Other Conclusion." 6 Comments

    Set forth below is the text of a comment that I recently put to the discussion thread for another blog entry at this site: “You are right to suggest that I wasn’t persuaded by the advice that she offered. ” I don’t recall you ever being persuaded by anyone’s advice. That’s not even close to being so, Anonymous. Just to cite the most obvious case, I was HUGELY influenced by the book that I read by Jack Bogle in the Spring of 1996. It was by reading Bogle’s book that I…

  • "Say That There Were Only 100 Million Investors in the World. That Would be $5 from Each of Them. I Think it Would be Fair to Say that There Won’t be One Investor in the World Not Getting a Whole Lot More than $5 of Benefits from Being Able to Have Thousands of Professionals Comment on the Last 36 Years of Peer-Reviewed Research in this Field." 8 Comments

    Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site: Fantasy forecasts? You mean like forecasting that you will get a $500 million settlement payment? Time will tell the tale, Anonymous. If this was not a matter of great importance, you wouldn’t fight so hard. If the level of fight that you have directed to this matter is a good indicator of its importance, I will be getting a lot more than a $500 million…

  • "The Experts Feel That Their Clients and Readers Won't Think of Them as Experts Unless They Say Something More Definitive Than '80% Stocks Might Be Good But 20% Stocks Might Be Good Too.' They Cannot Tell Their Clients and Reader to Wait 20 Years Until We Figure Out Whether It Is Fama or Shiller Who Got Things Right. So They IGNORE Shiller." 0 Comments

    Set forth below is the text of a comment that I recently put to another blog entry at this site: Would you agree that your inital response in this thread can be reduced to the following dilema: Either nearly every finance author, lecturer, blogger, advisor, and commenter on the planet is purposely corrupt and involved in a single-minded tight and as-yet completely unbreached unreportred and ongoing conspiracy against the truth that caused a major economic meltdown… OR….. a…

  • "Jack Bogle Said In His Book That Reversion to the Mean Is an 'Iron Law' of Stock Investing. And It's Not Just Jack Bogle. Bill Bernstein Knows That Buy-and-Hold Is a Big Pile of Smelly Garbage Too. So Does Scott Burns. So Does Larry Swedroe." 12 Comments

    Set forth below is the text of a comment that I recently put to another blog entry at this site: If the intelligent people don’t agree with you, then that means you will only have stupid people agreeing with you. The intelligent people DO agree with me, Deleted. I didn’t discover the errors in the Old School safe withdrawal rate studies by myself, Deleted. I suspected on my own that there was something missing in those studies. But I wasn’t able to put my finger on what it was…

  • "Shiller's Findings Would Not Have Been Considered Revolutionary Had an Entire Industry Not Already Been Built Teaching the Opposite Belief. The Battle Between Buy-and-Holders and Valuation-Informed Indexers Is Not an Intellectual Debate. The Battle Is a Turf Battle." 2 Comments

    Set forth below is the text of a comment that I recently posted to the discussion thread for one of my columns at the Value Walk site: "But I don't see that you have offered any justification for the belief outside of your assertion of it" That statement applies to almost everything you post. When anyone asks you to back up a single thing, you merely reference something you posted. There's only one thing that I believe that you don't, Sammy -- I believe that valuations affect long-term…

  • "If Shiller’s Nobel-Prize-Winning Research Is Legitimate Research, the Dominant Investment Strategy Gets It Precisely Backwards. The Last 38 Years of Peer-Reviewed Research Shows That the Most Important Thing in Stock Investing Is to Always, Always, Always Practice Price Discipline (Long-Term Timing). The Buy-and-Holders Assure Us Relentlessly That There Is No Need to Practice Long-Term Timing, That It Might Even Be a Bad Idea to Do So. Huh? What the F?" 0 Comments

    Set forth below is the text of a comment that I recently posted to another blog entry at this site: It looks like you are sending emails to lots of people, most (or all) of whom do not respond. You don’t need to create a daily post for each of them (unless you have so little new material to put out that you need to do this so you have a daily entry at your blog) Instead what you should do is once or twice a month do an entry saying “Here is a link to all the begging emails I have sent…

  • "I Have Not Come Across a Single Buy-and-Holder Who Is Willing to Acknowledge Publicly the Need to Include a Valuations Adjustment in a Retirement Study. I Have Known a Good Number Who Are Willing to Say This Privately. And I Have Known a Larger Number Who Are Willing to Say it Publicly One or Two Times and Then Retreat When They Face the Wrath of Their Buy-and-Hold Friends. And I Have Known a Very Large Number Who Are Willing to HINT That a Valuations Adjustment Is Needed. But It Is an Exceedingly Rare Thing to Find a Buy-and-Holder Who Will Openly Declare in a Public Place That All Retirement Studies That Lack a Valuations Adjustment Are in Error." 0 Comments

    Set forth below is the text of a comment that I recently posted to the discussion thread for one of my columns at the Value Walk site: Just stating facts, Rob. Ty it sometime. It's a fact that the retirement study posed at John Greaney's web site does not contain an adjustment for the valuation level that applies at the time the retirement begins, Sammy. Thousands of people have looked at the study and not one has been able to find a valuations adjustment in it. This despite 36 years of…

  • " Wade Pfau Was Afraid to Post at the Bogleheads Forum Because of the Abusiveness He Saw From You Goons Whenever I or Someone Else Discussed Shiller's Research and the Many Important Implications That Follow From It. Wade Is in Very Good Company re His Fearfulness. Once We Send a Clear Message That It Is Safe for Everyone Working in This Field to Express His or Her Sincere Views, No One Will Be Holding Back." 0 Comments

    Set forth below is the text of a comment that I recently posted to the discussion thread for one of my columns at the Value Walk site: The paper doesn't list me as co-author. But that is certainly the role that I played. I didn't go to Wade asking that he write a paper. He came to me because he had learned about Valuation-Informed Indexing by reading my posts at the Bogleheads Forum. He was afraid to post there because of the abusiveness he saw from you Goons whenever I or someone else…

  • "Say That Social Pressure in Favor of High-Stock-Allocation Recommendations Causes Us All to Increase Our Recommended Stock-Allocation-Percentage by 30 Percentage Points. Is That a Good Thing?" 0 Comments

    Set forth below is the text of a comment that I recently posted to another blog entry at this site: You must be missing the literally thousands of valuation posts and Bogleheads and elsewhere. I’m not missing them, Anonymous. I acknowledge that there are thousands of valuations posts. I say that it is not only the volume of valuation posts that matters. The RANGE of valuation recommendations matters too. Say that millions of investors are counting on their portfolio values to be real…

  • "The Peer-Review Committee That Examined the Trinity Study Should Have Rejected It on Grounds That It Contained No Valuation Adjustment" 0 Comments

    Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site: Uh huh. I found a similar pattern in winning lottery numbers a few years ago. Funny thing though, when I made a big prediction based on the pattern I found, it didn’t come to pass. It was like the numbers moved randomly, without even consulting my study! When your examination of the pattern that you believe helps in picking lottery winners is awarded a Nobel…

  • "It Is Human Nature to Look at Recent History, to Go Five Years Back or Something Like That Rather Than 150 Years Back. But That’s Not Science. Science Goes 150 Years Back If There Is 150 Years of Data to Examine." 12 Comments

    Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site: f I am showing you a strategy and it has a poor track record over 24 years, you would still be open to this strategy? Just a simple yes or no answer. Yes. The point you are making is the biggest reason why Buy-and-Hold remains dominant today. It is human nature to look at recent history, to go five years back or something like that rather than 150 years back.…

  • "Buy-and-Hold Came First and Valuation-Informed Indexing Is Such a Huge Advance That Site Owners Don’t Want People to Hear About It. It Makes Them Look Bad When People Hear About It Because They Have Not Been Promoting It, They Have Been Promoting Buy-and-Hold. So I Get Cut Out." 2 Comments

    Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site: Normal people can give a short and direct response. Not in these circumstances they can’t, Anonymous. In ordinary circumstances, I would say that the reason why people weren’t showing up at a web site was that they did not see value in the material. But I have had thousands of people tell me that my stuff is the best investing stuff that they have ever seen.…

  • "People Who Cannot Admit Mistakes Should Not Be Giving Investing Advice." 0 Comments

    Set forth below is the text of a comment that I recently posted to the discussion thread for one of my columns at the Value Walk site: So, it has made you act like a 12 year old and, therefore, unemployable? Shiller showed in 1981 that valuations affect long-term returns. If that's so, then stock investing risk is not stable but variable. Investors who want to keep their risk profiles constant MUST be open to changing their stock allocations in response to big valuation shifts. Bogle…

  • "I Think It Is Better For Me To Look Good By Showing the Humility Needed To Admit Mistakes Than It Would Be For Me To Look Good By Creating the Phony Impression That I Am a Perfect Being That Never Makes Mistakes. I Would Rather Be Perceived As Fallible But Honest Than As This Puffed-Up “Expert” Who Can’t Acknowledge His Human Weaknesses." 2 Comments

    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 posted is true. It is still surprising you posted it when it doesn’t make you look good. I have a catch phrase that I use from time to time, Anonymous. I sometimes say: “We ban what we fear.” That phrase sums up my beliefs re what messages a community permits to be voiced and what messages a community censors. On the evening of August 27, 2002,…

  • "Most People Don't Care About Theory. But the Experts Root Their Advice in Theory. And Most People DO Care About What the Experts Say. So in a Practical Sense Most People Today Are Following the Buy-and-Hold Theory. They Are Relying on a Belief That the Experts Are Shooting Straight With Them. And the Experts Are Deceiving THEMSELVES Because They Have So Much Riding on the Buy-and-Hold Theory." 9 Comments

    Set forth below is the text of a comment that I recently put to another blog entry at this site: We do agree on this, Anonymous. Most people don’t care about theory. But the EXPERTS care about theory. The experts root their advice in theory. And most people DO care about what the experts say. So in a practical sense most people today are following the Buy-and-Hold theory. They are not dogmatic about it. And they do not know precisely why they are doing what they are doing. They are…

  • "The Positive Leverage Here Is Off the Charts. I Have Spoken to College Professors Who Believe That Valuation-Informed Indexing Is the Future and Who Want to Teach It To Their Students But Who Are Afraid To Do So Today. It's the Same With Academic Researchers. It's the Same With Bloggers. It's the Same With Economists. It's the Same With Investment Advisors. It's the Same With Policymakers. Can You Imagine How Much Progress We Are Going To Be Making in This Field When We All Feel Free to Post Our Honest Views at Every Site We Visit?" 0 Comments

    Set forth below is the text of a comment that I recently posted to the discussion thread for one of my columns at the Value Walk site: And you think it is nonsense that your wife is questioning you on the reliance of a $500 million windfall to provide for the family, versus you getting a job that provides a steady paycheck? We obviously don't meed $500 million to get by, Sammy. I believe that it is entirely reasonable to expect that we will see a settlement of that size following the next…

  • "The Buy-and-Holders Have Become Too Embarrassed By Their Mistake to Acknowledge It." 0 Comments

    Set forth below is the text of a comment that I recently posted to the discussion thread for one of my columns at the Value Walk site: Bogle didn't need to change a thing. You continue to make it seem that Shiller is saying things he really hasn't said. Instead, you say he is scared or holding back. Just more of your fantasy world. Of course you need to keep the fantasy going to cover up. Here you are just piling up lies after lies after lies, telling your poor family that you need to…

  • "The 'Experts' Won't Tell You This. Most of the 'Experts' in This Field Make Money Only When People Buy Stocks. So They Are Compromised. You Need to Become Personally Familiar With What the Academic Research Really Says, Not Just What the People Quoted as Experts in This Field SAY That It Says." 2 Comments

    Set forth below is the text of an answer that I recently posted to a question ("When Will the Stock Market Crash Again?") at the Quora site: There are two popular schools of thought re market timing. One is that it is impossible to time the market effectively and a waste of effort to try. The other is that knowing when crashes are coming is so valuable that you just have to give the objective of predicting them your best possible shot. I hold a third view, a view which I believe is…

  • "I Would Like to See Personal Finance Bloggers Working Together to Get the Straight Story to People" 2 Comments

    Set forth below are some words that I posted as a comment in the discussion thread for my recent Guest Blog Entry titled Stock Investing Without All the Drama. Thanks for your kind comment, RetireByForty. Yes, this is ideal for retirees. People are often impressed that VII can provide a portfolio of double the size of a Buy-and-Hold portfolio at the end of 30 years. But the real magic here is that it does this at dramatically less risk. This is a win/win/win — greater returns and less…

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  • “Wade Was Wrong When He Said What He Said. What He Said Was Absolutely Idiotic. He Said That Greaney Had Solved the Problem on the First Day When He Said That Anyone Who Wanted to Take a Lower Withdrawal Rate Could Do So. That Was of Course Never the Issue in Dispute. The Issue Was Whether Those of Us Who Believed That a Valuations Adjustment Was Required to Get the Number Right Should Be Permitted to Say That. Greany Understood That, If People Became Aware of the Error in the Study, They Would Lose Confidence in It and He Did Not Want That to Happen.”

    Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site: “I believe that the retirement study posted at John Greaney’s web site lacks an adjustment for the valuation level that applies on the day the retirement begins.” Did you lie on that thread when you admitted you were wrong and apologized? Was Wade Pfau wrong when he also corrected you? I had no intention to deceive when I posted my apology. I was suffering from cognitive dissonance. I strongly believed that the Greaney study lacked a valuation adjustment. I had checked it many times before I put up my famous post saying that it did not. But scores of people whom I respected and considered friends were telling me that I was wrong and the board community, which I loved, was being torn apart at the seams. I somehow persuaded myself that I might be wrong and that an apology was in order. Yes, Wade was wrong when he said what he said. What he said was absolutely idiotic. He said that Greaney had solved the problem on the first day when he said that anyone who wanted to take a lower withdrawal rate could do so. That was of course never the issue in dispute. The issue was whether those of us who believed that a valuations adjustment was required to get the number right should be permitted to say that. Greany understood that, if people became aware of the error in the study, they would lose confidence in it and he did not want that to happen. I don’t believe that Wade came up with those words on his own. I believe that he was afraid that you Goons would do damage to his career (he told me this) and so he agreed to sign on to words that Greaney composed that he obviously did not think had anything to do with the problems we experienced. Rob Related Posts“If Greaney Included Language Describing the Retirement Risk Evaluator, No One Could Accuse Him of Deception, Could He? Greaney Would Be Shifting the Burden from Himself to the Person Reading the Study. It’s Very Different When Greaney Does Everything in His Power to Block People from Learning What the Last 34 Years of Peer-Reviewed Research Says. That’s the Sort of Thing That Will Sway a Jury […]

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  • “To Say That Irrational Exuberance Exists Is to Predict a Price Crash Whenever Stock Prices Get Out of Hand.”

    Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site: So that prediction was wrong. But you still didn’t answer my question. When has Shiller predicted the next crash? The title of his book is “Irrational Exuberance,” Anonymous. To say that irrational exuberance exists is to predict a price crash whenever stock prices get out of hand. At the time when Buy-and-Hold was developed, the dominant academic theory re how stock investing works was the Efficient Market Theory. If the market is efficient, stock prices are set by a rational process and the risk of a price crash is the same at all times. If there is such a thing as irrational exuberance, the risk of a crash increases with increases in prices. A high CAPE level always predicts a price crash to someone who believes that Shiller’s Nobel-prize-winning research is legitimate research. Rob Related Posts“Irrational Exuberance Hurts Us All. We Should All Do Everything We Can to Oppose It. We Should All Be Engaging in Market Timing and Encouraging All of Our Friends and Neighbors and Co-Workers to Engage in Market Timing as Well.”“If Markets Did Not Have a Memory, Returns Would Play Out in the Pattern of a Random Walk. That’s Why the Famous Book that Popularized Buy-and-Hold Was Titled “A Random Walk Down Wall Street.” Shiller’s Book Has a Different Title. Shiller’s Book is Titled “Irrational Exuberance.” Shiller Showed That Valuations Affect Long-Term Returns. That Couldn’t Happen Unless the Market Had a Memory. Valuations Affect Long-Term Returns Because the Market Remembers When Prices Go Up Due to Irrational Exuberance Rather than Economic Realities and Then It Erases Those Temporary Gains in Time Because the Market’s Ultimate Objective Is to Get Prices Right.”“At the Very Bare Minimum, We Need to Make It a Practice to Tell Both Sides of the Story. Reasonable People Need to Absolutely Insist on That Much.”“We Should All Be Working to See That We Never Again Experience a CAPE Value of 25 or More.”“Market Timing Is Not a Problem, Market Timing Is the Solution to the Problem.”Valuation-Informed Indexing #256: There Are Rare Circumstances in Which Short-Term Predictions of Price Changes Can and Should Be Made

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  • Valuation-Informed Indexing #529: If Market Timing Works At All, It Works All the Time

    I’ve posted Entry #529 to my weekly Valuation-Informed Indexing column at the Value Walk site. It’s called If Market Timing Works At All, It Works All the Time. Juicy Excerpt: Market timing works all the time. It doesn’t always quickly increase an investor’s returns. But it always gets his or her risk profile back to where it should be. Investors who go with the proper risk profile always end up with enhanced lifetime returns, just as people who eat carbs and sweets in moderation always enjoy healthier lives and just as sober drivers always live longer. The primary goal of investment advisors should be to get their clients so in the habit of engaging in market timing that they don’t even give serious thought to going with Buy-and-Hold strategies. Related PostsValuation-Informed Indexing #267: Take Valuations Seriously and You Will Discover Things That You Were Not Initially Even Seeking to DiscoverValuation-Informed Indexing #255: How Developments Like the Greek Debt Crisis Affect Stock PricesValuation-Informed Indexing #261: Unlike Long-Term Returns, Short-Term Return Sequences Are Highly UnpredictableValuation-Informed Indexing #259: Return Predictions Are Implicit in All Investing AdviceValuation-Informed Indexing #268: Chase Utley’s “Dirty” Slide and Robert Shiller’s “Dirty” ResearchValuation-Informed Indexing #260 : Shiller’s Ideas Should Be Treated as Mainstream Ideas

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  • Buy-and-Hold Goon to Rob: “Why Has Shiller Continued to Tell People, Even as Recently as Last Month, to Keep Buying Stocks? Either He Is Lying or You Are Misrepresenting His Work. Which Is It?”

    Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site: “Shiller’s research shows that 50 percent of the value of the stock market today is cotton-candy nothingness. ” Really? Then why has Shiller continued to tell people, even as recently as last month, to keep buying stocks? Either he is lying or you are misrepresenting his work. Which is it? I tell people to buy stocks. I say that the typical middle-class person should be going with a 30 percent stock allocation today. If that person is saving a portion of each paycheck, then he should be putting 30 cents of each dollar saved in to stocks. That’s buying stocks. So there is no contradiction there. The better question is — Does Shiller believe that people should be going with a lower stock allocation today, when the CAPE value is 32, than they did in 1982, when the CAPE value was 8. I say with no hesitation whatsoever, that they should be going with a lower stock allocation today. The risk of owning stocks in 1982 was virtually non-existent. The risk today is off the charts. So the investor who wants to keep his risk profile constant over time MUST go with a lower stock allocation today. That is, he MUST practice market timing. Does Shiller agree? We all should want to know the answer to that question. We all should be urging the launching of a national debate in which Shiller and thousands of others would be asked that question. Bogle agreed before he died that Valuation-Informed Indexing (market timing!) would probably work. I think that Shiller would say the same. Shiller would probably state the point more strongly. So let’s ask him! He is not going to answer the question unless you Goons agree to drop the criminal stuff. No one likes to see their career threatened. No one likes to see the lives of their loved ones threatened. So you will have to leave that stuff behind if you hope to get Shiller to respond to your questions. But I am 100 percent sure that he will be happy to help you out of you simply agree to be constrained by the dictates of U.S. law. Do that, and everyone wins. My sincere take. I naturally wish you all the best that this […]

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  • “We All Have a Get Rich Quick/Buy-and-Hold Impulse Residing Within Us. We Need to be Reminded Daily of the Dangers of the Get Rich Quick/Buy-and-Hold Approach If We Are to Overcome That Impulse.”

    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 I say is that we should be permitting discussion of what Shiller says at every site on the internet.” There is plenty of exposure to what Shiller says. You have also had more than sufficient exposure of your comments. We do not need constant repeating of the same material as it is already out there and easily accessible. The problem is that you cannot accept the answers you have been given, nor are you willing to take the blame for your own actions. The Greaney retirement study has not been corrected to this day, Anonymous. Also, we all have a Get Rich Quick/Buy-and-Hold impulse residing within us. We need to be reminded daily of the dangers of the Get Rich Quick/Buy-and-Hold approach if we are to overcome that impulse. Rob Related Posts“At the Very Bare Minimum, We Need to Make It a Practice to Tell Both Sides of the Story. Reasonable People Need to Absolutely Insist on That Much.”“If Greaney Included Language Describing the Retirement Risk Evaluator, No One Could Accuse Him of Deception, Could He? Greaney Would Be Shifting the Burden from Himself to the Person Reading the Study. It’s Very Different When Greaney Does Everything in His Power to Block People from Learning What the Last 34 Years of Peer-Reviewed Research Says. That’s the Sort of Thing That Will Sway a Jury to Vote to Put You Away.”“It’s Better to Get the Numbers in a Retirement Study Right Than to Get Them Wrong.”“The Error in the Greaney Retirement Study Is Always the Topic. A Failed Retirement Is a Serious Life Setback. The Reason Why We As a People Study Investing Is to Get the Retirement Numbers Right, Not to Get Them Wrong.”“It Is Not Possible That Both Fama and Shiller Are Right. They Are Saying Opposite Things!”“We Need to Have Every Buy-and-Holder Alive Exploring His or Her Doubts on a Daily Basis. That’s What This Is All About. We Are ALL Compromised. We All Carry a Get Rich Quick Urge Within Us. We All Need to be Fighting that Get Rich Quick Urge on a Daily Basis to Have Any Realistic Hope of Seeing Our Retirement Plans Work Out in the Real World. We All Need to Have Discussion Boards and Blogs that […]

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  • “The Concept of Irrational Exuberance Affects Every Aspect of the Stock Investing Story”

    Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site: One title does not apply to every situation and timeframe. It’s funny how you ignore everything else Shiller says. The concept of irrational exuberance affects every aspect of the stock investing story, Anonymous. Every single thing. If the market is efficient, as was believed to be the case in the days when Buy-and-Hold was being developed, we can trust the numbers on our portfolio statement. In that case, it is economic realities that determine stock prices and we can plan retirements based on those numbers. But if Shiller’s Nobel-prize-winning research is legitimate, then those numbers are not real. They are largely the product of temporary investor mood swings, and we need to distinguish what’s real from what’s irrational exuberance to have any hope of being able to plan our financial futures effectively. I don’t ignore everything else Shiller says. What I say is that we should be permitting discussion of what Shiller says at every site on the internet. What he said changes our understanding of how stock investing works in a fundamental way. Let’s all put our minds together and work together in a constructive spirit to advance our understanding of this critically important subject. Does Shiller believe that the safe withdrawal rate is always the same number or does he believe that it is a number that changes with changes in valuations? We all should want to know the answer to that question. I said what I think 18 years ago, I think that Shiller would have said what he thinks by now if it weren’t for the criminal stuff we have seen coming from the Buy-and-Hold side of the table. I say that we should all pull together to bring the criminal stuff to a full and complete stop so that we can all learn at long last what Shiller believes re this matter. Then we should continue the discussions in the hopes of learning what thousands of others will have to say when they are permitted to speak without fear of having their careers destroyed or seeing their loved ones threatened. There is not one school of academic thought as to how stock investing works. There are two. We have heard advocates of the Buy-and-Hold school thousands and thousands and thousands of […]

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  • Buy-and-Hold Goon to Rob: “We Don’t Have to Ask Shiller Anything”

    Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site: We don’t need to ask Shiller anything. We can read. You should try it sometime. I read the title of his book, Anonymous. It is “Irrational Exuberance.” If there is such a thing as irrational exuberance, stock investing risk is not constant but variable; risk is greater when there is more irrational exuberance. If risk is variable, it is a logical impossibility that the safe withdrawal rate is always the same number (since the safe withdrawal rate is a risk assessment tool). So I do not say that I believe that the safe withdrawal rate is always the same number. I believe that Shiller will say the same if you ask him. I encourage you to ask him. It’s a question that every investor on the planet should want to know the answer to. If the safe withdrawal rate studies are in error, that’s huge. There are millions of investors who have used those studies to plan their retirements and a failed retirement is a serious life setback. So we all should want to know what Shiller thinks. And the only way to find out is to ask him. Shiller will be happy to tell you what he thinks if you promise not to threaten him. It is the threats from the Buy-and-Holders that have been holding back progress in this field for 39 years now. People do not like to be threatened. That is why as a society we have enacted laws against it. My best wishes to you. Rob Related Posts“If Greaney Included Language Describing the Retirement Risk Evaluator, No One Could Accuse Him of Deception, Could He? Greaney Would Be Shifting the Burden from Himself to the Person Reading the Study. It’s Very Different When Greaney Does Everything in His Power to Block People from Learning What the Last 34 Years of Peer-Reviewed Research Says. That’s the Sort of Thing That Will Sway a Jury to Vote to Put You Away.”“Are You Willing to Say What You Believe Shiller Thinks About Safe Withdrawal Rates?”Buy-and-Hold Goon to Rob: “No One, Including Greaney, Ever Said That His Study Had a Valuation Adjustment. So One Look Should Have Sufficed. Why Would You Keep Looking, Hundreds of Times, for Something That No One Ever Said Was There?”“Part […]

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  • “We Don’t Know Precisely What Shiller Believes Because He Has Not Been Questioned in Depth re What He Believes. I Believe That We Should Be Questioning Him in Depth re What He Believes.”

    Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site: First of all, you have had plenty of time and formats to spread your opinions. Your problem hasn’t been getting your message out. Your problem is that you can’t get the investment community to agree with you. Secondly, your version of what you call “honest” posting is different than what most consider if the definition of that term. Third, millions of people don’t have to change why and how they buy stocks just to make you happy. You keep talking about Shiller saying how stocks work, yet you don’t agree with his comments. For example, he has continued to make statements, including comments in the last month, about staying in the stock market. Either Shiller is lying or else you are misrepresenting what he is saying. We don’t know precisely what Shiller believes because he has not been questioned in depth re what he believes. I believe that we should be questioning him in depth re what he believes. Is the safe withdrawal rate the same number at all times or is it a number that is higher when valucations are low and lower when valustions are high? I am not aware of Shiller ever directly addressing that point. I say that, if Shiller’s research is klegitimate, the safe withdrawal rate must change with changes in valuations. We should all want to know what Shiller believes. The best way to find out is to ask him. My sincere take. Rob Related Posts“What I Am Doing In Demanding Recognition of Everyone’s Right to Post Honestly Is As Important As What Shiller Did in Publishing His Revolutionary Research. Shiller Got Us Where We Need to Go Intellectually. I Am Getting Us Where We Need to Go in the Practical Realm. Shiller Did Amazing Work. But Millions of Investors Are Today Completely in the Dark re the IMPLICATIONS of His Amazing Work.”“Lots of People Have a Hard Time Accepting That There Is an Ongoing Cover-up of Research That Was Awarded a Nobel Prize and Featured in a Best-Selling Book. I Say That There Has Been a Cover-Up of Shiller’s Work. But It Is a Cover-Up Taking Place in Broad Daylight. Exceedingly Strange Stuff.”“Are You Willing to Say What You Believe Shiller Thinks About Safe Withdrawal Rates?”“The Reason Why People […]

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  • “The Stock Market Behaved One Way From 1870 through 2006 and Then in a Different Way from 2006 Through 2020. That’s 136 Years for Valuation-Informed Indexing and 14 Years for Buy-and-Hold.”

    Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site: “It will be interesting to see how things play out.” It has been 24 years, which has been long enough to see things “play out” and it didn’t turn out like you said it would. You have to stop blaming everyone else for your retirement failure. t’s only been 14 years since things began playing out in ways that you would not anticipate by looking at the historical return data. Shiller published a paper in 1996 saying that prices would fall hard within 10 years. So you cannot say that things did not play out as expected up until 2006. From 2006 forward, yes. So it’s 14 years. So the stock market behaved one way from 1870 through 2006 and then in a different way from 2006 through 2020. That’s 136 years for Valuation-Informed Indexing and 14 years for Buy-and-Hold. I’m going with Valuation-Informed Indexing. I don’t want to suppress discussion by Buy-and-Holders. I think that we need to hear both sides, Maybe the Buy-and-Holders are right. I sure don’t think so. But I don’t think you can ever say for sure. So I want them participating in the discussions held at every site on the internet. But I want the Valuation-Informed Indexers participating as well. That’s my sincere take, Anonymous. My best wishes to you. Rob Related Posts“At the Very Bare Minimum, We Need to Make It a Practice to Tell Both Sides of the Story. Reasonable People Need to Absolutely Insist on That Much.”“I Am Not Personally Persuaded That the Results of the Last 24 Years Show Us That the Market Has Changed in Some Fundamental Way. I Am More Impressed By What Has Happened Over the Past 150 Years Than I Am By What Has Happened Over the Past 24 Years.”“The Reason Why People Cannot Stand to Learn What Shiller Showed Us Is That His Stuff Is Such a Huge Advance Over Buy-and-Hold That We Cannot Bear to Acknowledge the Mistake We Made As a Society When We Elected to Spend Hundreds of Millions of Dollars Promoting Buy-and-Hold Strategies. Shiller is the Steve Jobs of Personal Finance. But We Don’t Have IPhones in This Field Today! Because He Is Too Shy to Speak Out About His Huge Achievements!”“If Market Gains Are Caused By […]

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  • Valuation-Informed Indexing #528: It’s the Irrationality of Mispricing That Makes Long-Term Returns So Predictable

    I’ve posted Entry #528 to my weekly Valuation-Informed Indexing column at the Value Walk site. It’s called It’s the Irrationality of Mispricing That Makes Long-Term Returns So Predictable. Juicy Excerpt: It shouldn’t be that way because, if returns were predictable, the market should take into consideration the information that makes predictions possible and incorporate that information into its assessment of the value of the market. Which would change the price. Stock prices are self-regulating so long as investors behave rationally. The problem is — investors are not capable of rational behavior! Related PostsValuation-Informed Indexing #261: Unlike Long-Term Returns, Short-Term Return Sequences Are Highly UnpredictableValuation-Informed Indexing #256: There Are Rare Circumstances in Which Short-Term Predictions of Price Changes Can and Should Be MadeValuation-Informed Indexing #262: The Unpredictability of Short-Term Return Sequences Masks the Predictability of Long-Term ReturnsValuation-Informed Indexing #140 — Stocks Will Be Insanely Overpriced and Insanely Underpriced At Least Once in Your LifetimeValuation-Informed Indexing #267: Take Valuations Seriously and You Will Discover Things That You Were Not Initially Even Seeking to DiscoverValuation-Informed Indexing #263: Shiller’s Comments About the Recent Price Drop Are Disingenuous

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  • “I Don’t Know Everything and I Do Not Claim To. You Do Not Know Everything Either. The Difference Is That You DO Claim to Know Everything. When You Deny Others the Opportunity to Hear Both Sides and Decide for Themselves, You Are Implicitly Saying That You Know Everything and Don’t Even Need to Consider Other Points of View.”

    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 say that VII works: “ I would point him to the Bennett/Pfau research showing that market timing has always worked for as far back as we have good records of stock prices.” Then you admit, it hasn’t been working: “Going by the historical, the crash should have arrived 14 years ago. You’ve got me re that one, Anonymous. We are living through something unprecedented. It’s scary.” So, it really has not ALWAYS worked and if you are the 60 year old guy following VII, you are screwed. I think that we all have to do the best we can with the information available to us. I don’t know everything and I do not claim to. I believe in Valuation-Informed Indexing. You do not know everything either. You believe in Buy-and-Hold. The difference is that you DO claim to know everything. When you deny others the opportunity to hear both sides and decide for themselves, you are implicitly saying that you know everything and don’t even need to consider other points of view. I reject that. I believe that we all need to remain open to other points of view. I don’t believe that anybody is screwed. I believe that we all should do the best we can given the information available to us. I believe in Valuation-Informed Indexing. So that’s what I tell people I believe in. And I naturally wish you all good things. Rob   Related PostsBuy-and-Hold Goon to Rob: Just Because You Were Able to Browbeat Wade Into Emailing the Trinity Guys Doesn’t Mean I’ll Do Your Bidding Too. Set Up Your Own Damn Forum.”“If One Were in an Especially Charitable Mood, One Could Even Say That Greaney Was the Victim of an Exceedingly Odd Set of Circumstances in Much the Same Way That I Was.”“If Greaney Included Language Describing the Retirement Risk Evaluator, No One Could Accuse Him of Deception, Could He? Greaney Would Be Shifting the Burden from Himself to the Person Reading the Study. It’s Very Different When Greaney Does Everything in His Power to Block People from Learning What the Last 34 Years of Peer-Reviewed Research Says. That’s the Sort of Thing That Will Sway a Jury to Vote to Put You Away.”“People Are Social Creatures. We Want […]

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  • “Irrational Exuberance Hurts Us All. We Should All Do Everything We Can to Oppose It. We Should All Be Engaging in Market Timing and Encouraging All of Our Friends and Neighbors and Co-Workers to Engage in Market Timing as Well.”

    Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site: “ There is a strong correlation between the CAPE value that applies today and the return that will apply for the next 10 years and the next 15 years and the next 20 years.” It didn’t work like you said it would for the last 10 years, the last 15 years or the last 20 years and you stayed out of the market to your detriment. If prices crash at some point (I believe that they will), it will have worked as I said it would. Price crashes hurt us. When stock prices crash, trillions of dollars of consumer spending power disappear from the economy and the economy contracts. Irrational exuberance hurts us all. We should all do everything we can to oppose it. We should all be engaging in market timing and encouraging all of our friends and neighbors and co-workers to engage in market timing as well. Does all of that not make perfect sense? Rob Related Posts“Market Timing Is Not a Problem, Market Timing Is the Solution to the Problem.”“For So Long As Honest Posting re the Peer-Reviewed Research Is Prohibited, the Thing That We Call the Stock Market Is Not Truly a Market at All. A Market That Produces a CAPE Value of 29 Is Not a Market That Is Functioning Properly.”” The Buy-and-Holders ASSUME That There Is No Need to Engage in Price Discipline When Buying Stocks and Then Set Up Very High Hurdles That They Insist That Those Arguing in Favor of Price Discipline (Long-Term Timing) Must Leap. But Why That Assumption? In Every Market Other Than the Stock Market, Price Discipline Is Essential. It Is Price Discipline That Makes Markets Work. Without Price Discipline, We Should Expect Markets to Collapse.”“Shiller Has Never Put Forward a Single Word Suggesting That Investors Should Not Be Using CAPE to Practice Effective Long-Term Timing. If It Is True That Valuations Affect Long-Term Returns, As Shiller Showed, Then Long-Term Timing MUST Work.”“We Should All Be Working to See That We Never Again Experience a CAPE Value of 25 or More.”“If Large Numbers of Investors Fail to Practice Price Discipline When Buying Stocks, the Market Eventually Crashes Because There Is No Other Way to Get Prices Down (It Is the Market’s Core Function to Get […]

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  • “Market Timing Is Not a Problem, Market Timing Is the Solution to the Problem.”

    Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site: “ When prices are insanely high, they will be headed downward in the long run.” Prices go up and down, but have always gone up in the long run. We cannot predict when and by how much they go up and down, which is why timing doesn’t work and your predictions didn’t work. As we look back on the last two decades we see that VII failed. I agree that prices go up and down and I agree that prices always go up in the long run. I do not agree that prices in the long run follow the pattern of a random walk. There is a strong correlation between the CAPE value that applies today and the return that will apply for the next 10 years and the next 15 years and the next 20 years. So risk is not constant, it is variable. So investors who want to keep their personal risk profile constant MUST practice market timing. If the next price crash brings on the Second Great Depression, no one is going to say that Valuation-Informed Indexing failed. People are going to be kicking themselves for not insisting that honest posting re the last 39 years of peer-reviewed research be permitted at every discussion board and blog on the internet, without a single exception. If irrational exuberance is a real thing (I believe that it is), then irrational exuberance is the mortal enemy of all stock investors. It makes it impossible for us to plan our financial affairs effectively. If we permit irrational exuberance to get too out of hand, we are always going to see an economic crisis. When the mountain of Pretend Money disappears into thin air, trillions of dollars of consumer spending is taken out of the economy and hundreds of thousands of businesses go belly up. Not good. There is only one way to combat irrational exuberance — market timing! Market timing is not a problem, market timing is the solution to the problem. No market can function effectively without price discipline and it is by practicing market timing that stock investors practice price discipline when buying stocks. That’s my sincere take, in any event, Anonymous. I naturally wish you all the best that this life has to offer […]

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What’s Here

  • Bennett/Pfau Research (60)
  • Beyond Buy-and-Hold (116)
  • Bill Bengen & VII (6)
  • Bill Bernstein & VII (2)
  • Bill Schultheis & VII (2)
  • Brett Arends and VII (1)
  • Carl Richards & VII (8)
  • Daily Caller Articles (10)
  • Economics — New and Improved! (72)
  • Financial Highway Column (11)
  • From Buy/Hold to VII (280)
  • Guest Blog Entries (96)
  • Index Universe & VII (11)
  • Intimidation of VII Advocates (66)
  • Investing Basics (270)
  • Investing Experts (63)
  • Investing Strategy (34)
  • investing theory (12)
  • Investing: The New Rules (120)
  • Investor Psychology (74)
  • J.D. Roth & VII (17)
  • Joe Taxpayer & VII (14)
  • John Bogle & VII (91)
  • Larry Evans and VII (12)
  • Lindauer/Greaney Goons (270)
  • Michael Kitces & VII (43)
  • Mike Piper & VII (31)
  • Podcasts (200)
  • Reactions to Pfau Silencing (71)
  • Reality Checker (4)
  • Return Predictor (11)
  • Risk Evaluator (11)
  • Rob Arnott & VII (4)
  • Rob Bennett (227)
  • Rob E-Mails Seeking Help (67)
  • Rob's E-Mails to Researchers (1)
  • Robert Shiller & VII (73)
  • Roger Wohlner and VII (5)
  • Saving Strategies (23)
  • Scenario Surfer (3)
  • Scott Burns & VII (8)
  • Silencing of Wade Pfau (89)
  • Strategy Tester (5)
  • SWRs (52)
  • Todd Tresidder & VII (3)
  • Uncategorized (12)
  • Various Experts & VII (33)
  • VII Column (525)
  • Wall Street Corruption (225)
  • Warren Buffett & VII (3)

Rob on the Internet

  • Rob's Weekly Valuation-Informed Indexing Column at the Value Walk Site.

  • Rob's Weekly Beyond Buy-and-Hold Column at the Out of Your Rut Site

  • Rob's Articles at the Financial Highway Site

  • Rob's Articles at the Balance Junkie Site

  • Rob's Daily Caller Articles: (1) Can We Handle the Truth About Stock Investing?; (2) How We Invest Is a Political Question; (3) The Economic Crisis Is Trying to Tell Us Something (and We're Not Listening); (4) Facts Don't Matter; (5) Going Google Stupid; (6) How Much Transparency Can We Handle?; (7) Confessions of an Internet Troll; (8) Conservatives Fall Into a Trap by Blaming Obama for the Bad Economy; (9) Meet the New Media, Same as the Old Media; and (10) How Restoring Honor Will End the Economic Crisis

  • Humble Money Experts Are the Best Money Experts, (Rob's Article in the Integrative Advisor, the Journal of the Association for Integrative Financial and Life Planning)

  • Articles on the Return Predictor, the RIsk Evaluator, the Scenario Surfer and the Strategy Tester

  • The Myth of Buy-and-Hold and Seven Other Guest Blog Entries

  • The Good Side of Stocks' Lost Decade and Seven Other Guest Blog Entries

  • A Better and Safer Way to Invest in Stocks and Seven Other Guest Blog Entries

  • The Economic Crisis Is the Best Thing That Ever Happened to Us and Seven Other Guest Blog Entries

  • The Bankers Did Not Do This to Us! and Seven Other Guest Blog Entries

  • Stock Volatility Kills! and Seven Other Guest Blog Entries

  • The Risks of Buy-and-Hold and Seven Other Guest Blog Entries

  • The Future of Investing and Seven Other Guest Blog Entries

  • What the Stock Investing Experts Don't Want You to Know and Seven Other Guest Blog Entries

  • What's the Best Age at Which to Experience a Stock Crash? and Seven Other Guest Blog Entries

  • Guest Blog Entry Compares Our Effort to Open the Internet to Honest Posting on Stock Investing with the Civil Rights Struggle of the Early 1960s

  • Our Monster Thread (153 Comments!) on Whether Bill Bengen Should Correct His Retirement Study Now That He Acknowledges the Errors He Made In It

  • Google Search Results for the Term "Valuation-Informed Indexing"
  • Favorite RobCasts

    • Bogle and Valuations

    • When Stock Losses Are True Losses and When They Are Not

    • There Is No Free Lunch! Or Is There?

    • Risk Tolerance in the Real World

    • Cash Is a Strategic Asset Class

    • Nine Valuation-Informed-Indexing Portfolio Allocation Strategies

    • Why the Stock Market Does Not Set Prices Properly (Even Though Other Markets Do)

    • Only Valuations Matter -- Everything Else Is Priced In

    • Low Stock Prices Are Better Than High Stock Prices

    • 30 Investment Myths in 60 Minutes

    Links That Matter

    • Ten Bogus Investing Truths

    • Study by Associate Professor Wade Pfau Showing That Long-Term Timing Provides Higher Returns at Reduced Risk

    • Study by Associate Professor Wade Pfau Showing That Valuation-Informed Indexing Beat Buy-and-Hold in 102 of 110 Rolling 30-Year Time-Periods in the Historical Record

    • Wall Street Journal Article Pointing Out That the Idea That Long-Term Market Timing Does Not Work Is a "Myth" of Stock Investing "That Will Not Die" Because "This Hoary Old Chestnut Keeps Clients Fully Invested" Even When It Is Contrary to Their Best Interests

    • Wall Street Journal Article Pointing Out That" "This Ratio (P/E10) Has Been a Powerful Predictor of Long-Term Returns" and That "Valuation Is By Far the Most Important Issue for Investors"

    • The Internet Blowhard's Favorite Phrase: Why Do People Love to Say That Correlation Does Not Imply Causation?

    • Michael Kitces (One of the Bravest of the Good Guys in This Field) Asks: "Who's Really at Risk When Avoiding Overvalued Stocks?"

    • Financial Mentor Article Reporting on How Our Knowledge of How to Calculate Safe Withdrawal Rates Has Grown During the First Nine Years of The Great Safe Withdrawal Rate Debate

    • Does the Trend Matter?

    • Improving RIsk-Adjusted Returns Using Market-Valuation-Based Tactical Asset Allocation Strategies

    • A Value Restoration Project Blog Post That Sums Up in Three Paragraphs All You Need to Know to Become a Highly Effective Investor

    • Year 20 Annualized, Real, Total Return v. P/E10

    • Year 10 Annualized, Real, Total Return v. P/E10

    • Valuation-Informed Indexing Always Superior to Buy-and-Hold Over 10-Year Periods

    • The Valuation-Informed Indexing Advantage

    • What P/E10 Predicted vs. What Actually Happened

    • Normal and Valuation-Adjusted Wealth Accumulation

    • Valuation-Informed Indexers Can Retire Five Years Sooner

    • Following Valuation-Informed Indexing Strategies Reduces Stock Investing Risk by 80 Percent

    • S&P 500 Tracked by P/E10 Level

    • Treasury Inflation-Protected Income Securities (TIPS) Table

    • Best, Average and Worst Returns Since 1871

    • Compound Annual Growth Rate Calculator

    • Investing Through Time

    • Mapping S&P 500 Performance

    • S&P 500 at Your Fingertips

    • S&P 500 Return Calculator

    • Russell's Research

    • Shiller's Data

    • Safe Withdrawal Rate Research Group