On November 14, 2009, I sent a follow-up to the e-mail to Carl Richards (author of the Behavior Gap blog) described in yesterday’s blog entry. The full text of the follow-up e-mail is set forth below.
Carl:
I have given more thought to our recent e-mail exchanges since last night.
Part of my job as a journalist is to inform middle-class investors of WHY it is that the “experts” in the investing field have not let them know of the dangers of Buy-and-Hold Investing for 28 years since the academic research showed that it cannot work in the real world for the long-term investor. Your handling of the matters discussed illustrates the problem well. You have great knowledge. You do great work. You have a good appreciation of the biggest problems. Yet you hold back from telling people in frank and plain language WHY it is that investing has become so intensely emotional an endeavor (because most of us are staking our retirements on an approach that our common sense tells us can never work). This is a news story that I need to report.
I am going to write a blog entry describing your take on things to the best of my ability. I expect that I will be using a number of sources to inform my writing of the piece: (1) material at your blog; (2) material you have posted as comments at other blogs; (3) your decision to tentatively ban me and then to lift the ban (I will of course describe the circumstances as fairly as I am able); and (4) our e-mail correspondence. So I WILL be reporting on the material in your e-mails.
As indicated in my e-mail from yesterday, I will generally NOT be quoting your precise words (although I probably wil report the precise words of parts of my responses). The part of your e-mail correspondence that I most need to quote are your views on the work that I have done developing the Valuation- Informed Indexing concept and your views about the problem with the Buy-and-Hold approach. I don’t think it is proper to quote these comments in full as you were making them in a private e-mail and might have stated things differently had you been thinking that they would be published. If you had agreed to be quoted, I would quote you. But you have indicated that you would prefer that I refrain from quoting this material, and I view that as generally being a reasonable request.
I say “generally” because I do see a need for a brief quote providing the color needed to make clear to my readers that it is not just me saying that you see merit in my work but you. The seven words “what you are doing has huge value” does the trick. Part of the news story here is that someone who sees huge value in the work reacts with at least a measure of hostility to blog comments rooted in the understanding of investing that follows from completion of that work. It is my intent to quote those seven words of yours in my blog report and then at the “People Are Talking” feature (with a link to the full blog entry) of my site.
There is a possibility that you did not mention reservations that you hold re my work in the e-mail to me. If you have reservations that you feel should be included in the blog report to put in context your seven words or any of your positions that I will be describing using only my own words, I am of course fine with that. I will make note in the report any reservations you have either in your words or by a description using my words, at your preference.
If you would like to see the text of the blog report before I post it (my guess is that it may take me a few weeks to be able to get to this item), I am happy to send you the text of the blog entry before posting it for your review. I cannot give you a veto over what appears. But if there are points where you persuade me that my account is either not accurate or not fair, I would certainly remain open to making whatever changes are needed to construct the most accurate and fair report possible.
Rob
I thought he made it very clear that you were not to use his emails, yet you continue to do so.
Why do you think it is that Carl does not want people to know what he thinks of Valuation-Informed Indexing, RIAFD? In ordinary circumstances, he would be rushing to let his readers know of a strategy he found so valuable, no?
Rob
Rob
I believe that Carl thinks you are a graceless internet troll and that regardless of what smidgen of value he may find he your ideas, he has no interest in being associated with you.
I’ve reported Carl’s own words on this question in several recent blog entries, RIAFD.
It’s a fact that I am banned from posting at his blog. And it’s a fact that he said “I have read everything I can about Valuation-Informed Indexing, and I agree with you that buy & hold passive investing is extremely problematic” and “I value and respect the passion, hard work and research that you have put into this very important issue” and “what you are doing has HUGE value.”
Rob
>>I’ve reported Carl’s own words on this question >>in several recent blog entries
That is precisely my point. He asked you not to use him emails and you completely defied that request. And yet, you wonder why he doesn’t want anything to do with you. Go figure
You are correctly stating that Carl asked that I not report what he said in his e-mail, RIAFD. And you are correctly stating that I did indeed report what he said (quoting only a few words but paraphrasing the rest). We are in agreement on the facts.
I am a big fan of Carl’s work. And I feel that I have responsibilities to him. But I do not feel that I have responsibilities onlyto Carl. I also have responsibilities to all of the millions of middle-class investors who have been hurt in the economic crisis. So I have to balance my responsibilities.
I believe that I have struck the right balance. I hope that I have.
I do not believe that Carl has struck the right balance. I believe that he does indeed have readers who become upset when someone offers comments at his blog pointing out that the academic research has shown for 30 years that there is zero chance that Buy-and-Hold can ever work for the long-term investor. I believe that the correct response to learning that is to be horrified by how emotional the reckless promotion of Buy-and-Hold has made many investors. Banning the discussing of the realities helps not at all, in my assessment.
I think that we all need to be making more of an effort to get the word out about how dangerous an “idea” the Buy-and-Hold Concept is. It doesn’t get easier as the financial pain grows bigger. It gets harder. The best time to act was in 1981. 1981 is not available to us today. The best time to act today is today.
How is Carl’s blog going to be doing if the continued promotion of Buy-and-Hold sends us into The Second Great Depression? How is Carl’s business going to be doing if the continued promotion of Buy-and-Hold sends us into The Second Great Depression?
There’s a reason why we have a First Amendment to the Constitution. It is to save us from situations like this. We need to keep in mind the reason why we believe in Free Speech when making decisions as to whether to permit honest posting on the academic research of the past 30 years on investing discussion boards and blogs.
My sincere take.
Rob