Wade Pfau, an Associate Professor at the National Graduate Institute for Policy Studies in Tokyo, wrote a comment to an earlier blog entry this morning that describes a research paper he has written (the paper is still in its first draft) about the New School Safe Withdrawal Rate concept that I developed with John Walter Russell (and with the help of hundreds of our fellow community members in the Retire Early and Indexing discussion-board communities). Set forth below is the text of his words. I sent an e-mail to Wade thanking him for letting us know of this exciting development. Who could have predicted on the morning of May 13, 2002, where this New School SWR business was going to lead?
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.
I just finished writing up a paper about using earnings valuations to predict withdrawal rates. But I think it is also important to consider dividend yields and bond yields as well, since these are the income sources of returns. With these measures, I find that withdrawal rates continue falling even after 2000. With PE10, you found the lowest withdrawal rates in that year.
I do cite you and John Walter Russell in my paper as the earliest and strongest advocates of this approach. I understand that John Walter Russell has passed away, sadly.
If you wish to see my paper, it is at:
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1726225
I’m hoping it will be publishable in a finance journal. This is just the first draft, so if you have some comments or anything, I can still make revisions. Thank you very much for your consideration.
Best wishes,
Wade
In your twitter feed you have linked to obliviousinvestor.com with an edited quote (without indicating that you edited his words)
“Success is determined by the returns you receive in the first decade of retirement. http://bit.ly/fSTq3z”
Here is the full quote
“For most investors, success is determined largely by the returns received during the period in which they have the largest amount of money in the market (i.e., the last decade or so of working years and the first decade or so of retirement).”
Thanks, Evidence.
I often do that sort of thing with my tweets.
When I quote someone at the blog or in an article, I obviously provide the entire quote just as they said it. A tweet can only be 140 characters. So I do sometimes shorten the quotes while seeking to remain as close to the original meaning as possible. I don’t feel 100 percent comfortable doing this. But I haven’t been able to figure out any other way to make some fine observations tweet-sized.
I do something a bit similar in headlines to blog posts. I sometimes take out a few words to keep the headline to two lines.
In both cases, the original words are available to the reader, either at the link provided in the tweet or in the blog entry under the headline. But I don’t think it is at all a bad thing for people to know that this is going on. So I am glad that you brought up the matter here.
Rob