Set forth below is the text of a comment that I recently posted to another blog entry at this site:
Rob,
I was curious as to why you never post a link to the actual death threat tat you claim was made. All I have seen is your link to your own comments. Can you enlighten us?
I don’t do it because it would be stupid to do it, Anonymous.
The Campaign of Terror has been going on for 12 years. There are THOUSANDS of cases of brutal abusiveness. I posted about the errors in the Old School safe-withdrawal-rate studies on the morning of May 13, 2002. The studies have not been corrected TO THIS DAY. This sort of thing was obviously going on for years before I came on the scene. Shiller published the research showing that there is precisely zero chance that a Buy-and-Hold strategy can ever work for even a single long-term investor in 1981.
Why is it that I was the first person to discover the errors in the Old School studies? It wasn’t because I am some super-genius. IT HAPPENED THAT WAY BECAUSE THE BUY-AND-HOLD MAFIA DOES NOT WANT MILLIONS OF MIDDLE-CLASS PEOPLE LEARNING THE REALITIES OF STOCK INVESTING. It happened that way because of the massive corruption in this field. I mean, come on.
It’s a waste of my time to prove the corruption. Anyone who wants to assure himself that the investing advice field is 100 percent corrupt just needs to look around for about 10 seconds to gather all the evidence he needs to prove the case beyond any reasonable doubt whatsoever. The question that we struggle with is not — Is the investing advice field 100 percent corrupt or not? The question we struggle with is — Why do so many of us NOT CARE that our retirement accounts are being destroyed by this corruption?
I remember the first article that I had published at the Daily Caller site. I thought that it was going to be a breakthrough. One, the site is bigger than most of the sites I have posted at. So the potential of my article going viral was much higher. Two, it is not an investing site. So I didn’t have to worry that the people who own the site want to make a buck giving Get Rich Quick investing advice or want to get links from the Big Shots in the investing field or whatever. So I thought that publication of that article was going to be a turning point.
I wrote about the errors in the Old School SWR studies. I don’t think I directly said that there was a cover-up but I hinted at it by pointing out how long it had been since I had put up my post pointing out the errors. And I hinted at the political implications since this was a political site. Those errors were in the process of causing MILLIONS of failed retirements. That’s a huge social problem, one of the biggest we have faced as a nation. And this wasn’t a case where it was other unfortunate people who were being hurt. The retirements of the people reading the article were the retirements being destroyed. Looking at this objectively, there should have been a HUGE reaction to that article.
There was no reaction. No going viral. No comments even. Nothing.
That’s why I rarely write Guest Blog Entries today. So long as people refused to run my Guest Blog Entries (this was usually the case in the days before the first price crash) I kept fighting to get them posted because I felt that getting them posted was the answer. After the crash, I got lots of Guest Blog Entries posted. But that didn’t change things. It was a step in the right direction. The truth about stock investing now appeared on people’s computer screens. The corruption was now exposed in an objective sense. But no one took action to fix the corruption! So what the heck good did it do?
We saw this at FinCon13. I gave a presentation presenting an airtight case for why we are in an economic crisis today. You couldn’t have a more exciting topic for a financial blogger’s convention. But what was the reaction? A number of people in the audience told Jaime Tardy that I seemed “bitter.” These people are not interested in doing anything to fix the corruption or to tell their readers how to invest more effectively. They LIKE Get Rich Quick. They won’t acknowledge it if you ask them but that’s the reality. They view anyone who does battle with Get Rich Quick as “bitter” because they LOVE Get Rich Quick.
Evidence is of great importance in intellectual battles. We have evidence of the corruption coming out of our ears and it is not helping us. That’s because this is not an intellectual battle. This is an EMOTIONAL battle. We cannot persuade people to give up their love affair with Buy-and-Hold by presenting them with evidence. Evidence speaks to the intellect. There is no intellectual case for Buy-and-Hold. The case for Buy-and-Hold is EMOTIONAL. We need to change people’s hearts.
Bernie Madoff did not get people to sign up for his fund by pointing a gun to their heads. He enticed them by appealing to the Get Rich Quick urge within them. It’s the same trick that Bogle uses to entice people into Buy-and-Hold, except Bogle practices it on a scale 5,000 times bigger. The Wall Street Con Men are destroying the lives of millions of people. But they don’t have to use force to do it.
And the full reality is that they don’t even need to use all that much secrecy to do it. The peer-reviewed research showing that there is zero chance that Buy-and-Hold could ever work for even a single long-term investor was published in 1981. And Shiller wrote about those findings in a best-selling book that is available in most public libraries. The corruption is taking place out in the open. But the millions of us who have been taken in by Get Rich Quick strategies look the other way each time we see it appear before us.
The investing advice field is 100 percent corrupt today, Anonymous. The evidence is everywhere. I don’t need to lift a finger to prove the case because the evidence is all around us.
The corruption is WITHIN us. Humans LOVE them some Get Rich Quick. The Wall Street Con Men exploit us because we WANT to be exploited. They couldn’t pull off what they have pulled off without our cooperation. The Wall Street Con Men don’t push Get Rich Quick so hard because they think it is a hot idea. They push it because they want to be popular and they want to make a buck and THEIR CUSTOMERS DEMAND IT.
After the next crash, I don’t think the customers will be demanding it anymore, Anonymous. At that point, everyone will see the massive corruption in this field everywhere they turn. Even you.
I naturally wish you the best of luck in all your future endeavors.
Rob
x says
I don’t do it because it would be stupid to do it (followed by the standard 1000+ words of incoherent unresponsive babbling)
“Extraordinary claims require extraordinary evidence.”
Is your problem that you don’t understand what that means, or that you simply don’t agree with it? Either way, it explains in one sentence your laughingstock status in the online community. Wild claims, supported by no evidence at all.
Rob says
When Wade Pfau was working with me, he spent a long time searching through the peer-reviewed research in this field trying to find a single study that supported the key Buy-and-Hold claim that it is not necessary to exercise price discipline when buying stocks. He never found one. He went to the Bogleheads Forum and asked if anyone there knew of a single study lending even a tiny bit of support to the key Buy-and-Hold claim. Jack Bogle did not know of a single study. Bill Bernstein did not know of a single study. Larry Swedroe did not know of a single study. Rich Ferri did not now of a single study. Mel Lindauer obviously did not know of a single study.
It’s all a big lie, X.
It wasn’t a lie in the early days. In the early days, it was a mistake. Eugene Fama discovered something of huge importance when he found that short-term timing never works. But Fama did not even test long-term timing. Robert Shiller was the first researcher to do that. Shiller found that long-term timing ALWAYS works and is ALWAYS 100 percent required. If Bogle had walked to the front of a big room within a week of publication of Shiller’s “revolutionary” (his word) research, we would not be in an economic crisis today. But he didn’t do that, did he? And a mistake that is covered up for 33 years is no longer properly termed a mistake but a lie.
I didn’t get Jack Bogle in this situation. He is the one who made the mistake. And he is the one who covered up the mistake for so long that it was transformed into a lie.
I have been Jack’s best friend in the world for the past 12 years. Jack didn’t mean to make the mistake. And he didn’t mean to tell the lie. By the time the mistake was discovered, he had built his entire career around promotion of the mistake-based strategy and the pain was so great that he came to suffer cognitive dissonance over the matter. He lied to everyone who ever asked him a question about what the peer-reviewed research in this field says. But he lied to himself first. When you lie to yourself, it becomes pretty darn hard to tell the truth to others.
Bogle is a flawed human, like all the rest of us. When he is suffering from cognitive dissonance, it becomes the job of all his friends to help him out. Many, many, many others have been too afraid to show their friendship, given the circumstances. Bogle has a lot of money and a lot of power and a lot of connections and he has shown a ruthlessness in making use of them to destroy the career of anyone who dares to “cross” him by telling the truth about what the last 33 years of peer-reviewed research says. I am as afraid of the man’s power and ruthlessness as everyone else. But I worked p the courage to “cross” him by insisting (not asking!) that he behave according to the norms that apply in every field of human endeavor other than the investing advice field. I have shown a love for Old Saint Jack that Old Saint Jack has never once in the past 33 years shown for himself.
I will continue to show that love for him. I will continue to praise him to the skies for his many genuine contributions, contributions that place him second only to Robert Shiller in my list of the true giants in this field. And I will continue to give him a good, swift kick in the butt when he puts forwards words in “defense” of the sorts of individuals who have posted in support of Mel Linduaer and John Greaney.
The same standards of ethical behavior that apply in all fields other than stock investing apply in the investing advice field too. Perhaps not today. But following the next price crash they will. Or else we will not make it. We cannot make millions of middle-class people responsible for their own retirements and then deny them access to accurate and informed and honest reports of what the last 33 years of peer-reviewed research tells us about what works for the long-term investor. I do my good friend Jack no favors by suggesting to him that it is somehow “okay” to post at the boards at which the sorts of individuals who have put up posts in “defense” of Mel Linduaer and John Greaney also participate. That is financial fraud. Financial fraud is a felony under the laws of the United States. That means prison time. I will not bow to the intimidation tactics of my good friend Jack and behave in a manner that would in all likelihood increase the length of the prison sentence that will be handed out to him following the next price crash.
The 12-year cover-up is an extraordinary event. It is the biggest case of financial fraud in U.S. history. I give you that one, X.
My site presents the extraordinary evidence needed to make the case. I put forward a post to the Motley Fool board on the morning of May 13, 2002, pointing out the errors in the Old School retirement studies. Not one of those studies has been corrected to this day. That tells the tale. There are thousands of articles at this site showing how the 12-year cover-up was carried out and maintained. Anyone who wants to know why we are in an economic crisis today has the material he or she needs to come to a full understanding of the matter available for his or her consideration. It is my job as a journalist to provide that material and I have done so.
Money and power and influence corrupt human beings. That story is as old as the human race.
The Wall Street Con Men pushing their smelly Buy-and-Hold “strategies” have a LOT of money and power and influence at their disposal. They have spread a LOT of corruption. And there are now millions of people suffering very, very serious consequences as a result.
Following the next price crash, enough of us will work up the courage to stand up to them and to get the Old School SWR studies corrected. From that point forward, it will be easy sailing. We will bring the economic crisis to an end and bring on the greatest period of economic growth in U.S. history.
Or we won’t.
If we don’t, we will all go down together. That would make me very, very, very sad.
But if that sad turn of events plays out before us I will at least have the small consolation of being able to say that I gave this thing my best possible shot despite the mountain of resistance that I faced from you Goons and from the Wall Street Con Men who support and encourage you.
I can do no more and I can do no less.
I naturally wish you all the best things that this life has to offer a person regardless of what investing strategies you elect to pursue.
Rob
Anonymous says
We saw this at FinCon13. I gave a presentation presenting an airtight case for why we are in an economic crisis today. You couldn’t have a more exciting topic for a financial blogger’s convention. But what was the reaction?
Sounds like your own view of your arguments and the value of this topic generally are far greater than everyone else’s. The ugly girl might declare that she’s beautiful, but if the other six billion people on the planet call her ugly, that’s still what she is.
Rob says
My assessment of these matters does not match the assessments of most others, Anonymous. Nothing could be more clear.
Rob
Anonymous says
My assessment of these matters does not match the assessments of most others, Anonymous. Nothing could be more clear.
OK, then it’s only a question of who’s more likely to be right – you, or a thousand experts with far more intelligence and experience than you.
Rob says
You are right that there are thousands of people with more intelligence and experience than I possess who say that I am wrong, Anonymous. We agree on that.
What you are not addressing is the intimidation factor.
There was a time when the research really appeared to say what the Buy-and-Holders say it says. These intelligent and experienced people you refer to are also POWERFUL and WEALTHY and INFLUENTIAL people. They built careers around promotion of the Buy-and-Hold Model before the research that discredited it was published. Sixteen years passed between the publication of the research that for a time seemed to support Buy-and-Hold and the research that showed that there is precisely zero chance that it can ever work for even a single long-term investor. When these powerful and wealthy and influential people learned that they were going to have to throw away 16 years that they had spend developing their careers and their businesses, they balked. Instead, they LIED about what the research said.
Now —
A reasonable argument can be made that the word “lie” is excessively harsh here. What Shiller showed was, in his own words, “revolutionary.” Revolutionary insights are generally not integrated into a society’s thinking immediately. Fama’s research led to the development of the Buy-and-Hold Model for understanding how stock investing works, a paradigm that directs an investor’s thought processes on every strategic issue that he considers. Shiller’s research demolished that paradigm (while affirming many of the powerful insights developed by the Buy-and-Holders that were not core enough to be the foundation stone of the paradigm — for example, the Shiller Model [Vauation-Informed Indexing] lends support to the Fama claim that short-term timing can never work).
The Buy-and-Holders truly believed in their work. They were excited about their insights and their ability to change the world for the better. Shiller’s 1981 research ruined all their hopes for the future. It SHOULDN’T have. Shiller’s work BUILDS on Fama’s work and on the insights of the Buy-and-Holders. His work makes the earlier work MORE IMPORTANT AND MORE VALUABLE. His work posed no real threat to the Buy-and-Holders so long as they promptly incorporated it into their own work.
But the Buy-and-Holders, as smart and experienced as they are, suffer from the terrible affliction of being human. They did not feel comfortable saying the words “I” and “Was” and “Wrong” any more than John Greaney felt comfortable saying those words when he discovered on the morning of May 13, 2002, that his retirement study got the numbers wildly wrong. Instead of THANKING Shiller for the wonderful contribution he had made that enhanced the value of their own work, the Buy-and-Holders elected to IGNORE Shiller’s revolutionary finding, to pretend that it did not exist, to LIE about this development.
This was a stupid, stupid, stupid, stupid, stupid decision.
All of the troubles that we are experiencing today stem from this stupid decision. Had Bogle walked up to the front of a large room in 1981 and said the words “I” and “Was” and “Wrong” (or at the bare minimum the words “I’m” and “Not” and “Sure” — those words would have launched a national debate which would have led to the same place as the swifter-acting words in not too long a time), there would be no economic crisis today. There would be no one going to prison. There would be no one destroying discussion boards and blogs. There would be no hundreds of thousands of business failures. There would be no millions of unemployed. There would be no millions awaiting failed retirements. And on and on and on.
My good friend Jack Bogle made a terrible, terrible mistake in 1981. We can’t go back. There’s no sense in wishing he could. But there IS sense in trying to understand WHY Bogle made the mistake. What the heck possessed my good friend to do this terribly stupid thing that has caused so much human misery in the years since?
Jack Bogle started out as a little boy. In 1981, he was a scared little boy walking around in big boy’s clothing and being applauded everywhere he walked. When he learned that he had been giving bad investing advice for a good number of years, HE WAS SCARED OUT OF HIS LITTLE-BOY PAINTS!
Do you see that, Anonymous? You need to understand this part of the story to understand every thing that is taking place today.
Had Bogle acknowledged his mistake in 1981, there was not one soul on the planet who would have made fun of him for it.
No — check that. I shouldn’t say that there was not one. The proper way to say it is that there was not more than one. There was one. The one was Jack Bogle himself!
Jack Bogle is, as you say, intelligent and experienced. Intelligent and experienced people have a certain trait that you might have noticed. THEY ARE HARD ON THEMSELVES. Jack possesses that trait. He DEMANDS THINGS OF HIMSELF that others would not demand of him if they were in his shoes.
So a voice within our good friend Jack Bogle attacked Bogle for having made the mistake he had made. This voice said all the things you hear me saying today, except ten times worse. The voice said: “You stupid boy, Jack! Anyone with a brain could have seen what Shiller has shown. You have ruined everything! Everybody is going to laugh at you when they find out! You have ruined millions of middle-class retirements! You will lose your reputation! You will probably lose all of your money! Your friends, people who listened to your foolishness, will lose THEIR money! You may even be thrown in jail! What a stupid, stupid, stupid boy you turned out to be!”
Jack isn’t stupid. But he has a voice within his brain telling him that he is. Most intelligent and experienced and accomplished people have one. On issues relating to money, that voice gets even stronger than it is when speaking about other issues. People don’t like to lose money. When an intelligent and experienced and accomplished human finds that he has made a mistake that has caused millions of people to lose LOTS of money, that self-critical voice can get very loud indeed. That’s what happened with our good friend Jack Bogle, the smart and striving and loving boy who grew up into a smart and flawed and self-critical man.
Bogle experienced emotional pain when Shiller showed him the piece of the investing puzzle that he had missed in earlier years because it wasn’t yet available to the humans in the days when our good friend Jack was building his reputation. There is a phenomenon that our friends in the psychology field have discovered that often kicks in when bright people like Jack Bogle come to feel intense emotional pain as the result of some mistake they have made. That phenomenon is called “Cognitive Dissonance.”
Bogle began telling a huge lie in 1981. His position required of him that he walk to the front of a large room and say the words “I” and “Was” and “Wrong.” He didn’t want to. He really, really, really, really, really didn’t want to because of what the mean voice within him was falsely telling him about what those words signified. The human brain has a switch that can be pulled in such circumstances. It is called The Rationalization Switch.
Aristotle called us humans “The Reasoning Animal.” Psychologists have learned in recent decades that there are often circumstances in which it would be more accurate to call us “The Rationalizing Animal.” Our brains can do amazing things. But once our will directs them not to find truth but to avoid truth, all of those amazing powers are employed to cause CONFUSION rather than an understanding of the realities. Our good friend Jack Bogle went into Rationalization Mode in the year 1981.
And all those who followed him of course did the same.
You know all the b.s. that they have poured out into the world in the years since.
None of it addresses the key point shown by Shiller — the exercise of price discipline is every bit as important when buying stocks as it is when buying any other good or service available for sale in this Consumer Wonderland of ours.
It’s all been b.s. ever since. We have never heard a word of truth from any Buy-and-Holder since 1981. Because the foundation stone of the entire model was shown in that year to be a lie. And the Buy-and-Holders who could not bear to acknowledge the lie in 1981 could bear to do so even less in 1981 and even less in 1983 and even less in 1984 and so on and so on and so on.
Lies produce bad fruit.
We are today seeing the bad fruit produced by the mountain of lies told by our Buy-and-Hold friends for 33 years now.
We are hurting. Big time.
And the price gets much higher with the next crash.
You need to come clean. Bogle needs to come clean. ALL Buy-and-Holders need to come clean.
You possess the power today to delay the important business of coming clean a bit longer. That means MORE pain for you. MUCH more. Smart move!
Or you can come clean by the close of business today. As your friend, I can tell you that that’s the true smart move. But of course I have little confidence that you will choose the smart move given your 12 years’ worth of decisions choosing more and more and more pain for yourself. My sadness over that reality doesn’t make it any less of a reality.
Bogle possesses intelligence and experience. All of the Buy-and-Holders do.
What good is it doing any of them? What good is intelligence and experience when the trickery it permits you to pull off ends up landing you in a prison cell?
Bogle needs to combine his intelligence and experience with some integrity, Anonymous. All of the Buy-and-Holders need to do that.
They need our help. There are times when it is hard to act with integrity. Having your friends standing by you can make a difference.
I am there for you. I am there for Bogle. I am there for ALL the Buy-and-Holders.
I am there to HELP.
Not to pretend to believe in your mountain of lies.
I am trying to reduce the number of prison sentences, not to add to them. Any action you will get out of me will be chosen with that goal in mind.
I wish you all good things.
As I demonstrate with every word that I put forward in response to your comments and questions here.
My best wishes, old friend.
Rob
laugh says
Its interesting when a mad man tries to use psychology to prove that it is the whole rest of the world that is crazy and not him.
Very interesting.
Rob says
The trouble is that a truly mad man doesn’t know he is mad, Laugh.
That’s why as a society we adopted a rule that each person gets to say what he sincerely believes. Following that rule, the society can over time come to see flaws in once-popular ideas and replace them with better ideas.
When you believe with all your heart and mind that you are right and that it is the other guy who is mad, that’s when you most need to hope that the other guy will insist on his right to say what he sincerely believes. It is only by him saying things that you do not think you need to hear that you will ever come to feel a need to consider different ideas.
I naturally wish you all the best that this life has to offer a person.
Rob
Yogi Bear says
Are you really willing to continue the downward spiral until some magical 80% stock market crash somehow (???) ‘saves’ you? Wade long ago challenged you to illustrate how even such a cataclysmic event somehow bails out your personal situation, and you failed to give any sort of answer.
Even if you don’t answer here, at least ask yourself: “What are my REAL best-chance prospects from here, and how would I attain them?” Here’s a hint: World financial collapse, followed by some group spontaneously anointing you fiscal savior plus a $500 million gratuity check, is not going to be very high up the list of reasonable expectations, Rob. And if it is the only item on your list, then you maybe want to sharpen up your pencil and do some serious re-figuring.
Rob says
I hope we will not see an 80 percent drop in prices, Yogi. The research says we should be expecting a 65 percent drop. That’s bad enough.
I’ll try to illustrate my thinking re my personal financial circumstances by pointing to someone who plays it differently than me and who has experienced a whole big bunch more success than me as of today. I spoke with Todd Tresidder at the Financial Mentor site several times during the recent FinCon14 blogger’s conference. Todd over and over again impresses me with his intelligence. I think there may come a time when he will have the most successful site on the internet. He does just about everything right, in my assessment.
Am I envious of his success?
I am to some degree. I would love to have what he has. It hurts not to have people comment here. So your post is not totally out to lunch.
But here’s the problem.
Say that Todd’s site continues to climb but that we do have the financial collapse you refer to and that we go into the Second Great Depression. Say that going into a depression eventually leads to a World War, as it did the first time we went through one. Say that because we now live in an era of nuclear weapons that we all get blown up. What the heck good is it going to do Todd to have this amazingly successful site if we all get blown up in a nuclear war?
Do you see?
I want success, Yogi. And I get it that you Goons don’t want me to have it if I continue to tell the truth about what the last 33 years of peer-reviewed research tells us about how stock investing works. And I get it that the Wall Street Con Men support your efforts. And I get it that they have lots of wealth and power and connections. I essentially have billions of dollars in marketing money being directed to bringing me down (by promoting Buy-and-Hold and thereby making it even harder for everyday investors to see how dangerous Buy-and-Hold is in the long run). I get all of that. Loud and clear.
But I also get the other side of the story.
If Bogle and all the others were 100 percent corrupt people, you would be right that I could never win. They would now and forever more use their power and wealth and connections to bury me. BUT THAT IS NOT THE CASE!
I learned about the errors in the Old School SWR studies by reading Bogle’s freakin’ book. Chapter Two of Bernstein’s book is the best short description of why Valuation-Informed Indexing works that I have read. Burns’ first reaction to my stuff was not to say that I am “catastrophically unproductive” but to say “you’re right” and to ask for my phone number so that he could do an interview with me.
These people are not 100 percent corrupt. They are 100 percent trapped.
They want to tell the truth. But they feel that, if they tell the truth on a single important topic, the entire Buy-and-Hold house of cards will come crashing down. And they see that as being the end of their careers. And the end of their friends’ careers. And they cannot bring themselves to do it.
Here’s what should have happened.
Bogle learned in 1981 about Shiller’s “revolutionary” (Shiller’s word) research. Bogle should have immediately walked to the front of a big room and said the words “I am not so sure anymore.” I believe that he still believed in Buy-and-Hold. So he should have said that. But he also obviously had begun to have doubts. Shller’s research undermines the premise of the Buy-and-Hold Model. So it is impossible that someone as smart as Bogle did not begin to entertain some doubts. He should have said that. He should have said “I am now only 80 percent confident that Buy-and-Hold will work.” Or 70 percent. Or 60 percent. Or whatever it was.
Had he done that, his speech would have launched a national debate. Hundreds of researchers would have researched all the questions that needed to be researched. And by now we would all know with a good deal of confidence what works. Knowledge would have advanced because people would have felt safe asking questions that undermine the Buy-and-Hold dogmas.
That didn’t happen. We are not perfect people. Humans are flawed creatures. So we have held off on enjoying the benefits of Shiller’s revolutionary findings for 33 years.
But we are not going to continue to deny ourselves the enjoyment of those benefits forever! We can’t continue down this dark road. We will all be ruined if we do. So we won’t. We are going to have that national debate. It’s just a question of time.
How will I profit?
It’s impossible even to count the ways, Yogi. Think this through. Millions of people invest in the stock market. I am the co-author of research that shows them how to reduce stock risk by 70 percent while greatly increasing returns. If you tell me that you cannot figure out how I will profit by that reality, then I am going to respond that you are lying. Perhaps you are lying first to yourself and then to me. But you are not thinking clearly if you do not see the profit potential in that. I am going to be one of the richest people in the United States when this saga comes to a happy ending. I mean, come on.
Wade of course gets that too. That is part of the reason why he was so excited when his research showed him that Valuation-Informed Indexing works. Part of it was the intellectual breakthrough. He cares about that side of things too or else he never would have become a researcher in the first place. But he quite naturally and understandably also cares about providing for his family as well. And so part of his excitement was that he saw himself becoming very famous and very rich as a result of the research he did with me. When he later said as a result of the threats you made to destroy his career that he no longer saw great profit potential in this, he was telling a little white lie. Naughty, naughty, Wade!
If Bogle could do it over, he would go back to 1981 and give that speech. I am 100 percent sure. He wishes that he were not in the place he is in today. ALL of the Wall Street Con Men do. ALL of you Goons do too.
The question is — How do we pull that off?
How do we get to the place where we all want to be without some of us getting sent to prison for a long time?
If you have any bright ideas, please share them with me, Yogi.
My best idea is to keep doing what I am doing.
I love my Buy-and-Hold friends. I will continue to sing their praises. I will continue to show them respect and affection and gratitude for the many wonderful insights I have picked up from them.
I will also continue to post honestly on safe withdrawal rates and scores of other critically important investment-related topics.
Because I want to hurt the feelings of my many Buy-and-Hold friends?
No.
Because I care about my Buy-and-Hold friends (AND about the millions of middle-class investors whose lives are in the process of being destroyed) and I want to see them find their way to a better place than the dark place they reside in today.
There’s HUGE leverage in this. Down the road a piece, it will not be just Rob Bennett posting honestly. Jack Bogle will be posting honestly. Bill Bernstein will be posting honestly. Scott Burns will be posting honestly. Todd Tresidder will be posting honestly. Wade Pfau will be posting honestly. Robert Shiller will be posting honestly. Heaven help us all, but Mel Linduaer and John Greaney may well be posting honestly.
We all will benefit from that. We all will end up winners here.
We can’t get there so long as everyone lives in fear. We all have to stand up to you Goons and your intimidation tactics. That’s the only way it can be done. That’s the answer.
There’s plenty of money to be made here, Yogi. The problem is the Trap. We all need to find our way out of the Trap.
I am 100 percent happy to do anything that I can do.
Except commit acts that constitute felonies under the laws of the United States.
For obvious reasons.
I hope that helps a bit.
My best and warmest wishes to you, my long-time Goon friend.
Rob
Yogi Bear says
” How will I profit? It’s impossible even to count the ways, Yogi. ”
Try, Rob.
Try.
Just one would be a start.
Rob says
We now know that emotion (valuations) is 80 percent of the stock investing story, Yogi.
I think it would be fair to say that I am the world expert on the ways in which investors engage in self-deception to persuade themselves that the inflated numbers on their portfolio statements are real. There are THOUSANDS of articles and blog posts and podcasts and columns at this site detailing in great depth how it is done. I will be making money for many years to come using that material to help investors understand how stock investing works in the real world through the publication of books and by giving speeches and by creating CD products and through personal consulting and on and on and on.
Shiller’s 1981 finding changed the history of investing analysis in a profound way. He “revolutionized” (the word is Shiller’s) the field. We have as a society delayed our recognition of his earth-shaking accomplishment. But we are not going to have any choice about going forward following the next price crash. From that point forward, nothing will ever be the same again.
Shiller and Fama say opposite things. They cannot both be right. It is a logical impossibility.
If Fama is right, we are doing fine. 95 percent of the investing advice that the average investor hears is rooted in Fama’s research.
But what if Fama is wrong? What if Shiller is right (there is now 33 years of peer-reviewed research showing this to be so)? If that’s so, then we should be in an economic crisis today. If that’s so, we are on our way to the Second Great Depression. If that’s so, we should be seeing threats of violence and career destruction on the part of the Buy-and-Holders in a futile effort to keep their strategy going for a few more months or a few more years.
If Shiller is right (and I obviously believe strongly that he is), the investing advice field is today in the process of being rebuilt from the bottom up. That’s why the Buy-and-Holders fight so hard. They know the stakes as well as I do. If valuations matter, Buy-and-Hold is not just wrong, it is the purest and most dangerous Get Rich Quick scheme ever concocted by the human mind.
Valuations (investor emotion) is no small thing, Yogi. Either it is nothing (as Fama theorized) or it is 80 percent of the stock investing story. I have played the lead role for 12 years now in getting accurate and honest reports of what the last 33 years of peer-reviewed research says out to millions of middle-class investors. I have zero fear that there will not be thousands upon thousands of money-making opportunities opening up to me once we pull together as a society to open every board and blog on the internet to honest posting. I will have far too many money-making opportunities available to me following that day than I will possibly be able to handle by myself. I will be hiring teams of people to help me take advantage of all the opportunities that will be open to me once this story gets out.
Does Jack Bogle have ways to make money?
Does Robert Shiller have ways to make money?
Does Rob Arnott have ways to make money?
Does Bill Bernstein have ways to make money?
The shift from Buy-and-Hold to Valuation-Informed Indexing is a bigger accomplishment than anything that any of those four has enjoyed. It was Shiller who showed that Buy-and-Hold doesn’t work, not me. But Shiller has not yet written clearly about the practical how-to IMPLICATIONS of his amazing research findings. I am the first to have done that in a comprehensive way. That’s huge. And achieving huge breakthroughs like that lead to tons of money in the long run in the society in which we live in today. (I think that’s entirely appropriate. Some might disagree. But, whether one agrees or not that it is appropriate, that certainly is the case).
It won’t just be me making tons of money once the internet is opened to honest posting. There will be hundreds of us, thousands of us. There are hundreds of smart bloggers who would LOVE to be making millions from their blogs and who today are not doing so. All they need to do is to turn their efforts to further development of the Valuation-Informed Indexing concept. The only reason why they don’t do it is that they fear what you Goons would do to them and their businesses if they began posting honestly.
Do you really think that they are going to continue to live in fear following the next price crash?
They are not. They are going to work up the courage to go for the money. And we are all going to be a lot better off as a result. People SHOULD be rewarded for giving accurate and honest investing advice. Seeing that the thousands of people who will be further developing the Valuation-Informed Indexing concept receive financial rewards for their efforts is in the best interests of every person alive in the United States today.
We have had big advances in the computer field since 1981, no? There was no internet in 1981. Now there is. Thousands of people made fortunes as a result of the development of the internet. There was no YouTube in 1981. Now there is. Thousands of people made fortunes as a result of the development of YouTube (there was an article on the front page of the New York Times on this just last Friday). There were no laptops or tablets or smart phones in 1981. Now there are. Thousands of people made fortunes as a result of the development of laptops and tablets and and smart phones.
Say that there has been a Typewriter Mafia back in 1981 that has devoted hundreds of billions of marketing money to seeing that no one could succeed in selling computers. We would today be a poorer people as a result. The advances that we have seen in the investing advice field over the past 33 years are 50 times greater than the advances we have seen in the computer field. The only reason why we have not seen thousands and thousands and thousands of millionaires made through the promotion of the first true research-based strategy is that the Buy-and-Hold Mafia has possessed the power to keep us all in the Dark Ages re our understanding of how stock investing works in the real world.
But for how much longer?
The next step down is the Second Great Depression, Yogi. Do you think people are going to stand for that? I do not. I love my country. I have noticed by reading history that my country has in the past always possessed the intelligence and fortitude and love to overcome forces like the Buy-and-Hold Mafia. I believe that we will prevail once again. When we do, no one is going to be able to count the money that will be flowing in to those who worked up the courage to post in support of those offering honest investing advice.
Money is what this whole freakin’ saga is about. If there weren’t so much darned money in pushing Get Rich Quick garbage, everyone in the field would have made the shift from Buy-and-Hold to Valuation-Informed Indexing by January 1982. The problem is that the big shots in this field love the marketing edge that comes from saying that their advice is research-based but cannot bear to give up the short-term wealth that comes from pushing Get Rich Quick garbage. Buy-and-Hold gives them the best of both worlds, in their eyes. It is pure Get Rich Quick garbage. So it makes them all rich beyond their wildest hopes. But because Fama made a mistake back in 1965 and many of us have been too afraid to say that in clear and firm and simple language in the three decades since, they have been able to make claims that there is research supporting these “ideas.”
The problem with spending billions of dollars promoting the purest and most dangerous Get Rich Quick strategy ever concocted by the human mind is that doing so eventually causes the collapse of the economic system in which you live. And the collapse of the economic system eventually causes the collapse of the political system. Lots of the people who push Buy-and-Hold are very wealthy people as a result of doing so and don’t want to get off the gravy train. But do they have any real choice? Where are they going to spend their money when the economic and political system of the United States collapses? In an ultimate sense Jack Bogle has as much of a motivation to see that honest posting be permitted as I do.
These people are today suffering from cognitive dissonance. They are telling themselves that pushing the purest and most dangerous Get Rich Quick scheme ever concocted by the human mind might work out in the long run, they are trying to hang on to a belief that we will NOT see an economic or political collapse.
But based on what do they believe this?
In 12 years they have not been able to find any support in the peer-reviewed academic research for this belief of theirs.
I am a research-oriented guy, Yogi. I believe that we are going to see the economic collapse that the last 33 years of peer-reviewed research says we are going to see.
And I believe that my many Buy-and-Hold friends are going to flip shortly after we see that collapse. I believe that my good friend Jack Bogle is a good man. I believe that he is going to be my biggest booster in days to come. With Jack’s help, I am going to experience no problems receiving that $500 million paycheck or taking over ownership of the Bogleheads Forum or being invited to give the keynote address to the next FinCon event or bringing thousands upon thousands of community members to this site or profiting from books and speeches and CD packages and consulting arrangements and on and on and on.
I am not a multi-millionaire today only because my good friend Jack Bogle has not yet worked up the courage to say the three magic words “I” and “Was” and “Wrong.” But Jack is going to work up the courage to do that. He has no choice if he wants to save from economic ruin the country he loves and that has blessed him in so many ways. So Old Saint Jack is in days to come going to work up the courage to do what he should have done 33 years ago. And from that point forward we will ALL be in much more favorable financial circumstances. But that will be so for me especially. Because I am the one who has been fighting so hard for 12 years now for a principle that Old Saint Jack first articulated many years back — INVESTORS SHOULD BE ROOTING THEIR INVESTING STRATEGIES IN THE PEER-REVIEWED RESEARCH.
I’m not too worried about making money, Yogi. I would like to see it happen soon. I would like to have seen it begin happening on the morning of May 13, 2002. So I do want to see a change in that department. But that is not the thing that I worry about most.
I worry that the economic collapse will get out of hand and that even working together we will not be able to turn things around in time. I don’t think that that is how things will play out. But the fact that there is even a small chance that things might play out that way scares me to death.
That’s my primary worry, not the money thing. The money thing will work out more than fine so long as Jack eventually works up the courage to say The Three Magic Words. And he doesn’t exactly have much choice, does he? He loves his country, does he not?
I say that Jack Bogle loves his country. I am sure.
So I see good things happening for all of us in days to come, Yogi.
My best and warmest wishes to you and yours.
Rob