A Rich Life

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

My Presentation to the 2014 Financial Bloggers Conference (FinCon14): How to Predict Stock Returns for Fun and Profit

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I gave a five-minute Ignite presentation to the 2014 Financial Bloggers Conference (FinCon14) called “How to Predict Stock Returns for Fun and Profit.” Here’s the video:

 

Comments

  1. I did not think you could do it, but you self-censored yourself for five minutes. No talk of “Goons”, “Death Threats”, “Threats to get researchers fired”, “Prison Sentences”, “Board Generals”, or “500 million dollar paydays.” It’s almost as if you know that acting like a crazy idiot in public will first get you laughed at, and then get you hauled off to the looney bin.

  2. I wish that everyone in this field began talking about the Goons and the death threats and the prison sentences and all the rest when they first became an issue, Anonymous. If they had we would be in a very different place.

    There is huge leverage in talking openly and honestly about these matters. Once we do something about the intimidation tactics that have been holding us back for 33 years, all the bad stuff goes away and we all get to enjoy the benefits of being the luckiest generation of investors who ever walked Planet Earth.We ALL want that. Bogle wants that. Bernstein wants that. YOU want that.

    The big question we face as a society is — How do we get from the awful place where we are today to the wonderful place where we all want to be tomorrow? We don’t get there by ignoring the problem. We get there by FACING the problem.

    That means making reference to the Goons and to the death threats and to the prison sentences. Dealing with the problem solves the problem. Dealing with the problem gets us to the other side of The Big Black Mountain. That’s where I want to be. That’s where we ALL want to be.

    My take.

    Rob

  3. It’s almost as if you know that acting like a crazy idiot in public will first get you laughed at, and then get you hauled off to the looney bin.

    Were the reporters who reported on how President Nixon obstructed justice over something that would have been a two-day story if he has just told the truth from the first day crazy idiots, Anonymous?

    What Nixon did was crazy. But Nixon was a human just like Bogle is a human. Humans sometimes do things that get them in terrible fixes. If we care about those humans , we make an effort to help them. We don’t ignore the matter and thereby make it worse.

    I love Jack Bogle. There wouldn’t be any Valuation-Informed Indexing were it not for the good work done by my hero Jack Bogle for many years before I came on the scene. I owe him a debt of gratitude.

    So, yes, I speak up when I see him committing criminal acts of financial fraud. That’s part of what it means to be a friend to someone.

    People hate it when I talk about the death threats and the financial fraud and the prison sentences. I get that loud and clear.

    How else do we get to the other side, where we all want to be?

    Do you have any better ideas?

    There are millions of people in the process of seeing their retirements fail today. Do those people matter?

    They matter to me.

    So, yes, I will continue to talk about the death threats and the financial fraud and the prison sentences.

    Until enough others work up the courage to talk about it and thereby bring an end to the ugly side of this and help us all get to a place where we can enjoy being the luckiest generation of investors who ever walked Planet Earth.

    You don’t love Jack Bogle as much as I do.

    You don’t love Mel Linduaer as much as I do.

    You don’t love John Greaney as much as I do.

    That’s the bottom line here.

    No apologies.

    None whatsoever.

    I talk about the prison sentences out of love. Because I want to shorten them.

    I will not stop loving my many Buy-and-Hold friends and I will not stop SHOWING my love for my Buy-and-Hold friends by urging them to come clean and by pointing out to them the consequences that inevitably follow from them failing to do so.

    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

  4. “So, yes, I will continue to talk about the death threats and the financial fraud and the prison sentences.”

    But here and only here. Not in public. How do we know which is the real Rob?

  5. So, in your speech next year, can we count on you to discuss your thoughts on goons, prison sentences, death threats, job threats and $500 million settlements?

  6. If you gave a public presentation on your claims of fraud, goons, prison sentences, death threats, $500 million windfalls, etc, And also took questions from the audience, I would not only come, but I would pay admission to see that.

  7. After the next crash, we will accept as a society that we need to make the shift to Valuation-Informed Indexing and we will all come clean.

    The real Rob is the guy who tells the truth about safe withdrawal rates.

    If there had never been any death threats, there never would have been any death threats to discuss.

    I discuss the death threats because I need to discuss the death threats to lead us all to a place where we can discuss accurate SWR numbers at every board and blog on the internet.

    Both Robs are real. One is process-oriented. One is substance-oriented. Process is important because it is by following proper processes (the laws of the United States) that we get to good substance (research-based investing advice).

    People are afraid to deal with the process questions. That is so. They are afraid because of the death threats and the threats to destroy careers. So your point is a circular one. We cannot develop a solid understanding of the substance questions until we solve the process problems. Solving the process problems is imperative. And we obviously cannot solve the process problems until we all start talking about them.

    For TODAY I only discuss the process problems here. But will that remain so following the next crash? I don’t think so. We are going to need to make a transition from Buy-and-Hold to Valuation-Informed Indexing. To do that, we all need to come clean. So we will need to work through what happened on the process side. The materials at this site will help.

    Some of the materials here will help me. But some of the materials here will help YOU, X. My job is to pull us all together, not to make Buy-and-Holders look bad. When I make claims that favor the Buy-and-Holders, I need evidence to support them if I am going to convince people. Some of the materials here supply me with the evidence I need.

    I am not saying that all of the materials here help you. Some obviously do not. But some do. The purpose of the materials here is to tell BOTH sides of the story. The purpose is to help me to after the crash be able to tell a story that pulls us all together so that we can all work together to rebuild our broken economy.

    A new idea cannot grow if it is not discussed.

    The laws of our nation permit new ideas to grow.

    We got on the wrong track at some point re what the peer-reviewed research says about how stock investing works in the real world.

    We need to fix that problem. We need to get back on the right track.

    My job is to gather the materials we need as a society to do what helps us all, to get us to where we all want to go.

    My goal, stated simply, is to be able to say precisely what I believe about stock investing at every board and blog on the internet.

    I don’t want that just for me. I want that for my friend Jack Bogle. And for all my other Buy-and-Hold friends.

    I want that for everyone.

    If you have ideas re how we can get to that magic place, please share them.

    Everything I do is aimed at that purpose.

    You are right that people hate hearing about the death threats and the prison sentences. We have no dispute re that point.

    But I have to get us to that magic place. If getting us there requires that I spend some time talking (only here!) about death threats and prisons sentences, then that’s what I need to do, like it or not.

    Instead of asking “which is the real Rob?” you should be asking “which is the real United States?” Do our laws show what we are? Or does our current reality show what we are?

    I say that our laws show what we are. I say that we will be enforcing those laws following the crash.

    Our laws are not self-enforcing. It takes people to enforce them. People need to work up the courage to stand up to the Wall Street Con Men and their Internet Goon Squads if our country is to be what we all intend for it to be.

    My job is to help that process play out.

    We have delayed telling millions of middle-class investors about Valuation-Informed Indexing for 33 years now. How do we change that? That’s the question before ALL of us today.

    I think we do it by telling people about the intimidation tactics that have been holding us back for 33 years now.

    THEN we move on to the fun stuff.

    I hope that helps a bit.

    Rob

  8. Say that Bogle gave his “I Was Wrong” speech and the New York Times wrote it up.

    And that within six months of that date we had 50 percent Buy-and-Holders and 50 percent Valuation-Informed Indexers at the Bogleheads Forum.

    There would be no more death threats, right?

    We would all be friends, right?

    We would believe different things about investing. But we would be friends.

    It is the power imbalance that has caused all the trouble.

    The Buy-and-Holders make use of death threats and threats to get academic researchers fired from their jobs BECAUSE THEY CAN. They engage in that garbage BECAUSE IT WORKS.

    It doesn’t work anymore once there are prison sentences announced. There is no power imbalance once we have 50 percent Valuation-Informed Indexers at the board.

    WE NEED TO ADDRESS THAT POWER IMBALANCE.

    Once that is done, all the fun stuff starts.

    The purpose is to enjoy the fun stuff. But we cannot do that without first addressing the power imbalance.

    The laws making financial fraud a felony were adopted to help us in this sort of situation. So we should begin making use of them.

    Enforcing the laws against financial fraud doesn’t just help the Valuation-Informed Indexers. It helps the Buy-and-Holders too. Enforcing the law HELPS US ALL.

    My take.

    Rob

  9. So, in your speech next year, can we count on you to discuss your thoughts on goons, prison sentences, death threats, job threats and $500 million settlements?

    If the crash comes between now and then, I think there’s a good chance that you will hear that.

    I don’t talk about that stuff except for here because people are not ready to hear that stuff today. It’s important stuff and I want people to know about it. But I cannot force people to listen to a message that they don’t want to hear.

    Does that not make good sense?

    Rob

  10. If you gave a public presentation on your claims of fraud, goons, prison sentences, death threats, $500 million windfalls, etc, And also took questions from the audience, I would not only come, but I would pay admission to see that.

    If you set it up, I will certainly show up and make the presentation and answer any and all questions, Anonymous.

    These are important matters that every citizen of this country needs to know about. I will do all that I can to spread knowledge of what has happened.

    I told a good bit of the story in the e-mails that I sent to the 30,000 academic researchers. I intend to re-send those e-mails following the next price crash. Do you think I might get a stronger response following the crash, which will put us in jeopardy of falling into the Second Great Depression? I do.

    I will do everything that I can do. But I obviously cannot do more than that. I can communicate the message. I cannot compel people to listen and act.

    Do you see?

    Rob

  11. Why would you make a presentation about stocks when you don’t invest in stocks. It is like the Pope giving advice on sex.

  12. The Pope gives advice on sex all the time, Anonymous. There have been entire encyclicals written about the sex question.

    And I invest in stocks to a greater extent than you do. The entire point of Valuation-Informed Indexing is to take the fullest advantage of the great returns provided by stocks. Valuation-Informed Indexers own more stocks than Buy-and-Holders over the course of an investing lifetime because they make their purchases at better prices. That’s why Valuation-Informed Indexers always end up ahead. The difference is that we invest in the way that works best over the course of an investing lifetime while Buy-and-Holders do what feels good in the moment.

    You don’t love stocks. You love your Get Rich Quick impulse. When prices crash, you will hate stocks. The emotional thing to do when prices are sky high is to love stocks and the emotional thing to do when stocks are dirt cheap is to hate stocks. Buy-and-Hold is pure emotion. That’s why you hate the idea of someone being permitted to discuss the last 33 years of peer-reviewed research.

    Valuation-Informed Indexing is anti-emotionalism. It is not anti-stocks. It is perfectly possible for investors to invest in stocks in non-emotional ways. And the long-term payoff is huge.

    Rob

  13. Like I said, it is like the Pope giving sex advice. He has no experience.

    Just think of all the financial harm that would have happened by missing out on one of the greatest bull markets we have ever seen.

  14. Experience in some circumstances is a positive and in other circumstances is a negative. Experience can lead to bias. Is a heroin addict the best person to ask re whether taking drugs is a good thing or not? The heroin addict will do anything to get his fix. But he is not acting in his best interests, despite his wealth of experience with taking drugs. His addiction makes it impossible for the heroin addict to think clearly.

    So it is with those who invest their retirement money pursuant to a Get Rich Quick approach. When you post abusively, it is your addiction talking, not the real you. There was a time when you cared what the peer-reviewed research says. That’s why you became a Buy-and-Holder in the first place.

    Your experience with Buy-and-Hold hurt you rather than helped you. Becoming addicted to the pure Get Rich Quick approach made you hate the peer-reviewed research that you once loved. Your experience had proven to be a negative.

    A bull market is the worst thing that can happen to stock investors. Secular bull markets ALWAYS lead to secular bear markets. There has never in our 140 years of stock market history been an exception. And secular bear markets ALWAYS lead to economic crises. Again, there has never been a single exception. The accumulated losses that follow from bull/bear markets are always so great as to cause our economic system to collapse.

    This is a good thing? Huh?

    We would all be better off if we invested pursuant to our self-interests and priced stocks properly at all times. To do that, we would have to have access to honest and accurate reports re what the peer-reviewed research in this field shows about what works. The Wall Street Con Men are not necessarily our friends.

    My take.

    Rob

  15. Experience matters and results matter. When I go to the doctor, I choose someone that has experience and has been successful. Same goes for investing. I listen to people like John Bogle and William Berstein because they have a track record of making money, unlike Rob Bennett.

  16. So Bernie Madoff was the best qualified investment advisor right up until the day his fraudulent fund collapsed?

    I don’t buy it, Anonymous.

    Integrity matters.

    And common sense matters.

    And the findings of the peer-reviewed research matters.

    I’m all for making money. But I want the money in my retirement account to last. I have zero interest in investing in some Ponzi scheme that gets me excited for a few years and then leaves me with next to nothing when I need the money to retire on.

    The Get Rich Quick strategy advocated by Bogle and Bernstein has a very, very poor track record. It has been causing huge amounts of human misery for 140 years now. Has Bogle’s advice worked through a single bull/bear cycle? Saying that he has been “successful” is like saying that Madoff’s fund was successful until the day he was put in prison. I mean, come on.

    If Buy-and-Hold were a legitimate strategy, we never would have seen the Buy-and-Holders advance a single death threat when the errors in their Old School retirement studies were exposed. People with legitimate strategies based on real research don’t behave that way. Not ever.

    I love Bogle and Bernstein. Make no mistake. But the Bogle and Bernstein that I love are the Bogle and Bernstein that advised investors to take the findings of the peer-reviewed research into consideration when forming their investing strategies. The Bogle and Bernstein of today are the opposites of their earlier selves in every possible way. If you told the old Bogle and Bernstein that there would come a day when they would be involved in the most massive act of financial fraud in U.S. history, they would have been horrified.

    I don’t need to engage in financial fraud to promote Valuation-Informed Indexing. That’s because I have 33 years of peer-reviewed research backing up what I say. I learned the importance of checking the peer-reviewed research from Bogle and Bernstein. So I would feel that I was betraying my friendship with these two giants if I were to endorse the acts of financial fraud that their elder versions of themselves have engaged in, Not this boy.

    As for doctors, would you go to a doctor who bled his patients because that was state-of-the-art medicine many years ago? We learn new things all the time. We learned in 1981 that long-term timing always works and is always required. People like Bogle and Bernstein need to keep up with the literature if they are going to put themselves forward as “experts” in this field. And they need to possess enough courage to walk to the front of the room and say the words “I Was Wrong” when new findings are published showing that their old understanding is in error.

    Bogle and Bernstein are in the process of destroying themselves. And I love these guys. So I have worked up the courage to speak up. And I will continue to do so. I urge all who care about them and about the millions of middle-class investors whose lives they are in the process of destroying to do so as well.

    That’s my sincere take re these terribly important matters, in any event.

    Rob

  17. Bernie wasn’t investing and neither are you. I invest like Jack and Bill. I don’t believe in timing get rich quick schemes

  18. You are in good company, Anonymous.

    There are millions of smart people who invest like Jack and Bill.

    I certainly wish you (and all of them) the best of luck with it.

    Rob

  19. “There are millions of smart people who invest like Jack and Bill. I certainly wish you (and all of them) the best of luck with it.”

    It is a trademark quality of your particular personality disorder that you most certainly do not wish good fortune on that poster and yet feel that you must say that you do.

  20. All of the laws and social customs and cultural artifacts of our nation evidence that same “personality disorder,” Grandpop.

    We are a diverse nation. We have Democrats and Republicans living together. We have young people and old people living together. We have people with black skin and people with white skin living together. We have men and women living together. We have people from the South and people from the Northeast living together. And on and on and on.

    For people with differences to live together in harmony, there has to be a mutual respect for the other guy’s position. I have evidenced my respect for my many Buy-and-Hold friends in every one of the hundreds of thousands of posts that I have put forward over the past 12 years. You Goons never evidence any respect whatsoever for Valuation-Informed Indexers. You only evidence hate and envy and anger and contempt.

    That’s the problem. That’s always been the problem.

    It’s not in my power to make you stop hating.

    But I pray that I never join you.

    There’s no one on this planet who feels the respect and affection that I feel for Jack Bogle. I think it would be fair to say that I feel more respect and affection for the man than he feels for himself.

    And, yes, I care what happens to Anonymous and you and Mel Linduaer and John Greaney too.

    I don’t care ONLY for them. I care for the millions of middle-class investors whose lives they are in the process of destroying too. But I certainly care for them.

    I don’t believe that there are two “sides” re this matter. It is my strongly held view that we are all in this together and that deep in our hearts we all want the same things. We ALL agreed to follow the published rules of the boards and blogs at which we post. There is nothing else re which every last one of us is in agreement as much as we are in at least formal agreement that the tactics employed by you Goons should never be tolerated at a single board. It’s you Goons who have betrayed yourselves. It’s you Goons who hate yourselves and who evidence that hate on a daily basis.

    I wish good fortune on Anonymous and I wish good fortune on you, Grandpop. You and Anonymous do not wish good fortune on me.

    Why?

    Because I have the peer-reviewed research in this field backing me and you do not. So it doesn’t bother me that there are people who do not agree with me on how to invest in stocks. While it bothers you a great deal that there are people who do not agree with you.

    My aim is to change that. My aim is to help you feel the peace that I feel.

    But I cannot pull it off without your cooperation, can I?

    When you are ready to let go of the hate, I am here for you, man. I cannot force it no matter how much I care.

    My best and warmest wishes to you and yours.

    Rob

  23. “I wish good fortune on Anonymous and I wish good fortune on you, Grandpop.”

    Really? You are hoping for people to go to prison and for stock to drop 65%. That sounds like someone that is bitter and angry and wants revenge.

  24. The sooner we open the internet up to honest posting on SWRs and many other topics, the shorter your prison sentence will be. Nobody has been pushing for that harder than me.

    And there will not be a 65 percent drop if we open the internet to honest posting on the last 33 years of peer-reviewed research. If we permitted people to learn what the research says, the P/E10 level could never drop below 15 again. That’s a significant drop from where we are today. But it is a drop of a good bit less than 65 percent.

    And of course we wouldn’t be seeing any drop at all if we had stabilized at 15 back in 2009, as we would have had we opened the internet up to honest posting back then. The economic crisis would be over now had we done that.

    It’s the Buy-and-Hold Lies that are killing us. Learning what the peer-reviwed research shows is good stuff piled on top of good stuff piled on top of good stuff.

    I am not bitter and angry and seeking revenge. I am excited and loving and seeking greater prosperity for all.

    What a meanie I am to want to share with people what they need to know to reduce investing risk by 70 percent!

    How could anyone BE so mean?

    Rob

  25. and for stock to drop 65%.

    Think about what you are saying, man.

    Say we were talking about a car you wanted to buy.

    Would you be having nightmares about the possibility that its price might drop by two-thirds?

    Lower prices on things you plan to buy are a good thing.

    The only reason you view lower prices for stocks as a bad thing is that you are counting on the Pretend Gains to finance your retirement. That’s not on me. That’s on the other guy. I have been telling you since May 13, 2002, not to count on the Pretend Gains.

    Outside of the popping of the Buy-and-Hold Fantasy, lower prices for stocks help all of us.

    Rob

  26. For people with differences to live together in harmony, there has to be a mutual respect for the other guy’s position.

    Right, and when that respect is broken, the offender needs to be taken out of society. In real life, this might mean jail time, or not being invited back to a social gathering.

    On the internet, these trolls can just be banned. Problem solved.

  27. Except that you cannot ban the Reality Principle, as reflected in the peer-reviewed research.

    And the longer you try, the more it eats you up inside.

    Rob

  28. “We ALL agreed to follow the published rules of the boards and blogs at which we post.”

    I didn’t.

    (And where are YOUR rules, for posting here?)

  29. Read the rules of all of our boards and blogs. Those are my rules.

    Read the laws of the United States of America. Those are my rules.

    Read the history of civilized peoples. Those are my rules.

    You say that you never agreed to those rules. I say you did.

    Otherwise, why would you be so filled with self-hate?

    You don’t hate me, Grandpop. That’s a pose. You hate yourself. I hold up a mirror to you and you see the thing you hate, that’s all. If you never cared about what the peer-reviewed research says, nothing that I say would bother you so much.

    Rob