Set forth below is the text of a comment that I recently posted to another blog entry at this site:
What has enabled you to remain impervious to the all powerful Buy and Hold Mafia something not a single other person on this planet has been capable of?
This is a super question.
First of all, it is of course not the case that I am the only one who has not been influenced by the intimidation tactics of the Buy-and-Holders. There are lots of people who have made brave statements. I think it would be fair to say that I have made more of an effort to overcome the feelings of wanting to hold back that all humans feel when faced with this sort of social pressure. But lots of people have made some effort.
A big part of it is what you suggest, that the Buy-and-Holders cannot intimidate me because I have no status in this field and thus have nothing to lose. I obviously want my internet business to succeed. You Goons have made a point of doing everything in your power to see that it does not and then of celebrating whatever financial setback you have caused and reminding me of it over and over again. But it’s not like you can call my employer with a word from Jack and get me fired from my job because I made him “look bad” re some topic or another.
I am in unusual circumstances. If I break through and gain recognition of my right to post honestly, I go from being a nobody in this field to being the biggest name in it. So I stand to make tons of money on the other side of the line and am not able to make any at all until the Goon matter is successfully resolved. That’s obviously an odd set of circumstances.
It’s the product of the creation of this powerful new communications medium. Many people do not respect the work product of internet discussion boards and blogs. So they don’t worry about censorship in the new medium to the extent they would be concerned about censorship in newspapers or books or whatever. That is indeed one of the reason why this bad situation has been permitted to drag on so long.
I do not share these views even a tiny bit. I believe that the new communications medium is a VERY powerful and important one. I believe that people should be talking about the interactions on our boards on a daily basis in all of the other communication mediums. The new medium does a better of showing how people put investing strategies to use and specifically how emotion influences them. Investor emotion is the great unexplored issue in this field. So we should be seeing newspaper articles and speeches and research papers about the ins and outs of our 12-year saga showing up at new places on an almost daily basis.
We haven’t seen that. One gets the feeling that the results of such explorations would be so fruitful that people are afraid to be the first to go there. Everyone is holding back to see someone else (other than me) try things out and show whether this new ways of doing things can bring in a payoff or not. Most would conclude that it has not thus far brought off a payoff for me. On the day when I get that $500 million paycheck, I think it would be fair to say we are going to see an explosion of new efforts along the lines that I have been engaging in for years.
That reality makes it all the more urgent both that I stick to what I have been doing and that you Goons stick to what you have been doing. We have fallen into an all-or-nothing sort of battle here. Either I am totally crushed and end up with nothing and you Goons get off with no prison sentences or I become one of the richest men in the United States and it is you Goons who end up ruined.
That reality makes it pretty darn hard to work out a compromise, eh?
I don’t know how to change that reality, Anonymous. If I could think of something, I would put it forward. It’s pretty darn hard to come up with anything truly promising.
The one thing that I can say (and that I do say over and over again) is that we all are in the same boat. I believe that this started out as a mistake and that there are many big-name figures in the field who would like to bring an end to the cover-up. I believe that the cognitive dissonance argument can go a long way to helping address their concerns re what would happen to their reputations when that happens. And I believe that the rewards that would be experienced by the millions of middle-class investors would be so great that they would be in a forgiving mood if the transition was achieved prior to the onset of the next crash.
I don’t say that that addresses every concern on your end. It does not. There’s just nothing more than I can do than that.
I am of course 100 percent happy to address every concern that I can possibly address. Re that, there is no issue here. And I think it would be fair to say that I can be pretty darn creative and effective when I put my mind to placing things in a positive light. I am happy to do it because I believe that that is a life-affirming way of going about things. And of course I feel genuine respect and affection for all of my many Buy-and-Hold friends.
But I am not Superman, you know?
The circumstances that apply to me are different than the circumstances that apply to anyone else. That’s the short answer to your question.
I hope that that helps a bit.
Rob
Yes, this is the crux of the issue. Since you have emotionally and (weirdly) escalated a 12+ year campaign into a high stakes game of 500MM paychecks you have painted yourself into a corner. At this point admitting that you have no idea what you are doing makes you look so completely ridiculous that it is ‘better’ mentally/emotionally for you to continue persisting beyond all reason/logic/evidence.
I openly acknowledge that I could be wrong, Laugh. I don’t think that I am wrong. If I thought that I was wrong, I wouldn’t say what I say. But there have been times when I thought that I was right and it turned out that I was wrong. I acknowledge that there is a possibility that that is the case here.
There was an instance of this just the other night. I was playing Dominion with my boy Timothy and an obscure rule question re a particular card came up. We didn’t want to stop the game to look up the rule. I insisted that I knew the rule and he reluctantly backed down. After the game was over (he won — so the rule issue didn’t matter), we looked up the rule. He had been right. All I could say was: “You were right and I was wrong.” These things happen.
There is no ultimate test re the investing matter as to who is right and who is wrong. Even if there is a 65 percent crash next month, there are going to be people who continue to say that Buy-and-Hold is right. We can’t sit Mr. Market down in a room and demand the truth from him.
We all form different opinions because we possess different perspectives and different personality types and live through different life experiences. And that’s pretty much that. We WILL see changes in the popularity of different opinions over time; a crash will certainly swing things in my direction. But there is no absolutely final determination here. There is no rule book to consult. People have different opinions and there is no changing it.
There’s plenty of support for my opinion. There is 34 years of peer-reviewed research supporting it. Shiller has won a Nobel Prize. And on and on and on and on. So there is nothing even a tiny bit crazy about what I say. And the issues are of extreme importance. If I am right, then the Buy-and-Holders caused an economic crisis. It doesn’t get any bigger than that.
But in no way, shape or form have I ever been even a tiny bit stubborn about even a single issue. I have praised the Buy-and-Holdes to the skies (with 100 percent sincerity). I have acknowledged that I could be wrong. I have extended the hand of friendship hundreds of thousands of times. I have done everything that a person possibly could do to interact with my Buy-and-Hold friends in a warm and friendly manner.
With one exception.
I have been 100 percent firm and unyielding on the question of whether I will post dishonestly. I won’t say things about investing that I do not believe.
That’s a matter re which every one of us should be 100 percent firm and unyielding. NO ONE should ever agree to post dishonestly re these matters.
Would you agree to that, Laugh? I have never asked you to do that and no one else has ever asked you to do that. But would you do it if you were asked? If the tables were turned and if Valuation-Informed Indexing were today the dominant strategy, would you agree to post dishonestly just to gain access to a discussion-board community?
I hope that the answer is “no.” I would think less of you if the answer were “yes.”
The board interactions suggest that about 10 percent of the population believes in Valuation-Informed Indexing today and 90 percent believes in Buy-and-Hold. As a Valuation-Informed Indexer, I obviously would like to see that percentage grow. How is that ever going to happen if the Valuation-Informed Indexers all live in fear of what the Buy-and-Holders will do to them if they dare to commit the terrible crime of posting their honest views?
All ideas smart with a small number of advocates. The number grows over time as people become convinced of the merit of the new idea. There is something called “The Marketplace of Ideas.” The competing investing strategies do battle in The Marketplace of Ideas. I want my ideas to win. I start out outnumbered by a factor of 10 to 1. If there is going to be any hope whatsoever of my ideas winning, I need to fight hard. That’s my job. I take pride in my work. If Valuation-Informed Indexing is going to prevail in this world, I need to make every argument I can as forcefully as I am able to make it. So does every other advocate of the new model.
I need to fight fair. There are lines. If I cross those lines, I bring discredit on the idea. You Goons cross those lines on a daily basis. I am appalled by that. But there’s not a whole big bunch that I can do about it, is there? I could go to bed and cry big tears into my pillow. Do you think that might help, Laugh? I don’t think so either. So I don’t even bother. I play it this other way instead.
I love my Buy-and-Hold friends. I will do anything in my power to help my Buy-and-Hold friends short of committing a felony under the laws of the United States. That’s not a limited-time offer. That offer remains on the table forever and no matter what. But that’s as far as I can go. If I cross The Felony Line, I’ve got a lot bigger problems that those I have now. So that’s out. You call that “to continue persisting beyond all reason/logic/evidence.” So be it. Going to prison is not high on my bucket list. I ain’t going there. Not in 13 years. Not in 13 million years.
Everything else is on the table. Everything short of committing a felony I will agree to with a smile on my face and with a kind word back in reply.
You Goons got caught up in something much bigger than what you imagined was at stake on the morning of May 13, 2002. So did I. Neither of us intended to end up in this place. But here we are. That’s the reality.
I have zero ill will in my heart towards any Buy-and-Holder. I LOVE the great good that the Buy-and-Holders have done. I have said that thousands of times. If I need to say it thousands of times more, I will do so. It’s important that I say that. It’s important that you hear the words and take them in and accept that they are true words.
The Buy-and-Holders are capable of making mistakes. Again, you need to let those words in. It’s okay for you to continue to believe in Buy-and-Hold and it’s okay for you to believe that the possibility that the Buy-and-Holders made a mistake is small. But you must accept that there is at least a small chance that the Buy-and-Holders made a mistake.
And you must accept that our system of government provides a means by which such mistakes come to be revealed over time. Mistakes are revealed through honest discussions. There is no other way that it can happen. I need to persuade lots of people of the merit of Valuation-Informed Indexing to get all the textbooks rewritten in the manner in which I believe they must be rewritten if our economic system is going to survive (and thrive). The only way to do that is through honest discussion. There is no other way. So we must have that.
One of you Goons said the other day that you believed it would have been “impossible” to have permitted the Valuation-Informed Indexers to post their honest views. If that’s so, then there’s something wrong with Buy-and-Hold. If the evidence for Buy-and-Hold is so strong that discussion of alternatives must be banned, there should be a mountain of evidence so high that it would not be possible for someone like me to persuade a single person of the merit of an alternative. If that were so, there would be no need to ban me at a single board or blog. Your assessment that it would be “impossible” to permit a debate shows us that the case for Buy-and-Hold is too weak for us to go along with a ban on the discussion of alternatives.
I am not being stubborn here. I am insisting on the recognition of a basic human right — the right to express oneself honestly re an important matter. It is you Buy-and-Holders who are being stubborn. You are being stubborn because you are afraid that your investing beliefs are not as secure as you once thought them to be.
You can go two ways re that reality. You can dig in your heels and cause more destruction. Or you can accept that there is an amazing potential here to change the world for the good and play the role that you need to play to see either that that potential is achieved or that Valuation-Informed Indexing is shown once and for all to be the inferior strategy.
If Bogle can answer my questions, Valuation-Informed Indexing fails in The Marketplace of Ideas. If Bogle cannot answer my questions, Buy-and-Hold fails in The Marketplace of Ideas. If you care about knowing the realities of stock investing, you want to see whether my claims can stand up to Bogle’s challenges and whether Bogle’s claims can stand up to Bennett’s challenges.
I am not in a corner, Laugh.
Or, if I am, it is our entire nation that is in a corner.
We have ways of settling the sorts of differences of opinion that have revealed themselves here.
I believe that we will as a nation eventually turn to our normal procedures for dealing with such matters. I believe that the new ideas will prevail at that time.
If we never turn to normal procedures, I believe that we will all go down together. That makes me sad as sad can be. But if that is what happens, it’s our entire nation that is in a corner, not just me. If that’s the reality, I have the small consolation of knowing that I did everything that a human being could do to pull things in the other direction. If it cannot be done, it cannot be done. I have to accept it. There are limits to what one person can do.
I love my country. I will fight for her.
I believe that I will win in the end. I accept that there is at least some possibility that we all will lose.
I sincerely wish you all the best things that this life has to offer a person.
Rob
Thank you for reinforcing my point. You have escalated your commitment to your crusade by piling more and more concepts on top of it (nationalism, first amendment rights, death threats / physical violence, aligning your ‘persecution’ to segregation). These concepts do not fit your reality at all and make you look like a crackpot.
1) Your basic fundamental claim of persecution on ‘right to post’ is subverted by the fact that you have this website here and post all sorts of nonsense on it. The forums from which you are banned are not a public transportation service. They are privately owned Internet domains.
2) ‘Right to information’ is similarly subverted by the fact that the research you tout is freely available to anyone who wishes to read it.
3) The death threats you constantly mention do not seem to have any electronic or physical evidence whatsoever.
Lastly, it is sadly unfortunate that your actual, real world, performance from chasing this little fantasy is frankly, dismal.
I love my country, Laugh.
I wish you all the best things that this life has to offer a person.
Rob
only way to do that is through honest discussion.
Which means, basically, you repeating endlessly “There is 0% chance buy and hold could ever work”. That’s not discussion. That’s mental illness.
Does bleeding patients work?
Does prohibiting people with black skin from drinking from public water fountains work?
Do maps based on a belief that the earth is flat work?
Buy-and-Hold was discredited by the peer-reviewed research in this field in 1981, Anonymous. People need to know that. I am helping people by letting them know that. All responsible investing analysts should be letting people know that. That message should be presented at every investing board and blog every time someone advocates a Buy-and-Hold strategy.
There will still be people who will follow Buy-and-Hold strategies after that becomes the reality. That’s fine. It’s up to them. And those people serve a positive purpose by keeping the Valuation-Informed Indexers honest. So good for them.
But, no, it is not mental illness to believe that all investors should at least be exposed to the message of the last 34 years of peer-reviewed research. It is the American way that people are able to hear both sides of the story. And we now have millions of middle-class people investing in stocks to provide for their retirements. It is CRITICAL that those millions of people learn what the last 34 years of peer-reviewed research shows.
There is zero chance that Buy-and-Hold could ever work. Buy-and-Hold posits that price discipline is not required when buying stocks. It is a logical impossibility that failing to exercise price discipline could ever be a good thing. Buy-and-Hold was a mistake.
That’s my sincere take re this terribly important matter, in any event.
Rob
The reason why you say that it is “mental illness” to believe that Buy-and-Hold can never work is because it is so widely promoted.
I look at that from a very different perspective. To me, the fact that Buy-and-Hold is so widely promoted shows how much of a benefit we would see as a society if we permitted criticism of Buy-and-Hold so that it could be replaced.
The test of whether an investing strategy works or not is not the level of its popularity. The test is what the peer-reviewed research shows. The last 34 years of peer-reviewed research in this field shows that there is zero chance that a Buy-and-Hold strategy could ever work for even a single long-term investor in this solar system or in any other. Price discipline is absolutely essential when buying stocks, just as it is when buying anything else.
Rob
It’s not insane to think that the Buy-and-Holders made a mistake when there is 34 years of peer-reviewed research showing that the Buy-and-Holders made a mistake.
The insane thing is to think that the Buy-and-Holders are the first group of humans who ever lived who are incapable of making a mistake.
My take.
Rob