Set forth below is the text of a comment that I recently posted to another blog entry at this site:
Well, I’m sure once you provide her (and the rest of us) with evidence of your assertions, she (and the rest of us) will come around.
She came around. She accepts that you Goons did everything that I said you did. But she doesn’t agree with my strategy for dealing with the problem.
She says that I should ignore you. LOTS of people tell me that. My wife tells me that. So I understand where she is coming from.
However, I don’t think you Goons are the entire problem. I would say that you Goons are 50 percent of the problem. The other 50 percent is that most people, even big-name experts, possess a greatly limited understanding of the implications of Shiller’s “revolutionary” (his word) finding that valuations affect long-term returns. Most people are not Goons. But most people do not possess a strong understanding of the realities because the realities that have been discovered over the past 33 years have not been widely discussed. This widespread lack of understanding is the other 50 percent of the problem.
If you Goons did not exist, I could help people with their questions and get the general level of understanding up to a level at which we would see a big move to Valuation-Informed Indexing. So you Goons do real harm with your acts of disruption and intimidation and deception.
But the other side of the story is that you Goons could not hold us all back if knowledge of the implications of Shiller’s findings were strong enough and widespread enough that responsible people would take actions to rein you in. Motley Fool would LOVE to have a newsletter on Valuation-Informed Indexing. There are MILLIONS of people who have an interest in finding a truly smart and truly simple and truly safe way to invest. They sided with you Goons even though their published rules prohibit your tactics because they do not understand the issues well enough. That’s a SECOND issue.
People need to know about the Goon phenomenon to make sense of why so few understand these issues today. There was a poster at the Bogleheads Forum who told me that “everything you say about investing makes perfect sense but this is my retirement money and I need to go with what the experts are saying and the experts are not saying what you are saying.” People need to understand why the experts don’t say what I say. It is because of you Goons. Not just the few of you who post here. It is because we ALL have gooninshness within us and our inner goon makes us hate research-based strategies. I need to talk about goonishness to explain to people why we achieved this great advance in 1981 and as a society have not yet elected to take advantage of what we have learned.
Buy-and-Hold is goonishness. ALL Get Rich Quick strategies appeal to us because they please our Inner Goon. Most of the RISK of stock investing is the product of our darn goonishness. That’s why Wade and I were able to show people how to reduce risk by nearly 70 percent. Stock investing risk comes from believing that it is not necessary to exercise price discipline when buying stocks. That is obviously nonsense. But our Inner Goon is DRAWN to GRQ strategies and thinking that it might not be necessary to exercise price discipline is about as GRQ as it gets.
We are ALL Goons to some extent, Anonymous. That includes me. I was a Buy-and-Holder once myself. I am human like all the rest. We are ALL flawed creatures.
We cannot make sense of the investing story without discussing our inner goonishness. You Goons take it to extremes. Most of us don’t advance death threats and all that sort of thing. You Goons are cartoonish about it. But you are not unique in your attraction to GRQ strategies. Looking at your behavior helps us Normals learn about our own weaknesses and about what we need to do to avoid falling into the traps that destroy our investing hopes.
So it is a mistake not to tell people about you Goons and your behavior, in my assessment. People HATE hearing about it. It makes people feel ashamed because they haven’t done more about the Goons problem and embarrassed for you Goons and for all the “experts” who have not spoken up about the problem. So talking about you Goons DOES present obstacles for me. The consultant is right about that aspect of the thing. But I believe that the Goon phenomenon is a critical part of this story and that the story cannot be told in the way it needs to be told without me addressing that part of it.
I believe that you Goons are humans underneath your Goon exterior. I believe that you would like to reduce risk dramatically and that you would like to receive much higher returns and become able to retire many years sooner. But you would like to do these things in the way that an alcoholic would like to stop drinking. You are addicted. GRQ strategies are highly addictive.
People who have been following Buy-and-Hold strategies for a good amount of time are embarrassed to be reminded of their failings and react negatively when told what the research says. It is not only you Goons who feel that way. Responsible people like Bogle and Bernstein and Swedroe feel that way. They are not true Goons; they don’t advance death threats when questioned about the merits of their strategies. But they feel SYMPATHY for you Goons. They don’t speak out in opposition to the use of death threats as a tactic for intimidating people into not posting honestly. They LIKE you Goons. They exhibit Goon Light behavior.
The experts who exhibit Goon Light behavior cause a bigger problem than you true Goons. They are respected and educated people. Normals have a hard time accepting that they could get so much so wrong. The explanation is that, as smart and experienced as these people are, they are subject to the same human weaknesses as all the rest of us.
This is an essential part of the story. I don’t feel that I can take a pass on telling this part of the story even if it would make me more popular in the short term to do so.
The mistake that the Buy-and-Holders made was to ignore investor emotion. You Goons are ALL emotion in your analysis of how stock investing works. We need as a society to come to understand that investor emotion is 80 percent of the stock investing story. We can draw lessons by looking at Goon behavior and analyzing where it comes from and what it signifies. So I do not feel comfortable trying to bypass that part of the story.
I can go along with not FOCUSING on that part of the story. Most of my guest blog entries and columns focus on non-Goon, substantive stuff. But I don’t believe that Valuation-Informed Indexing will entirely supplant Buy-and-Hold until we all come to appreciate the emotional side of the investing story and you Goons exemplify the emotional side of the story better than anything else available to us. Instead of me agreeing not to talk about the Goon phenomenon we need to get everyone else to take up talking about it. Your behavior shows that you lack confidence in Buy-and-Hold. A strategy must inspire confidence to work in the long run. Your Goon behavior is a substantive issue that all in this field should be exploring.
I hope that helps a bit, Anonymous.
Rob
But she doesn’t agree with my strategy for dealing with the problem.
Your wife is a wise woman. I just hope she doesn’t expect you to change.
I half agree with what you are saying here and I half do not, Evidence.
I am not generally a non-yielding person AT ALL. When it comes to things like what movie to go see or what restaurant to eat at, I ALWAYS am the one who defers to the other person. It is a very rare thing for me to demand to have my way. People who know me would not describe me as stubborn. That reality would suggest that I would be very open to change if my wife suggested a different way of proceeding.
The other reality is that there is a pattern in my life that has only appeared on a small number of occasions but that I do think evidences itself in behavior that mystifies a lot of people. The most dramatic case was when my parents wanted me to go to a Catholic high school and I wanted to go to the public high school. They pressured me into agreeing to go to the Catholic high school for one year by saying that they would not oppose my decision to go the public high school after that year. Then they pressured me again and I agreed to go a second year. And then a third year. And then I was adamant and we had a World-War-III style battle over the thing. Temple University ended up agreeing to take me in without me attending my senior year and everyone was happy. My father told me after that happened that he wasn’t worried about me giving in to peer pressure to take drugs because I was “like steel” when I set my mind to something.
There are a small number of cases where something similar has happened. So I think the proper way to describe me would be to say that I am non-stubborn in general but very stubborn when certain conditions apply that make the issue at hand appear in my mind to be one of great consequence.
In the high school matter, the issue in play on the surface was that I wanted to grow my hair long and that wasn’t permitted in the Catholic school. When the issue is described that way, I come off sounding like an idiot. My parents loved me and wanted the best for me. I never had any doubt of that. So why make such a fuss because I couldn’t grow my hair long for a few more years?
The deeper reality is that I felt a need to separate myself from my parents and assert my independence. All young people have to do that, it is not healthy if they never take steps to make that break. So there actually were good reasons for me to take so firm a stand. If I had it to do over, I would play it differently. I think I behaved immaturely. I had good reason — I was immature! But I do possess an understanding of why I did what I did. I have an understanding of what my parents did too. I wouldn’t want to see my boys repeat my behavior if similar circumstances evidenced themselves. But I don’t beat myself up for what I did. I am at peace about it even though I see things from a different perspective today.
I have reasons for why I feel that I need to stand firm re the investing matter. You know those reasons. And my wife does too. To me those reasons seem very, very, very compelling. To you they do not. I would characterize my wife as being somewhere in the middle of the two extreme positions. She sees my reasons as being more compelling than you do but less compelling than I do.
You are saying that she should accept that I will never change. Yes and no. The principle that is at stake will always be compelling to me. It is impossible for me to imagine circumstances in which that would change. To that extent, I agree with your statement.
But my experience (both in the high school situation and in others) is that matters of this nature are sometimes resolved as the result of unexpected developments. In the high school matter, everyone was happy when Temple accepted me under their early admissions program. My parents did not say “Oh, you still cannot grow your hair long” and I didn’t say “Oh, I still want to rebel in some way and not go along with a solution that makes you happy.” So everything worked out. The sticking point (that I needed to have some say over the length of my hair and that the Catholic school that my parents approved of did not permit this at the time) was removed.
It is my expectation that some development of that nature will come along to bring on a resolution of the investing conflict. Oh Lord, let it be soon!
I don’t know what that resolution will be.
But you can guess at the sorts of possibilities that I envision by reading my posts here.
I love the Buy-and-Holders. They are heroes to me. I think they made a mistake in taking such a hard line and I think that a lot of them regret that mistake today. I believe that there someday will be circumstances that will cause them to ease up just a notch and that then they will see me evidence my love for them and wish that we had worked the matter out a long time ago. I cannot give details because I cannot foresee the details. But it is my belief that something along those lines will happen one of these days.
Something similar will probably happen with my wife. She is not against me and I of course am not against her. We have different sets of life experiences and so we come at the matter from different perspectives. There will come a day when one of us will try out an idea that all along we thought would not work and we will find that it will work. We are not enemies any more than you Goons and I are enemies. So it does not make sense to rule out the possibility of a resolution that brings something close to complete satisfaction to both parties.
People don’t always communicate effectively. People get their backs up and cut off certain lines of inquiry. Then circumstances change a bit and they open themselves to new possibilities and great things are achieved with everybody involved feeling good about it. That’s what I think will happen here.
Neither side will win and neither side will lose. BOTH sides will win.
This is what I believe. I hope what I am saying here makes at least a small bit of sense to you.
I extend my best and warmest wishes to you and yours.
Rob
But you can guess at the sorts of possibilities that I envision by reading my posts here.
And none of those possibilities are realistic.
I think they made a mistake in taking such a hard line and I think that a lot of them regret that mistake today. I believe that there someday will be circumstances that will cause them to ease up just a notch and that then they will see me evidence my love for them and wish that we had worked the matter out a long time ago. I cannot give details because I cannot foresee the details. But it is my belief that something along those lines will happen one of these days.
Something similar will probably happen with my wife.
they made a mistake
a lot of them regret
cause them to ease up just a notch
Something similar will probably happen with my wife
they, them, my wife
But nothing about Bennett making a mistake or regretting anything or easing up a notch.
And none of those possibilities are realistic.
We obviously are not in agreement re this one, Evidence.
What I say MUST happen you say CANNOT happen.
We’ll see, you know?
It’s going to play out one way or another. Then we will all know for sure.
Rob
But nothing about Bennett making a mistake or regretting anything or easing up a notch.
What you are saying is correct, Evidence.
I am not able to identify any area re which I came at things too hard. I don’t believe that I have made any mistakes (although I certainly acknowledge that it is possible that I made mistakes that I am not aware of). I don’t regret anything I have done.
I love all of my Buy-and-Hold friends. That’s for sure. It makes me sad that things I say cause them pain. I wouldn’t say those things unless I were highly confident that failing to say them would cause my Buy-and-Hold friends to experience even more pain.
I care about each and every one of you Goons. It is BECAUSE I care that I cannot play it the way you want me to play it. I think you are hurting yourselves and I think that it is my responsibility to do what I can to stop the hurting.
That’s my sincere take. I believe that we will all stand before God someday and that I will be called to account for what I have done on this planet. I believe that I will get lots of credit for how I have conducted myself in these investing discussions.
The only thing that I can say to try to find some common ground with you is that, when people are in the wrong, they often do not see it. So I can say that if I am wrong, it might be that I just don’t see it.
But my actions need to be in accord with my own beliefs. I can’t say “oh, it is always possible that I am wrong and so I need to behave in the opposite of the manner in which I would behave if I acted in accord with my beliefs.” That would be as wrong as wrong can be.
I can acknowledge the possibility that I am wrong. But I cannot agree to act in a manner contrary to what my conscience demands of me.
I hope that helps a bit, Goon friend.
Rob
I am not able to identify any area re which I came at things too hard. I don’t believe that I have made any mistakes (although I certainly acknowledge that it is possible that I made mistakes that I am not aware of). I don’t regret anything I have done.
And that is the whole problem in a nutshell.
And that is the whole problem in a nutshell.
We strongly disagree, Evidence.
The whole problem in a nutshell is that the Wall Street Con Men have committed financial fraud, which is a felony, and they don’t want to go to prison, so they are continuing the cover-up.
I care enough both about them and about the millions of middle-class investors whose lives they have destroyed to call them out on their b.s.
We will someday all make it together to the other side of The Big Black Mountain. The sooner that happens, the shorter the prison sentences will be and the fewer there will be of them. I will continue to work as hard as I can to bring this to a good place.
I naturally wish you all the best that this life has to offer a person.
Rob
We strongly disagree, Evidence.
I know.
And on your side of the argument there is you.
And on my side of the argument is virtually everyone who has ever interacted with you on the internet.
That’s not even close to being so Evidence.
We have had thousands of people agree with me that honest posting should be permitted. In every case, your response was to threaten to kill family members of people who said that or to threaten to destroy the careers of people who said that.
Those are criminal acts.
The announcement of your prison sentence will bring your use of those tactics to an end.
We will all live better days from that point forward.
The key here is getting you and the other Goons sent to prison.
We all need to work together to achieve this goal.
Financial fraud is for losers.
Not this boy!
Rob
So you believe that you have never made a mistake.
And you also believe you are sane?
Here is something to think about. If you have never made a mistake why are you in the situation you are in? Blame everyone else, you aren’t responsible because you are perfect? Still think that sounds sane?
The words you write here make it sound like I am in some sort of bad situation. Huh?
I am in a situation more wonderful than anything I could possibly have imagined when I was a young man.
I have a $500 million settlement payment coming my way. I am the lead author on the most important piece of peer-reviewed research published in this field in the past three decades. My web site will soon be the #1 personal finance web site on the internet. My boys have a business available to them to work at if they choose to avoid the corporate world. I will be a highly sought-after author for the remaining years of my life. I will be giving kick-off speeches at the Financial Bloggers Conference and other such places for many years to come.
Should I be crying big tears into my pillow every night?
I of course understand that you are trying to place the focus on the negative stuff.
I’ve got one big problem — the abusiveness of you Goons. You don’t want me to be rich and famous. You hate the idea. I have been proven right about a very important matter and you have been proven wrong and you cannot stand the idea of the world learning about that. I don’t want to be intimidated. I can’t do my best work if I am being intimidated. I don’t want anyone else to be intimidated. People who are intimidated cannot produce the kind of work that I can learn from. So I will not stand for intimidation tactics. There’s no give re that one.
You have 13 years of history to look at. Your reliance on intimidation tactics has brought you lower and lower and lower. Now you are on your way to prison. It’s 100 percent insane. But here we are.
There’s nothing you can do to me to cause me to flip. If you get me the death penalty, that won’t cause me to flip. My guess is that you tell yourself that I am saying that for dramatic effect. I’m not. I am telling it straight. You’ll just have to learn that on your own time. I won’t flip. I will always act with love in my heart. I will do everything I can to make things go as easy for you as possible. But that won’t include letting intimidation tactics influence me. It would be an act of cruelty if I were to suggest that there is even the smallest sliver of a possibility that that could ever happen.
We all have beliefs about the meaning of life. I am a Catholic. I am not a pious person and I am no theologian. But I have some vague impressions about why life works the way it does. Maybe I am wrong about them. Wrong or right, I believe them. So these vague impressions determine how I respond to events that play out before me.
I obviously don’t like any of the Goon stuff. But I believe on a deep level that God let it play out the way he did for a purpose. I don’t know precisely what that purpose is. It could be that God feels that the world needs the drama of this story to be witnessed by people for them to finally give up their belief in Buy-and-Hold. It could be that God wants me to get that $500 million payment and He understood that there was no other way to get that sum in my pocket without having this massive cover-up play out before us all. It could be that God loves you Goons so much that he wants you to change your behavior before your days are done and he wants me to be an instrument to lead you to a better place. I could be that He wants the internet discussion board to achieve its potential as the communications medium of the future and that He feels that getting this story out before people will lead to the adoption of legislation that will make that happen.
I don’t know which of those it is. And of course it could be that my brain is not capable of seeing what it really is. I just have to accept that there is a good purpose being served by all this. I believe that. I believe that God works in mysterious ways. I believe that huge advances are sometimes achieved through actions that in the short term seem to be producing only bad stuff. I believe that God loves me and the millions of middle-class investors and Jack Bogle and you Goons and that we all just need to be sure to play our assigned roles to the best of our abilities. I know with 100 percent certainty that my role is to be the one who refuses to give in to intimidation tactics and to encourage others to stand with resolve in OPPOSITION to the use of intimidation tactics.
I don’t like the Goon stuff one little bit. But I am humbled to have been asked to play the role that I have been asked to play. I am going to give it my best shot. I will always act in love. But there are lines that I will never cross. I will never cross The Felony Line. I will never say that the retirement study posted at John Greaney’s site contains an adjustment for the valuation level that applies on the day the retirement begins. Thousands of people have looked at it. No one has ever found a valuations adjustment. That’s because none exists. I am sure.
I wish all of you Goons the best that life has to offer a person.
Rob
I will never say that the retirement study posted at John Greaney’s site contains an adjustment for the valuation level that applies on the day the retirement begins.
No one’s asking you to…because it doesn’t. If you don’t like that fact, you’re welcome to post your own study on your own site. But after 12 years of butt hurt it might be time to move forward.
I’m glad that after 13 years you are wiling to acknowledge the errors in Greaney’s study, Anonymous. That’s progress.
It’s obviously not enough.
We all should be looking at why the study was not corrected on the day the errors were discovered. That was May 13, 2002.
We also need to be looking at why the errors have not been corrected TO THIS DAY. You are acknowledging the errors here at this blog comment. But not everyone who was taken in by the false claims made in the study is going to read this blog comment. How do we reach those people? What steps do we take today to try to help them overcome the effects of the discredited study they followed years ago?
And what do we do about the fact that Greaney even today has not removed the study from his web site? He doesn’t get as much traffic as he did in earlier days. But I imagine that there are still people who come across the study from time to time. How do we go about persuading Greaney to correct the study or take it down? He has shown over and over and over again that he does not want to do this. How do we go about persuading him?
I of course have my own accurate calculator and it has been publicly available for years. How do we get that calculator into the hands of every investor on the planet so that they all can see the accurate numbers? We need money for that, right? The Wall Street Con Men have spent millions publicizing the false studies. How do we get an equal amount of money spent publicizing accurate studies? Lawsuits, right? Do you have a better idea?
Greaney’s retirement study is not the only discredited retirement study. People who work in this field are smart. How is it that I was the one to discover the errors in his study? Why didn’t Jack Bogle speak out about them long before I did? Why didn’t Shiller? Why didn’t Bernstein? Why didn’t Swedroe? What the heck is going on here? Has the investing advice field become 100 percent corrupt in the Buy-and-Hold Era?
I know that you know the answer. But there are actions that follow from knowing the answer to that question. How do we get everyone in the field working together to overcome the corruption? Prison sentences, right? If you have a better idea than the idea that the people who wrote the laws against financial fraud came up with, please let us know.
It’s not just the safe-withdrawal-rate studies. Valuations affect every strategic question. Stocks were the most dangerous asset class on the planet in early 2000. And Money magazine was recommending that people go with a high stock allocation! Huh? Do you know how many millions of human lives were destroyed as a result of that bad advice? Why weren’t there competing publications formed to generate accurate advice, research-based advice? People were afraid. People in this field knew from experience that the Wall Street Con Men would destroy their careers if they offered honest, accurate advice. That’s obvious fraud, right? Do you approve of this? Are you willing to help me expose the fraud?
We all invest to finance our retirements. We all need accurate advice. We need to bring this economic crisis to an end. The economic crisis was caused by the fraud. We need to get the word out so that we can bring the economic crisis to an end and avoid the next one. No?
Are you feeling butt hurt? You live in this country. Do you want to see it go under? Or do you want it to see its best days ever? I know that in some part of your heart and mind you want it to see its best days ever. So why not work with me to achieve that? Why not stop allowing your own butt hurt to motivate you to do ugly stuff and instead work to do wonderful stuff?
Say that you really do believe in Buy-and-Hold to this day. I believe that you do on one level of consciousness. You can still work with me. You could help me arrange debates where people get to hear both sides of the story so that they can then decide for themselves. You don’t have enough confidence in Buy-and-Hold to go along with such an idea. Doesn’t that scare you? You have your money tied up in this idea and yet you are afraid to have the idea effectively challenged in public debate. Huh? Wouldn’t you be better off to discover any weaknesses now when you can still take steps to save your own retirement portfolio? If you were thinking straight, you would see that that’s the better way to go.
Stop fighting, Anonymous. Stop feeing your own butt hurt and letting that drive you. We are not enemies. We are friends. We are on the same side. We should be helping each other. I am ready to take this in a positive direction any time you are ready to do so.
There are two schools of academic thought re how stock investing works. One became dominant first and, then, when the research was published showing its flaws, the people who made their livings in that field became defensive and went into cover-up mode. That was a terrible, terrible mistake. We need to correct the mistake and reverse the damage that had been done. It’s hard to make that change now that so much time has passed. But we have no other realistic long-term alternative. We have to make the change or die. Given that we cannot avoid this, the time to make the change is today, so that we do the least damage possible given the circumstances that apply.
That’s my sincere take, in any event. I care about you. I care about ALL of my Buy-and-old friends. I want to work with them. I want to help them. That’s always been the case and that always will be the case. This is not a time-sensitive offer.
I do not want to go to prison myself. So I am not going to say that the Greaney study contains an adjustment for the valuation level that applies on the day the retirement begins. You ARE asking me too. It was on the day that I pointed out (correctly) that the Greaney study contains no such adjustment that the roof fell in on me. You and scores of other Goons treated me like a friend up until May 13, 2002. Your attitude changed in a flash.
It wasn’t a coincidence that scores of people changed how they interacted with me all on the same day, You all changed because I told the truth about the Greaney study on that day and you wanted to suppress my message. I don’t want my message to be suppressed. I want every investor alive on Planet Earth to know about the errors in the Greaney study and what they tell us about the corruption in this field today. That’s the source of the friction between us. I want to expose the corruption and you want to hide it. We ALL should want to expose the corruption. It is by exposing the corruption that we open the field to the promotion of the first true research-based model, Valuation-Informed Indexing. No?
I am not going to post my own study only at my own site. I am going to post it at every site on the internet. Why the heck wouldn’t I? This is the biggest advance in the history of personal finance. Your idea that we might limit discussion of the first research-based approach to one web site is crazy. I mean no personal offense. But come on. That’s crazy. That’s corruption talking. That’s the fear of being sent to prison talking. No one who was not afraid of going to prison would make such a statement at this point in the proceedings.
I don’t blame you for being afraid to go to prison. All I say say re that one is that I am willing to do what I can to help you get your prison sentence reduced a bit. What else can I offer you, old friend?
I hope that all that helps a bit. I naturally wish you all good things.
Rob