Set forth below are excerpts from the texts of two comments posted to another blog entry at this site by a Goon poster going by the name of “Laugh.” The second comment was posted a little over an hour after the posting of the first comment.
Comment #1: Um, except the papers are all available publicly and have been read by thousands and tens of thousands of people without any barriers. There is no cover up. The information is freely available and well known (as well known as any Nobel prize winning research). It has had no effect on market crashes.
You say there is a cover up but any individual in the world can download the information and act upon it without any inhibitors. The barriers you have created you have built yourself within the confines of your fevered mind.
Comment #2: Those boards are the property of other people/companies/etc. They can kick you out at any time.
You can also say ‘I followed the board rules’. Those board rules can be changed by the owner of the board at any time, and the board owner doesn’t really have to follow them either.
I am sorry that you have been operating under these illusions for more than a decade. It is truly sad.
The person named Laugh is correct.
I half agree with both you and with Laugh, Reality.
I posted Laugh’s comment as a blog entry because I think he is making an important point. Shiller’s book was a best-seller. It is available in most public libraries. He was awarded a Nobel prize for his “revolutionary” (his word) research. Shiller’s findings have been covered-up in an important sense — there is not one site on the internet other than this one that explores the implications of those findings in depth. So the cover-up is real. Yet it is a very strange sort of cover-up in which the findings win a Nobel prize and in which a book reporting on the findings is a best-seller and is added to the collections of most public libraries.
We agree on the basic facts. The general public will have to decide for itself whether those facts constitute a “cover-up” or not. I say that it is a cover-up but a highly unusual one. I don’t think the Buy-and-Holders had bad intent when they started out. And I believe that they follow Buy-and-Hold strategies themselves to this day. It is not their intent to hurt people. They think they are giving good advice. I can sign onto any statement saying that.
But death threats? Demands for unjustified board bannings? Tens of thousands of acts of defamation? Threats to get academic researchers fired from their jobs?
Huh?
That stuff sure sounds like the sort of stuff you see only in a massive cover-up, Reality. I cannot say different re this aspect of things.
What I believe is that there was good intent starting out. Then Shiller published research throwing doubt on the entire Buy-and-Hold project. The Buy-and-Holders suffered cognitive dissonance. They could not accept that the model that they had developed was wrong. So they ignored Shiller. They went on with their business thinking that they had done nothing wrong. And they hadn’t done any serious wrong at that point. They were wrong about how stock investing works, in my assessment. But they were sincere. And they had put forward many genuine insights. So it was a mix. Which is what you would expect in the early days of a project to take the speculation out of investing analysis and make it more of a science.
But as time passed the Buy-and-Holders became more and more embarrassed about how they had not tried to respond to Shiller’s findings. In science, we discover mistakes as new research is published and we move forward. That hasn’t happened in the investing field and it is because of the efforts of the Buy-and-Holders that it hasn’t happened. So over time it became a thing not where they were just ignoring Shiller themselves but where they were also engaging in intimidation tactics to block people from explaining to others how they had ignored him and how they had thereby caused an economic crisis.
That’s where the financial fraud comes in, in my assessment.
I think it is fraud if you run a blog and you advocate Buy-and-Hold and a fellow comes on and points out that there is 34 years of peer-reviewed research showing that Buy-and-Hold is dangerous and your readers tell you that the fellow is upsetting them and you ban him because you want to make a buck and you can’t do it so long as this guy keeps posting stuff in accord with the last 34 years of peer-reviewed research. I say that that is fraud. I say that you can go to prison for that.
You say otherwise. And Laugh says otherwise.
Okay.
What do you want me to do about it?
I’m not going to join in on this massive act of fraud. I have not done that in 13 years. And I am not going to do it in 13 billion years. For obvious reasons.
I suppose that we will find out what the rest of the community of investors believes following the next crash. At that point people will have no emotional reason to continue to believe in Buy-and-Hold. They will be angry at the “experts” who caused them to lose their retirement money. They will be looking for people to hang from a tree. The Buy-and-Holders will be the obvious candidates. Especially the ones who engaged in insanely abusive intimidation tactics.
Do you know what I will be doing then? I will be arguing for mercy. I will be saying that we need to pull our country together and that going after the Buy-and-Holders and even you Goons will to a large extent be counter-productive. So I will be on your side. I am on your side now. But it will take more friendship for me to be on your side then, when I will have lots of people calling for your hanging. But, if I am true to myself, I will remain on your side even then. It’s the right way t go. I am sure.
That doesn’t mean that I will say that there should be no prison sentences. I think there should be some. And we will not be able to calm down the millions who will have seen their retirement plans collapse without mixing in a little justice with the all-important mercy. We sent Bernie Madoff to prison. You Goons have caused 10,000 times the human misery that Bernie Madoff caused. I am not able to see how we could fail to send at least a small number of people to prison following the next crash.
Maybe it won’t happen. I am not God. I could be wrong. I certainly am not going to demand prison sentences if most others don’t see a need for them. I am going to post honestly. I am going to tell the story of why millions of middle-class people will have lost their retirement money. If people demand prison sentences, I will ask for a show of mercy given the unusual circumstances re the lengths of those prison sentences. If most people do not demand prison sentences of any length, I will go about my business of helping people to understand how stock investing works in the real world, according to the last 34 years of peer-reviewed research in this field. It’s not going to bother me one tiny bit if you don’t get sent to prison, Reality. I have much, much bigger fish to fry.
We’ll see what happens, okay?
I believe that deep in your heart you want to know how stock investing works in the real world, just like everybody else. So I believe that deep in your heart you are on the same side that I am on. That’s why I chalk your behavior up to emotional pain and am able to bring myself to say that your prison sentence should be shorter than it would be in other circumstances. I believe that you will flip following the next crash. Maybe you will call for a prison sentence for your old self at that time! That’s a strange thing to say. But it’s no stranger than a lot of other stuff we have seen during the first 13 years of our Debate About Having a Debate.
I am going to continue to post honestly. That’s in stone. That can never change.
I love my Buy-and-Hold friends and am going to show as much charity to them as it is possible for me to show them without crossing the line and becoming guilty of financial fraud myself. That’s also in stone. That also can never change, no matter what you Goons say or do.
We are all going to just have to evidence a little patience and wait to see how it plays out. We don’t have any other options available to us. It’s not just that I will not post dishonestly re safe withdrawal rates. It’s that I CANNOT post dishonestly re safe withdrawal rates. It’s not in me. If something is not in a person, that something is not in that person. That’s the way it is. I mean, come on.
I will be as honest as I can possibly be without crossing the line and becoming uncharitable while also being as charitable as I can possibly be without crossing the line and becoming dishonest. And we will all see how that strategy plays out following the next price crash.
I believe that it is going to play out very, very well indeed.
Because I love my country. I believe in it. I think we have the capacity to work through these sorts of things in time.
But we’ll see.
I naturally wish you the best of luck in all your future life endeavors, Reality.
Take good care, man.
Rob
Just a suggestion, perhaps you should post your rules for acceptable comments. The two comments from Laugh that you served up as today’s post certainly wouldn’t get through anymore.
Comments that add to our collective learning experience are encouraged. Comments that detract from our collective learning experience are discouraged.
I obviously approved the two comments by Laugh. And then I highlighted them by featuring them as a separate blog entry. I believed that there was a learning experience to be had by seeing them and thinking about what they signify.
Now —
If Laugh showed up every day and posted those same words to every blog entry here, I wouldn’t approve them every time. I can see approving the same comment more than once if it was used in two different places where it had some relevance. But I wouldn’t approve the same comment on a daily basis because it would be boring for people to read the same words over and over again.
You need to add something. That’s the bottom line. I’ve approved death threats. Death threats hurt us because they drive good people away. So my first reaction to a death threat is to want to delete it. But death threats signify something in this particular debate. They show how emotional Buy-and-Holders become when challenged with accurate reports of what the last 34 years of peer-reviewed research shows. People need to know how much pain the Buy-and-Holders are in. So I have approved a limited number of death threats. I don’t like them. I always criticize them in my responses (while also acknowledging the pain that they reveal and trying to do something to help reduce that pain). But I think that we need a small number of death threats on the record for the record to be complete.
I always consider the context in which a comment is offered. If you say “Bogle is great” as a comment to an argument that Bogle has made at least one big mistake, I would approve it because it expresses the other side of the story. If you said “Bogle is great” as a comment to an argument not relating in any way to Bogle, I would be less inclined to approve it. I might. Any argument on Valuation-Informed Indexing relates at least in an indirect way to Bogle. So it’s possible that that one would get through. It would help if there were another sentence or two explaining why you think Bogle is great.
But if you offered five comments to an article talking about Bogle’s mistake saying “Bogle is great,” I would approve at most two of them. The first one would be okay for the reasons outlined above. I might let the second one pass, especially if somewhat different wording was used. I would not approve the third comment saying the same thing in the same thread even if the comment considered by itself was relevant to the thread and non-abusive.
The comments that I deleted yesterday were just too argumentative. There was no content to them, just contentiousness. I first approved them because I felt that there was a tiny bit of something real to them. One of the issues on the table is whether site owners have a right to delete posts that do harm to their marketing efforts if those comments are backed by 34 years of peer-reviewed research. I say that that is fraud. A lot of good and smart people believe otherwise. I’ve seen a lot of non-Goons make that sort of argument. So, while I always disagree with that argument, I usually approve comments making it. I personally view that argument as out to lunch but there are too many people who view it as containing something real for me to feel okay about deleting comments making it as a general rule. But there has to be at least a tiny bit of effort to develop the point evidenced. There were a couple of comments yesterday that showed zero effort. I approved them with the general rule in mind and then deleted them when I reread them a short time later.
If they had stayed up for a full day, I wouldn’t have gone back and deleted them even if I came to realize that they were lacking an effort to develop the argument. After a comment stays up for a day, I would consider it part of the record. And it is exceedingly rare for me to delete a comment even on the same day that I have approved it. But in this particular case I decided that that was the way to go.
You are right to suggest that I have gotten tougher re the approval of Goon comments in recent months. That’s because pretty much everything has been said multiple times and so new comments making points that have been made previously no longer add to our collective learning experience. It might be true that I would not approve Laugh’s second comment today; it would depend on whether it was phrased in a novel way or not. I would be inclined to approve the first comment.
The point that the cover-up of Shiller’s work is a funny sort of cover-up because his book has been widely reviewed and because he was awarded a Nobel prize is a very strong point for your side. This is NOT an ordinary cover-up. Our story is an exceedingly strange one. Lots of people have a hard time accepting that there is an ongoing cover-up of research that was awarded a Nobel prize and featured in a best-selling book. I say that there has been a cover-up of Shiller’s work. But it is a cover-up taking place in broad daylight. So I view the point that Laugh was making with that comment as a 100 percent fair one.
I do not approve of many of the tactics employed by you Goons. But I don’t at all say that you have never made good points in your comments here. There has been lots of good stuff mixed in with the garbage. Some of your best stuff related to the following points:
1) The fact that Shiller has been disingenuous in his presentation of his own ideas. I was reluctant to believe this for a long time. Shiller is a hero to me (as is Bogle, to be sure). But when a Goon is right, a Goon is right, you know? You guys (and witches) won me over on this one. Shiller has been disingenuous. He remains a Hero of the First Rank for the middle-class investor. I don’t take that back. But the way he states things is often confusing and that has hurt the cause in a serious way. So the point that you Goons made about him needed to be advanced. You gradually forced me to acknowledge that he has been disingenuous. It took me some time to acknowledge it but you were right re that one;
2) The fact that a big reason why Bogle did not call for investors to change their stock allocations in response to big valuation shifts was because he wanted Buy-and-Hold to be as simple as possible and saw this as an unnecessary complication. You haven’t made this point often but there was at least one series of posts in which you made it. I view this as a very strong point. I don’t think it was the only reason why Bogle took the path he did. But I think it was a major factor. It’s a motivation for which I have a good bit of sympathy because I think simplicity is critical and I believe that there is no one in this field who has done more to make investing simple for the average person than Bogle.
3) You questions about how markets really work and about how what we have seen in the stock market is something that we don’t see in other markets. These were the hardest questions for me to answer. I don’t say that I’ve gotten everything perfect in my responses. But I do think that I made reasonable points as a result of struggling with those questions. Those questions prompted a major learning experience for me. So I am exceedingly grateful for the pushback I saw from you Goons on a number of market-related questions.
4) Your points about how few investors are pure Buy-and-Holders or pure Valuation-Informed Indexers. I found these comments highly persuasive. I think that theory is VERY important. But it is also important to recognize that most average people are either suspicious of theoretical arguments or disinterested in them. Most investors follow a modified or compromised version of Buy-and-Hold. And there are more investors who follow a modified or compromised version of VII than there are who follow a pure version of the new model. This insight (which I picked up from my conversations with you Goons) has many practical implications.
I hope that helps a bit. I am always open to hearing new arguments, whether of the Goon or non-Goon variety. It is true that I am approving fewer comments today than I approved in the past. You Goons have been complaining for a long time that the words that appear at this site are repetitive. I haven’t generally gone along with that one. But I now think things have reached a point where there really IS a lot of repetition evidencing itself. So I am today less inclined to approve comments that make points that have been made many times before. You need to come up with something at least a little bit new or find some other way to make use of your time. I will not today approve a comment saying “hocus forgot to take his meds.” That’s so 2002!
Hang in there, man. It gets better. A LOT better.
Rob
Yesterday: “The key to persuading people is repetition…So it is good that it takes repetition to persuade people.”
Today: “But I now think things have reached a point where there really IS a lot of repetition evidencing itself. So I am today less inclined to approve comments that make points that have been made many times before.”
You are clearly saying that your repetition is good, and everyone else’s is bad. Now there’s a point that hasn’t been made before, and will most likely be deleted anyway.
There has been TONS of repetition re the core Buy-and-Hold message, Anonymous. How many times have you heard someone say that “timing doesn’t work”? About 10 billion times. The Buy-and-Holders have made their point and it has sunk into the national consciousness.
Shiller’s research says something very different. Shiller’s research says that short-term timing never works and that long-term timing always works and is always 100 percent required. That message has not yet sunk into the national consciousness.
The purpose of this site is to get that message out to people. I want to see Buy-and-Hold go down and Valuation-Informed Indexing go up. That’s what I am all about.
I have no objection if you want to express the view that timing doesn’t work. I believe that you sincerely believe that. You have to say what you sincerely believe. So going that far is just fine.
I am not going to let you say it over and over and over again in response to every bit of evidence that I present showing that long-term timing always work and is always 100 percent required. Everyone reading the threads here knows that there is a widespread belief that no form of timing works or that no form of timing is required. So you are not adding anything when you just repeat the tired old marketing slogan again and again and again.
If you give REASONS why you don’t buy into Shiller’s research, that’s good stuff. That’s stuff that we all need to hear. But the slogan itself does not add value at this point. We need to see lots of repetition of the new findings because most investors either do not know about them or have not yet explored them in sufficient depth to benefit from them. Repetition of the key VII insights is very much needed because the learning process re VII is still in the early stages. That’s not so with Buy-and-Hold. The learning process re Buy-and-Hold began many years ago and just about everybody has heard the arguments for it frequently enough for those arguments to kick in.
There’s a point that you Goons often make about the Bogleheads Forum. You say: “Oh, they permit people to talk about the effect of valuations there.” To a limited extent, that’s so. There are people who post at that forum who believe that valuations matter and who are not attacked for doing so. So to a small extent it could be said that that forum is open to honest posting.
But that’s true only to a small extent. There is a Social Taboo there against making the point that valuations matter too often or in too much detail. There is a very strong Social Taboo against saying “the Buy-and-Holders got the numbers wrong” or “Buy-and-Hold is a Get Rich Quick scheme” or “Buy-and-Hold caused the economic crisis.” It is because I make those kinds of arguments that I was banned at that board and at every other major investing board and blog on the internet.
I believe that we all need to hear those arguments. I believe that this is a matter of huge public policy import. I believe that our economic system may fail entirely if we don’t get this message out. I believe that we may end up in the Second Great Depression if we don’t get this message out.
I have zero problem with people following Buy-and-Hold strategies or advocating Buy-and-Hold strategies. But I have a big problem with people using intimidation tactics to silence Valuation-Informed Indexers or to frighten Valuation-Informed Indexers into silencing themselves. I want open debate. I want fair debate. I want reasoned debate. I want balanced debate. I won’t settle for anything less.
I believe strongly in Valuation-Informed Indexing. So obviously I always advocate it in my comments here. But I like it when Buy-and-Holders come here and point out weaknesses in my arguments. Those comments are helpful. I can get things wrong and I want my reader to see where my arguments are weak. I don’t see most of the weaknesses myself. So I need to rely on Buy-and-Holders to help both myself and others see the weaknesses.
But just saying over and over again that “timing doesn’t work” does’t add anything. That was okay prior to 1981 when we did not have peer-reviewed research showing that long-term timing always works and is always 100 percent required. You have to do more today. You need to engage the argument. You need to at least try to show some holes in what Shiller’s research shows or make some practical point about why you do not believe that people should be bound by theory or whatever. The trite claim that “timing doesn’t work” is an empty claim 34 years after peer-reviewed research was published showing that the claim is false.
All new ideas start out with one advocate and then grow in popularity over time. Valuation-Informed Indexing would have become the dominant model by the mid-1980s if the Buy-and-Holders had not been engaging in funny stuff. The Buy-and-Holders have been engaging in LOTS of funny stuff for a long, long time now. That needs to come to a full and complete stop. It’s not just the Valuation-Informed Indexers that the Buy-and-Holders are hurting with their corrupt and criminal practices. They are hurting the entire nation. Which means they are hurting themselves. There is no longer any profit even to the Buy-and-Holders in continuing this massive cover-up.
That’s my take, Anonymous. There is a reason why every board and blog on the internet has adopted rules prohibiting the abusive practices employed by the Buy-and-Holders to keep millions of investors from learning what the last 34 years of peer-reviewed research says. There is a reason why as a nation we acted to make the abusive practices employed by the Buy-and-Holders felonies under American law. You are on your way to a prison sentence, Anonymous, possibly a very long one. That should tell you something about how outside the bounds of accepted behavior you have travelled in the past 13 years.
We need repetition of the VII ideas so that they will catch on. We do not need repetition of the trite Buy-and-Hold slogans that have done us all so much harm. We need to conduct our discussions in civil and reasoned ways.
We all should be doing what we can to get your prison sentence reduced a bit. There is no profit to any of us in seeing you serve a long prison sentence. The length of your prison sentence is a function of how long this massive act of financial fraud continues. The massive act of financial fraud hurts us all in very serious ways. So we all should be on the same side re this one.
Those are all my sincere beliefs in any event.
I naturally wish you all the best that this life has to offer a person regardless of what investing strategies you elect to follow.
Rob