Set forth below is the text of a comment that I recently posted to another blog entry at this site:
Rob,
Why do you continue to do what you do? Clearly, you are not making any money running this board and it doesn’t seem to have resulting in a consulting business or other kind of revenue generating endeavor. You also don’t seem to have a following. So after spending all these years going down the same path, the question remains why you keep doing what you are doing?
I’m not making any money, Reality. You got that one right. I haven’t made a dime in 13 years. That makes me very, very, very sad. It makes my wife even sadder!
I don’t think you are right when you say that I don’t have a following. There’s one sense in which you are right. No one posts comments here but you Goons. That reality leaves the impression that I do not have a following. But I have had thousands of people express great enthusiasm re my stuff. I have had some of the biggest names in the field tell me that they rank my site as the #1 investing site on the internet. That translates into MILLIONS of followers once the Ban on Honest Posting is brought to a full and complete stop. That translates into wealth at Bill Gates and Steve Jobs and Warren Buffett levels. I could get by on those sorts of amounts, you know?
The short answer to your question is that I have never been offered any options for handling things in any other way. Back in the 1960s, the Buy-and-Holders started us all off on a grand quest to learn in a scientific way how stock investing works. They generated dozens of genuine and powerful insights. They made a mistake re valuations. Shiller corrected the mistake in 1981. The Buy-and-Holders elected to cover up the mistake rather than to acknowledge it. We are now in the economic crisis that inevitably was going to follow from that terrible choice. The Buy-and-Holders would be thrilled to go back in time to gain an opportunity for a do-over. But no time machines are available to them. So they go with this abusive stuff instead to put off for a day or a week or a month or a year the time when they will finally have to come clean and acknowledge that valuations really do affect long-term returns after all.
I love my country, Reality. That’s a four-word explanation of why I do what I do. I love my country.
Our country is in a jam. We shouldn’t be. We are the luckiest generation of investors who ever walked Planet Earth. Combine Shiller’s “revolutionary” (his word) finding with the many good findings of the Buy-and-Holders and it becomes possible to reduce stock investing risk by 70 percent. The peer-reviewed research that I co-authored with Wade Pfau shows that. So we are in an amazingly positive situation.
But the Wall Street Con Men have power and money and influence and a ruthless determination to block millions of middle-class people from learning how stock investing works in the real world. So tens of thousands of entrepreneurs have seen their businesses fail. And millions of workers have lost their jobs. And millions more are on their way to suffering failed retirements.
I don’t think we will be able to make it if we don’t open the internet to honest posting following the next price crash. It’s not just that we are going to see a deepening of the economic crisis, possibly putting us into the Second Great Depression. Even the continued viability of our political system is in jeopardy. Millions of middle-class people are not going to get the joke when their retirement plans fail. They are going to be angry. They are going to be asking lots of hard questions. I want to be available to soften their anger to the extent that that will be possible. I need to have credibility in their eyes to be able to do that. I won’t have credibility if I tell lies just to make a buck today. So I continue to post honestly.
We have a great country, Reality. I believe that we will get through this. We have gone through dark times before and survived them. The Buy-and-Holders are not bad people. Jack Bogle is a hero of mine. None of the material at this site would exist were it not for the things I have learned from reading Bogle’s books and speeches. I think it is going to melt Jack’s heart when he sees the human misery he caused with his support for the Campaign of Terror led by you Goons. I think Jack is going to flip and demand an end to the Ban on Honest Posting. I expect to be working closely with Jack to turn things around. I think the years following the next crash are going to be exciting and positive times. I believe that even some of you Goons will be getting involved in constructive projects in those days. We’ll see.
I love my country and I want to help. I want to help the millions of middle-class investors. I want to help all the investment advisors who don’t like the idea of giving up their personal integrity to be able to make a buck in this field. I want to help all my Buy-and-Hold friends who started out doing something very, very good and important and now find themselves on a very dark path indeed. I get a kick out of helping people. I look forward to taking all the bad stuff we have seen over the first 13 years of our Debate About Having a Debate and turning it into gold.
I talked to lots of people at the Financial Bloggers Conference (FinCo15) that I returned from the other day. There were a few who debated me. That’s of course fine. There are lots of good and smart people who still believe in Buy-and-Hold and I think we all learn from them making their case to the best of their ability. There were a greater number whom I would describe as confused, who see that there are holes in the Buy-and-Hold dogmas but who cannot begin to perceive how fatal a mistake the Buy-and-Holders made when they elected to cover up the last 34 years of peer-reviwed research in this field. And there were a good number of people whom I spoke to who agreed with me on most points but who hold back from saying so in clear and firm and simple language because they know how that would upset lots of people and do damage to their careers.
We are on the one-yard line, Realty. It’s been 34 years since Buy-and-Hold was discredited by the peer-reviewed research. When you see people using death threats to intimidate those trying to tell people about the peer-reviewed research, you know that the “strategy” under discussion is in its last days. Buy-and-Hod died intellectually 34 years ago. It is close to dying in practical terms. It is one stock crash away from its demise. Or at least so Rob Bennett believes.
I love my country. I enjoy putting the talents that God gave me to productive use. I get a kick out of helping people. I am honored and humbled to be the lead player in the most important political/economic story of my lifetime; what journalist would turn down that opportunity? I care about every soul that I have connected with over the past 13 years, including you Goons.
Does that tell you what you need to know?
I call the situation that I am in “the Perfect Trap.” I can’t make a penny because if the model for understanding how stock investing works that I have developed becomes better known, lots of powerful people will have to say the words “I” and “Was” and “Wrong” and they really, really, really don’t want to do that. Yet I cannot let go because the shift from Buy-and-Hold to Valuation-Informed Indexing is the biggest advance we have ever achieved in the history of personal finance by a factor or 50 or more. Yowsa!
Could I be wrong?
Anybody can be wrong about anything. I check myself every day trying to find any sign that I am wrong. I have never found anything of any consequence. So I have to continue on the path that I am on today. In the event that I am wrong, I will just have to live with it. These things happen in this world. I cannot deny the mountain of evidence that says that I am right. I couldn’t live with myself if I did that.
If I am not wrong, our country is close to entering the greatest period of economic growth in our history. We will in not too much more time be seeing 34 years of powerful insights becoming opened up to us in one day. Imagine seeing all the advances that we have seen in the computer electronics field arrive on our doorsteps in a single day. That’s what we are going to see in the investing field except to a far bigger extent than what that suggests because it is far more important that we get investing right than that we be able to communicate through computers.
We are in the process of changing the world in a very big way and in a very positive way, Reality. I’m not trying to keep any of this to myself. I am open to sharing with everyone. This is good stuff piled on top of good stuff piled on top of good stuff piled on top of good stuff. No downside whatsoever. You don’t see projects with that sort of upside too often. I have never seen anything like this anytime, anywhere.
That’s the story. I love the good that thousands of us have done with a burning love. I don’t love the Goon stuff even a little bit. But I do acknowledge that even you Goons have made many positive contributions mixed in with all the smelly garbage that you specialize in. This story is so positive that even those doomed and determined to destroy themselves and their country end up making positive contributions! Wow!
Love is the answer, Reality. It really is. I 100 percent believe that you are going to see that following the next price crash. I’m rooting for you!
Rob
Anonymous says
Michael Kitces compares buy and hold to buy, hold and rebalance. Either way, they both work.
https://www.kitces.com/blog/how-rebalancing-usually-reduces-long-term-returns-but-is-good-risk-management-anyway/
Rob says
Thanks for taking time out of your day to share the link with us, Anonymous.
I would obviously never recommend a Buy-and-Hold strategy. But Michael is a super-smart guy and a super-nice guy too. So I encourage anyone reading these words to check out his stuff and to learn from it.
Take care, man.
Rob
Anonymous says
“Michael is a super-smart guy and a super-nice guy ”
So, is Michael Kitces going to jail, Rob?
Rob says
I don’t think that Michael will be going to jail.
But it’s not me who decides the matter, Anonymous. It’s the millions of middle-class investors whose lives are in the process of being destroyed who will decide the matter.
If I were in Michael’s shoes, I would not play it in the way that he has played it. I would speak out a lot straighter and a lot stronger. Those millions of people are going to be very angry when they realize how they have been lied to. I wouldn’t be taking any chances. I would be calling the Buy-and-Holders out on their b.s. if I were in Michael’s shows.
Michael wants to tell the truth. That’s as clear as clear can be. He says a lot of things that others don’t say. I have a quote from him at the slider at the top of every page of this site. In that quote, he says; “There are time-periods where stocks are a terrible addition to that portfolio. Yet inexplicably we as planners STILL tend to suggest that it is risky not to own stocks when in reality the only risk is to our business.” That’s a pretty darn clear statement. It’s to Michael’s great credit that he has been willing to state things that clearly. Few in this field are willing to do so. In relative terms, Michael is an amazing straight-shooter.
To anyone paying attention, that statement does the job of warning people about the dangers of Buy-and-Hold. But you and I and Michael and Bogle and Shiller and everyone else know that for most of us, that doesn’t do the job. We all have a Get Rich Quick urge residing within us. We all want to live in a fantasy world where this might be the first time in history when a Buy-and-Hold strategy actually worked for one or two long-term investors in a galaxy far, far away from this one.
The phenomenon that Michael is pointing to in his statement is not so inexplicable as he suggests. There is a mountain of money to be made in this field by anyone willing to tell the Buy-and-Hold lies. Michael has seen lots of others raking in that easy money and naturally he wants to grab some of it himself. But he has a conscience. What to do, what to do? He shoots straight with that wonderful comment and thereby satisfies his conscience. And then he rationalizes not calling out Bogle and the other Wall Street Con Men on all the other lies that they put out on daily basis. So he makes good money and still is able to live with himself.
Not this boy, you know?
I don’t want to tell the Buy-and-Hold Lies. I don’t want to destroy the lives of the people who listen to what I have to say about stock investing. I don’t think I should have to. I don’t think Michael should have to either. Nor do I think that Shiller should have to do that. Or Bogle. Or you. Or anyone.
We are on the one-yard line, Anonymous. We have 34 years of peer-reviewed research showing that Buy-and-Hold is the purest and most dangerous Get Rich Quick scheme ever concocted by the human mind. I think that Michael Kitces could get away with being more honest than he has been a lot more often than he has been even somewhat honest. He could do more. If he did more, I would back him up. And if Michael and I were both fully honest, Wade Pfau would join us. And then Rob Arnott would sign up. Then Shiller. Then Bogle. And on and on and on.
I am going to tell people after the next crash that Michael tried very hard to be honest. I am going to explain how he was willing to put his neck on the line to help out millions of middle-class investors like them. And I am going to tell them that Michael had good reason to be hesitant to be fully honest, that his fears that you Goons would destroy his career if he dared to take it one step further than he has were well-founded, that he had every reason to believe that you would follow through on your threats and that you have demonstrated in real life over and over again that you will stop at nothing to block people from learning the truth about this massive act of financial fraud. And that Bogle and lots of other big names in this field have made clear that they are 100 percent behind you in every criminal act in which you engage.
Will that get Michael off the hook?
I think so. Probably.
But also possibly not. I don’t know for certain. There has never before in U.S. history been an act of financial fraud this big. We are in uncharted territory.
It’s possible that some people will say that Michael is more to blame for this economic crisis than you Goons. He hasn’t done the evil things that you Goons have done. But you Goons are just internet Goons. People don’t expect much of you. Michael does this for a living. People have a right to expect more from him. His small and subtle dishonesties are arguably more damaging than your big and obvious ones. I am going to make a case for him. I am going to work it hard. I love Michael. But I cannot say with absolute certainty how things are going to go for him. It’s not for me to say. We are talking about a massive case of financial fraud here. There are going to be millions of people who are going to be very, very angry.
I am not Michael’s keeper. He is a grown-up. He is a professional. He has to take care of himself. I have urged him not to engage in any dishonesties whatsoever. He has elected to play it this other way. I am sure as heck not ever going to play it the way he has elected to play it. No way, no how. No can do. I can’t go for that. But Michael is his own person and he gets to decide how he plays it. That is as it should be, in my assessment.
Do you want to know what my bottom line on this is?
My bottom line is that Michael has been a fool to put himself in circumstances where these sorts of questions even need to be asked.
No one will be looking at any of Rob Bennett’s statements following the crash and wondering whether he will end up in a prison cell or not. I have been very clear how I feel about the massive act of financial fraud. I have THOUSANDS of statements in opposition to the criminal acts in the Post Archives. I hope to have lots more in the record before the crash comes. I am covered, Anonymous. If only one person on Planet Earth is covered, it’s me.
Good for me, you know?
I hope that Michael ends up being sufficiently covered. He’s a great guy, he’s a smart guy, he tries to be honest, I have learned a lot from him. I love the guy. But I can’t say that I don’t think that he had made a mistake by leaving himself at least somewhat open to charges that he participated in this massive act of financial fraud. I don’t think that will get him sent to prison. I am certain that it will do harm to his reputation.
Was it worth it?
In my mind, it wasn’t worth it. When I started writing about investing, I considered it 100 percent impossible that I would ever engage in deliberate deception on a matter relating to people’s retirements. I am 100 percent certain that the same was once true of Michael Kitces and Wade Pfau and Robert Shiller and Jack Bogle. Yet here we are. They let themselves be sucked in and here we are asking whether Michael Kitces — a great guy and a smart guy — will be going to prison following the next crash.
I sure hope not, you know? But it sure makes me sad that we even have to discuss the matter. And it sure makes me think that Micheal messed up in a big way somewhere down the line when he got on a pat that over time led him to being in circumstances where I cannot honestly give a definitive answer to the question.
We’ll see how it all turns out, Anonymous. I will be doing everything in my power to insure that as few of my Buy-and-Hold friends as possible end up in prison cells and that the prison terms of those who do are as short as possible given the circumstances that apply. Re that you have my pledge.
The rest is out of my hands.
My best and warmest wishes to you and yours, my old Goon friend.
Rob