” I Believe That the Buy-and-Holders Made Many Hugely Valuable Contributions to Our Understanding of How Stock Investing Works. I Think of Them as Friends. Can You Say the Same re the Valuation-Informed Indexers? Can You Point to Any Valuable Contributions That We Have Made Over the Past 37 Years? Do You Think of Us As Friends?”

Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site:

So it would be fair to say that the prediction-making aspect of the Valuation-Informed Indexing project has not been working out so hot.”

And the Titanic sinking wasn’t so nice.

Market timing IS prediction making. Forward tests, not back tests, which is all you’ve got to cling to. So to properly rephrase your quote: The market timing aspect of your market timing scheme has failed miserably every single time.

You keep saying “just you wait till the next crash, it will be a doozy”. Sorry, you’re out of chances. You’ve proven beyond any doubt that you have no understanding of how the market works. You proved that 22 years ago, when you got out of stocks forever. The single fact is all anyone will ever need to know about your market knowledge.

I see the issue of whether stock gains are rooted in something real or are just the product of irrational exuberance and the issue of whether it is possible to say precisely when those gains will disappear as two separate issues. 100 percent of the evidence available to us today supports the belief that gains that result from overvaluation are not rooted in anything real and will disappear in time. But the ability to say precisely when those gains will disappear is not there.

Someone who retires based on portfolio numbers that are rooted in irrational exuberance is making very risky choices. He doesn’t know when his retirement will fail but he knows or should know that the odds are strong that it will. Huh? What the f? I think it would be better to hold off on retiring until there is enough real money in the account to support a long-term retirement. To me, the question of when the retirement will fail is of secondary importance. The question of whether it is a safe retirement or not is of far greater importance.

That’s my sincere take re this one, in any event.

I would add that I detect a lot of emotion in your post, Anonymous. That’s a telltale sign, in my assessment. I believe that the Buy-and-Holders made many hugely valuable contributions to our understanding of how stock investing works. I think of them as friends. Can you say the same re the Valuation-Informed Indexers? Can you point to any valuable contributions that we have made over the past 37 years? Do you think of us as friends?

My best wishes to you.

Rob