I’ve posted Entry #467 to my weekly Valuation-Informed Indexing column at the Value Walk site. It’s called The Fact That the Safe Withdrawal Rate Changes Tells Us More Than the Number Itself.
Juicy Excerpt: That was 17 years ago. I have crafted millions of words over those 17 years in response to criticisms of me and my work advanced by my Buy-and-Hold friends. Would you care to guess what percentage of those words were aimed at coming to a better understanding of what the safe withdrawal rate is when each of the various CAPE levels apply?
The answer is: zero.
I have put forward words saying what the safe withdrawal rate is at the various CAPE levels. So I have done my part to get discussions started on this question. But there has never once been a case in which a Buy-and-Holder engaged. I have seen cases in which Buy-and-Holders have acknowledged that it might make sense to use a somewhat higher withdrawal rate when valuations are high. But there is not one case in which someone on the other side of the table was willing to say that the safe withdrawal rate can ever be a number other than 4.
Have you stopped posting at Valuewalk?
No.
The column did not show up yesterday. It is in the system. But it has not been put on the schedule. It appears to me to be some kind of a glitch but I am not able to say for certain. I am going to submit a new one today and see if that gets scheduled.
Rob