“The Job of a Journalist Is to Help People By Explaining Things to Them That They Do Not Yet Fully Understand. It Wouldn’t Be Possible to Imagine a Story That Helps More People Than This One That Is As Poorly Understood As This One. The Potential to Help People Live Better Lives That Exists Here Is Just Off the Charts.”

Set forth below is the text of a comment that I recently posted to the discussion thread for one of my columns at the Value Walk site:

I look at results, Rob. It has been a disaster for you. Despite your attempts, there is no way to spin it any other way.

I did not study investing in school. I have never managed a big mutual fund. I should not know more about this subject that any ordinary investor. Wade Pfau holds a Ph.D. in Economics from Princeton. I should not be able to teach Wade anything about how stock investing works. Yet, when Wade spent 16 months of his life researching my ideas, he told me that he could not sleep at night because he was so excited by what he was learning and concluded that: “Yes, Virginia, Valuation-Informed Indexing works!”

It shouldn’t be possible for something like that to happen. It happened because learning in this field has been suppressed during the long bull market. Bull markets make Buy-and-Hold look good. And Shiller’s advance is a very big one. So it is hard for those on the Buy-and-Hold side of the fence to take it in; it changes their understanding of how stock investing works in scores of different ways. So we have a huge advance that checks out in every way (Shiller was awarded a Nobel prize) that is so far not at all wifely understood or at all fully developed.

That’s a journalist’s dream, Sammy. The job of a journalist is to help people by explaining things to them that they do not yet fully understand. It wouldn’t be possible to imagine a story that helps more people than this one that is as poorly understood as this one. The potential to help people live better lives that exists here is just off the charts.

The obstacles to moving the ball forward are huge too. I don’t say different. I have had my head slammed against a wall on hundreds and hundreds of occasions. It hurts. It hurts a lot.

But someone has to do it. Suppose that Shiller had included in his book a statement that: “Given my finding that valuations affect long-term returns, there is zero chance that the safe withdrawal rate is the same number at all valuation levels — the safe withdrawal rate CHANGES with changes in valuation levels.” It would have made my life a whole lot easier if Shiller had said that in his book and I could just point to the quote rather than having to explain that that conclusion follows logically from words that Shiller really did say in his book. By holding back on that one, Shiller made it harder for me and for all the others (there are lots of us, although not enough of us to get the studies corrected at this time) who believe that the Buy-and-Hold retirement studies are in error.

I have chosen a difficult course for myself. But a course that will likely benefit my fellow humans in very big ways down the road a piece (and that will likely benefit me personally as well since the basic rule re compensation for work done is that the amount of compensation received depends on the amount of value added to the world). I haven’t enjoyed having my head slammed against a wall hundreds of times. But I have been humbled and honored to have been able to have enjoyed the experience of hearing hundreds of people (both ordinary investors and big names) tell me that I am the first person whom they have ever heard talk about stock investing in a way that makes total sense. You can’t buy with any amount of money the feeling of satisfaction that comes from hearing those words hundreds of times.

We all are put on this earth and given a limited number of years to find some purpose for our lives. I believe that I have found mine. Choosing to pursue work that seems likely to benefit the world in a very big way has made my life difficult for a time. You call that a “disaster.” I don’t see it that way. I am grateful that I was given the gift of being able to pursue this opportunity and the talents to pursue it to the extent that I have so far.

If Shiller is right, we all need to come to a better understanding of the far-reaching implications of his research findings. It’s terribly important that we all engage in the discussion needed to do that. So Rob Bennett sincerely believes, you know? So I soldier on.

My best wishes to you.

Rob