“The Scandal Is Not That Many Do Not Agree With Shiller’s Findings. That Is Of Course All Part of the Wonderful Game. The Scandal Is That People Who Work in This Field and Who Believe That Shiller’s Research Is Legitimate Are Afraid That Their Careers Will Be Destroyed If They Talk Openly About What They Believe About the Dangers of Buy-and-Hold.”

Set forth below is the text of an e-mail that I sent to Sharyl Atkisson on January 13, 2020:

Sharyl:

My name is Rob Bennett. I admire your work.

I have spent the last 17 years of my life investigating a story that is a very big deal and that very much needs to be told and that is a known to a lot of people but that few will speak about because of the money and power held by those who want to keep it covered up. The dominant model for understanding how stock investing works (Buy-and-Hold) was discredited by the Nobel-prize-winning research of Yale Economics Professor Robert Shiller. Had the far-reaching implications of Shiller’s work been explored, we would have avoided the economic crisis of 2008. And stock valuations are today at levels that suggest that we will be seeing a repeat of the economic crisis in not too long a time.

The scandal is not that many do not agree with Shiller’s findings. That is of course all part of the wonderful game. The scandal is that people who work in this field and who believe that Shiller’s research is legitimate are afraid that their careers will be destroyed if they talk openly about what they believe about the dangers of Buy-and-Hold. Wade Pfau holds a Ph.D. in Economics from Princeton. He worked with me for 16 months on research showing that long-term market timing always works. When he tried to share our results on discussion boards, he was intimidated into silence. I have seen dozens of similar stories of learning experiences being blocked because advocates of the Buy-and-Hold strategy do not want the public to learn of the strong case against it.

The article linked to below tells the story in some depth:

[Link Provided Here]

I wish you the best of luck in all your future endeavors.

Rob

Rob says

March 11, 2020 at 3:18 pm

In the early days, I would have said it was John Greaney. We had a wonderful community at the Motley Fool site. We certainly had a large number of Buy-and-Holders. So there was a lot of skepticism re Valuation-Informed Indexing. But we also had lots of smart and good people who possessed a strong interest in knowing more about how stock investing works in the real world. If Greaney had not poisoned the discussions. we would have all enjoyed an amazing learning experience. And then we would have taken what we had learned and shared it with other boards all over the internet and eventually the first true research-based model would have become the dominant model for understanding how stock investing works.

So, if I were forced to name one person, it would be Greaney. But I no longer place the same percentage of blame on Greaney. There were times when I went to sites that Greaney had never visited. He obviously was not able to poison discussions at such places. But I ran into the same general problems. So I don’t think that it is fair to place all the blame on him. We had a unique opportunity at the Motley Fool board to advance knowledge because we all cared about the subject and we all liked each other. So he did play a huge negative role by messing things up at that particular place. But this problem is bigger than Greaney or that one board. If one were in an especially charitable mood, one could even say that Greaney was the victim of an exceedingly odd set of circumstances in much the same way that I was.

There was a test that I used when I was recording a RobCast about the discussion that I had with Scott Burns. I certainly did not agree with Burns when he said that my efforts were “catastrophically unproductive.” But I have a great deal of respect for Burns. So I spent a lot of time trying to understand why he said the things that he said. The test that I applied was to ask whether he would pass a lie detector test if he were asked certain questions. I believe that both Greaney and Burns would pass a lie detector test if they were asked “Is a 4 percent withdrawal safe?” and they answered “yes.” I do not believe that either of them would pass a lie detector test if they were asked “Are death threats acceptable in discussions of how stock investing works?” and they answered “Yes.”

The death threats and the other Goon stuff were advanced out of frustration. I believe that Greaney truly believes that a 4 percent withdrawal is safe. But he is not able to formulate effective responses to my challenges to his study. And he sees that my challenges cause people to lose confidence in the study. I think he rationalizes the death threats and the other garbage on grounds that his study really helps people and the only way to maintain confidence in it is to engage in criminal acts. It’s the sort of thing that Nixon did when he obstructed justice. He believed that he was doing important work to bring peace to the world and that the only way to continue it given the circumstances that applied at the time was to obstruct justice. So he did what he did.

Shiller’s research represents a mind-blowing advance. It changes our understanding of every question that comes up in the stock investing field. It’s the equivalent of a cure for cancer. It is 100 percent positive, there is no negative to it. But it threatens all of our existing knowledge in this field. So it is PERCEIVED as a negative by people who have invested their entire lives on developing and promoting an understanding based on the old model.

So I believe that this is a lot bigger than John Greaney. If I were forced to provide one name in response to your question, his is the name that I would offer. But I do not think that it is fair to give that one-word answer. Greaney is caught up in something a lot bigger than him. As am I. As is each and every one of us. None of us asked to be caught up in this controversy any more than any of us asked to be born. Things happen in life that you do not expect. And no one hands out a rulebook as how to respond to various sets of circumstances. We all do our best to figure out what to do while feeling pressure from all sides during the decision-making process. “And there’s no time to think,” as Dylan once argued in song.

My sincere take.

Philosophical Rob

Comments

Evidence Based Investing says

March 11, 2020 at 10:35 am

“[Link Provided Here]”

Any chance that you could provide the link to us your loyal readers?
Rob says

March 11, 2020 at 11:00 am

No. I am not going to provide a link.

But regular readers have heard it all, in any event. The purpose of that article was not to break news. It was to sum up the case against Buy-and-Hold and for Valuation-Informed Indexing in one place. So you have been exposed to it all, Evidence. It’s just the presentation that is a little different. I obviously could not set forth the entire case on the morning of May 13, 2002, because I did not know the entire case at that time. The purpose of the article was to put it all in one place now that it is possible to do that. You have been watching the case build in real time for 18 years now. You have not missed out on anything.

Rob
Anonymous says

March 11, 2020 at 2:12 pm

Rob,

Over the last 18-20 years, which goon has caused you the most harm?
Rob says

March 11, 2020 at 3:18 pm

In the early days, I would have said it was John Greaney. We had a wonderful community at the Motley Fool site. We certainly had a large number of Buy-and-Holders. So there was a lot of skepticism re Valuation-Informed Indexing. But we also had lots of smart and good people who possessed a strong interest in knowing more about how stock investing works in the real world. If Greaney had not poisoned the discussions. we would have all enjoyed an amazing learning experience. And then we would have taken what we had learned and shared it with other boards all over the internet and eventually the first true research-based model would have become the dominant model for understanding how stock investing works.

So, if I were forced to name one person, it would be Greaney. But I no longer place the same percentage of blame on Greaney. There were times when I went to sites that Greaney had never visited. He obviously was not able to poison discussions at such places. But I ran into the same general problems. So I don’t think that it is fair to place all the blame on him. We had a unique opportunity at the Motley Fool board to advance knowledge because we all cared about the subject and we all liked each other. So he did play a huge negative role by messing things up at that particular place. But this problem is bigger than Greaney or that one board. If one were in an especially charitable mood, one could even say that Greaney was the victim of an exceedingly odd set of circumstances in much the same way that I was.

There was a test that I used when I was recording a RobCast about the discussion that I had with Scott Burns. I certainly did not agree with Burns when he said that my efforts were “catastrophically unproductive.” But I have a great deal of respect for Burns. So I spent a lot of time trying to understand why he said the things that he said. The test that I applied was to ask whether he would pass a lie detector test if he were asked certain questions. I believe that both Greaney and Burns would pass a lie detector test if they were asked “Is a 4 percent withdrawal safe?” and they answered “yes.” I do not believe that either of them would pass a lie detector test if they were asked “Are death threats acceptable in discussions of how stock investing works?” and they answered “Yes.”

The death threats and the other Goon stuff were advanced out of frustration. I believe that Greaney truly believes that a 4 percent withdrawal is safe. But he is not able to formulate effective responses to my challenges to his study. And he sees that my challenges cause people to lose confidence in the study. I think he rationalizes the death threats and the other garbage on grounds that his study really helps people and the only way to maintain confidence in it is to engage in criminal acts. It’s the sort of thing that Nixon did when he obstructed justice. He believed that he was doing important work to bring peace to the world and that the only way to continue it given the circumstances that applied at the time was to obstruct justice. So he did what he did.

Shiller’s research represents a mind-blowing advance. It changes our understanding of every question that comes up in the stock investing field. It’s the equivalent of a cure for cancer. It is 100 percent positive, there is no negative to it. But it threatens all of our existing knowledge in this field. So it is PERCEIVED as a negative by people who have invested their entire lives on developing and promoting an understanding based on the old model.

So I believe that this is a lot bigger than John Greaney. If I were forced to provide one name in response to your question, his is the name that I would offer. But I do not think that it is fair to give that one-word answer. Greaney is caught up in something a lot bigger than him. As am I. As is each and every one of us. None of us asked to be caught up in this controversy any more than any of us asked to be born. Things happen in life that you do not expect. And no one hands out a rulebook as how to respond to various sets of circumstances. We all do our best to figure out what to do while feeling pressure from all sides during the decision-making process. “And there’s no time to think,” as Dylan once argued in song.

My sincere take.

Philosophical Rob