A Rich Life

The Old Ideas on Saving & Investing Don't Work -- Here's What Does

Buy-and-Hold Goon to Rob: “I Don’t See Anything in Shiller’s Book That Says He Could Help Save Us From an Economic Collapse.” Rob’s Response: “You Can Count on Seeing Those Words in My Book.”

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

I don’t see anything in Shiller’s book that says that he could help save us from an economic collapse.

You can count on seeing those words in my book, Anonymous.

My best and warmest wishes to you.

Plain-Speaking Rob

Comments

  1. To bad your book is not out yet, Rob so that you save us all right now from the Covid-19 crash.

  2. It’s definitely too bad that the book is not out. We all need a clear and complete explanation of what is going on and what we all did (darn that Get Rich Quick/Buy-and-Hold impulse residing within all of us!) to get ourselves into this mess.

    The other side of the story is that the book is only a few months away from completion. Can you imagine where we would be if I had not worked up the courage to advance my famous post from the morning of May 13, 2002? That’s what got the ball rolling. I could have cowered in fear and then we would not have that clear and complete explanation available to us even in a few months. So thank God for the voice that He put in my head to do the right thing re that one, you know?

    Opening every discussion board and blog on the internet to honest posting re the last 39 years of peer-reviewed research, as I have been urging since the morning of May 13, 2002, would indeed have protected us all from the worst effects of the Covid-10 crash. We of course would have seen the terrifying threat to millions of lives in any event. And we of course would have seen some drop in our portfolios in any event, as our efforts to cope with the health threat required huge economic disruptions which obviously were going to cause a drop in stock prices. But the sort of price drop that is now on the table should never be on the table and never would be on the table in a world in which honest posting re Shiller’s Nobel-prize-winning research were permitted.

    The thing that we call a stock market is not even truly a market — not today. In a true market, prices change as the result of the input of various information bits. We have lots and lots and lots of Get Rich Quick/Buy-and-Hold information bits being pumped into the brains of all market participants on a daily basis. But consideration of research-based information bits is prohibited. So, when a bad economic development like this takes place, we don’t see a drop in the CAPE value from 16 to 13 but perhaps a drop in the CAPE value from 30 to 8. We have made things a lot worse than than they needed to be. And we had to on numerous occasions travel outside the confines of U.S. law to pull it off. Not good.

    I think we will make it. I think that we are a good people and that we are going to make it successfully to the other side of The Big Black Mountain. I am scared. I have been scared for a long time of what the last 39 years of peer-reviewed research told us was inevitably coming. Now that it appears that it may really be here, I am even more scared. But I remain hopeful that we will pull together as a nation and get the word that millions of investors need to hear out to them, as we should have begun doing on the morning of May 13, 2002 (or even better yet, back in 1981, when the Nobel-prize-winning research that showed us for the first time in history how stock investing works in the real world was published).

    Wish us all luck, Anonymous! I naturally wish you all the best that this life has to offer a person.

    Frightened But Hopeful Rob

  3. Now is your opportunity to tell us all what we should put our money into. Give us your investment selections.

  4. “ In a true market, prices change as the result of the input of various information bits.”

    And that is what has happened. The market has reacted to Covid-19. Your book will have been a waste of time.

  5. Now is your opportunity to tell us all what we should put our money into. Give us your investment selections.

    There are thousands of people who can do that better than I can. You should just let those people do their jobs.

    But you should let them do their jobs effectively.

    To do their jobs effectively, they need to be able to study what the last 39 years of peer-reviewed research teaches us all about how stock investing works in the real world. We should all be working to open every discussion board and blog on the internet to honest posting re safe withdrawal rates and scores of other critically important investment-related topics.

    My sincere take.

    Super Expert (on One Subject — the Need to Open the Entire Internet to Honest Posting re Shiller’s Nobel-Prize-Winning Research Findings) Rob

  6. And that is what has happened. The market has reacted to Covid-19. Your book will have been a waste of time.

    We disagree.

    The market is obviously reacting to Covid-19. That’s beyond dispute.

    The question is — Is that ALL that the market is reacting to?

    Shiller says that there is a non-economic factor that affects stock prices — irrational exuberance. If that is so, then we need to take irrational exuberance into consideration in every calculation and in every analysis. Shiller was awarded a Nobel prize. So his stuff should be given consideration, in my sincere assessment.

    Some people may prefer to tune Shiller out. That’s their business. I don’t see it as my place to tell those people what to do. But I say that everybody should at least be exposed to Shiller’s message. Those who engage in criminal behavior (death threats, extortion, etc.), to keep people from hearing Shiller’s message should be placed in prison cells. The rest of us have every right in the world to protect ourselves from the consequences of the behavior of these sorts of individuals.

    That’s my sincere take, Anonymous.

    Law-Abiding Rob