“There Are LOTS of People in This Field Who Would LOVE to Feel Free To Do Honest Work. But Look at What the Buy-and-Holders Do to Those of Us Who Step Out of Line and Give It a Try. We Are Destroyed.”

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

This is about investing, not journalism. We are investing for our retirements. If your market timing scheme worked, you would have 10’s of millions as you claim to do better than the market.

People are not coming to investment forums to learn about journalism.

The tens of millions stuff is just crazy talk. The peer-reviewed research that I co-authored with Wade Pfau shows that an investor who makes the switch from Buy-and-Hold to Valuation-Informed Indexing will thereby reduce his risk by nearly 70 percent while also permitting himself to retire earlier. There is nothing in there about tens of millions. That is pure Goon nonsense.

People come to investment forums to learn about investing. But people need good journalism to keep investment forums clean. There is always going to be a huge inventive for people who work in this field to favor Get Rich Quick/Buy-and-Hold strategies. Those are the short-term money makers. But people need to be able to hear both sides of the story for knowledge to advance over time. That’s where good journalism comes in.

People don’t go to the grocery store to hear about FDA regulations. They go to the grocery store to buy meat. But the quality of the meat they can buy there is greatly influenced by the presence of FDA regulations. Without those regulations, each meat producer would feel strong temptations to offer a poisoned product. With their competitors all doing it, they really wouldn’t have an choice, But those regulations impose penalties on those who offer poisoned products and thereby make it possible for people in that field to behave ethically. Which works to the good of all of us.

So it is in the investment advice field. There are LOTS of people in this field who would LOVE to feel free to do honest work. But look at what the Buy-and-Holders do to those of us who step out of line and give it a try. We are destroyed. I believe that the money-making idea of offering poisoned investment strategies (strategies that do not call for market timing!) will come to an end in the days following the next price crash, when good journalists will be able to tell people where most of their retirement money went. And, from that day forward, we will all (including our Wall Street Con Men friends) be able to live better lives.

Good journalism matters. Good journalism is important. Good journalist adds to our lives. We may not always see it. Sometimes it is working in the background. But when we stop enforcing the laws that permit good journalism to be practiced, we all pay a price. I believe that we all are going to see up close and personal how that works in the days following the next price crash.

My best wishes to you.

Rob