“There Is No Intellectual Support for Buy-and-Hold. What There Is Is a Mountain of INSTITUTIONAL Support.”

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

What support?  No one is commenting here.  Many people would dispute your interpretation of comments at the Motley Fool and other boards, but at this point, that was so long ago, it really is no longer relevant.  What support, if any, have you had in the last 5 years?

There’s 40 years of peer-reviewed research showing that valuations affect long-term returns. The author of that research was awarded a Nobel prize in recognition of the huge advance he achieved. That research was based on 150 years of stock-return data. That’s a mountain of support.

The other side of the story is that there is not one iota of evidence that market timing is not always required. Wade Pfau spent 16 months trying to find something and he came up empty-handed. The peer-reviewed research that I co-authored with him is so powerful that you Goons threatened to get him fired from his job if he continued doing honest work. Your own behavior shows how powerful our research is.

It’s a rare case in which 100 percent of the evidence supports one side of a controversy and 0 percent supports the other. But that’s where things stand. There is no intellectual support for Buy-and-Hold. What there is is a mountain of INSTITUTIONAL support. Buy-and-Hold was developed at a time when Shiller had not yet published his Nobel-prize-winning research. So the Buy-and-Holders got the market timing thing wrong. Now there are thousands of wealthy and powerful and well-connected people who do not want the word getting out about the mistake they made and about the ocean of misery that it has caused millions of people.

I don’t want to be on the side of the ocean of misery. I don’t believe that the Buy-and-Holders want to be there either. You see them drop hints about the realities all the time. But few are willing to give up their high-paying careers just to be able to do honest work. I believe that we are going to see some put their necks on the line after the next crash. Then we can all begin living better lives from that day forward.

Having 100 percent of the evidence supporting me is enough for me, Anonymous. I wish there had been no criminal acts. I wish there has been no abusive posts. But we don’t reside in heaven. This is Planet Earth. Sometimes things get a wee bit off track down here in the Valley of Tears. I am going to continue to say that I do not believe that the retirement study posted at John Greaney’s web site contains a valuation adjustment and wait to see how things play out after the crash. The big benefit of playing it that way is that doing so permits me to sleep at night.

You have continued posting abusively for the past five years. That’s strong evidence that even you Goons don’t truly believe that the Greaney study contains a valuation adjustment. If you believed that it did, you never would have put forward a single abusive comment.

My best and warmest wishes to you and yours.

Rob