Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site:
You have spent the last 20+ years telling everyone else as to how you think you are right and everyone else is wrong and that the world needs to change. In the end, nothing will change for you.
You have spent the last 40 years living in denial as to what the peer-reviewed research tells us all about how stock investing works in the real world and insisting that as a society we must never, never, never acknowledge that we once made a mistake in thinking that market timing is not always 100 percent required. In the end, we will acknowledge as a society that Robert Shiller’s Nobel-prize-winning research is legitimate research.
We all should be doing everything in our power to see that every site on the internet is opened to honest posting so that we all can begin enjoying an amazing learning experience. That’s my sincere take, Anonymous.
Rob
“You have spent the last 40 years living in denial as to what the peer-reviewed research tells us all about how stock investing works in the real world and insisting that as a society we must never, never, never acknowledge that we once made a mistake in thinking that market timing is not always 100 percent required. In the end, we will acknowledge as a society that Robert Shiller’s Nobel-prize-winning research is legitimate research.”
I have read the research, but I suspect you have not. You have an interpretation of what just one guy said. When I look at my portfolio and returns, I am glad that I followed what research REALLY says versus you or I would not be able to retire.
Every human being has a slightly different interpretation of everything he sees than every other human being who sees the same thing . We all have different life experiences that cause us to see different things. I am happy for you that you believe that Buy-and-Hold has worked out well for you. My objection to your behavior comes when you try to limit what others can hear about these matters. You get to decide for you. I get to decide for me. Others get to decide for others.
There is not one academic model for understanding how stock investing works. There are two. If you said “I personally believe that the safe withdrawal rate is always 4 percent but I understand that there are others who believe that the safe withdrawal rate is a number that changes with changes in valuation levels and each investor has to decide on his own which model to follow,” there never would have been any problem. It is the idea that Buy-and-Hold is Truth and that there can be no questioning of it that is the source of all the friction. If you block what people can hear and it turns out that Shiller’s Nobel-prize-winning research is legitimate research, then you are responsible for the losses that millions of people will end up suffering because of your abusive behavior. It’s better to just decide for yourself and say what you believe and let others decide for themselves after hearing both sides make their case.
My sincere take.
Rob
” My objection to your behavior comes when you try to limit what others can hear about these matters. You get to decide for you. I get to decide for me. Others get to decide for others.”
What behavior? You are the one blocking posts on your website. If you can do so, why can’t others block you? Why a double-standard?
“There is not one academic model for understanding how stock investing works. There are two.”
No, there are not just two. There are so many different models out there, but you only focus on two.
The only two models for understanding how stock investing works that are rooted in peer-reviewed research that I know of are Buy-and-Hold and Valuation-Informed Indexing.
There are opinions that are put forward that are not rooted in either of the two academic models. But I left the idea of going with opinion-based strategies behind me a long time ago. I was frustrated with the multiplicity of opinions on this subject and then I heard about Buy-and-Hold and how it is rooted in peer-reviewed research and I knew that this was for me. It was The Great Safe Withdrawal Rate Debate that caused me to switch from Buy-and-Hold to Valuation-Informed Indexing.
Most Buy-and-Holders are proud of the fact that their model is rooted in peer-reviewed research (at least according to their belief). That’s the reason why The Great Safe Withdrawal Rate Debate has been so contentious. When I questioned whether the Greaney retirement study contained a valuation adjustment, I was really questioning the entire Buy-and-Hold Model. I did not intend to do that at the time. I did not even realize that that is what I was doing. But you Goons got it from the first moment. Over time, I came to see that you were right. I was questioning the entire model.
I of course see that as a good thing. Even if it turns out that I am wrong and that the Greaney study really does contain a valuation adjustment after all, the questioning generated lots of discussion and thus supplied us all with an amazing learning experience. I view my famous post from the morning of May 13, 2002, as my finest moment. What I said should not have been so controversial. The obvious thing to do was just to check the study and to see if a valuation adjustment could be found in it. I think it would be fair to say that the Buy-and-Holders don’t want to do that. For obvious reasons.
We would not have seen one-hundredth of the reaction that we have seen had I questioned one of the opinion-based strategies. The people who follow those strategies wouldn’t have cared that there was someone in the world who followed a different one. The Buy-and-Holders believe in research and they very much want to believe that theirs is the only true research-based strategy. So my question posed a major threat to them. Again, that was not my intent. I just didn’t want my friends to suffer failed retirements. But that’s what happened. If Shiller is right, Buy-and-Hold tumbles to the ground. His research findings challenge the premise of the Buy-and-Hold Model — that market timing is not required because stock investing risk is stable, not variable.
Rob