Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site:
Since that deranged non-response ignored my question about your book, we can assume it won’t be finished by the end of this year. Or any year.
It won’t be finished by the end of this year, as I had hoped. I can now see light at the end of the tunnel. Before, when I would rework a section, it would often cause changes in a number of places throughout the book. I now have all the chapters divided up properly and in the right place. So things are much more stable. I can focus on one chapter and get that in better shape and then move on to something entirely different. The work proceeds a lot more quickly and efficiently that way. So things are improving.
But, no, I am not done or even super close to being done. My new target date for completion is June 2022. I think I’ll make this one. But then I thought I would make the earlier ones too.
Wish me luck!
Rob
When did you start working on your Investing for Humans book?
The learning experience started on the morning of August 28, 2002. I was a Buy-and-Holders until then. Greaney advanced his first death threat on the evening of August 27, 2002, When that post attracted more than 200 recommendations from other Buy-and-Holders, I knew that this stuff was for the birds. So I began my search for something better.
I was not working on the book in any direct sense for a number of years. I was mostly working on the five unique calculators that reside on the site as well as on full-length articles for the site and columns for other sites (I once had three going at one time) and participating in discussions held at places like NoFeeBoards.com and Early Retirement Forum and Bogleheads Forum.
I began working with Wade Pfau on our peer-reviewed research showing that Valuation-Informed Indexing is superior to Buy-and-Hold in December 2009. That gave me a big boost in confidence. Having someone with a Ph.D. in Economics look everything over carefully and conclude that it all checked out meant a great deal to me. I got another big boost in confidence when Rob Arnott checked out my stuff and also said that it all checked out. That was after Wade had flipped.
Somewhere in that time range (probably 2012 or 20113), I realized that this was big enough to support a book. I took a stab at it but my knowledge was not yet deep enough for me to pull it off. So I put the project aside after about six months.
In 2018, I was contacting influential people to request their helps in overcoming you Goons. I felt that I needed a single statement that made the case re the dangers of Buy-and-Hold and the need for a new model for understanding stock investing (Valuation-Informed Indexing). That’s the article that came to be titled “Buy-and-Hold Is Dangerous.” writing that was a struggle. Again, there were a lot of ideas in my head but I had not yet thought them all through sufficiently to tame them and organize them effectively. The article clicked in February 2019. For the first time I had been able to tell the entire story in one clear narrative.
That told me that I was ready to write the book. So I would say that I started on the book in March 2019. My first target completion date was January 2020. But of course as with everything else relating to this project the writing of the book turned out to be a lot harder than anticipated. I am now making steady progress. The book is not super close to being finished. But the parts of it are now stable, which means that there is light at the end of the tunnel. My new target completion date is June 2022.
Rob
“Greaney advanced his first death threat on the evening of August 27, 2002”
Is there any good reason why you have never posted a link to this death threat? You also say “first death threat” which implies he made more than one death threat. If so, why not post a link to any other threats. Doing so would bring you credibility. Not doing this undermines your credibility.
The idea that you need to see the death threats is just silly. It is a distraction from the issues that matter. What matters is that Greaney has not corrected the error he made in his retirement study in the 20 years since it was brought to his attention. That’s scary. That affects every investor (and even every non-investor) on the planet. We all need to be engaging in a national debate re how something like that could happen.
Greaney couldn’t get away with that without the help of Motley Fool and Morningstar and John Bogle and on an on and on. The entire point of investment analysis is to help people plan their retirements. If we can’t get errors in retirement studies corrected, why are we here? The suggestion there is that the entire field is corrupt together. The Get Rich Quck/Buy-and-Hold urge that resides within all of us is killing us as a society. I think we are going to get past it. But it is taking a long time. 20 years is a long time for an error in a retirement study to remain uncorrected.
You don’t need links to the death threats. You saw them in real time. You probably pushed the “recommendation” button when you saw them. You say them and approved of them. I mean. come on.
The attitude of Buy-and-Holders toward the last 40 years of peer-reviewed research comes though in every comment you post here. If Buy-and-Hold were a real thing, you would be thrilled to have people point out errors in Buy-and-Hold retirement studies. You would want to make those studies as accurate and helpful as possible. Death threats are not the only tactic that you employ to distract people from the errors in the study. But ALL intimidation tactics serve the same general purpose — blocking knowledge of how stock investing works from advancing. That’s the core error in thinking — believing that the important thing is never to have to acknowledge a mistake, no matter how many people get hurt.
It’s obviously a small percentage of Buy-and-Holders who become outright Goons. But what is the percentage who speaks out about what you Goons do? It should be 100 percent. If it were 100 percent, Greaney would have felt compelled to correct his study within 24 hours of the moment that he learned of the error he made in it, Buy-and-Hold survives because the Get Rich Quick impulse that resides within all of is a powerful force. I believe that Shiller helped us all in a big way by publishing research showing the power of that urge. I believe that it will be a turning point in U.S. history when we pull together as a society to open every discussion board and blog to honest discussions of the last 40 years of peer-reviewed research in this field.
We’ll see.
Rob
“The idea that you need to see the death threats is just silly.”
No, it is not silly. In our society, everyone is considered innocent until proven guilty. Otherwise, we can just make up any accusation we want.
“You don’t need links to the death threats. You saw them in real time. You probably pushed the “recommendation” button when you saw them. You say them and approved of them. I mean. come on.”
I have not seen any of the death threats. I have not seen anyone else confirm that they say any death threats. This is exactly why I am asking and other have asked to see them.
They have been discussed at this blog on numerous occasions. The standard Goon response has been to say that your reason for posting photos of guns in discussions of stock investing was to stress the importance of gun safety.
Rob
Is this the thread you are referring to:
https://boards.fool.com/sydsydsyd-theyre-taking-them-down-as-fast-as-we-18207722.aspx?sort=postdate
If this is the case, it is clear you made up the story about death threats. There are no threats. It is a discussion on personal protection and ends up with a message about gun safety. This is why people don’t believe you.
Here is a press release at the PRWeb site
http://www.prweb.com/releases/2007/04/prweb519605.htm
“Rob Bennett writes the daily “Financial Freedom Blog” and is the author of “Passion Saving: The Path to Plentiful Free Time and Soul-Satisfying Work.” His next book, “Investing for Humans: How to Get What Works on Paper to Work in Real Life,” is slated for publication in 2008.”
and in the Rob Bennett — What Kinda Guy? section at this site
http://www.passionsaving.com/rob-bennett.html
“Rob expects to publish his second book, Investing for Humans: How to Get What Works on Paper to Work in Real Life, in 2008.”
Is this the thread you are referring to:
https://boards.fool.com/sydsydsyd-theyre-taking-them-down-as-fast-as-we-18207722.aspx?sort=postdate
If this is the case, it is clear you made up the story about death threats. There are no threats. It is a discussion on personal protection and ends up with a message about gun safety. This is why people don’t believe you.
We disagree, Anonymous. If Buy-and-Hold were a real thing, we would never see a post like that show up in discussions of stock investing.
Once we open every discussion board and blog on the internet to honest posting re the last 40 years of peer-reviewed research, we won’t see that sort of thing anymore. We will probably see differences of opinion re whether Buy-and-Hold or Valuation-Informed Indexing is the way to go, at least for a time. But once the need to permit honest posting is universally recognized, the tone of the discussions will change. They will be normalized. The Buy-and-Holders will no longer be trying to prevail through intimidation, They will either be prevailing through reasoned discussion or not prevailing at all. Which is as it should be, in my sincere assessment.
I naturally wish you all the best that this life has to offer a person, regardless of what investment strategy you elect to follow.
Rob
Here is a press release at the PRWeb site
http://www.prweb.com/releases/2007/04/prweb519605.htm
“Rob Bennett writes the daily “Financial Freedom Blog” and is the author of “Passion Saving: The Path to Plentiful Free Time and Soul-Satisfying Work.” His next book, “Investing for Humans: How to Get What Works on Paper to Work in Real Life,” is slated for publication in 2008.”
and in the Rob Bennett — What Kinda Guy? section at this site
http://www.passionsaving.com/rob-bennett.html
“Rob expects to publish his second book, Investing for Humans: How to Get What Works on Paper to Work in Real Life, in 2008.”
Okay. I don’t have perfect recall of the entire chronology. A lot has gone down over the first 20 years of our discussions.
Those things must have been written when I took my first stab at writing the book. That effort did not get very far. That’s before the days when Wade Pfau and I co-authored our peer-reviewed research showing that “Yes, Virginia, Valuation-Informed Indexing works!. That’s even before several of the calculators had been published. I don’t think that I had even started my weekly Value Line column at that time. I have now posted over 500 entries to that column. So the depth of my knowledge of the Valuation-Informed Indexing concept was obviously much less than what it is today.
I had the basics in place at that time. I knew that I had a tiger by the tale. I knew that there was an important story to tell, a story that more than justified a book. But not all of the puzzle places had yet clicked into place at that time. Every last puzzle piece has noant clicked into place even today. If every puzzle piece had already clicked into place, there would be no purpose serves by me continuing to post new column entries. But I can explain things much more clearly and much more completely today than I could then. At some point you need to get the thing out because getting the book out will help me to get more people involved and that will help us all to learn more together. So at some point you need to go with what you’ve got. I believe that a completion date of June 2022 is realistic and sensible.
I hope that that plan meets with your approval, Evidence.
If there had never been any Goon attacks, I believe that I would have finished the book many years ago, probably by the dates specified in your comment. It would have helped me to have thousands of people contributing in positive and constructive ways. You Goons made the job 50 times harder than it had to be and thereby held us all back.
That’s why I am expecting to receive a $500 million settlement payment. When the Ban on Honest Posting is lifted, we all get to live better lives for all time to come. Someone had to do the work that I have done to get the internet opened to honest posting. I am in the process of doing it. So I naturally obtain the financial rewards that follow from doing it. That fact that this has taken so long shows how important a project it is. You obviously would not have devoted 20 years of your life to holding back progress if you didn’t see that Shiller’s Nobel-prize-winning research represents a huge advance, a turning point in the history of the United States.
Please recall that I have been urging us as a society to open the entire interest to honest posting going back to the afternoon of May 13, 2002. I advocated that we take the easy, pleasant road to better lives for all of us, not this messed-up road filled with death threats and acts of extortion and all sorts of other intimidation tactics that serve no possible position purpose.
Fair enough?
Rob
All people need to do is read this thread to really see how much you are disconnected from reality.
And they need to read the Greaney study to find out whether it contains a valuation adjustment or not.
And we need to open every discussion board and blog on the internet so that any time some Buy-and-Holder cites the 4 percent rule, someone in the community can point out that the studies from which the 4 percent rule was pulled lack adjustments for the valuation level that applies on the day the retirement begins.
That’s the answer, Anonymous. That’s normalization. That’s how things are handled in every field of human endeavor other than the investment advice field in the Buy-and-Hold Era and that’s how they need to be handled in the investment advice field as well.
I am sure.
Rob
“ That’s why I am expecting to receive a $500 million settlement payment.”
You have MUCH better odds winning the Powerball lottery versus getting even one dollar from a settlement payment.
Are you okay with waiting to see how things play out in the days following the next price crash?
If Shiller’s Nobel-prize-winning research is legitimate research, then irrational exuberance is a thing. It is not in the nature of irrational exuberance to remain irrational exuberance forever It is in time transformed into irrational depression. When that happens, people don’t like it so much anymore. They are instead repelled by it.
The reason why Shiller was awarded a Nobel prize is that he showed us the path to never again having to worry about irrational exuberance or irrational depression — market timing! If we all are always sure to adjust out stock allocations to reflect the amount of irrational exuberance in the stock price at the moment, we will never again see a bull market or a bear market or a price crash or an economic crisis. All of those things are possible only if investors irrationally elect not to engage in market timing (price discipline!). Prices are self-regulating in a world in which honest posting re the past 40 years of peer-reviewed research is permitted.
Millions of people will benefit in very big ways when we permit honest posting at every discussion board and blog on the internet, without a single exception. People will be talking about the realities of stock investing everywhere you go, And I will be at least 20 years ahead of the game. I believe that I will see a $500 million settlement check coming my way at that time. But I am not God. I could be wrong. We will just have to show a little patience and let things play out to find out for sure.
I naturally wish you all the best in life regardless of what investment strategy you elect to follow in any event, Anonymous.
Rob
“ Okay. I don’t have perfect recall of the entire chronology. A lot has gone down over the first 20 years of our discussions.”
I really don’t understand this statement. All you have done is repeated about a half dozen lines for the last 20 years. It probably took a total of 30 minutes to come up with that and then it was just hitting the repeat button. You really haven’t done a thing. Meanwhile, others have posted way more volumes of useful information, while holding down jobs and/or running businesses.
“ Are you okay with waiting to see how things play out in the days following the next price crash?”
It has been 20 years. We have seen it all play out. Nothing turned out the way you said it would.
I really don’t understand this statement. All you have done is repeated about a half dozen lines for the last 20 years. It probably took a total of 30 minutes to come up with that and then it was just hitting the repeat button. You really haven’t done a thing. Meanwhile, others have posted way more volumes of useful information, while holding down jobs and/or running businesses.
The line that I have repeated thousands of times is: Valuations affect long-term returns. That’s what Shiller showed with his Nobel-prize-winning research, You are right that it is a very simple concept. But it is a single concept with far-reaching strategic implications. If valuations affect long-term returns, then stock investing risk is not stable but variable. That means that any investor seeking to stay the course in a meaningful way is REQUIRED to engage in market timing.
We didn’t always know that. There was a time when many smart and good people believed that market timing might not be absolutely necessary or even that there might be circumstances in which it would not be a good thing. There were about 15 years in which people believed that before Shiller published his Novel-prize-winning research “revolutionizing” (his word) the field. So we now have an ocean of material on stock investing that is outdated, discredited by the last 40 years of peer-reviewed research.
I am saying that we should open every internet site to honest posting That would permit us to get rid of all the outdated Buy-and-Hold stuff that is causing so much human misery and replaced it with true research-based stuff that HELPS people. Yes, the finding that market timing is required is only one thing, But it is a very, very big thing. It is like the finding that the earth revolves around the sun rather than the other way around, It changes everything.
You own behavior shows that you appreciate on some level of consciousness the importance of Shiller’s Nobel-prize-winning research. You have spent 20 years of your life blocking people’s ability to discuss and thereby learn about Shiller’s Nobel-prize-winning research, You wouldn’t do that if you didn’t think it was a big deal. It is a life-and-death matter to you that no one be permitted to discuss the new research, If they do, that will be the end of Buy-and-Hold. And you just can;t freakin’ stand it.
You say that people have put forward volumes of information, Lots of people have put forward lots of information, that’s for sure, And much of that information is good stuff considered in isolation. But none of that information is going to do us any good id our economic system collapses. And our relentless promotion of the Buy-and-Hold “strategy” has put is in danger of seeing our economic system collapse. We have to get the market timing thing right for any of the rest of it to amount to anything,
Market timing is the brakes on the car. It is market timing that keeps irrational exuberance (the enemy of all stock investors) in check, These other people are helping us to build a stronger engine and to have a better sound system and an amazing paint job and all the rest. But none of that good stuff counts for anything in a car without brakes. And there is 40 years of peer-reviewed research showing that market timing is the brakes on the car.
I am trying to give value to the good work that all of these other people are doing by opening every sire on the internet to honest posting re the last 40 years of peer-reviewed research, Without market timing, none of the rest works, We all need to be taking valuations into consideration at all times. When calculating safe withdrawal rates. And when doing any other calculation relating to stock investing. If it is true that valuations affect long-term returns (and that the market is not efficient, as was believed to be the case when Buy-and-Hold was being developed) then it is a logical impossibility that the Buy-and_Holders could ever get a single calculation right. Not good.
My sincere take.
Rob
It has been 20 years. We have seen it all play out. Nothing turned out the way you said it would.
The bull market has not come to an end yet, Anonymous. The last time I checked, the CAPE value was 38. Are you joking?
That’s like saying that by all indications Bernie Madoff was an amazing fund manager as of the week before his fraud was exposed. Huh?
Rob
You can’t even get your wife or kids to back you up on all this, let alone one single person in the investment world.
I have had many people in the investment world support me strongly until the intimidation got so intense that they backed away. Take away the intimidation and we can all change the world in a very positive way.
The benefit of peer-reviewed research is that it permits people to learn new things. Shiller published his Nobel-prize-winning research in 1981. It’s time to open the entire internet to discussion of his “revolutionary” (his word) finding and permit us all to benefit from them.
Rob
Do you have kind of special glasses? Why is it that only you see the death threats? Why is it that only you see acts of intimidation? Why is it that only you see a mass conspiracy? Why is it that only you see people supporting you and we can’t?
Here is a blast from the past:
https://arichlife.passionsaving.com/2014/06/05/i-play-it-the-other-way-my-focus-is-the-goon-stuff-i-focus-on-that-because-that-is-the-critical-factor-that-no-one-else-has-explored-in-depth-by-focusing-on-the-goon-stuff-i-am-making-a-unique-c/#comments
Read the comments section. Look at how wrong you were again on predictions. It shows your timing schemes has failed so many times.
Do you have kind of special glasses? Why is it that only you see the death threats? Why is it that only you see acts of intimidation? Why is it that only you see a mass conspiracy? Why is it that only you see people supporting you and we can’t?
I do possess a special power, Anonymous. My special power is that I believe that peer-reviewed research provides useful guidance on how stock investing works. The Buy-and-Holders once possessed that special power as well. That’s why I was once a Buy-and-Holder. The Buy-and-Holders gave up that special power in 1981, when Shiller published his Nobel-prize-winning research showing that discredited the core idea behind the Buy-and-Hold Model, that the market is efficient. Now the Buy-and-Holders tolerate only peer-reviewed research that was published prior to 1981 or that was published after 1981 but that ignore Shiller’s “revolutionary” (his word) findings of 1981. I use both the pre-1981 and post-1981 research for guidance. Valuation-Informed Indexing integrates Shiller’s research findings into what we knew about stock investing before he came along.
Say that I was right in my claim of May 13, 2002, that the retirement study posted at John Greaney’s web site lacks an adjustment for the valuation level that applies on the day the retirement begins (I am). If that’s so, then we should be discussing that at every discussion board and blog on the internet. It was not only Greaney who advanced the 4 percent rule. That rule was discussed in thousands of newspaper articles and by thousands of investment advisers. The primary purpose of investment analysis is to help people plan their retirements. If thousands of articles and thousands of advisers have been getting it terribly wrong for 40 years now, getting that fixed is the nost important public policy issue before our nation today.
What could possibly explain the fact that such discussions have been banned at every large investing site? How could such a ban be enforced without all sorts of abusive behavior, including a goof bit of outright criminal? No halfway rational person could imagine a way that that could be pulled off. Common sense tells you that all of the things that I discuss had to have happened? Otherwise, why wouldn’t the Greaney study have been corrected by now? It’s been 20 freakin’ years.
I mean, come on.
Rob
is a blast from the past:
https://arichlife.passionsaving.com/2014/06/05/i-play-it-the-other-way-my-focus-is-the-goon-stuff-i-focus-on-that-because-that-is-the-critical-factor-that-no-one-else-has-explored-in-depth-by-focusing-on-the-goon-stuff-i-am-making-a-unique-c/#comments
Read the comments section. Look at how wrong you were again on predictions. It shows your timing schemes has failed so many times.
Long-term timing has never failed. Not once in the 150-years of stock market history available to us. It’s not even possible that it ever COULD fail. Shiller’s Nobel-prize-winning research shows that irrational exuberance is a thing. If that is so, then stock investment risk is not stable but variable. If stock investing risk is variable, then investors seeking to stay the courage in a meaningful way MUST engage in market timing to pull that off. Always. No exceptions. The market timing works on the day it is employed because that is the day when the investor’s risk profile is restored to what he intended it to be.
Here is one of the paragraphs from one of my responses from the earlier thread:
“If we don’t see the next leg by the end of 2016, perhaps we will see it by the end of 2018. We cannot predict these things with precision because the timing depends on when investor psychology changes. We don’t have the tools to get inside people’s minds. The only thing we have to go by is the historical data — How long has the process of investors coming to terms with the realities taken in the wake of earlier out-of-control bull markets? This one was more out of control than any before it (because of the reckless and relentless promotion of Buy-and-Hold “strategies”). So we cannot even achieve the same level of imprecision that would be possible in more ordinary circumstances. But I believe that the “end of 2016” guess is a perfectly reasonable estimate.”
It didn’t happen by the end of 2016. But it may well happen by the end of 2022 or by the end of 2023 or by the end of 2024. Whenever it happens, it will be horrible to see the ocean of human misery caused by one more Buy-and-Hold Crisis. All of that human misery goes away on the day we open the entire internet to honest posting re the last 40 years of peer-reviewed research in this field. Stock prices are self-regulating in a world in which investors have access to information about what the last 40 years of peer-reviewed research teaches us all about how stock investing works in the real world.
My best wishes to you in any event.
Rob
“I have reported accurately that the 140 years of historical return data shows that we will see a price drop of roughly 65 percent sometime within the next three years.”
You just need to say the three little words ” I was wrong”
I reported accurately what the data showed, Evidence. We have never before seen prices remain at out-of-control levels for so long. If you had a friend who got behind the wheel of a car after drinking six beers and you warned him that there’s a good chance that he will kill himself but he lived, would you then say: “Oh well that proves that it is ‘100 percent safe’ to drive drunk, feel free to drive after drinking six or eight or ten beers from this point forward.”
I don’t buy it. If something is insanely dangerous, it doesn’t become “100 percent safe” because it doesn’t yield catastrophic results on one or two occasions.
I would permit honest posting re that past 40 years of peer-reviewed research. Then people can make up their own minds. I feel 100 percent confident that we wouldn’t have a CAPE value of 38 today if we had been permitting honest posting all along.
Rob
“ We have never before seen prices remain at out-of-control levels for so long.”
Which means your timing scheme failed.
Not so. The purpose of long-term timing is to keeps one’s risk profile constant over time. That aim is achieved on the day that the stock allocation change is made.
Irrational exuberance tricks people and hurts people. All that you are showing when you point out that we have seen more irrational exuberance in recent years is that more people have been tricked and more people have been hurt than ever before.
I believe that we would all be far better off if we had been permitting honest posting re the last 40 years of peer-reviewed research all along.
Rob
“We have never before seen prices remain at out-of-control levels for so long. ”
Which proves that no matter what timing scheme you come up with based on history, the market can always do something it has never done before.
Buy and Hold will capture 100% of the market return (minus very low costs)
And it will always ultimately smash the economy to smithereens.
The Get Rich Quick element of Buy-and-Hold (no market timing now!) adds absolutely nothing and subtracts a great deal.
That’s my sincere take re this terribly important matter, in any event.
Rob
“If something is insanely dangerous, it doesn’t become “100 percent safe” because it doesn’t yield catastrophic results on one or two occasions.”
Is there a single instance in the historical record where a 4% withdrawal rate failed?
There is not. When stocks are priced as they were in 1982, a 9 percent withdrawal has a 95 percent chance of working out. So 4 percent is super, super, super safe. But, when stocks are priced as they were in 2000, a 4 percent withdrawal has only a 30 percent chance of working out. That ain’t safe.
It’s the valuation level that applies on the day the retirement begins that tells you what withdrawal rate is safe. The reason why 4 percent has never failed is that, until recent years, we have never seen such valuation levels. The fact that 4 percent came within an inch of failure on the tiny number of occasions on which valuations got anything close to today’s levels tells you you not that 4 percent is “100 percent safe” at these levels but that 4 percent is insanely dangerous at these levels.
We should be telling people the truth about this stuff. At the very minimum, we should permit the truth to be spoken and leave it to each community member to decide for himself or her herself. Criminal and civil liabilities kick in when we play it the way we have been playing it for the past 20 years.
My best wishes to you.
Rob
You are a walking contradiction. You say that everyone should time the market because it always always acts the same way. Now you say that this market is doing something it never has done. By saying that, you are admitting that timing has failed. You can’t have it both ways.
You are a walking contradiction. You say that everyone should time the market because it always always acts the same way. Now you say that this market is doing something it never has done. By saying that, you are admitting that timing has failed. You can’t have it both ways.
Irrational exuberance always hurts investors. There has never been a single exception. But the time at which that hurt will take place cannot be determined in advance. What we know for certain is that times of high irrational exuberance are times of extreme risk.
We all should be doing what we can to keep irrational exuberance under control. That means pointing out the necessity of market timing as often as possible.
Rob
If your expected crash does not happen during your lifetime, then your timing scheme failed.
Would you put a deadline on advice not to drive drunk? If you tell someone not to driver drunk and he survives two or three incidents with only a concussion and some broken limbs, would you then declare “if driving drunk does not kill you within the next few years, then I will declare that driving drunk has been shown to be 100 percent safe.”
I would not. There are reasons why reasonable people have come to believe that driving drunk is dangerous. Being drunk compromises one’s judgement and reaction time. It’s the same with irrational exuberance. It is not a coincidence that an economic crisis always follows a time when irrational exuberance is permitted to get out of control. Investors need to be able to make rational decisions to achieve their goals. So irrational exuberance always ends up hurting us in very seriious ways. We should always be promoting market timing every chance we get.
That’s my sincere take re these terribly important matters, in any event.
Rob
The timingscheme has to not only work during your lifetime, but early enough so that you haven’t run out of money and that you can benefit from a rise in stocks.
Market timing works on the day that the asset allocation is made, Anonymous. That’s what you are not getting. The most important thing in stock investing (70 percent of the story) is to always, always, always Stay the Course. To do that in a world in which valuations affect long-term returns (that’s how it is on good old Planet Earth, according to the last 40 years of peer-reviewed research in this field), you need to engage in market timing. There is no other way to pull it off. If you fail to engage in market timing, you are permitting your risk profile to jump all over the place for no good reason whatsoever. That is very much NOT Stay the Course.
Now —
Is it possible that the community of investors will go more than a little bit nuts for a time and make it hard for EVERYONE to achieve his or her investment goals as a result? Obviously. That is what has happened to us over the past 25 years. Buy-and-Hold/Get Rich Quick is an ADDICTIVE strategy. We are all suffering through the effects of that addiction today. One very basis effect is that we have pushed stock prices so high with out reluctance to engage in market timing that the most likely long-term stock return is now a negative number. Not good.
The answer there is for us all to work together to ensure that every discussion board and blog on the internet remains open to honest posting re the peer-reviewed research at all times. We have as a society adopted laws against death threats and demands for unjustified board banning and thousands of acts of defamation and acts of extortion for very good reason. We are all in the same boat. We all want the same things from investing (higher returns, less risk). So we all should be working together to see that the same laws that apply in every field other than the investingment advice field are made to apply in the investment advice field as well.
Are we humans perfect creatures? Obviously not. But we are pretty darn appealing creatures all the same. Did we not permit Shiller to publish his book? Did we not award him a Nobel prize for his amazing research? Did we not set up discussion boards where thousands of community members have expressed a desire that honest posting re safe withdrawal rate and scores of other critically important investment-related topics be permitted? We’re imperfect. But we are also underneath the surface kinda awesome.
That’s my sincere tale re these terribly important matters, in any event.
My best wishes to you and yours.
Rob
“ The most important thing in stock investing (70 percent of the story) is to always, always, always Stay the Course.”
That is buy and hold.
“ Market timing works on the day that the asset allocation is made, Anonymous. That’s what you are not getting.”
In 2005, when your retirement plan was off track, you told us that you did not worry about that since a market crash would come and then you could buy stocks on the cheap, allowing you to not only catch up, but come out ahead. Now you are changing the story again.
Meanwhile, I am now getting close to $7 million and you are telling me that It will all crash down and I will be broke.
Who’s plan worked?
“ The most important thing in stock investing (70 percent of the story) is to always, always, always Stay the Course.”
That is buy and hold.
It’s Buy-and-Hold updated (because the publication of new peer-reviewed research showed us the need for an update) to include market timing.
Rob
Market timing works on the day that the asset allocation is made, Anonymous. That’s what you are not getting.”
In 2005, when your retirement plan was off track, you told us that you did not worry about that since a market crash would come and then you could buy stocks on the cheap, allowing you to not only catch up, but come out ahead. Now you are changing the story again.
Meanwhile, I am now getting close to $7 million and you are telling me that It will all crash down and I will be broke.
Who’s plan worked?
My plan worked. Valuation-Informed Indexing has performed far superior (much higher returns, far less risk) to Buy-and-Hold for 150 years now. That’s as far back as we have records. The peer-reviewed research that I co-authored with Wade Pfau shows this beyond any reasonable doubt whatsoever.
You are failing to adjust for the effects of irrational exuberance. That will throw you off track every time. It is because Shiller showed is the need to do that that he was awarded a Nobel prize.
Rob
“ My plan worked. ”
You are obviously mathematically challenged. Try paying your bills with your VII fake money.
Try paying them with your bull market Buy-and-Hold money after prices have crashed.
I feel more comfortable going with a strategy that has worked well for 150 years than with a strategy that has never in 150 years worked well. Call me madcap.
The purpose of peer-reviewed research is to help us tune out the bull market noise and come to understand the realities that always prevail in the long-term.
Rob
“I feel more comfortable going with a strategy that has worked well for 150 years than with a strategy that has never in 150 years worked well. Call me madcap.”
Your strategy has not been used over 150 years. It hasn’t worked for you and it hasn’t worked for anyone else. You have already admitted that you have depleted your savings.
On the flip side, buy and hold has always been rewarded. The market has always recovered and gone on to new highs.
The only people who have gone broke with market drops are those that are buying stock on margin. Buy and holders keep holding and do just fine.
The peer reviewed research does not say what you say. Spinning it that way is just silly.
Valuation-Informed Indexing has not been used for 150 years because Shiller’s Nobel-prize-winning resesarch has only been available to us since 1981., Since 1981, we have been living through the most dangerous and out-of-control bull market in U.S. history. We should be thanking our lucky stars that we will have Shiller’s research available to help us survive the next Buy-and-Hold Crisis when it inevitably arrives. It’s a GOOD thing that we learned things 40 years ago that we never knew before. The things that we learned will permit us all to live better lives from the point that we open the entire internet to honest posting forward.
I didn’t deplete my savings because of any problems with the last 40 years of peer-reviewed research. I depleted my savings because of the criminal behavior of the Buy-and-Hold Goon Squads. If Buy-and-Hold could be defended in civil and reasoned discussion, we never would have seen any criminal behavior.
The market always recovers and goes on to new highs. That’s because the U.S. economy has always remained productive. It’s not the Get Rich Quick element of Buy-and-Hold that has helped the market recover. It’s the Get Rich Quick element of Buy-and-Hold that has caused the economic collapses that always follow from a time from a high percentage of stock investors come to believe that bull market prices are real. We can have all of the good of the stock market while cutting out most of the bad by permitting honest posting and moving on from Buy-and-Hold.
If you think that the only people who have been hurt by bull markets are people who bought on margin, you need to pick up a copy of the book “Grapes of Wrath.” Or watch the movie.
If the Buy-and-Holders were doing just fine, they would not get so agitated when someone mentions the last 40 years of peer-reviewed research in this field. That’s a tell.
If lots of people did not find value in my descriptions of what the research says, you would not have felt threatened by me and never would have attacked me. The first one to advance a death threat is the one who has lost the debate.
Rob
“ I didn’t deplete my savings because of any problems with the last 40 years of peer-reviewed research. I depleted my savings because of the criminal behavior of the Buy-and-Hold Goon Squads. If Buy-and-Hold could be defended in civil and reasoned discussion, we never would have seen any criminal behavior.”
The goons spent down your savings? The goons locked you up in your house so that you couldn’t go out and work a job? Of course not. You have had 20+ years to make changes and get a job, but you chose not to. Stop blaming others for your failure.
I am the person who discovered the error in the Buy-and-Hold retirement studies, Anonymous. That’s the most important PRACTICAL advance in the history of personal finance. I am not responsible for the THEORETICAL advance that underlies what I said in my post. That was Shiller. But Shiller’s huge theoretical advance doesn’t do any of us any good if we are not all free to talk about it at every discussion board and blog on the internet. I turned the theoretical into something practical.
That was worth a whole lot more than $500 million. Do you know how many people we have hurt with this “idea” that the safe withdrawal rate is the same number at all times. Millions! All investors! And my post changed that. There were enough people who loved my post that we were able to get people (John Walter Russell) to calculate the safe withdrawal rate accurately and honestly and to get an academic researcher (Wade Pfau) to devote 16 months of his life to preparing peer-reviewed research showing that “Yes, Virginia, Valuation-Informed Indexing works!”) That changes everything. That could have helped us to avoid the 2008 economic crisis and to avoid the one that is still upcoming. That permits us all to retire many years sooner while taking on far less risk.
I have agreed to accept a $500 million settlement payment because I would like to put all the ugliness behind us and see us all working together to make the transition from Buy-and-Hold to Valuation-Informed Indexing. $500 million is more than I could spend in 10 lifetimes. So I think it makes perfect sense for me to be willing to settle for that amount. But the value that I brought to the table is obviously far greater than $500 million. Opening up the internet to honest posting on retirement planning is just an off-the-charts huge, positive advance. It changes the history of the United States in a fundamental way.
My sincere take.
And my best wishes to you, as always.
Rob
“I was mostly working on the five unique calculators that reside on the site”
Do any of the calculators currently work? I have clicked on the links under the Valuation-Informed Indexing heading and none of the five seem to work. There are either completely blank areas of the page or error messages when I try to use them. On one, “The Stock-Return Predictor” I can’t get it to accept today’s S&P500 value of 4,662.85 (from a couple of minutes ago)
I have a call in to the guy who sometimes does work on my site, My focus has been moving forward on the book. So I have let this matter slip more than I ordinarily would.
Once we get every site on the internet opened to honest posting, we will have calculators coming out of our ears. So that is my top priority. And I believe that finishing the book will do more to help that cause than anything else I could do with my time. When I have the book printed out, I will have something to send to influencers who want to know the full story about the 40-year Ban on Honest Posting in this field.
The calculators are amazing tools. But they don’t help anybody if we have no means by which to get the word out to millions of middle-class investors.
Rob
“ My focus has been moving forward on the book.”
Are you referring to the book that you said would be out 12 years ago?
“ When I have the book printed out, I will have something to send to influencers who want to know the full story about the 40-year Ban on Honest Posting in this field.”
Yep, those YouTube videos worked out so great for you, that I bet you will get the same great results from all those influencers on TikTok, Reddit, etc.
Are you referring to the book that you said would be out 12 years ago?
That’s the one!
It will be a humdinger when it is ready for public consumption, I promise you that muvh. Whenever I feel a little discouraged, I read the first three Parts (the first 27 chapters) and that gives me a confidence rush. Those first three Parts are perfectly polished today. Part Four needs a lot of work. The other Parts need work but are in better shape than Part Four.
‘I won’t put it out until it is perfectly ready. I am not willing to compromise even an inch re that one. This is to be a statement that lasts forever. The statement is coming together more quickly now than ever before. I think I will bring it home in not too much mote time.
I am 100 percent confident that it will be worth the wait. Yes, I wish that I had finished it sooner. But is there anyone else who has published a clear and complete statement on the dangers of Buy-and-Hold? If there is, I haven’t heard about him or her. If I end up being first, I guess you could say that it’s understandable why it took some time to make it perfect. This stuff is HARD.
Not intellectually. It’s hard EMOTIONALLY saying things that millions of people very, very, very much do not want to hear. They need to hear them but they very much do not want to hear them. So to be the one writing down the words of the message is very, very hard. But someone has to do it. And I think that it would be fair to say that the universe elected me to perform the task. So I am giving it my best shot.
My best wishes to you, as always.
Rob
And when your book falls flat, who or what will you blame next?
Yep, those YouTube videos worked out so great for you, that I bet you will get the same great results from all those influencers on TikTok, Reddit, etc.
After the price crash, millions of people will be in great pain. They are going to want to figure out what happened to them. Or so this Rob Bennett fellow sincerely believes, you know?
Rob
And when your book falls flat, who or what will you blame next?
The Fates! Evolution! God! Mel Lindauer! John Greaney! The weather! Bad timing! Those darn humans!
There are so many possibilities!
Rob
So there be a great financial disaster……..then how will you get even one dollar of the $500 million when everyone else is broke?
We are going to have to rebuild. Buy-and-Hold has caused a lot of pain over the years. But it has never entirely broken us. I hope and pray that it will not entirely break us this time either. Which means that we are going to have to rebuild.
Everyone is not going to be broke. Everyone is going to be worse off than he or she would have been had we been permitting discussion of the last 40 years of peer-reviewed research all along. And we will decide as a society whether we want to continue hurting ourselves or whether we like the sound of moving on to something far better.
I vote for moving on.
My best wishes to you.
Rob