Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site:
“Does the Greaney study contain a valuation adjustment or does it not. “
It does not. Everyone knows that. No one ever claimed otherwise. However you keep bringing it up to distract from the fact that you can’t answer questions that are posed to you.
I like it that you now say that “everyone” knows that the Greaney retirement study lacks a valuation adjustment (and thus is in error since there is 40 years of peer-reviewed research showing that valuations affect long-term returns). Did “everyone” speak up about it on those occasions when Greaney would say that a 4 percent withdrawal is “100 percent safe” even at the sort of valuation levels that applied in the last 1990s. I don’t recall “everyone” doing that. I recall there being a big commotion when I first worked up the courage to do it on the morning of May 13, 2002.
Did “everyone” know that slavery was wrong in the days when it was legal?
Did “everyone” know that smoking was bad in the days before we put cancer warnings on cigarette packages?
Did “everyone” know that pollution was hurting out planet in the days before “Silent Spring” was published and kicked off the environmental movement?
Did “everyone” know that it was wrong that women couldn’t vote in the days when that was so.
Sometimes everyone knows something one one level of consciousness but also suppresses what they know because there is a social taboo against speaking up about truths that are inconvenient to people with power and wealth and connections.
Yes, everyone who cares to know whether or not the Greaney study is in error knows that it is, Nothing could be more obvious. Everyone who cares to know the truth about stock investing also knows on one level of consciousness that one asset class can not always be the best choice and that putting ourselves at risk of a huge price crash also puts us at risk of an economic crisis and that valuation-based market timing is always a good thing (how could it ever be a bad thing for stock investors to practice price discipline when making purchases?).
It’s one thing for everyone to know something, It’s something else for everyone to be able to talk about that something so that they can process the knowledge and put it to good use in the real world. Today’s CAPE value would not be 40 if we had opened every discussion board and blog on the internet to honest posting re the last 40 years of peer-reviewed research in this field, as I proposed on the afternoon of May 13, 2002.
My sincere take.
And my best and warmest wishes to you, Evidence.
Rob
“It’s one thing for everyone to know something, It’s something else for everyone to be able to talk about that something so that they can process the knowledge and put it to good use in the real world. Today’s CAPE value would not be 40 if we had opened every discussion board and blog on the internet to honest posting re the last 40 years of peer-reviewed research in this field, as I proposed on the afternoon of May 13, 2002.”
Here is an interesting thread at Bogleheads about the SWR issue.
Traditional SWR – flawed at the core https://www.bogleheads.org/forum/viewtopic.php?f=10&t=368411
I don’t agree with the point made in the thread starter. But I think it is a very good thing for that point to be made and debated.
My view is that safe withdrawal rate analysis is a powerful analytical tool but that valuations MUST be taken into consideration. When you fail to take valuations into consideration, you have a tool that appears to be powerful but that points in all sorts of crazy directions because it is being applied in an inappropriate way.
And of course I am just fine with the reality that there are many smart and good people who liked using the tool in the inappropriate way in which Greaney employed it so long as they are okay with people who favor employing it in other ways being permitted to participate in community discussions.
We didn’t know everything there was to know about how stock investing works in 1980. The odds are strong that even those of us who have incorporated the last 40 years of peer-reviewed research into our thinking do not know everything there is to know about stock investing as a result. So we just have to open every discussion board and blog on the internet to honest posting so that we can over time learn together what we all very much need to know.
Thanks for supplying the thread, Evidence.
Rob
Drops are never blamed on buy and hold.
https://www.cnbc.com/2022/01/23/stock-market-futures-open-to-close-news.html
Without the blame, there is no $500 million windfall.
It is good to see that normal people can have good discussions over and the Bogleheads forum without having the old hocomania disruptions.
Drops are never blamed on buy and hold.
https://www.cnbc.com/2022/01/23/stock-market-futures-open-to-close-news.html
Without the blame, there is no $500 million windfall.
This is what has to change, Anonymous. I blame drops that take place at time of lots of irrational exuberance on Buy-and-Hold in every article that I wrote about price drops. I have placed the blame on Buy-and-Hold/Get Rich Quick THOUSANDS of times. We need to see everyone doing that. When everyone is doing it, we will never again see a CAPE value of 38, which means that we will never again see the huge drops that we have come expect from the stock market as a result of how we all talked about how stock investing works in the pre-Shiller years.
And, yes, I will get a $500 million settlement payment when that happens. Which will be a good thing for every single person affected by all this because the announcement of my $500 million settlement payment will cause the word re Valuation-Informed Indexing to spread like wildfire, We all need to know how stock investing works in the real world. So this will be a win/win/win/win/win, with no possible down site.
I can live with that!
Rob
“ And, yes, I will get a $500 million settlement payment when that happens.”
You are not getting even one dime as part of your delusion.
It is good to see that normal people can have good discussions over and the Bogleheads forum without having the old hocomania disruptions.
We couldn’t possibly disagree more, Anonymous. There were hundreds of people at Boglehead who indicated that I was one of their favorite posters. Those people should be able to hear from the posters that they want to hear from.
The only people who ever had any problem with discussions of the far-reaching implications of Shiller’s Nobel-prize-winning research were Buy-and-Holders. It tells us something very, very, very bad about Buy-and-Hold that so many Buy-and-Holders felt that way about things. If you do not feel comfortable hearing challenges to your strategy, that’s a strong signal that your strategy is a poor one that is going to cause you harm in the long run.
My sincere take.
Rob
You are not getting even one dime as part of your delusion.
Thanks for your support, Anonymous.
Rob
“ We couldn’t possibly disagree more, Anonymous. There were hundreds of people at Boglehead who indicated that I was one of their favorite posters. Those people should be able to hear from the posters that they want to hear from.”
Bogleheads was explicitly started with the goal to keep you out, given your history of bad behavior. No one wanted you there.
That’s false. There were many people there who told me that I was the first person they ever heard talk about stock investing in a way that made complete sense. It was’t a majority. But I was a significant minority, about 10 percent of the board community.
Even John Bogle had a post where he said that he could see how Valuation-Informed Indexing could work! I think it would be fair to say that , when you’ve lost John Bogle….
If it hadn’t been for the criminal behavior of those who were posting in “defense” of Mel Lindauer, Bogle would have expanded on those comments and we all would have enjoyed an amazing learning experience. I believe that the announcement of prison sentences for those who have posted in “defense” of Lindauer and Greaney are going to send shock waves through all investing communities. I am proud to be able to say that I have been speaking out in strong opposition to the criminal stuff dating back to the evening of August 27, 2002, which is the day when Greaney advanced his first death threat and I abandoned my belief in Buy-and-Hold and began my quest to develop the first true research-based strategy, Valuation-Informed Indexing.
My best and warmest wishes to you and yours, Anonymous.
Rob