“The Next Buy-and-Hold Crisis Will Bring on an Ocean of Human Misery”

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 people care about is the avalance of nonsense that you cause in message boards. your presumption of causation is wrong: ‘what i am saying must be right because i get banned for it’ is totally inaccurate. there are many other possibilities.

the most likely being: you are a message board nuisance due to the volume and length of your repetitive posts as well as your inability to defend your statements with actual facts.

I have never posted one word of nonsense in the 20 years of The Great Safe Withdrawal Rate Debate, Edge. What happened is that as a people we made a mistake in the 1960s when we discovered that short-term market timing does not work and jumped to the hasty conclusion that no form of market timing is required (Shiller’s Nobel-prize-winning research showing that market timing always works and is always required was not available to us at that time). In the beginning, cognitive dissonance kept the experts in this field from seeing their error. But, as time went on, they became more and more stressed that millions of investors not come to learn about it. So a social taboo developed against honest discussion of these matters.

That social taboo is today killing us. Millions of us think that market timing might be optional or might not even be a good thing. As a result, we have seen the CAPE value rise to insane levels. It is my belief that the next Buy-and-Hold Crisis will help us to see that we all need to be working hard to ensure that we all practice market timing (price discipline!) at all times and that we take action to get super high CAPE values down as fast as possible.

That ends it. Doing that would normalize the discussion of stock investing at every site. All of the nastiness would go away because it would no longer serve any purpose. Once every site was permitting honest posting re the last 40 years of peer-reviewed research, each investor would be able to hear both sides of the story and decide for himself or herself how much market timing he or she wants to engage in. It’s up to the investors to decide that, not to the members of internet goon squads. I mean, please give me a freakin’ break.

There is enormous interest in learning the realities of stock investing. Nothing could be more clear. If that were not so, you Goons would never have engaged in a single abusive post, much less any of the criminal stuff. I believe that the people of the United States will be successful in overcoming you Goons and opening every site to honest posting re the peer-reviewed research in the days following the next price crash. I sure hope so.

I believe that the next Buy-and-Hold Crisis will bring on an ocean of human misery. That part of course makes me very, very sad. But I also believe that it is that next Buy-and-Hold Crisis that is going to make clear to us that permitting honest posting is absolutely essential and that will in time bring on the greatest surge of economic growth ever seen in our history. Stock investing matters. We all should want to know what the peer-reviewed research tells us about how it works. There is no downside to knowing the realities. The peer-reviewed research permits us all to retire many years sooner while taking on only a fraction of the risk that we were taking on during the Buy-and-Hold Era. I can live with that. I have a funny feeling that millions and millions of middle-class investors will feel just fine living with it as well.

Everybody makes mistakes. I find no fault with my Buy-and-Hold friends for the mistake they made. But mistakes need to be corrected when they are discovered. Covering up mistakes makes things worse and worse and worse, I believe that my Buy-and-Hold friends are good and smart people. I believe that, if they were thinking clearly, they would have wanted their mistake corrected within 24 hours of the time it was uncovered by the publication of Shiller’s Nobel-prize-winning research. So I will continue to do everything I can to get our discussions back on track and to help my Buy-and-Hold friends get to a place where they can again feel good about themselves and the work they do.

The Great Safe Withdrawal Rate Debate is not a debate that will have winners and losers, Edge. We all will be winners. I am not able to imagine circumstances in which there could be any losers emerging from this. Learning is the one true free lunch available in this world. I vote for learning, which of course requires the widespread tolerance of honest posting. I am proud that after three years of being afraid of what Greaney would do to me if I worked up the courage to point out the error in his retirement study, I finally did just that because I cared about what would happen to my friends at the Motley Fool board if I failed to do so.

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