Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site:
“ I haven’t committed any criminal acts and I have done journalism work that would have brought me more than $500 million but for the criminal acts that you committed. ”
Is there anyone other than you that believes on3 word of that?
Yes.
Lots of people believe it. There’s no one who knows things at the same level of depth that I do because no one has been there for every post like I have. But, yes, there have been people who have indicated that they understand the intimidation side of this or the substance side of this. It’s not hard to understand. But it is hard to accept. Peoples first inclination is to turn away, to not get involved, to go back to living their comfortable lives.
When I told the site owner at the Motley Fool site that Greaney’s behavior was driving away our best posters, he thanked me for my “thoughtful” email and expressed the view that it would be “ideal” if Greaney would permit honest posting. So he clearly got it in part. The other side of the story is that Greaney was bringing in money for Motley Fool. Greaney’s study led people to believe that they could retire many years sooner than what the peer-reviewed research showed was possible. People loved that. So they came to the site to hear what he had to say and told their friends. The more people there were at the site, the more money Motley Fool made with advertisements. That site owner’s job was to make money for Motley Fool.
He had two jobs. His job was to enforce the rules. And his job was to bring in money. The two jobs were in conflict. If he enforced the rules, he was going to cost Motley Fool money. What to do? What to do?
It is in the nature of the stock market to make us dishonest. There is no man in the sky with a long gray beard who sets stock prices. All stock investors collectively possess that power. We can set prices wherever we want. At one-half of their true value. At their true value. At two times their true value. At three times their true value. Whatever we please. And, if we set them very, very high, we can fool ourselves into thinking that we are eligible for retirement many years sooner than we really are. Believing that feels good. We all have access to that good feeling anytime we care to experience it.
All we have to do is to tell lies about the bull market prices. To keep those prices high, we have to pretend that we believe that irrational exuberance is not such a big deal, that it is perfectly fine to be price indifferent, to “stay the course” by keeping our stock allocation the same rather than by keeping our risk profile the same. I would turn the question around on you. Is there anyone other than you Goons who believes a word of the “oh, market timing is not really 100 percent required” garbage?
We all believe it and don’t believe it at the same time. We all want to know the true value of out stock portfolio. Our brains tells us to want that. And we all want to believe that the inflated claims about the value of our portfolio are real. Our Get Rich Quick urge wants us to believe that. It’s an inner conflict that goes on every second of every day that the stock market is in business.
We are all creeps. That’s what it comes to. We are all liars. We are all greedy cusses. That’s what the entire history of the stock market shows.
And we are all also angels. If we had no desire to tell the truth, Shiller would never have been able to get his research published. Or his book. He never would have been awarded a Nobel prize.
We are angels with a creepy side. We are creeps with angelic inclinations. We are both things. The way it is. And the stock market prices of a given day is determined by whether out creepy side or our angelic side is stronger or weaker on that day. It is a constant battle between our better nature and our weaker nature.
The forces of our better nature made a huge advance when Shiller published his Nobel-prize-winning research. And the forces of our weaker nature made a huge advance when the site administrator at the Motley Fool site elected to put Greaney up for the Poster of the Year award rather than to ban him from the site. Every one of us has a role to play in this drama and the decisions that each of us makes every day determine where stock prices go. That’s how it works.
I think that the next price crash is going to tip things in support of permitted honest posting re the last 40 years of research. I think people are going to be horrified by what they see and they are going to work up the courage to stand up to you Goons. Once we are able to talk about the research, the side that favors research-based strategies will develop a huge momentum and you just won’t be able to get the genie back in the bottle.
But we’ll see, you know. Yes, lots of people believe all of that. Nothing could be more clear. But lots of people don’t want to believe it and lots of people are afraid to say in public what they believe. That’s what needs to change. I think that it is in the process of changing. Otherwise, Shiller would never have been awarded a Nobel prize. But we are just going to have to let the process play out to find out for sure. Seeing all the human misery that persuading people to follow a pure Get Rich Quick/Buy-and-Hold “strategy” for investing in stocks always brings is part of the process. I believe today that we are going to have to see that next price crash to work up the courage to speak up and take us all to a far better place than we ever imagined we could live in during the Buy-and-Hold Era.
We’re almost there, Anonymous. The humans are on the verge of achieving some amazing advances. All we need today is a little bit of courage. I know how it feels. I didn’t quite have the courage that it takes to speak honestly about stock investing on the evening of May 12, 2002, I developed it on the morning of May 13, 2002. I have never looked back, I said that the Greaney retirement study lacks a valuation adjustment then and I still sat that today. Sue me.
Rob
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