Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site:
<em>So you are an expert, but then not an expert. It just depends on the story at the time. Got it.</em>
Yes, these are exceedingly strange circumstances. In ordinary circumstances, I would not have the training that it would take to be an expert. But the people who have the training are not talking about the last 41 years of peer-reviewed research. So they are less expert than me. At least I am doing that much. The research shows that valuations is 70 percent of the stock investing story. Talking about that aspect of the story puts me far ahead of the people who have the training that in ordinary circumstances would qualify them as experts.
This is why I say all the time that we need to open every discussion board and blog on the internet to honest posting re the last 41 years of peer-reviewed research. It’s the only way out of this crazy mixed-up situation where people who are experts are not experts and where people who are not experts are experts. The biggest perceived problem today with permitting honest posting isn’t even the embarrassment that the Buy-and-Holders feel over having made a mistake. The biggest problem today is the embarrassment they feel over having covered up the mistake for 41 years. The best thing to do when you learn that you have made a mistake is to COME CLEAN about it and then get on with the rest of your life. The longer the cover-up goes on, the worse things are for everyone. Nothing can ever make things better but COMING CLEAN re the mistake.
The entire industry is corrupt, Anonymous. From top to bottom. Motley Fool should have taken action on Greaney the first time he advanced a death threat. But Greaney was popular! They didn’t want to miss out on the money he brought in as a result of his popularity. They didn’t approve of the death threats. But they were far more worried about the loss of money that would follow from taking action on the death threats than they were about the death threats themselves.
That’s a bull market! That’s what bull markets are all about! Bull markets are liars markets. They are a rejection of the human capacity to engage in reason.
OF COURSE you have to take valuations into consideration when calculating the safe withdrawal rate! Nothing could be more obvious. All the people who failed to do that didn’t fail to do it because they are dumb. They failed to do it because they want to believe in the Get Rich Quick fantasy that is today’s ongoing bull market. Permit honest calculations and the bull market dies. Permit honest discussion and people are going to do what is int their best interest and lower their stock allocation. Which will bring prices down and end the bull market. Which would permit us all to love better lives from that point forward.
Do we believe in the laws that permit us all to post honestly?
Or do we believe in the bull market that permits us all to pretend that we have accumulated more wealth than we really have accumulated?
That’s the question on the table. We want both things but the two things are in conflict. It’s a battle between reason/research and emotion/bull market prices. We will have to determine as a people which way we want to go with this. We can’t say that we support reason and permit a CAPE value of 35 to remain in place. The one thing cancels out the other.
When the CAPE value is 35, there is very little reason being permitted in the investment advice field. True experts are banned or terminated at such times. If they were permitted to speak, the bull market would come to an end. And who wants that, right?
Yes, I am a non-expert expert. I don’t have the background to be an expert. But I can’t stand the thought of misleading my friends re the safe withdrawal rate. That makes me far more of an expert than the people whose efforts have permitted the CAPE value to climb to 35. That CAPE value is a national scandal. It is not the product of a high level of expertise in this field. Call me dumb but I know that it’s wrong to lie to people about the numbers they are using to plan their retirements.
Rob
“ This is why I say all the time that we need to open every discussion board and blog on the internet to honest posting re the last 41 years of peer-reviewed research.”
It is open to honest (truthful) posting. It is not open to lying and bad behavior.
That explains that CAPE value of 28, Anonymous. Good point.
Rob
So you lied and misbehaved because you don’t like the CAPE number. Got it.
You consider it misbehaving to point out the error in the Greaney retirement study. The error is that Greaney did not take the CAPE number that applied on the day the retirement began into consideration in determining the safe withdrawal rate.
Pointing out the error in a retirement study is not bad behavior. It is wonderful behavior. If everyone who believed that Shiller’s Nobel-prize-winning research was legitimate research had been doing that going back to the first day, Greaney never would have made the error in the first place. It is because too many thought it was too much trouble to point out the error that Greaney came to believe that it might be okay not to include a valuation adjustment. It’s not okay. People at the Motley Fool board used that study to plan their retirement. A number of those people had become friends of mine over the years.
Rob
You have already been given a long list of your misbehavior and you try to divert the subject by repeating your Greaney Schtick.
Here’s the long list:
1) Pointed out that the retirement study posted at John Greaney’s web site lacked a valuation adjustment on the morning of May 13, 2002;
2) Continued to do this on May 14, 2002;
3) Continued on May 15, 2002.
And so on and so on.
If the Greaney study is corrected, the entire Buy-and-Hold house of cards comes tumbling to the ground. The entire point of investment advice is to help people plan their retirements. If a very big error in a retirement study goes uncorrected for 20 years, what does that say about the dominant model for understanding how stock investing works? It sure doesn’t say anything good.
There shouldn’t be any “controversy” about correcting an error made in a retirement study. If Buy-and-Hold were a real thing, there wouldn’t be a single voice raised in opposition to my suggestion that Greaney correct the error within 24 hours. We have heard more then a single dissenting voice.
My best wishes.
Rob
You were never banned for being wrong about Greaney. You were banned for bad behavior including, but not limited to lying, hijacking threads, refusing to answer questions, making up accusations of criminal activities and insulting well regarded experts ( example: calling John Bogle the largest con-man).
Are you willing to specify the date on which you believe the Greaney retirement study was corrected? Are you willing to say how you believe that those who were misled by the study should be compensated for their losses?
I have noted on numerous occasions that I rate John Bogle as my second favorite investment expert of all time (second only to Robert Shiller). It was by reading Bogle’s book that I learned of the error in the Greanry retirement study (Bogle said that it is an “iron law” of stock investing that stock prices revert to the mean and yet Greaney’s study claims that the safe withdrawal rate is the same number at all valuation levels). But it is of course also so that Bogle permitted his name to be used in the title of a board (“Bogleheads Forum”) at which the sort of individuals who have posted in “defense” of Mel Lindauer and John Greaney were permitted to post. So, yes, he lent the power of his name in support of the biggest act of financial fraud in our nation’s history (I pointed out the error in the Greaney study on the morning of May 13, 2002, and it has not been corrected to this day).
My best and warmest wishes to you and yours.
Rob