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 you fail to understand is that the top 10% are consolidating the ownership of stock and other assets. This is limiting the “supply” to those outside the top 10%. Ever play the game Monopoly? What happens to the bottom 90% of people when they own only a small percentage of the properties on the board? You have to decide if you are going to be an “owner” or a “consumer”. The top 10% have enough assets to ride out the ups and downs. In the end, they will win because they can keep buying assets, priced high or low. They are playing the long game. People with little to no assets can’t afford to play the game. They are just trying to survive.
It’s an increased desire to buy that sends prices up. This is why market timing is so essential. When prices are insanely high, market timing pulls them back down to reasonable levels. When prices are too low, market timing pulls them up to reasonable levels. Market timing is the thing that permits the market to do its core job — get prices right. It is market timing that keeps the market functional. We would never have a CAPE value like the one that applies today if we all stressed the importance of market timing.
Rob
So the top 10%, who own about 90% of all the stock, need to suddenly change what they are doing because you say so? Why? They are already wealthy and have no need to change.
https://www.cnbc.com/2021/10/18/the-wealthiest-10percent-of-americans-own-a-record-89percent-of-all-us-stocks.html
Nobody needs to do anything because I say so. Nobody should do anything becauss I say so.
But everyone should be exposed to both sides of the story. No one should follow the pure Get Rich Quick/Buy-and-Hold strategy solely because they are not aware of the research-based alternative. Honest posting re the past 42 years of peer-reviewed research should be permitted at every site, without a single exception.
Rob
“ Nobody needs to do anything because I say so. Nobody should do anything becauss I say so.”
That is the opposite of what you usually say. You use the word “need” all the time when you refer to what people need to do. Are you now dropping that demand?
I believe that as a nation of people we need to open every site to honest posting re the peer-reviewed research.
I don’t even a tiny bit believe that anyone needs to go along with anything that I say. I believe that Buy-and-Holders have ever bit as much of a right to express their sincere beliefs as do Valution-Informed Indexers.
There’s room for more than one point of view. But no one cam have confidence in his or her point of view until they are able to hear both sides of the story.
Rob
“ I believe that as a nation of people we need to open every site to honest posting re the peer-reviewed research.”K
What you think comprises the peer-reviewed research is different than what others consider the research. Instead, it is just your opinion of what one guy said. Your opinion is no more important that anyone else. You are free to post what you want on YOUR website and the rest of the world can ban you, ignore you, etc. In fact, one could argue that your lack of success disqualifies you from giving out investment advice.
And I can call for every site to be opened to honest posting re the last 42 years of peer-reviewed research.
Rob
And every site owner can ban you for their honest belief that you behave badly and are a liar.
And thosr site owners can suffer devastating losses in the next Buy-and-Hold Crisis and see millions of their friends and neighbors and co-workers also suffer devastating losses and decide as a result that it might be a good idea to open every site on the internet to honest posting re the last 42 years of peer-reviewed research.
It’s in our collective power to change the world for the good. We just have to work up the courage to stand up to you Goons to make it happen. It is possible that the human misery endured in the next Buy-and-Hold Crisis will be the experience that will help us take the steps we need to take to live better and fuller and freer lives from that point forward.
I am cautiously optimistic, Anonymous. I would say that the good news that we have seen over the first 21 years of our discussions has been 20 times more good than the bad news we have seen has been bad. But we’ll see, you know?
Rob
Are you worried that they will end up broke and divorced? That would be really bad for anyone because then they can’t save their retirement, right?
My biggest worry is the damage that the next Buy-and-Hold Crisis will do to millions of human lives.
I believe that everyone who is doing honest work in this field should be rewarded for it. Once I receive my $500 million settlement payment, I’m obviously not going to be broke for many lifetimes going forward, right? So that one is solved just by opening every site to honest posting, which we all should favor for all sorts of reasons. But that won’t solve the problems associated with the next Buy-and-Hold Crisis. It will ease them a but. But, once we permitted the CAPE level to rise to where it is today, we set ourselves up for some serious problems. That one concerns me.
Rob
“ My biggest worry is the damage that the next Buy-and-Hold Crisis will do to millions of human lives.”
Like being broke and divorced, right?
There are people out there that think they will win the lottery or some other get rich quick scheme, like a $500 million settlement based on a dream. We have to deal with reality and look at outcomes. Dreams don’t pay the bill.
Get Rich Quick/Buy-and-Hold investment strategies are a dream, Anonymous. There is now 42 years of peer-reviewed research showing that valuations affect long-term returns. There were people at the old Motley Fool board who were using the Greaney study for help in planning their retirements.
I think we should be permitting honest posting re the research.
Rob
There has never been a failed outcome with buy and hold. Meanwhile, you are broke. Sorry, but I choose not to be broke and divorced like you. No one else wants to sign up for it as well.
Read “Grapes of Wrath,” Anonymous. That’s the story of what Get Rich Quick/Buy-and-Hold leads to.
The Bennett/Pfau research shows that there has never been a successful outcome with Buy-and-Hold. For the entire history of the market, investors who have refused to engage in market timing/price discipline have lowered their lifetime return while greatly increasing the amount of risk they were taking on. One thing that the Buy-and-Holders got right was their idea that investors should look to the peer-reviewed research for guidance on how to invest in stocks.
Rob
It is a story Rob. I deal in reality. I deal in numbers. I deal in facts. I deal in outcomes.
Your spin and opinions are not based on any of these.
Okay. I wish you all the best of luck with whatever investment strategy you elect to pursue in any event, Anonymous.
Rob