Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site:
People often argue about which sports team is better. We know that someone is right and someone is wrong. Games have a scoreboard for a reason. Look at your outcome. You are broke. Outcomes tell us who is right and who is wrong.
The last 42 years of peer-reviewed research is the more important scoreboard, Anonymous. The difference is that the peer-reviewed research looks at the entire history of the stock market while your scoreboard is how things feel at a moment in time when irrational exuberance is out of control and the CAPE value is scary high.
Rob
So looking at REAL numbers from performance over a long term perspective is not as good as your feelings about a market. Tell me which one pays the bills? Tell me which one can buy a nice place to live? Tell me which one can let me take a nice retirement trip?
Research-based Valuation-Informed Indexing provides far higher returnss at greatly reduced risk over the long-term. As Wade Pfau put it: “Yes, Virginia, Valuation-Informed Indexing works!”
Get Rich Quick/Buy-and-Hold possesses enourmous short-term appeal. It is the Get Rich Quick/Buy-and-Hold urge that resides within all of us that has been making stocks a high-risk asset class for as far as back as the formation of the first stock market (and which the publication of Shiller’s Nobel-prize-winning research brings to an end once we open every site to honest posting re the last 42 years of research, without a single exception).
That’s where I’m coming from re this one in any event, Anonymous.
Rob
Wade recently said VII doesn’t work. You ignore that. The numbers for the last 42 years also show it doesn’t work. You ignore that.
Can you buy a house? Can you go on a retirement vacation? Can you pay for long term care? If you can’t say yes to each of those questions and you are in your 60’s, you failed.
Take away the abusive stuff and see what he says. I predict that in 24 hours he will go right back to saying what he truly believes. What someone says when there are not threats being directed at him counts 20 times what he says when threats are being directed at him.
My sincere take.
Rob
He says it didn’t work. He pointed out the numbers. Show us how the numbers are different. Either it worked or it didn’t. The numbers tell the story and it didn’t work. You can see the last 42 years of numbers, right? Did Wade make those up?
Wade told me that he was afraid that you Goons would get him fired from his job if he continued to say that the Greaney retirement study is “dangerous” (that’s his word). Why would you threaten him if you thought he agreed with you? That doesn’t make any sense.
Rob
Yet Wade said he wasn’t threatened and not a single person has ever found evidence of your claims of threats and criminal activities. In fact, you have never given one single link to any threats or criminal activities. All you have done is made up allegations. Meanwhile, the numbers for the last 42 years show that you are wrong and that VII has been a disaster.
All of the evidence that any clear-thinking person needs is to look at the retirement study posted at Greaney’s web site and to see whether it contains an adjustment for the valuation level that applies on the day the retirement begins. It doesn’t take 21 years to determine whether or not a retirement study contains a valuation adjustment. Even Evidence acknowledged not too long ago that it lacks one.
There were people at the Motley Fool board who used that study as guidance for planning their retirement. If the fact that a study that people used to plan their retirement hasn’t been corrected in 21 years doesn’t tell you what you need to know, then nothing is going to tell you what you need to know. We either want to invest effectively for the long run or we want to give in to our Get Rich Quick urges. That’s the choice on the table when we decide as a nation of people whether or not to permit honest posting re Shiller’s Nobel-prize-winning research.
You know what I think. I think we should make it as hard as possible for people to talk themselves into practicing price indifference. I think we should remind them on a daily basis of the dangers of going with a pure Buy-and-Hold approach. I think we can all do better than we have been doing at a time when we have permitted the CAPE value to rise to 30, only a few notches below the value that brought on the Great Depression.
There’s no amount of abusiveness that can get that CAPE value below 30. There’s no amount of abusiveness that can put a valuation adjustment into the Greaney study. Get Rich Quick/Buy-and-Hold strategies always take us to this point. They always will. People love Get Rich Quick/Buy-and-Hold. They are always going to go in that direction unless they are warned regularly of the dangers. We now have 42 years of peer-reviewed research pointing us to a better path. I think we should be talking about that 42 years of research at every discussion board and blog on the internet, without a single exception.
I naturally wish you all good things.
Rob
“ You know what I think.”
No one cares what you think. You don’t get to just make up stories in order to try and make people do what you want. YOU are the one that is broke so YOU need to fix your own problems. Not us.
Okay, Anonymous.
Please take good care.
Rob