Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site:
So all these buy and holders that know numbers better than you and that have multi-million dollar retirement portfolios should all switch over to your market timing scheme, despite the fact that buy and hold has worked in EVERY single 30 year period, while at the same time, we have never seen a successful outcome with your market timing scheme. Got it.
Whether they switch or not is up to them. I don’t tell people what to do. All that I say is that they should permit honest posting re the peer-reviewed research. There are thousands of people who expressed a desire to engage in discussions of what the research says. When you engage in criminal behavior to block such discussions, You are walking down a very dark path. I wouldn’t do it. I think that going down that path was a very bad move.
Buy-and-Hold has NEVER worked better than Valuation-Informed. Wade Pfau and I spent 16 months examining that question. It has never happened once in the history of the market. Surprise! Surprise! It has never happened because it never CAN happen. If valuations affect long-term returns, investors who fail to engage in valuation-based market timing are permitting their risk profile to get out of whack. That can never be a good thing. It’s a logical impossibility. I mean, come on.
If we are not going to permit discussion of the peer-reviewed research, we should just shut down all the peer-reviewed journals. They aren’t doing us any good if we don’t permit discussion of what is published in them. The Buy-and-Holders once advocated making reference to the peer-reviewed research. If you encourage people to publish peer-reviewed research, there’s always a chance that you will learn something new. When you do, you have to learn how to pronounce those horrible words “I” and “Was” and “Wrong.” That’s just the way it goes. There’s no getting around it.
My best wishes.
Rob
Everyone else is wrong and only Rob is right. Got it.
Everyone (including Rob) possesses a Get Rich Quick/Buy-and-Hold impulse that leaves us vulnerable to claims that there might be an alternate universe in which everything works 100 percent the opposite of how things have always worked here on good old Planet Earth and in which it might not be 100 percent necessary for all stock investors to engage in valuation-based market timing at all times.
Rob says that everyone who comments on stock investing at any site on the internet should be 100 percent free to point to the 43 years of peer-reviewed research showing this. The same laws that apply in every field of humans endeavor to protect us all from the sorts of abusive tactics that have been applied by the Lindauerheads and the Greaney Goons for 22 years now to suppress the discussions that thousands of us have expressed a desire to engage in should apply in the investment advice field as well.
My best wishes to you,Anonymous.
Rob
I’m 40 and have bought and held. I’ve got over a million dollars despite a pretty ordinary income and, until 2020, being the head of a single income household . You’re pushing 70 and if I recall correctly at the height of your career you were working at a well known accounting firm taking home more money than I make now, over 20 years later. You made more money than I did and you had decades more compounding time in your side. Despite all of this I have more money to show for it than you do. What gives?
What gives is that as a nation of people we achieved an amazing advance in our understanding of how stock investing works in 1981, when Robert Shiller published his Nobel-prize-winning research showing that valuations affect long-term returns. That research shows that, if we encourage all investors to practice valuation-based market timing at all times, we can all retire years earlier while investing at greatly reduced risk. I want to talk over the scores of powerful how-to implications of that research with hundreds of thousands of interested parties participating at hundreds of different web site. A small group of loony-tunes Buy-and-Holders (the “Goon,” who make up about 10 percent of the population of Buy-and-Holders) very, very, very much doesn’t want to see that happen.
I believe that the people of the United States will win this one. I certainly didn’t think that it was going to take more than 22 years back on the morning of May 13, when I advanced my famous post pointing out the error in the Greaney retirement study. But I still believe that the people of the United States will prevail in the end. A big test will come in the days following the onset of the next Buy-and-Hold Crisis. If the owner of one large site becomes sufficintly concerned re the ocean of human misery that we will see in the event that the next Buy-and-Hold Crisis plays out like any of the earlier ones played out, we will be on our way.
I don’t guaranty that we will all make it safely to the other side. But I sincerely believe that we will. We will just have to wait and see how it all plays out. I don’t have any doubts as to which “side” I am rooting for.
My best and warmest wishes to you and yours, Anonymous.
Rob
From where I sit yours is a cautionary tale, one that actually supports the Buy and Hold thesis.
Okay.
From where I sit, the behavior that we have seen from you Goons for 22 years running now supports Shiller’s thesis that stock investing is not an entirely rational endeavor but at times a highly emotional endeavor.
The emotional aspects of the stock investing experience are The Undiscovered Continent of Personal Finance. I believe that we should be permitting (and encouraging!) honest posting re the last 43 years of peer-reviewed research at every internet site. If we were talking about this stuff every day at every site we never again would see the sort of CAPE value that applies today.
That’s where I’m coming from re this one, in any event.
Rob
22 years ago I was a college student opening up my first Roth IRA with a financial planner who was either predatory or incompetent, and I bought a mutual fund with all sorts of fees. Took me some time to realize the error of my ways. It took me an even longer amount of time to learn about you, Rob.
I don’t approve of mutual funds with lots of fees. I am a big fan of the Vanguard policy of offering broad index funds with very low fees. But I believe that the “idea” that is often associated with people who advocate the Vanguard philosophy that stock investors do not need to practice valuation-based market timing (price discipline!) when buying stocks has caused more harm to investors than high mutual-fund fees.
I don’t believe that the people who advance this idea had bad intent when they developed it. But I think that they have a responsibility to stay informed about new research in the field and there is now 43 years of peer-reviewed research showing that valuations affect long-term returns. I believe that we all have a responsibility to do all that we can to see that every site is opened to honest posting re the research by the close of business today, if not sooner.
I naturally wish you all the best that this life has to offer a person, Sensible.
Rob
How do we know who is right and who is telling the truth. We look at outcomes. 100% of American’s would pick to be in Sensible’s shoes versus your shoes.
That’s not so.
We have seen thousands of people express a desire in being able to engage in discussion of the last 43 years of peer-reviewed research. 10 percent of the population engages in valuation-based market timing today. I am confident that, if we opened every site to honest posting re the research, we could get that up to 20 percent within six months. The abusive posting and the criminal stuff has held us all back big-time.
There was research published showing the smoking causes cancer. The tobacco industry tried to keep that reslity hushed up for a number of years. People who wanted to spread the word were penalized for doing so. Today, fewer people smoke. The industry doesn’t like that. The people of the United States are better off. We can’t have a situation where an industry is able to engage in criminal bevavior to block millions of people from gaining access to what new research findings just because there is a quick buck to be made by keeping people in the dark.
I guess we can have it. We have it now. I don’t think that we can indefinitely have such a situation continue. We have the laws that we have for a reason. It makes no sense to have peer-reviewed journals if we are not going to permit discussion of the findings of the peer-reviewed research.I believe that there will come a time (probably in the days following the onset of the next Buy-and-Hold Crisis) when we will apply the same laws in the investment advice field that already apply in every other field of human endeavor. We will all live richer and fuller and freer and better lives from that point forward.
Research is about learning. Learning is the one true free lunch in this world. We should permit discussion of it. I am sure.
Rob