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The Old Ideas on Saving & Investing Don't Work -- Here's What Does

“The Feeling Among Buy-and-Holders Is, If No One Talks About Shiller’s Amazing Research Findings, It’s Just As If Those Research Findings Don’t Exist.”

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Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site:

Your opinion is not the same as the actual research. One study does not constitute the last 43 years of research. Outcomes are what matter. Outcomes tell us who is right and who is wrong.

Shiller’s Nobel-prize-winning research paper showing that valuations affect long-term returns is only one research paper. But it remains the controlling authority on the questions addressed by it until it is discredited. That has never happened in any way, shape or form in 43 years.

I’ve been doing this for 22 years now and there has never been a Buy-and-Holder who made a case that Shiller’s research doesn’t stand up to scrutiny. All of the efforts have been directed at getting people to stop talking about it The feeling among Buy-and-Holders is, if no one talks about Shiller’s amazing research findings, it’s just as if those research findings don’t exist. They exist. And smart people who would very, very much like to be able to discredit them have not been able to do it. The fact that the Buy-and-Holders are so impressed by Shiller’s research that they don’t even try to discredit it gives that research persuasive power.

My sincere take.

Rob

Comments

  1. Shiller has warned you about timing the market with CAPE. You act like that comment never existed.

    Many have told you how you are wrong on Greaney. You act like those comments never existed.

    Wade Pfau was on a podcast earlier this year talking about the data since Shiller’s study was published and he explained how market timing did not work. You act like his comments never existed.

    All the board owners told you that you were banned because of your behavior. You act like these comments from the board owners never existed.

  2. You act like the 43 years of peer-reviewed research showing that valuations affect long-term returns don’t exist. We need to figure this stuff out. That’s why I say that we need to open every site to honest posting. No intimidation tactics whatsoever. Let people say what they truly believe and then ask lots of questions so that over time we all gain a sense of clarity re what is going on.

    Bernstein said that the safe withdrawal rates at the top of the bubble was 2. You can’t get more clear than that. Yes, there’s lots of stuff in his book indicating a belief in Buy-and-Hold. If he felt comfortable posting honestly, he could try to explain the contradictions and we could all learn from what he said. I believe that over time he would become a Valuation-Informed Indexer. There’s only one way to find out.

    I believe that over time we would ALL become Valuation-Informed Indexers if honest posting re the peer-reviewed research was permitted at every site. The problem we are facing today is that the Buy-and-Holders got there first. Shiller’s research had not yet been published at the time when Buy-and-Hold was being developed. The Buy-and-Holders took a shot in the dark re valuation-based market timing (there was research showing that the guessing-game approach to market timing doesn’t work) and they made a mistake. Since then, it’s just been a matter of wealthy and powerful and well-connected people not wanting to acknowledge having made a mistake in a field in which possessing a reputation as an expert pays off big time.

    Part of the scientific process is admitting mistakes as they are discovered. It is a logical impossibility that valuation-based market timing doesn’t work in a world in which valuations affect long-term returns. Once the Buy-and-Holders acknowledge the mistake, we can all begin putting our energies into developing the first true research-based stock investing strategy (Valuation-Informed Indexing),

    Rob

  3. “ You act like the 43 years of peer-reviewed research showing that valuations affect long-term returns don’t exist. We need to figure this stuff out. That’s why I say that we need to open every site to honest posting. No intimidation tactics whatsoever. Let people say what they truly believe and then ask lots of questions so that over time we all gain a sense of clarity re what is going on.”

    There is nothing “we” need to figure out. We just don’t agree with a thing you say. You clearly don’t listen, so we have no interest in catering to your demands. You are the one that is broke. Not us. Your financial catastrophe is due to your actions. Fix your own problems and stop asking to do stuff for you. End of story.