Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site:
Nothing has worked out like you said it would for the last 25 years. You are 65 years old and broke. You are saying you don’t have any doubts yet?
I have tiny doubts because prices have remained high for so long. Prices have remained high longer than at any prior time in U.S. history. That shakes my confidence a little.
The other side of the story is that the Buy-and-Holders evidence almost no confidence whatsoever. You Goons evidence bravado, That’s not the same thing, Say that you possessed a deep belief in Buy-and-Hold. Then you would be fine in hearing people who believe that Shiller’s research is legitimate have their say. You would present your side from time to time and many people would agree with you while some would not. So what, you know?
That would be normal. That’s not even a tiny bit what we see. What we have been seeing for 22 years running is that Goon portion of the Buy-and-Hold community goes completely nutso is anyone suggests that Shiller might have a point. The defensiveness is off the charts. That’s not the majority of Buy-and-Holders., It’s about 10 percent. But the others tolerate the strange behavior. They might speak up against it once or twice. Then they fade into the background. They go along to get along.
That tells me that Shiller is very much onto something,. Buy-and-Hold is rooted in the Efficient Market Theory, the idea that investors act in their self-interest, that they are rational. Shiller is saying “no, at times investors are not rational at all, at times they are highly emotional.” If that’s so, we need to be studying the ways in which investors become emotional and what to do to help them hold into their rationality. The Bennett/Pfau research indicates that investor emotionalism is 70 percent of the stock investing story, that overcoming one’s inclination to emotionalism is the most important thing that one needs to do to achieve long-term investing success. That learning to practice price discipline can permit one to retire five years sooner while taking on far less risk. That’s no small thing, That’s investor heaven.
I wasn’t sure on the morning of May 13, 2002, I was reasonably confident that Greaney got the number wrong but I wanted to hear what other people had to say because I was not 100 percent sure. I couldn’t identify any flaws in what I was saying. But it seemed too incredible to be true. So I wasn’t entirely sure, It made me happy when Wade Pfau described himself as experiencing the same sort of feelings. He was so excited about our research that he said he couldn’t sleep at night. But he was asking himself: “Did I miss something?” Because it all seems so impossible. Most of the Buy-and-Holders are very smart people. So it’s hard to imagine that you would be right and they wouod be wrong about so important a matter.
In some ways, I am much more confident today than I was on the morning of May 13, 2002. So many pieces of the intellectual puzzle have snapped into place during the first 22 years. But we haven;t had a price collapse. We had that one short-lived one in late 2008. But that didn’t last long enough to break the bull psychology. Buy-and-Hold is just as popular today as it was in 2002. Witness today’s CAPE value. So I wouldn’t say that I am entirely free of doubt.But i just have no explanation for the Goon behavior outside of Shiller’s contention that investors are capable of high levels of emotion. So in an overall sense I remain confident.
The most important thing to me is that we explore these questions. If Shiller is wrong,let’s find that out. Let’s talk about it and identify where he is wrong and where he is right. It is only Buy-and-Holders (and really only a small percentage of the Buy-and-Hold population) that wants to suppress discussion of the peer-reviewed research. That speaks volumes to me. I cannot imagine ever overlooking that one, It’s just not the way that humans behave when they believe in what they are saying.
I am 100 percent confident in saying that we need to open every site to honest posting re the research. I am highly confidence but not 100 percent confident re my belief that Shiller’s Nobel-prize-winning research is legitimate research.
My best wishes, etc.
Rob
Shiller is not wrong, you are wrong. He told you not to time the market with CAPE and you wouldn’t listen. The buy and holders are not broke. Shiller is not broke. Wade Pfau is not broke. Greaney is not broke. You are the only one here that is broke. You are the one here that is wrong.
The title of Shiller’s book is “Irrational Exuberance.”
Rob
Robert Shiller’s exact words are “Don’t time the market with CAPE”. If you don’t like it, then take it up with him.
Last I checked, you are the broke one, not Shiller, not Pfau, not Greaney, not the buy and hold crowd.
So you only believe in your own interpretation vs the actual words used by Robert Shiller. Too bad you didn’t listen to Shiller when he told you to not time the market with CAPE. You went broke and your wife left you, yet you still can’t accept the blame for your own decisions.
I’m also the one whose name is on the post that first pointed out the error in the Greaney retirement study. The way it is.
I suggested many, many years ago that we go as a group to Shiller, assure him that there will be absolutely no funny business and ask him to appear at the Bogleheads Forum to discuss whether it is possible to calculate the safe withdrawal rate accurately without taking valuations into account. If Buy-and-Hold were a real thing, there wouldn’t be one person who had any hesitation in going forward with that idea.
There’s a reason why I think it’s a good idea and you do not. I want to see us all move forward in our understanding of how stock investing works. You want us to remain stuck in the level of understanding that we possessed in 1981. Yucko, you know? It’s one thing to be a Buy-and-Holder because you just don’t know any better. It something very different to willfully remain stuck in ignorance when libraries all across the nation carry a book pointing to a better way.
Rob
So you only believe in your own interpretation vs the actual words used by Robert Shiller. Too bad you didn’t listen to Shiller when he told you to not time the market with CAPE. You went broke and your wife left you, yet you still can’t accept the blame for your own decisions.
I don’t believe that a throwaway phrase that Shiller made in an interview controls over his entire life’s work. I’d like to hear in depth what Shiller believes about market timing and safe withdrawal rates and scores of other subjects. And I’d like to hear what Bill Bernstein thinks about all those subjects. And what Rob Arnott thinks. And what Wade Pfau thinks. And what thousands of others think.
No intimidation tactics whatsoever. People sharingt their sincere beliefs with the aim of helping each other out. That’s what I believe in. Motley Fool used to call it “Learning Together.”
Rob
So you decide what are throw away phrases and which ones you want to interpret to fit your opinions. Got it.
I decide for me, of course. Everyone does that for every issue that comes up. And then others decide for themselves whether they want to buy in to what I concluded or not. That is for them to decide, not you Goons. Each community member gets to decide for himself or herself.
Will there still be some community members who will elect to use the Greaney study after we open every site to honest posting? There will be. It’s their business. But there will be others who will go with the peer-reviewed research. The number who follow the peer-reviewed research will grow over time as they talk things over amongst themselves.
That’s what I want to see happen. I want people to have a choice between Get Rich Quick strategies and research-based strategies. So long as people have a choice, I am confident that the good stuff will prevail over time, But so long as most of us are afraid to post honestly in the face of the brutally abusive tactics of the Buy-and-Hold Goon Squads, Buy-and-Hold/Get Rich Quick has an unfair advantage. People think it looks real because it is not being questioned but the only reason it is not being questioned is that people are afraid to give voice to their questions. That’s fraud.
I sincerely believe that the Greaney retirement study lacks a valuation adjustment.
Rob
Others have decided, Rob. They decided to reject you. They decided to follow what works for them. They don’t need to bow down to your demands. They don’t have to agree to your faulty thinking. You are the one with the problems and you are the one responsible for fixing your own problems. Stop telling people what to do.
I am not telling anyone what to do. I am saying what I will do. I will continue to say that I believe that the Greaney retirement study lacks a valuation adjustment. That’s it.
Rob
So your past comments where you told people that they have to remove you from bannings or change their studies “by close of business that day” were make by someone else that happened to hijack your board.
Greaney should have corrected his study within 24 hours of the moment that he learned of the error that he made in it. Nothing could be more obvious. There were people at the Motley Fool board who were using that study for help in planning their retirement. I know this. I was there.
Rob
No one with any credentials has said Greaney made an error. Only Rob Bennett, who is broke.
Wade Pfau described the Greaney study as “dangerous.” He has credentials coming out of his ears.
You never should have threatened him. Extortion is a crime.
Rob