Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site:
Question: How much is a house worth?
Answer: It is worth the amount that someone else is willing to pay for it.
Question: How much is a plot of land worth?
Answer: It is worth the amount that someone else is willing to pay for it.
Question: How much is a painting worth?
Answer: It is worth the amount that someone else is willing to pay for it.
Question: How much is a share of stock worth for any company?
Answer: It is worth the amount that someone else is willing to pay for it.
So, it is simple. If you want something and you are willing to pay the price that is asked by the owner, then buy it. If you don’t like the price, then don’t buy it. You don’t just demand that other people have to lower their price on a particular asset just because you say so and that YOU think it is overvalued. Your faulty thinking has led to you going broke, while the rest of us have done very well, from a financial perspective. We are not here to make you happy. We are not here to fix your problems.
No one can determine what something is worth unless the information they need to make that determination is available to them. Once a ban on honest posting re the peer-reviewed research Is put in place, the market is no longer functional. So you get the crazy and dangerous CAPE level we see today in the stock market.
I would permit honest posting re the peer-reviewed research. Then I am confident that the price that people were willing to pay for stocks really did reflect their true value. It’s the ban on honest posting re the peer-reviewed research, enforced by the sorts of people who have posted in “defense” of Mel Lindauer and John Greaney, who have been holding us back for 22 years now.
Where I’m coming from.
Rob
Here is a thread at bogleheads
https://www.bogleheads.org/forum/viewtopic.php?t=440314
“Shiller PE now near 39 – 2nd highest ever” 603 posts
603 posts in a single thread, looks like Shiller can be discussed despite your claims.
It’s super that there’s a thread with 603 posts.
But what good is it doing, Evidence? Shiller’s research needs to be discussed on a daily basis. Not in one thread, in EVERY thread. If it were being discussed in every thread, you would never see a CAPE value anywhere near 39.
The CAPE value that applies today tells the tale. Many investors think it might be okay to “forget” to engage in valuation-based market timing (price discipline!). It’s the relentless promotion of the Buy-and-Hold strategy that has done that to us.
My sincere take.
Rob
“Not in one thread, in EVERY thread”
And right there in a single sentence you have demonstrated why you kept getting banned at multiple boards. You can’t accept that your arguments never got any traction so you thought if instead of improving your arguments you would simply repeat them more often you might get your way.
It didn’t work but you never learned your lesson.
My arguments never got traction with a majority of board members. i certainly agree with that much. They consistently got traction with a small percentage of the community (about 10 percent). I don’t like that reality. But I accept that it’s a reality.
I want to see the percentage who believe in Valuation-Informed Indexing to increase. It’s not going to happen if I just keep it zipped when the far more numerous group that believes in Buy-and-Hold just continues to make their points on a daily basis.
I don’t apologize for insisting on recognition of my right to post honesty. Every community member should be advancing his or her honest views. I would never dream of intimidating a Buy-and-Holder into saying something that he or she didn’t believe. Such acts of intimidation are degrading to both parties.
If we make it the rule that Shiller’s research findings need to be accepted by 100 percent of the community before the first person can begin talking about them, we are never going to get there. My take is that, once Shiller’s research was published in a peer-reviewed journal, it became fair game. Any site owner who cannot bear to hear peer-reviewed research discussed at this site should shut down the site. To prohibit discussion of the last 43 years of peer-reviewed research is fraud.
That’s my sincere take, in any event. The lesson that you are trying to teach is not one that I have any interest in learning, Evidence. I had come to view a number of people at the Motley Fool board as friends. I don’t make it a practice to lie to my friends.
Rob
“ That’s my sincere take, in any event. The lesson that you are trying to teach is not one that I have any interest in learning, Evidence. I had come to view a number of people at the Motley Fool board as friends. I don’t make it a practice to lie to my friends.”
No “interest in learning “ means you won’t listen to anyone. You don’t want a discussion. You just want people to listen to you and then agree with you. You don’t have any friends and there isn’t this any traction in what you say or you would have some people posting over here in support of you.
It’s been a hard stretch of road, Anonymous. I’ll give you that one.
Please remember that it’s our Buy-and-Hold friends who made it a core principles of their approach to follow the peer-reviewed research in making stock investing decisions. That’s where I got it from (thank you, John Bogle!).
Research doesn’t always take you where you thought it was going to take you. It seems to say one thing for one stretch of time and then new research is published telling a very different story. That’s called “learning.” It’s a good thing. Obviously there is a price to be paid in that you need to say those awful words “I” and “Was” and “Wrong” to unlock the benefits of the learning experience. In the end, though, you end up far ahead and cannot even understand why you hesitated to say them.
I’m the true Buy-and-Holder here. That’s what I believe deep down. I stopped saying it because it seems too crazy to have so many Buy-and-Holders yelling at me and to have me saying that I am the true Buy-and-Holder. But that’s the core reality. It’s a Buy-and-Hold principle to take what the peer-reviewed research says into account when making stock investing decisions.
My best wishes to you.
Rob
“ Obviously there is a price to be paid in that you need to say those awful words “I” and “Was” and “Wrong” to unlock the benefits of the learning experience.”
You are broke and you have been wrong on everything. Those are words you need to be saying. The problem is that you not learned a thing.
Okay, Anonymous.
My best wishes to you.
Rob
If a buy and holder was in his 60’s and broke, would you tell him that his strategy was wrong or would you tell him to wait and see how things turn out?
I would tell him that I would work with him to see that every discussion board and blog on the internet was opened to honest posting re the last 43 years of peer-reviewed research in this field so that all could be set right re every investor in the United States.
But you of course already knew that that is the way that I feel about this matter.
Rob
If that is how you feel, then you should start posting honestly (truthful) at this site first. Unfortunately, you have ignore that advice for the past several decades.
Okay, Anonymous.
My best and warmest wishes to you and yours, in any event.
Rob
“”I don’t apologize for insisting on recognition of my right to post honesty.”
Let’s suppose that someone believes that the most important factor in baseball is starting pitching and they post on a Phillies discussion board about starting pitching. And that person believes so strongly that starting pitching is the only thing that matters that they only post about starting pitching.
Other people put up arguments that show other factors are at least as important and that there are flaws in the starting pitching argument. Rather than debate the issue the person just repeats the same thing over and over again or gives non responsive answers. That person then insists on bringing up starting pitching in multiple other threads that have nothing to do with starting pitching. And then complains about getting banned on other Phillies boards. And then claims that everyone would come around to his way of thinking if only there wasn’t a ban on talking about starting pitching.
How long do you think that person would be tolerated on that Phillies discussion board?
I never did anything even remotely like that.
Greaney promoted his retirement study at the Motley Fool board on a daily basis. I put up a post saying that perhaps we should consider the effect of valuations on safe withdrawal rates. Numerous community members thanked me for starting what they viewed as the most exciting and important discussion ever held at the forum.
John Walter Russell devoted the next eight years of his life to researching my ideas on stock investing and found that they all checked out. Wade Pfau saw my stuff at Bogleheads and asked if it would be okay with me if he did research on the merits of Valuation-Informed Indexing. After 16 months of research, he concluded that: “Yes, Virginia, Valuation-Informed Indexing works!”
All of the abusive stuff came from the Buy-and-Hold side of the table. There were many people who left the boards because they were disgusted with the tactics employed, the death threats and other garbage like that. The solution was for the site administrators to enforce the published posting rules. But Buy-and-Hold is popular at times of insanely high valuation levels because it posits that irrational exuberance gains are real gains. The site owners elected to go with what sells over what works.
We need a group of people strongly enough committed to civil and reasoned debate to stand up to your Goons. I believe that there’s a chance that we will see that develop in the days and years following the onset of the next Buy-and-Hold Crisis. I can’t guaranty it. But it seems to me to be better to hope that something like that happens than to agree to post dishonestly myself. I sincerely believe that the Greaney retirement study lacks a valuation adjustment.
It would have been better if there had never been any cover-up. We all want the same thing. We all want to know how to invest effectively for the long run. But it’s hard to say the words “I” and “Was” and “Wrong” when there’s been a 43-year cover-up of the error that was revealed by the peer-reviewed research. I cannot wave a magic wand and make the 43-year cover-up disappear. The best that I can do is to do whatever is in my power to keep it from becoming a 44-year cover-up. I do what I can.
Rob
If Shiller’s research finding that valuation affect long-term returns is legitimate, that changes everything we once thought we knew about how stock investing works. There’s not one issue that comes up in this field that is not affected by that amazing finding.
So, yes, it seem like I frequently bring up the subject of pitching being important. The answer is for everyone to accept that there are today two models for understanding how stock investing works, Buy-and-Hold and Valuation-Informed Indexing. The days in which Buy-and-Hold was the only academic model are long gone. We need a major figure to speak out on this question in strong enough terms that it becomes universally accepted that there are now two models.
From that point forward, we will all be able to express our sincere views at every site without there being any conflict. When I first said that the Greaney retirement study is in error, there were people who were shocked. They had never imagined that such a thing were possible. Had there been honest posting going back to 1981, no one would have evidenced even the tiniest bit of surprise. All of our problems come from the fact that people have been reluctant to point out the dangers of Buy-and-Hold in light of Shiller’s Nobel-prize-winning research findings. A problem that was caused by people being afraid to speak out is not going to be solved by more people being afraid to speak out. We need to see more people working in the courage to speak out, not fewer.
Rob
Once every site has been opened to honest posting re the research, I will be inclined to take a back seat in the discussions. I might turn my attention back to the saving issues that I posted on prior to May 13, 2002.
My primary focus in the investing realm is on the process side. I had become friends with a number of people at the Motley Fool board and I felt like a creep that I didn’t have the courage to point out the error in the Greaney study. I found it amazing that there was even one person who thought it was a good idea to keep the cover-up going. That’s the opposite of everything I believe in.
Once every site has been opened to honest posting re the peer-reviewed research, I am confident that we will as a nation of people be able to take things to a very good place. We permit honest posting re the research in every other field. I think there are good reasons why that is so. It is shame that the investment advice field had gotten so messed up. It makes me sad for the people who work in this field and who would like to be able to use their energies to do good work. So I view it as very important that we bring the fraud stuff to a full and complete stop.
Call me madcap, you know?
Rob
“ I never did anything even remotely like that”
Yes you did. You even doubled down on that in a post you made above. Look at your post from 5:36 pm from yesterday in which you state the following:
“ Shiller’s research needs to be discussed on a daily basis. Not in one thread, in EVERY thread. If it were being discussed in every thread, you would never see a CAPE value anywhere near 39.
You want this topic discussed every day in every thread and you think that it will result in everyone coming around to your opinion on CAPE.
“”I never did anything even remotely like that.”
And the fact that you don’t have any awareness of how your behavior comes across is the main reason why you have been unable to accept advice from numerous people to change your catastrophically unproductive personal aggrandizement.
Shiller’s research findings affect every decision made by stock investors. A world in which valuations affect long-term returns is a very different world from a world in which the market is efficient,
We all need to know which world is it we live in. We can’t get there just by pretending that Buy-and-Hold is fine and dandy regardless of what the last 43 years of peer-reviewed research shows. We need to have the discussions.
No one is capable of getting one thing right in this field without first determining whether Shiller is right or the Buy-and-Holders are right. And we are not going to get there by suppressing the discussions we need to have to make that determination.
If Buy-and-Hold were a real thing, the Buy-and-Holders would be happy to have the discussions needed to show that.
Rob
And the fact that you don’t have any awareness of how your behavior comes across is the main reason why you have been unable to accept advice from numerous people to change your catastrophically unproductive personal aggrandizement.
I get it that people become upset when I point out the dangers of Buy-and-Hold strategies. The problem is that me keeping it zipped wouldn’t make the strategies any less dangerous.
People wouldn’t be so upset if we had been talking about these matters at every site going back to 1981. It’s the cover-up that has caused the upset, not anything that I have done or said. I did a good thing in pointing out an error in a retirement study that numerous people at the Motley Fool board were using to plan their retirement.
Errors in retirement studies need to be corrected, no matter how upsetting it is for the people who relied on those studies to acknowledge the errors in them.
Rob
“The answer is for everyone to accept that there are today two models for understanding how stock investing works, Buy-and-Hold and Valuation-Informed Indexing. ”
The answer is for Rob Bennett to accept that virtually no one agrees with him and that he should come up with better arguments if he wants to persuade anyone.
Lots of people have agreed with me, some with a great deal of enthusiasm. The number is in the thousands of you count both direct expressions of agreement and indirect expressions made through recommendations of direct expressions.
Those thousands of voices matter. They count, We need to hear those voices in every discussion held on the internet. And, of course, the more often we hear them, the more supportive voices there will be.
If we hadn’t seen lots of people agreeing with me, we never would have seen a single death threat. I mean, come on. If it was just me, you never would have flipped your lid.
Rob
“”Lots of people have agreed with me, some with a great deal of enthusiasm. The number is in the thousands of you count both direct expressions of agreement and indirect expressions made through recommendations of direct expressions.”
At Motley Fool you would occasionally get over 100 recommendations (if that is what they were called) for some of your saving related posts. You never received close to that many for you SWR related posts.
Your Passion Saving board at MF never really took off and you abandoned it fairly soon after it was launched.
Other attempts at hocus run boards never took off.
You get banned at almost everywhere you post.
You don’t even try to post at places where you are not banned eg. Reddit
You don’t have a single person who supports you posting here.
You currently post at just one other blog and that one doesn’t seem to allow comments.
You can pretend that there are thousands of people who agree with you but the evidence suggests otherwise.
And you won’t even discuss investing matters here.
If people agreed with you, they would be on this website posting in support. You even admit that no one talks to you.
Buy-and-Hold is what sells. Valuation-Informed Indexing is what works. I believe that there is going to come a time when as a nation of people we are going to see that we need to permit discussion of what works.
We’ll see, you know. I am not capable of saying that I believe that the Greaney retirement study contains a valuation adjustment. It’s just not in me.
Rob
“If people agreed with you, they would be on this website posting in support. You even admit that no one talks to you.”
We both know that I won’t have any shortage of people talking to me once we have opened every site to honest posting re the research. That’s the key to making all the good stuff available to millions.
Rob
“”We both know that I won’t have any shortage of people talking to me once we have opened every site to honest posting re the research. ”
Reddit it open to your posting.
But you won’t post there because you can’t block others from posting.
You could post there if you wanted to but you know people would ask questions that you can’t answer and you would just fall back on saying Greaney’s study didn’t have a valuation adjustment but failing to explain why it should have a valuation adjustment.
Okay, Evidence.
Rob
The thread at Bogleheads is continuing, discussing the correlation of PE10 with future returns and referencing Asness.
It really does show that thorough discussion of Shiller is not off limits.
The fact that the discussion is being held is certainly a good thing.
Rob
The real truth is you like things just the way they are. You need to have a fake cover story. You don’t want to work, but don’t want to look like a lazy bum either. You think that if you can convince people that you are a victim, then it won’t look so bad. Sorry, no one is buying it.
Yeah, yeah.
Rob
You believe that your opinion of a topic should be discussed in every thread of every board every day. That means you believe that your opinions are somehow superior to everyone else’s in the world. You are basically giving everyone else the middle finger when it comes to other people and they want or don’t want you to see.
Everyone should post in accord with their sincere views. If I say that I believe that the Greaney study contains a valuation adjustment, I am engaging in fraud.
Rob