Set forth below is the text of a comment that I recently posted to the discussion thread for another blog entry at this site:
I think the dangers of market timing need to be discussed on every board and every thread, every single day. I think the dangers of being broke in your 60’s need to be discussed on every board and every single tread, every single day.
There are no dangers to valuation-based market timing so long as it is practiced in a reasonable way. Saying that there are dangers to engaging in price discipline when buying something is absurd. The vast majority of people practice price discipline with everything they buy other than stocks. Wade Pfau devoted 16 months of his life trying to locate some peer-reviewed research supporting the Buy-and-Hold claim that there might be an alternative universe in which everything works the opposite of how it has always worked here on good old Planet Earth and he came up empty-handed, The response of the Lindauerheads and Greaney Goons was to threaten to destroy his career if he continued doing honest work in this field. Gee, I wonder what’s going on here?
My best wishes.
Rob
“There are no dangers to valuation-based market timing so long as it is practiced in a reasonable way.”
Would going with a 0% stock allocation for 30 years be regarded as practicing market timing in a reasonable way?
In the circumstances that I was in, yes.
The typical Buy-and-Hold allocation is 60 percent stocks, 30 percent bonds, 10 percent Treasuries. I was trying to get an internet writing business off the ground. So there was already lots of risk in my overall “portfolio.” So it made sense to reduce the stock allocation to 30 percent. The insanely high valuation levels required another 30 percent cut to the stock allocation.
What you should be identifying as extreme are the valuation levels we have all had to endure in recent decades. The Buy-and-Hold injunction against valuation-based market timing played a big role in bringing on those valuation levels. Stock prices are self-regulating so long as investors are permitted to discuss and learn from the peer-reviewed research.
Rob
“I was trying to get an internet writing business off the ground.”
I would correct that to
“I was trying to get an internet writing business off the ground with no backup plan”
I had a backup plan when I started.
From May 13, 2002, forward, 100 percent of the evidence supported the idea that valuations affect long-term returns and 0 percent supported the idea that that market is efficient. So the value of the work being done just continued going higher and higher. It still goes higher every time there is an abusive post. The harder it is for us to open every site to honest posting re the research, the more important it is that that task be completed and the greater the compensation will be for those who get us there.
Rob
“ I had a backup plan when I started.”
So why didn’t you continue to work through back up plans over the past 20 years when your original plan failed? Why would you ever allow yourself to enter your 60’s without a fully funded retirement account?
That was the doing of you Goons. I have been speaking out in opposition to the abusive stuff going back to the first day.
What’s the alternative? Should I pretend that I believe that the Greaney study contains a valuation adjustment after all? Do you understand that financial fraud is a felony and that felonies translate into prison terms?
Thanks but no thanks, you know?
Rob
“I had a backup plan when I started.”
What was that backup plan?
I had enough in savings to cover my essential spending. All that I needed to earn from the business was what I needed for extras, new cars and vacations and things of that nature.
Rob
But you didn’’t have enough in savings as you pointed out in 2005 when you were already off your target. Why didn’t you just get a job?
I have a job — opening every site on the internet to honest posting re the last 44 years of peer-reviewed research in this field. That’s a job that benefits every last one of us in a very important way. I only wish that someone had completed that job long before I came on the scene.
Rob
“I have a job — opening every site on the internet to honest posting re the last 44 years of peer-reviewed research in this field.”
Approximately how many sites do you think you have opened to honest posting so far?
We only need one large site, Evidence. Over and over we have seen big-name experts express a desire to be able to do honest work. But they have never seen the sorts of behavior we have seen from you Goons in any other field of endeavor. They want protection. Once one site offers it, that site will take off and the approach will spread all across the internet.
After we get one large site, it’s all downhill sledding.
Rob
So approximately none so far.
There’s no large site today that permits honest posting re the last 44 years of peer-reviewed research. If there were, I would be posting there.
There are lots of places that permit honest posting in their published rules. But there are not any that will protect those posting honestly from the sorts of individuals who have posted in a”defensea” of Mel Lindauer and John Greaney.
Rob
Your self-appointed “job” doesn’t pay a dime because no one sees value in what you have to say. A real job is where someone is willing to pay you for a service/labor you provide.
Lots of people are willing to pay. It’s about 10 percent of the population of investors — that’s millions of people. The problem is the abusive and criminal behavior of the 90 percent. We need to as a nation of people develop the till to insist that that 90 percent follow the laws of the country in which they reside.
We are not there today. But we are close. Another Buy-and-Hold Crisis and all the human misery associated with it might be enough to get us over the line. We’ll see.
Rob
“If there were, I would be posting there.”
Has Reddit banned such posting?
I’ve posted at lots of places. The reaction is always largely the same. 10 percent loves the idea of being able to engage in discussions of the last 44 years of peer-reviewed research. 10 percent is violently opposed to anyone being able to do that and is open to engaging in abusive and even criminal behavior if that is what it takes to stop it. 80 percent is fine with people engaging in the discussions but is too intimidated by the abusive and criminal behavior to insist on it. The 80 percent is generally sympathetic with the Buy-and-Holders because they follow Buy-and-Hold strategies themselves.
I have no reason to believe that Reddit would be any different. Thanks but no thanks.
Rob
“I have no reason to believe that Reddit would be any different. Thanks but no thanks.”
You want there to be websites that allow posting about valuation based market timing. There are no bans on that subject at Reddit. But you won’t post there because a percentage of the people will disagree with you.
Let me speak
OK you can speak
I don’t want to speak because people will disagree with me.
There are no official bans on honest posting anywhere. There are practical bans because of the intimidation effect of the Goon tactics and because of the complacency of the Normals that permits it to continue.
I enjoy disagreement that is expressed in civil ways. I learn from it. But I believe that the laws that apply in every field of human endeavor other than the investment advice field to protect us from the ugly Goon tactics are good and necessary laws. When we discard those laws, we discard what makes us human.
I believe that we will find our way to the other side. I can’t guarantee it. But I believe it. I believe that we are in a fundamental sense a good people.
Rob