This article should be read in conjunction with the article titled Academic Researcher Silenced by Threats to Get Him Fired From His Job After Showing Dangers of Buy-and-Hold Investing Strategies. Both articles explore the same material — the 140 blog entries at the A Rich Life blog reporting on the breakthrough findings of Academic Researcher Wade Pfau showing that for the entire 140 years of stock market history for which we have available to us stock-return data Valuation-Informed Indexing strategies have provided far higher returns than Buy-and-Hold strategies at greatly reduced risk. The other article tells the story of Wade showing his excitement in discovering how stock investing really works, his disillusionment in learning how publishing accurate research would limit his career prospects for so long as Buy-and-Holders retain the power to block honest discussion of the realities and his decision to flip to the dark side after internet Goons threatened to send defamatory e-mails to his employer as his “punishment” for acknowledging the need for retirement studies that get the numbers millions of us have used to plan our retirements wildly wrong to be corrected. This article collects in one place links to all of my blog entries reporting on Wade’s research and on my e-mail correspondence with him, supplemented by my commentary on them.
1) “I Cite You and John Walter Russell as the Earliest Advocates of [New School SWR Research”
I was thrilled to see Wade’s name on a comment to my blog.
I learned about the errors in the Old School safe-withdrawal-rate studies by reading John Bogle’s book, which explains that Reversion to the Mean is an “Iron Law” of stock investing. I read the book in either the Spring of 1995 or the Spring of 1996. I am not a numbers guy. So I never tried on my own to determine the true safe withdrawal rate. Once I knew that I had to go with a much lower stock allocation at times of sky-high valuations than I went with at times of moderate valuations or low valuations, I knew what I needed to know to put together my own Retire Early plan. It was only when I posted what Bogle’s book said about the studies that the Goons demanded that those of us interested in the issue determine the accurate SWR numbers that I became interested in getting that specific. John Walter Russell jumped it to help and spent the last eight years of his life doing amazing research on every aspect of the SWR issue and, in his later years, on a good number of non-SWR issues as well. The Goon response to John’s research, which was well-received by all non-Goon community members, was that it didn’t count because it was not peer-reviewed. Wade’s interest in the subject gave us the opportunity to obtain peer-reviewed research. So I viewed his expression of interest as very good news for the entire community.
I was especially glad to see Wade give John Walter Russell the credit for the incredible contributions he made in the eight years before his death. John was our most loved poster. But he was viciously smeared by the Goons on an almost daily basis. The Goons even smeared him when they learned about his death in October 2009. I told Wade in later communications with him that his work merits a Nobel prize. I of course really do believe that. But I believe that about John’s work as well. The fair thing would be if John and Wade received a joint Nobel prize, John for being the trailblazer and Wade for being the first researcher with the credentials needed to go through the peer review process to bring John’s breakthrough findings to a wider community of investors.
This blog entry reports on research that Wade posted to his site showing that Valuation-Informed Indexing has provided higher returns than Buy-and-Hold at less risk for the entire 140 years for which we now have stock-return data. As the title of Wade’s blog entry put it — Valuation-Informed Indexing works!
This put the Buy-and-Hold Goons in a tough spot. They have for 10 years now tried to justify their Ban on Honest Posting on grounds that the academic research supports Buy-and-Hold and that thus it would be “dangerous” (this is Mel Lindauer’s word) to permit honest discussion of what the research says. I have argued that permitting honest posting would be a win/win/win/win/win. If Buy-and-Hold really does work, honest discussion will bring that out and we will all benefit from learning that reality. On the other hand, if it turns out that Buy-and-Hold never works in the long run, it of course is better that we learn that before the economic crisis turns into the Second Great Depression.
Wade removed this blog entry from his site in later days, at the demand of the Goons. No one has ever found any mistakes in his research or any problems with his findings.
I liked it that Wade mentioned in the article that I was banned from the Bogleheads Forum. Too many in this field shy away from noting the pressures that have been applied by Buy-and-Holders on those posting honestly re the last 30 years of academic research. This is an important part of the story. If it were not for these pressures, I believe that a lot of people a lot smarter than I would have pointed out the dangers of Buy-and-Hold and developed the Valuation-Informed Indexing concept years before I came on the scene. I got there first because everyone else was hiding under the bed-covers!
Wade was a big fan of my RobCast #137, “Nine Valuation-Informed Indexing Portfolio-Allocation Strategies.” John Walter Russell was also a big fan of that one. The most common question I get from visitors to my site is about how to implement the VII concept. I try to provide materials to help people implement the concept. But my personal belief is that the most important element of this story is the political angle, the Ban on Honest Posting. If it were not for the Ban on Honest Posting, we would have hundreds of sites exploring the Valuation-Informed Indexing concept and offering thoughts about implementation strategies. All investors would be ten times better off hearing from hundreds of smart people rather than just from me. I have never felt comfortable with the idea of setting myself up as some sort of Grand Poobah and telling people: “The Oracle says that all investors should be going with a 30 percent stock allocation today.” Yucko! Let’s hear what some other people have to say on this topic!
This is amazing stuff.
Wade studies investing for a living. He has a Ph.D. from Princeton University. He read my posts at the Vanguard Diehards board and was intrigued with my claim that long-term timing always works. He didn’t reject the idea out of hand (like a Goon!) and he didn’t just take the word of some fellow whose biggest claim to expertise in this field is that he figured out how to get stuff posted to the internet. He checked the research. What a novel idea!
Guess what he discovered? “The literature seems slim.” Ultimately, he concluded that there is only one study that examines the question and he found a lot of holes in that study. So really there is nothing. This is the issue on which people should be focused. The question of whether long-term timing always works or not is critical. Why aren’t there hundreds of peer-reviewed studies of this question?
The short answer is that index funds only became available in 1976 and Shiller only published his research showing that valuations affect long-term returns in 1981. Long-term timing was a practical impossibility before there were index funds (VII does NOT work for those picking individual stocks). So, in the days when Buy-and-Hold was being developed, there was only one form of timing — short-term timing. When the research showed that short-term timing never works, lots of smart people jumped to the conclusion that timing in general never works. These people were not evil and these people were not stupid. They just didn’t know to check on what happens with long-term timing for the perfectly understandable reason that the only form of timing they had ever heard about was short-term timing. Now long-term timing is a practical possibility for all investors. So the focus of most investment research should be how best to practice long-term timing. But first we have to address the problem of the feelings of wounded pride being felt by the Buy-and-Holders because of the mistake they made. Humans!
Anyway, I find it pretty darn amazing that a fellow with a Ph.D. in Economics from Princeton had never stopped to wonder whether long-term timing works or not until he read my work. I don’t mean that as a dig at Wade. He is obviously in lots of very good company. I just point this out to help people understand why the first 10 years of our discussions have been so contentious. I rarely experience much difficulty explaining the realities of stock investing to ordinary investors. They come to the subject without preconceptions and are generally eager to learn. It’s a very different story with them there “experts!” The experts have read all the books and know what all the books say on every possible subject. Trying to explain to them why just about everything the books say is wrong is a tough job! The experts do not want to hear this. Let me restate that more accurately and clearly. The experts very, very, very, very much do not want to hear this!
Wade was open to learning new things. That’s why we became such fast friends. Three cheers for Wade Pfau!
Here’s how Drip Guy (one of the Goons) responded to learning that I was right all along (Drip Guy’s words are directed at Wade): “Since your own work is overtly at odds with the ethos of the board — here, the theme is John Bogle’s philosophy, which eschews market timing, I myself will no longer obliquely support it by giving you a whetstone on which to sharpen your knife. You must certainly know that this very board came into existence in order to ESCAPE the lunatic behaviors of one individual — the very individual with which you have publicly and openly aligned yourself, and who you are openly quoting and sourcing in your column and are forming your intended paper around. While there is much merit in open discussion of competing, differing, and varied approaches, as to you, sir, I personally will have no more of it here on this forum, given the poison well from which you are now openly drawing your own water.” When Wade flipped, Drip Guy praised him to no end. The dumb guy got smart. Hoo boy!
The blog entry also quotes one of the Normals: “As a relatively new person on this forum, I have no idea what you are talking about. There is someone, not Wade, whose “lunatic” behavior lead to the existence of this board? I can understand avoiding the classic abusive internet behavior of toxic contributors. However, that is a far cry from having no more of open discussion of competing approaches. From what little I have seen on this forum and Wade’s site, I don’t see anything harmful. Again, I am new here, but I hope people can post ideas that do not conform to other’s ideas of what Bogle would say. After all, this is finance, not religion. Bogle is a smart guy who has done a tremendous service to American investors, including the majority who do not do business with Vanguard. Does that mean no one is allowed to disagree with him on any topic?” Um — I think it would be fair to say after ten years of this craziness that the correct answer to that one is “Precisely so!” For Bogle’s benefit and for the benefit of all the middle-class investors who have found value in his investing ideas, we need to change that. By the close of business today, if at all possible.
4) Site Administrator Alex Frakt Doubles Down on Defamation/Intimidation Strategy at Bogleheads Forum
After ten years of this stuff, I am not easily shocked. But this one shocked me all the same.
Wade’s research was obviously breakthrough stuff. So one of the posters at Bogleheads Forum put up a post saying that the leaders of the board owed me an apology for having banned me after I brought these matters to the attention of the Buy-and-Holders nine years earlier. Site Administrator Alex Frakt responds by saying: ““We’ve had to remove a couple of comments and posts from this thread regarding Rob Bennett. I have been in contact with the OP offline and he is now fully aware of hocus’ modus operandi, so there is no further need for these posts. Let’s continue to keep this forum a hocus-free zone. P.S. For anyone confused by this message, I’ll suggest googling “hocomania”.”
Buy-and-Hold is based on research and data. It is science. It is logical. It is rational. So they say.
5) My Second E-Mail to John Bogle: “I Haven’t Been Banned at Any New Boards or Blogs for Six Months!”
Frakt’s e-mail prompted me to write a second e-mail to John Bogle asking for him to help us all out re this matter. I urged The Big Guy to “take a sad song and make it better.” I received no response.
This blog entry reported on words that Wade posted to my blog. He told me that: “It is hard to keep track of all your articles, but I do especially like the one with six criticisms of my research.” He is referring to this one. I like that one too. The point, of course, is that, when Wade showed that Valuation-Informed Indexing has provided far superior results (over Buy-and-Hold) for 140 years now, he was understating the case.
Wade then offered a strange comment: “I lost some enthusiasm about the topic when I found out I was only rehashing the stock formula investing plans of the 1940s and 1950s.” No one should think of Valuation-Informed Indexing as something that is 100 percent new. There is nothing 100 percent new in the field of stock investing. People have been electing to follow either common-sense strategies or Get Rich Quick strategies since the first market opened for business. Just as Buy-and-Hold is just a new term for the Get Rich Quick mindset, Valuation-Informed Indexing is just a new term for the common-sense mindset. Benjamin Graham was advocating in the 1930s that investors go with a 25 percent stock allocation at times of low prices, a 50 percent stock allocation at times of moderate prices, and a 75 percent stock allocation at times of low prices. That is obviously Valuation-Informed Indexing. I discussed Graham’s 75/50/25 allocation in my RobCast on VII allocation strategies. So Wade knew about this at the time he listened to that RobCast.
What makes Buy-and-Hold something new is not that it is a Get Rich Quick strategy. What makes it new is that it is a Get Rich Quick strategy that purports to be backed by academic research. It is this claim that made Buy-and-Hold more dangerous than any earlier Get Rich Quick approach. Many investors do not check the “studies” themselves. They hear “experts” (expert salesmen!) say that there is research backing Buy-and-Hold and they assume there must be something to it. The widely promoted claim that there is academic research supporting the idea that investors do not need to consider price when buying stocks gave that “idea” a power to ruin our economy that no Get Rich Quick scheme that came before it ever possessed.
The good news is that, as Buy-and-Hold falls, Valuation-Informed Indexing rises. And Valuation-Informed Indexers can legitimately claim that their strategy is supported by the research. So, just as Buy-and-Hold caused more investors to invest ineffectively than any strategy that ever came before it, Valuation-Informed Indexing has the potential of helping more investors to invest effectively than any strategy that ever came before it. The claim that academic research supports a strategy is a powerful claim. Thus far, the power of that claim has been used only to wipe out millions of middle-class retirement accounts. But there is nothing that stops us from putting the power of the academic research to good purposes in days to come by opening the internet up to honest and accurate and realistic reports of what the research says.
Wade makes a powerful statement: “The traditional approach to retirement planning (as described on pages 10 and 11 of The Bogleheads’ Guide to Retirement Planning, for example) is counterproductive and possibly damaging.” That’s bold and clear and clean and properly provocative. I like! But he goes lame and tame and sad and vague with his statement that: “This paper doesn’t rely on valuations, at least in an explicit sense, because I am trying to make it as uncontroversial as possible.” Why this urge to be so darn non-controversial? If today’s conventional retirement planning today is “counterproductive and possibly damaging,” I think it would be fair to say that we are doing lots of things terribly, terribly wrong. We need to find out what they are quick and then make changes. We are far more likely to do so once we get over our fear of offending the Buy-and-Holders with our “controversial” reports on what the academic research really says.
That’s my take, in any event. Maybe it’s a journalist thing.
7) “The News Is So Good That People Just Cannot Bear to Let It In”
Of all the things that bug me about the Goons (that’s a long list!), the thing that bugs me the most is that their employment of so much ugliness has distracted people from the real message of the first ten years of our discussions — Stock investing will be a whole big bunch more fun in the future than it has ever been in the past. Our message is good news piled on top of good news piled on top of good news. It takes a true Goon to find the cloud in such a mass of silver linings. Mel Lindauer said that it would be “dangerous” to permit honest posting on safe withdrawal rates at the Vanguard Diehards board. He’s right! It would be dangerous in the way it would be dangerous to the profits of the medical industry to find a cure for cancer. It would be dangerous in the way that it would be dangerous to the weapons manufacturers to bring about peace in the Middle East. It would be dangerous in the way that it would be dangerous to the cosmetics companies to find the Fountain of Youth.
The academic research, honestly and accurately reported, is dangerous to those promoting Get Rich Quick strategies. That’s the idea. We want to bury that smelly garbage 30 feet in the ground, where it can do no further harm to humans and other living things. In their early days, the Buy-and-Holders were with us. That’s what they once wanted too. When the Buy-and-Holders find their way back to where they once belonged, all will see that our story is a 100 percent positive story. We know things about stock investing today that people have wanted to learn about stock investing for centuries. We shouldn’t be arguing about whether to spread the word or not. We should be racing each other to see who can get get the good news out the fastest.
Going back to the morning of May 13, 2002, the only negative to our story has been the behavior of the Buy-and-Holders seeking to “defend” the idea of not correcting retirement studies that get all the numbers wildly wrong.
I discussed the article referred to in this blog entry in comments up above.
9) “Had Shiller Published His Research 20 Years Earlier, There Never Would Have Been Any Buy-and-Hold”
Wade set things up in a scientific way in the words of his that I quoted in this blog entry. He said: “My null hypothesis is that valuations-based investing is not useful, and now I am seeking to determine if I can find sufficient evidence to reject this null hypothesis with sufficient confidence.” The trick that Buy-and-Holders play again and again and again is to make the argument that even 140 years of historical data is not enough to prove that Valuation-Informed Indexing will always offer far greater returns at greatly reduced risk. What can one say in response to such a claim? Of course there is a chance that the entire historical record available to us today is not sufficient to tell us anything with 100 percent confidence. It is not possible to say with 100 percent confidence that the moon is not made of green cheese.
The proper way to examine the question is to compare the mountain of evidence supporting Valuation-Informed Indexing with the lack of even a sliver supporting Buy-and-Hold. There has never been a single study showing that long-term timing does not work. Every time the question has been examined, the finding has been that long-term timing always works. So it is every bit as true to say that “timing always works” as it is to say (as the Buy-and-Holders do) that “timing never works.”
When questions are framed in reasonable ways, looking at the historical data is a big plus. When you decide on what you want the data to say before looking at it and then twist things however they need to be twisted to fool investors into thinking that the data supports a Get Rich Quick approach, you are engaged in an exercise in marketing, not an exercise in scientific exploration. Valuation-Informed Indexing is what Buy-and-Hold would be today had the Buy-and-Holders remained true to their original vision.
I have nothing to say re this one.
11) Wade Pfau: “The Market Timer Enjoys a Far Less Risky Strategy”
The primary reason to become a Valuation-Informed Indexer is not to obtain the far higher returns it offers. The primary reason is to dramatically lower the risk of stock investing. It is a rare middle-class investor who can handle the level of risk that applies to those following Buy-and-Hold strategies in the long run.
People need to look at the historical stock-return data for themselves. Allowing the people who sell stocks for a living to tell us what it says is like asking a used-car dealer “Is this really a good car for me?” To hear the Buy-and-Holders tell it, you would think that, even when market timing works, it is hard to pull off. Wade looked at the data. He reported the story the data tells accurately. The reality is that “the findings for market timing are so robust that it hardly matters how we do it.” Tell your friends.
13) “Everyone in This Field Should Be Urging the Authors of the Studies to Make Corrections”
Wade is smart. He shows in the comments of his that I quote in this post that there is such a thing as being too smart for your own good.
He says: “We will not know if there will be an increased failure rate [for retirements] for another 20-30 years.”
So what?
What does that have to do with anything?
There are some people who smoke three packs of cigarettes a day and don’t die of cancer. Does that justify telling people that smoking is “100 percent safe” when we all know perfectly well that it is not?
I say “no.”
We know that valuations affect long-term returns. So we know that there is no way on God’s green earth to identify the safe withdrawal rate without taking the effect of the valuation level that applies on the day the retirement begins into account.
So why continue this charade?
Integrity matters.
Such is my sincere take re this important matter, in any event.
I know, I know. Putting forward common-sense observations about stock investing became exceedingly “controversial” in the Buy-and-Hold Era.
14) Wade Pfau: “Perhaps the Trinity Study Was Not Meant to Be a Safe Withdrawal Rate Study”
This is, as my youngest would put it, “sad.”
Perhaps the Trinity study was not meant to be a safe withdrawal rate study. That makes sense. That explains why thousands of financial planners and thousands of newspaper articles have referred to it as a safe withdrawal rate study. All of the pieces of the puzzle are finally beginning to snap into place.
It is this kind of statement that reveals the utter corruption of the investing advice field. If we cannot get credentialed experts to acknowledge that retirement studies that get the numbers wildly wrong need to be promptly corrected, we need to consider finding new employment for everybody who works in this field today and starting over with fresh faces and fresh, innocent hearts and fresh, curious minds.
No?
I wrote many thousands of words in response to Wade’s many questions of me. I was happy to do it. He’s a smart fellow who became a good friend and I am being 100 percent sincere when I say that his research merits a Nobel prize. But his argument that there is no need to correct retirement studies that get the numbers wildly wrong makes me want to wretch. I have little patience for statements that show that the people putting them forward are not even making an effort to do the right thing.
A failed retirement is a serious life setback.
I ain’t got no Ph.D. in Economics. Please keep that in mind when assessing the value of any words that I put forward relating to safe withdrawal rates.
I ain’t got no Ph.D. in Economics. You’d have to put me in school for a lot of years to teach me to say something as dumb as what Wade is quoted as saying in this blog entry.
I don’t find this particular joke even a tiny bit funny.
I expand on the point made immediately above in the words I put to this blog entry. I explain why no expert in this field is permitted to employ common sense when giving investment advice. The root problem is something called “The Efficient Market Theory.” The blog entry states: “The error at the core of the Efficient Market Theory is fundamental. It has influenced every aspect of investment analysis for decades now. It needs to be corrected, not rationalized.”
If Wade were to acknowledge this obvious truth, he would thereby render himself unemployable in this field.
If that sounds overstated to you, please continue reading until you get to the part where the Goons threaten to get Wade fired from his job for the terrible “crime” of acknowledging that retirement studies that get the numbers wildly wrong need to be corrected and, instead of calling the police, he asks the Goons precisely what sort of language they need to hear from him so that be can earn their enthusiastic support for his “research.”
This one is Orwellian. I don’t want to say more than that. It’s too creepy. People shouldn’t have to deal with this sort of thing as the price of wanting to help their friends learn how to invest effectively.
The most important takeaway not only from this e-mail but from the first ten years of our internet discussions re the realities of stock investing is contained in this sentence: “We all need to become more HUMBLE re the extent of our understanding of how stock investing works.” Please say a prayer that we find our way before we all come to feel the shame of causing even more human misery.
This is my favorite! This is the “Wade is a Hero!” blog entry. Whenever I feel down about one of the characters in our play, I try to think back to a time when that person did amazing things to restore my belief in human nature. I remember the day I discovered Greaney’s site. I was so excited that someone had written an entire site about early retirement (this was 1998 — there were no other web sites on early retirement at the time) that I talked about it to my wife through my entire ride home from work (I copied the entire site on the day I discovered it and placed the results in one of my 30 binders of materials on how to achieve financial freedom early in life). When I get discouraged about Wade’s recent decisions, I think back to the day he worked up the guts to contact the Trinity authors. It may not sound like much. But I had been seeking help with this matter for nine years and no one before Wade had been willing to step up to the plate. Nothing he does in future days will take away his moment of heroism. This happened, it is in the books, those particular books are closed, and that is that. Thanks, man!
Please note Drip Guy’s response. He says: “Rob — You likely think yourself quite clever for actually enlisting an apparently naive but scholarly dupe as your proxy to contact the Trinity authors about these supposed ‘errors’ (yet to be elucidated) that only you seem capable of seeing; leading YOU and you alone to come up with all kinds of self-invented grandiose names for what are merely your own delusions, misunderstandings, and confabulations…. I think you will be surprised at how this apparently initially successful attempt will backfire on you, as do all your Wile E. Coyote-like schemes, because while Wade has certainly shown he is mostly mild mannered in demeanor, I think he is doggedly determined in being accurate. He is very much, in that respect, the Anti-Hocus. I think you will shortly be adding him to Scott Burns, Michael Kitces and others who have innocently engaged you, only to discover your true nature after the fact.”
Yikes!
I was surprised that you were able to pull it off, Drip Guy. I give you that one, my long-time abusive-posting friend.
This was the biggie. I think it’s fair to say that the history books of tomorrow will record April 29, 2011, the day we learned about Wade’s breakthrough research, as the day a new form of capitalism was born in the United States. My Goon friends will complain that that’s overstatement, another case of Rob being Rob. Let them complain! We’ve got the data on our side. We’ve got the research on our side. We’ve got the future on our side. We’ve got the Wadester on our side (and the truth is, we will always have the Wadester on our side, regardless of anything to the contrary he says in future days in response to pressures imposed on him by our Goon friends).
A simple way to invest that provides returns so much greater than Buy-and-Hold that millions of middle-class people can stop worrying about whether they will be able to retire at 65 and instead begin planning their early retirements? Check!
A simple way to invest that reduces the risk of stock investing by 80 percent? Check!
A simple way to invest that brings bull and bear markets to an end, that makes stock price volatility a thing of the past, that makes economic crises of the type we are living through today a thing of the past too? Check!
That’s history-making stuff in the eyes of any reasonable person.
Take that, Goons!
I will always be humbled by Wade’s kind acknowledgment of the role I played in bringing this paradigm-shifing research to life: “I am also extremely grateful to Rob Bennett for motivating this topic and contributing his experience and encouragement.” I certainly never believed as a boy growing up in Northeast Philadelphia that there would come a day when my feeble efforts to do good in this crazy and mixed-up world of ours would be paying these kind of dividends. I often reread the following words just to be sure that I did not misunderstand them the first 100 times I saw them appear on my computer screen: “On a risk-adjusted basis, market-timing strategies provide comparable returns as a 100 percent stocks buy-and-hold strategy but with substantially less risk. Meanwhile, market timing provides comparable risks and the same average asset allocation as a 50/50 fixed allocation strategy, but with much higher returns.”
This couldn’t have happened without the economic crisis. Do you see how God sometimes permits bad things to happen for the purpose of ultimately achieving a greater good?
And the hits just keep on coming!
The Goons think of me as being anti-Bogle. Nothing could be farther from the truth, according to my way of seeing things. Bogle is as much of a hero to me as Pfau and Shiller and Russell. I learned about the errors in the Old School retirement studies by reading Bogle’s book. Bogle popularized indexing and there would of course be no Valuation-Informed Indexing had there not first been index funds in which to invest. And of course it was Bogle and the other Buy-and-Holders who pushed the idea that one’s investing strategies should be rooted in the academic research. When we reach a consensus that Buy-and-Hold needs to be buried 30 feet in the ground, where it can do no further harm to humans and other living things, it will be that principle that will have done the most to make the dream a reality.
The Wall Street Con Men have always been tempted to say whatever will help them make the sale. That should come as a surprise to no one. The humans who become investment advisors suffer from the same human weaknesses as the humans who become used-car salesmen. The trouble in the investing field has always been that most of us don’t know enough about the subject matter to see through the marketing mumbo jumbo. We would laugh at a car salesman who told us there was no need to take the price of a car he was pushing into consideration before signing on the dotted line. But when some fast-talking investing expert says that “timing never works,” we nod our heads and marvel at the years of education and experience it must have taken for him to acquire such “expertise.” Bogle and the other Buy-and-Holders brought an end to that with their focus on research and data. We now have available to us a means of checking out the claims of the expert salesmen. We now have a means of bringing some long-needed integrity to the investing advice field. It’s sad that Bogle and the other Buy-and-Holders have blocked our efforts for a time. In the end, though, they get a big share of the credit. This looking-at-the-research stuff was their idea.
When I announced my plans to direct some hard questions to Old Saint Jack at the next meeting of the Vanguard Diehards, I was told by a few community members there that I shouldn’t do so because Bogle is a nice, old man. That’s all the more reason to do it, in my eyes! I certainly agree that Bogle is a nice, old man. A nice, old man does not want to cause an economic crisis! A nice old man does not want to cause millions of failed retirements! A nice old man does not want to see a discussion board with his name on it ruined with nasty, abusive posting!
We all owe something to the nice, old man who goes by the name “Jack Bogle.” If we were in his shoes, we would want our friends to press us to overcome the temptation to cover up our mistakes, come clean, and get things moving in the right direction. I strongly believe that we should do for Bogle what we would want him to do for us were our positions reversed. I am 100 percent confident that we will be laughing over a beer with him in the not-too-distant future and wondering how there ever could have been a time when some of us thought that it was an okay idea to fail to correct the retirement studies that we had discovered get the numbers wildly wrong.
Bogle was attacked by Goons in his day. Fidelity once ran a full-page advertisement in the Wall Street Journal characterizing Bogle’s investing ideas as “Un-American.” I’m not the anti-Bogle. I’m The New Bogle. Valuation-Informed Indexing is the investment strategy Bogle would have advanced in the early 1970s if only Shiller had published his research 10 years sooner. The work we are doing today fulfills Bogle’s vision of a smart, simple and safe investing strategy that can improve the lives of millions of middle-class investors in highly significant ways. Bogle is NOT a LIndauerhead! That idea is an insult to Bogle and all his true followers.
21) Coach Potato Advocate on Wade Pfau’s VII Research: “At First Glance, I Find This Interesting”
This is important. We all know how hard it is to convince people of a different point of view once their minds are made up. We’ve seen that in the first ten years of our investing discussions. That said, we have seen two very encouraging signs.
One highly encouraging sign is the popularity of Buy-and-Hold. Yes, that has proven to be a disaster in the short run. But the real message is that most middle-class investors want to do the right thing, most middle-class investors want to follow research-backed strategies and to avoid Get Rich Quick b.s. (remember, Buy-and-Hold is marketed as a research-backed strategy). If researcher felt safe publishing honest and accurate research, we have every reason to believe that millions of middle-class investors would pay attention to the findings of that research. That’s huge.
It’s also encouraging in a twisted sort of way to consider how the Goons reacted when Pfau published his research showing that Valuation-Informed Indexing always provides far higher returns than Buy-and-Hold at greatly reduced risk. The Goons obviously saw this as a huge threat to their ability to maintain public confidence in Buy-and-Hold. Hey! — They should know, right? The comments of the poster cited in this blog entry show why the Goons are so worried. This fellow is a rock-solid Buy-and-Holder. He has resisted efforts to engage in reasoned dialog in the past. But look what he says when he is presented with a compelling data-based case that Buy-and-Hold can never work in the long run. He is not instantly convinced. It would not be realistic to expect that. But he indicates that Wade’s research opened his mind a bit. That’s all we need! Once we get minds opened enough to listen to the case, the benefits of Valuation-Informed Indexing are so compelling that we will win them over. Buy-and-Holders believe because they have placed their trust in “experts” who have told them that there really is data supporting this strategy. When they learn what the research really says, the power of the data-based argument flips. People who were taken in by Buy-and-Hold when it was not possible for them to gain access to genuine research can be persuaded of its dangers once the Social Taboo against reporting accurately what the data says is broken. I believe that we will see a breaking of the taboo with the next price crash. So things are looking up (because they are looking down!).
22) The Economist Magazine Endorses New School Safe Withdrawal Rate Research
It is of course an important step forward that the Economist and numerous other big-media outlets are now warning investors that: ” a safe withdrawal rate is very dependent on the valuation of the stockmarket at the retirement date.” That said, there are three things missing from this report and from most of the other similar reports that appeared only after it became so obvious that we are going to see millions of failed retirements that the Buy-and-Holders felt it had become wise to disassociate themselves from the “research” that they were pushing with such relentless dogmatism only a few years back.
One, where are the thanks to all the people who stuck their necks out by reporting years ago on the errors in the Old School retirement studies? I don’t mean just me. Shouldn’t these articles be giving John Walter Russell credit for his breakthrough research? And how about the thousands of members of the Retire Early and Indexing discussion-board communities who expressed a desire that honest posting be permitted at our boards in the face of the most vicious smear campaigns ever advanced in the history of the internet? These people possess ten times the “expertise” possessed by the glorified salesmen who were saying for years that the Old School studies aren’t really wrong because they only provide a “rule of thumb” while failing to explain why discussions of analytically valid studies had to be banned in deference to the tender feelings of the “researchers” who got the numbers wildly wrong despite decades of academic research showing that valuations need to be taken into consideration to calculate the safe withdrawal rate accurately.
Two, where are the demands for corrections of the studies that we now all accept as being wildly in error? Millions of people will be suffering failed retirements because of our failure as a society to get these studies corrected for the ten years since the errors in them became public knowledge. Yet new people are exposed to the wrong retirement numbers every day when they enter terms like “safe withdrawal rate” into the Google search engine. A car that caused only thousands of deaths would be recalled. Yet we permit studies that are likely going to cause millions to suffer one of the worst life setbacks imaginable to remain uncorrected for 10 years. Huh?
Three, where are the links to studies and calculators that get the numbers right? Aspiring retirees need to know the accurate safe withdrawal rate. I published The Retirement Risk Evaluator a good number of years back.
Four, where are the analyses of why the old studies got the numbers so wildly wrong and remained uncorrected for such an insane amount of time after the errors were brought to light? We all learn in kindergarten that the one good thing about making mistakes is that we can learn from them. Were the editors of the Economist absent that day? These studies have caused huge amounts of human misery. Why not turn that human misery into something good by examining how we got so far off track during the crazy bull years? The answer, of course, is that the Old School studies are rooted in the same belief in the Efficient Market Hypothesis that also caused all investing advice offered under the Buy-and-Hold Model to be dangerously off the mark. Examining why these studies got the numbers so wildly wrong is the first step to getting all sorts of mistakes made during the Buy-and-Hold Era corrected.
Five, why no discussion of the Campaign of Terror that is responsible for the ten-year delay in getting these studies corrected? People are embarrassed over the Campaign of Terror. We don’t like to talk about it. We are ashamed that we have let the Goons engage in such ugliness. You know what? Keeping quiet about this stuff plays into the Goons’ hands. Bullies get excited to see their intimidation tactics work. Humans have for centuries been enforcing social norms that make it impossible for the lowest among us to engage in the sorts of tactics we have seen employed by the Lindauerheads and the Greaney Goons. Why not start applying those social norms to Buy-and-Hiold advocates? I am confident that it would make a big difference. We have had thousands of community members express a desire that honest posting be permitted. Those people matter.
23) “I Am a Threat Only to the Buy-and-Holders”
It’s amazing that the site administrator at the Bogleheads Forum terms me a “threat” to the board community that meets there. I’m a threat? Buy-and-Hold is marketed as a research-based strategy. If you have research backing up your claims, the easy response to any challenge raised to your ideas is to present the research supporting them. If the Buy-and-Holders could do that, challenges raised by people like me would cause members of the board community to be reaffirmed in their belief in the strategy backed by the research as they saw the challenges beaten back.
I am not a threat to the community. My investing ideas are the future of that community. The community project is to learn about research-based strategies. Buy-and-Hold was once perceived to be a research-based strategy. But Shiller discredited the research once thought to suggest that there is no need to engage in long-term timing 30 years ago. Valuation-Informed Indexing is the research-based strategy of today and tomorrow. I am a threat to Buy-and-Hold. But I am no threat whatsoever to any community member who possesses a sincere desire to learn about what the research says works in stock investing for the long-term investor. The reason why I love Valuation-Informed Indexing so much is that it is the first true research-based strategy (the interpretation of the research that led many good and smart people to believe that Buy-and-Hold could work has been shown to have been mistaken).
One of the benefits of true research-based strategies is that they help the investors following them to overcome the most dangerous investor emotions. I think it would be fair to say that Buy-and-Holders are the most emotional of all investors. Why? The behavior of the Buy-and-Holders is itself strong evidence that this strategy is not what it purports to be.
In fairness to the community that meets at the Bogleheads Forum, many community members have expressed a desire that honest posting be permitted at the Bogleheads Forum, just as many community members expressed a desire that honest posting be permitted at the Vanguard Diehards board that came before it. Frakt speaks for a small number of big shots who are pushing books advocating Buy-and-Hold strategies. He does not speak for the community as a whole. In fact, the published rules of the site permit honest posting on safe withdrawal rates and on many other critically important investment-related topics while prohibiting the tactics that have been employed by the Lindaurheads to block civil and reasoned discussion of the investing realities.
The biggest obstacle I face in trying to help people understand how stock investing works is that Valuation-Informed Indexing is so huge an advance over Buy-and-Hold that people cannot accept that what the academic research shows can be true. The result is that I hear lots of patronizing responses. I explain that we can reduce stock investing risk by 80 percent once we open the internet to honest posting and people who should be very excited about this development say: “That sounds nice, Rob”
I hint at that problem in this blog entry when I quote the words from an e-mail to Wade in which I compared Shiller’s discovery that valuations affect long-term returns to the harnessing of electricity. I don’t think that’s an overstatement. I really believe that the change is that big. If Shiller is right, we are wrong to think that each day’s stock price is determined by economic or political events taking place that day. Those events can serve as catalysts for price changes that eventually would take place anyway. But the true causes of price changes are investor emotions that were experienced 10 years ago. This changes the game in a fundamental way. If price changes are caused by economic and political events, it is not possible to greatly reduce investing risk — we obviously can not do anything to influence economic and political events to make them more favorable for investors. But we CAN change investor psychology if P/E10 does what 30 years of academic research shows it does. P/E10 warns us when investor emotions are getting out of control and provides us a reason for taking note of the warnings (those who take note earn far higher returns at greatly reduced risk). If we take note of investor emotions when they first start to go out of control, we can stop them from getting too much out of control. We can put an end to bull markets and bear markets and economic crises.
One of the particular problems I face is that, when I point out the role played by The Stock-Selling Industry in promoting Buy-and-Hold, it sounds like I am saying that everyone in this field is unethical. There is one sense in which I really am saying that but there is another sense in which I am not saying that. We’ve known for 10 years now that the numbers in the Old School retirement studies are wildly wrong and the studies have not been corrected to this day. Such a thing obviously could not happen except in a field which is corrupt from top to bottom. So the corruption present here is a serious problem that absolutely must be addressed. But I do NOT believe that the experts in this field have any idea how bad a strategy Buy-and-Hold is or how good a strategy Valuation-Informed Indexing is. I believe that what is going on is that people cannot let in how big an advance we have achieved and they are rationalizing. Because they are afraid to move forward, they are telling themselves stories aimed at convincing themselves that sticking with the old and discredited ideas is not really such a bad thing. Once they make a decision to do that, they become intensely sensitive and defensive over the topic.
We need to break the spell we are under. The experts should be helping. That’s their job. But it is not entirely fair for us to put this all on the experts. We need to express to them a desire to move forward. My guess is that, when we do that, we will find a lot of the experts will be perfectly happy to move beyond Buy-and-Hold. Right now, we are waiting for them to make the first move and they are waiting for us to make the first move. We all need to stop worrying about who goes first and just MOVE. Once things get started moving in the right direction, things will get better and better and better and we will all laugh that it took us so long to see the merit of moving ahead together.
I knew that the Goons were getting to Wade when I saw the post cited in this blog entry appear at his blog. In my earlier e-mail correspondence with him, Wade would be dancing around like a boy on Christmas morning when he discovered some exciting new aspect of how stock investing works that he had not known about before and that he could examine in breakthrough research. He used to marvel at how no other researchers had looked at these questions. “How could it be?” he would ask me. Why had all these wonderful discoveries been left to him?
Now he knew. Now he was announcing that he would no longer be doing research on valuations-related topics. Now this was too “controversial” in his eyes. Wade has two small children to support. He is subject to the same pressures as most of the other humans. Still, it is mighty sad to see someone of so much talent and ambition blocked in his efforts to realize his dreams by helping millions of us become far more effective investors.
It’s not only sad for Wade and it’s not only sad for the millions of middle-class investors who miss out on what they would have learned had he felt free to pursue his research quests where his intelligence and his findings led him. It’s sad for the Buy-and-Holders too. Buy-and-Holders are not monsters (No, really, hear me out re this one!). They are humans too. They have retirement accounts. They want to invest effectively. They worry about their financial futures. They really do follow Buy-and-Hold strategies (they tell tales about lots of topics but I have never seen any evidence that they are telling tales re that one). So they hurt themselves while hurting lots and lots and lots of others. And then they experience pangs of shame and guilt over what they have done as they resort to ever more desperate acts to cover up their acts of deception and intimidation and hubris.
Are you beginning to understand why I am no big fan of Get Rich Quick investing strategies? They don’t only rob us of our retirement dreams. They rob us of our souls.
Wade saw an intensity of hate that he had never before seen in his life and he blinked. How many of us with two small children to raise can say that we are 100 percent certain that we would not ever give consideration to making the same call?
The Buy-and-Holders are not evil people (well, maybe Greaney…). There are millions of smart and good people who believe in Buy-and-Hold without reservation. But the Get Rich Quick idea that is at the core of the Buy-and-Hold marketing campaign is evil. Goonishness is sin. And it is only when we learn to talk about these issues with the level of frankness I am employing here that we will begin making serious efforts to pull ourselves out of this economic crisis. That’s my sincere take re these important matters, in any event.
26) Wade Pfau Creates Graphic Comparing Nominal and Valuation-Adjusted Wealth
You need to study this graphic. It is pointing at something of importance for those of us who want to bring the economic crisis to a quick end (shouldn’t that be pretty much all of us?). I discussed the significance of the graphic in one of the e-mails that I sent to Wade. I will offer more in-depth comments in the section of this article that examines that e-mail.
27) Kay Conheady Asks: Does the Trend Matter?
We know that valuations affect long-term returns. We know that P/E10 is the best metric to us to assess valuations. So many assume that there should be an ideal stock allocation that corresponds to each P/E10 level. Perhaps you should be at 50 percent stocks when the P/E10 level is 20 and at 20 percent stocks when the P/E10 level is 25 and at 75 percent stocks when the P/E10 level is 15, something like that.
No. It doesn’t work that way. It is generally true that you want to go with a lower stock allocation at higher P/E10 levels because higher P/E10 levels translate into lower returns and increased risk. But the a P/E10 level of “20” does not always signify precisely the same thing.
A P/E10 level of “20” signifies a significant amount of overpricing. Not an insane amount. A significant amount. Stocks generally offer a very strong long-term value proposition. So most investors should want to go with a fairly high stock allocation at times when stocks are significantly overpriced but not insanely overpriced. So, if you put a gun to my head and force me to say what stock allocation makes sense for most investors when the P/E10 level is “20,” I probably would indeed respond with a number somewhere in the general neighborhood of 50 percent. You always need to account for the investor’s particular financial circumstances and risk tolerance. But a 50 percent stock allocation is roughly right when the P/E10 is 20, according to the research.
However, that roughly right answer leaves out an important part of the story, a part that those steeped in Buy-and-Hold logic rarely think to inquire about. A P/E10 of “20” experienced on the way up to a P/E10 level of 44 signifies something very different from a P/E10 of 20 experienced on the way down to a P/E10 level of 7. Now — you don’t know when the P/E10 level hits “20” that we will be going up t0 44. If you did, you would go with a stock allocation far higher than 50 percent when you saw a P/E10 level of 20. But you do know that the odds are far greater that the P/E10 level is headed downward when you experience a P/E10 level of 20 a few years after seeing a P/E10 level of 44 than they are when you experience a P/E10 level of 20 a few years after seeing a P/E10 level of 7.
The P/E10 level does not move randomly. We do not jump from 14 to 7 to 44 to 10 to 33 and like that. There is a pattern that plays itself out over and over again (there’s not been one exception in the historical record). Stock prices start at low levels in the wake of the economic crisis caused by an earlier trip to insane price levels. The economic crisis wipes out huge amounts of (pretend) investor wealth. So investors are naturally depressed and lacking hope for the future. Still, stocks offer such amazing long-term returns when priced low (the most likely 10-year annualized return when we are at a P/E10 level of 7 is 17 percent real) that eventually some overcome their depression and buy some stocks. That sends prices gradually higher and the gradual price movement eventually entices other investors out of their depression too. These new investors send prices even higher, until they reach fair-value levels. As prices pass fair-value levels, some investors become concerned that the long-term value proposition is becoming less strong. But those who enjoy seeing their portfolio values increases at this point begin concocting rationalizations for the higher prices. The rationalizations catch on and prices rise yet higher. But the rationalizations are never 100 percent convincing. The millions who invest in stocks at high prices continue to worry silently that they are making a mistake. Eventually, some economic or political event causes a number of them to move their concern from the back burner to the front burner and they trigger a price collapse. But prices don’t collapse to a P/E10 value of 7 in one year. As prices drop, investors who recall the higher prices that applied recently jump in to buy more stocks and temporarily firm up prices. It takes year for prices to fall all the way down to one-half fair value (a P/E10 level of 7 or 8), just as it took years for prices to reach insanely high levels a few years earlier.
A P/E10 value of “20” is a bit scary on the way up. But there is a significant chance that stocks can provide a strong long-term value proposition at this price. There has never in history been a time when stocks performed well when purchased at a P/E10 value of “20” on the way down. So the same P/E10 value means different things when encountered in different stages of the bull/bear cycle.
It’s a good sign that financial planners are working up the courage to begin writing about these sorts of issues. All such analyses of course represent a direct challenge to the Buy-and-Hold Model of understanding how stock investing works. If the market were efficient, the P/E10 value would be a meaningless number. If Buy-and-Hold worked, investors would not ever need to change their stock allocations in response to changes in P/E10 levels. The article referred to in the blog entry linked to here is an exercise in silliness to the confirmed Buy-and-Hold advocate. We need to see a lot more of this brand of silliness!
28) Bill Bengen: “Buy-and-Hold In These Environments Is an Invitation to Disaster”
I’m always looking for ways to simplify my message. Is there one point that sums up all the damage that has been done by Buy-and-Hold that I could communicate to people and thereby bring all the ugliness to an end?
There are two of those “here is the entire story in one write-up” moments set forth in this blog entry.
First, consider the Bill Bengen story. This is the guy who came up with the idea that 4 percent is always safe. He has abandoned the idea. He took his clients down to zero stock allocations in the early days of the economic crisis. He now says that Buy-and-Hold is an “invitation to disaster.” It is not Rob Bennett saying these things, it is Bill Bengen, the hero of the Buy-and-Holders. This has the Buy-and-Holders scared to death.
Right?
Not right. The Buy-and-Holders blow it off. Now that Bengen is pointing out the dangers of Buy-and-Hold and acknowledging the errors in the Old School studies, Bengen is a moron. He was never smart. All of that stuff goes down the Memory Hole. If that doesn’t show that Buy-and-Hold is a 100 percent emotional strategy, I don’t know what would do the trick.
Second, please read the comments at the end of the discussion thread. I believe that the discussion in this thread played a role in causing Wade to flip to the dark side. The need for a correction in the Old School SWR studies is as obvious as anything could ever be. Millions of people used these studies to plan their retirements. The numbers in the studies are wildly wrong because the methodology used to calculate the SWR was analytically invalid. We need to do all we can to get the word out before millions of elderly people are left destitute and as a society we face one of the worst social catastrophes we have ever suffered as a nation. There is no dispute anymore on the question of whether the studies are in error or not. Our first ten years of discussions have helped us achieve a consensus on that point. Even the fellow who developed the bad methodology now publicly acknowledges that the studies get the numbers wrong. So we are all working together to get them corrected by the close of business today.
Right?
Actually, not right.
If we correct the discredited retirement studies, people are going to start asking questions about all the other Buy-and-Hold studies that get the numbers wildly wrong. It’s not just in retirement planning discussions that we have been giving bad advice for three decades now. The same thing happens when we give advice on risk management and on setting one’s stock allocation and on hundreds of other critically important investment-related topics. So the thing to do is to — Stonewall! Acknowledge the mistakes but don’t fix the studies! Maybe no one will notice! After all, most investors bought into the Buy-and-Hold garbage! They are not going to want to admit having been taken! If their emotional addiction to the Get Rich Quick garbage we have been feeding them has grown strong enough, perhaps we will be able to get away with this con for another few months or for another few years! It’s certainly worth a try! What’s the alternative? Acknowledging that that fellow who posted on the internet about the errors in the retirement studies 10 years ago was right all along? We can’t do that! I mean, come on!
Arty says in a post put forward at 11:56 am: “It isn’t your argument on valuations (for example) that is the biggest issue, in this context. It is the manner in which you dialogue that can be improved. Because at present, I think many are thinking more about your manner than your arguments. Point being, your arguments could become more persuasive with some rhetorical modification. ”
I respond: “I get it that I could say “valuations matter” but not say “the Old School SWR studies need to be corrected” and no one would be troubled, Arty. I got that on the morning of May 13, 2002. But would doing that lead to Buy-and-Hold being buried 30 feet in the ground, where it could do no further harm to humans and other living things? My guess is that the answer is “no.” Why? Because lots of people have said that valuations matter and not followed up with a demand that the Old School SWR studies be corrected and Buy-and-Hold still lives today. We need to take it to the next strep to get anywhere with this thing, Arty. We need to open up the internet to honest posting on important investment-related topics. Nothing short of that is going to get the job done, in my assessment.”
Arty then says: “There are good minds here who, in their various ways, are trying to help you with this (Wade, to whom I think you owe apology, and Drip Guy and What also make the points, albeit perhaps less nicely). It seems you confuse adjustments to manner, persuasion, tone, and rhetorical adeptness with “burying things” or utter compromises. That isn’t what I am saying at all. But I think it may be all you hear, at present. In sum, I’m talking about doing precisely what you want—but more effectively.”
I then say: “When do we start work on getting the article on the front page of the New York Times that is needed to warn the millions of middle-class investors who were taken in by the Old School SWR studies of the dangers of those studies and to tell them what they need to do today to protect their retirements from going bust? I wasn’t the one who threatened to organize a Goon Squad campaign to get Wade fired from his job when for a time he was posting honestly on safe withdrawal rates, Arty. That was the other fellow. The fellow who I worked up the courage to stand up to on the morning of May 13, 2002.”
Evidence-Based Investing says: “Rob has been getting that message from numerous people over the last 10 years. Every time he ignores it.”
Rob says: “It’s true that many, many people have put forward suggestions along these lines, Evidence. It’s also true that for 10 years I have been responding in the same way. I always say that I am open to anything that does not require me to post dishonestly on safe withdrawal rates.”
Evidence says: “And there is the problem right there. You are the only one who thinks that a “change in tone” means “agreeing to post dishonestly on SWRs”.
Rob says: “I’m the one who has to accept responsibility for the words that appear associated with my name, Evidence. The hand of kindness is extended. I will do anything that I can do short of agreeing to post dishonestly re SWRs. That I will not do. Not 10 years ago. Not now. Not ever. At least it’s not a complicated situation! (That’s a joke, kinda, sorta.)”
Wade has two small children to support. He cannot afford to post honestly on the need for corrections in the long-discredited Old School safe withdrawal rate studies. Acknowledge the need for corrections in those studies and you become a non-person in this field. Acknowledge the need for corrections in those studies and you won’t pass peer review and you won’t get written up by the most influential people and you won’t be permitted to post at the Bogleheads Forum and your blog won’t get links from the biggest sites. Is there really any need to go so far as to correct the discredited studies? Isn’t acknowledging that they are in error enough? Shouldn’t the investors who were taken in by these garbage studies have realized they were garbage the first time they looked at them? It’s obvious that they don’t contain valuation adjustments, isn’t it? None of the authors of the studies ever pretended that they looked at the most important factor affecting the question under examination, did they? As Greaney once observed, his study “is what it is.” All of the studies are what they are. The only thing different today is that we are now acknowledging that we know the numbers in the studies are wrong whereas for the earlier 10 years we were pretending that we thought that the numbers in the studies were accurate. Why does this fellow think anything needs to be corrected? The studies are what the studies are, for heaven’s sake. They always were what they always were. They always will be what they always will be. It’s all perfectly clear to everyone except that Rob Bennett fellow.
This has been going on for ten years now.
Here are some words that Wade put to the thread: ” The only truly safe withdrawal rate is 0%. So what we try to figure out instead is what is a reasonably safe withdrawal rate. Lower withdrawal rates are clearly safer, but they have the cost of reducing a retiree’s spending and increasing the chance of leaving a lot on the table at the end. Retirees try to balance these tradeoffs: to find the highest withdrawal rate possible while still remaining “reasonably” safe. Many people who have kept up with the literature still conclude that 4 or 4.5% is reasonably safe. That is the exact thinking process which can be seen in Bill Bengen’s interview. Now, the 4% rule has many problems: (1) it looks at the probability of failure and not the magnitude of failure (i.e. 1 year of failure is more manageable than 10 years of failure); (2) it ignores the missed benefits of higher spending: people may be willing to spend more now even though it increases the probability of having less later (3) it ignores other income sources such as Social Security, annuities, and pensions (4) it doesn’t account for fees or taxes; (5) it assumes that retirees can actually earn returns that match the index returns; (6) it assumes retirees need inflation-adjusted withdrawals (i.e. spending doesn’t decline as people get older); and (7) it doesn’t account for valuations. I suggest you are focusing too much on the last point and ignoring everything else. Some of those other factors allow higher withdrawal rates, while others support lower withdrawal rates. A complete withdrawal rate study must account for all of this.”
I favor a policy of permitting honest posting on each and every one of these points and on any other points that any community member wants to discuss. It’s true that I focus on the valuations topic. That’s because it is only discussions of the effect of valuations that have been banned. It is the failure of the Buy-and-Hold advocates to tell their readers how much they need to change their stock allocations in response to big valuation swings that is the problem. The other stuff mentioned by Wade is not so “controversial.”
29) Wade Pfau Posts More New School Safe Withdrawal Rate Research
Wade says here that retirees who take valuations into consideration when setting their stock allocations can achieve safe retirements while saving less each year because the higher returns they will obtain in the long run will more than make up the difference. We shouldn’t need research to tell us that. Common sense should tell us that. But, given what we have been hearing from the “experts” during the Buy-and-Hold Era, it makes me happy to hear Wade say it.
30) “We Are the Luckiest Group of Investors That Has Ever Walked Planet Earth”
Everyone benefits if we open the internet up to honest posting on investing topics. Both Democrats and Republicans. Both the old and the young. Both women and men. Both Buy-and-Holders and Valuation-Informed Indexers. Even The Stock-Selling Industry benefits if we bring an end to the Campaign of Terror. Not too many of us will be able to afford to buy stocks once the economy enters the Second Great Depression. This is a rare win/win/win/win/win.
31) Wade Pfau: “Your Comment About Mr. Bengen Causing Failed Retirements Is Too Harsh”
Wade thinks we are being “nicer” to Bengen to say nothing about the need for him to correct the errors in his study immediately. I don’t see it. I truly do not.
I am grateful to Wade for his willingness to state his point of view at the blog. And I am grateful to Bill Bengen for the short e-mail he sent me acknowledging receipt of my e-mail to him.
This is an important point. I often criticize people in the investing field for not doing more to get the retirement studies corrected. The full reality is that not all of the blame should fall on people in the investing advice field. Where are the personal finance journalists who should be writing about this matter? Where are the politicians who should be addressing the public policy consequences of our failure to get those studies corrected for 10 years now? Where are the retirees themselves, for heaven’s sake? In ordinary circumstances, there would be no need for any of the rest of us to push for corrections because the retirees who were taken in by the studies would be so angry that the authors of the studies would not dare to leave them uncorrected for a single day. Do you want to know how many times in 10 years I have heard a retiree complain about what was done to him? This has not happened one time.
33) “Doing Away with Price Volatility Is Doing Away with Risk”
Getting the Old School retirement studies corrected is important in its own right. But the full reality is that that is only the beginning. We have not advanced in our understanding of how stock investing works in 30 years because of our concern that pointing out things the Buy-and-Holders got wrong would hurt their feelings. That’s the bad news. The good news is that we have 30 years of advances waiting for us once we work up the courage to begin moving forward again. Can you imagine what kind of computer you would be using to read this article if the industry had been able to block all advances in computer technology achieved from the year 1981 forward? That’s what happened in The Stock-Selling Industry. Once we get those SWR studies corrected, we will see a flood of exciting new insights. They will be coming so fast that we will not be able to keep up. And we will all live richer (in every sense of the word) lives as a result.
That’s why I soldier on.
One of the things we have seen over and over again over the course of our first 10 years of discussions is that the Buy-and-Holders are very concerned about who will get the credit for the transition from Buy-and-Hold to Valuation-Informed Indexing. I don’t worry about it. Valuation-Informed Indexing is superior in so many ways that there is more than enough credit to go around to everybody who wants to help out. Bogle should get some of the credit. Bernstein should get some of the credit. Fama should get some of the credit. Siegel should get some of the credit. We need all these people working with us. It’s not an issue.
35) “Wade Pfau Does Not Post With Full Honesty [at the Bogleheads Forum]”
I believe that this blog entry played a big role in causing the rift. My comment that Wade does not post with full honesty came in response to baiting by the Goons. I had said that the Bogleheads Forum was a corrupt enterprise for so long as a ban on honest posting remained in effect and one of the Goons came back and asked if that meant that Wade was dishonest (since Wade posts there and does not say that he objects to the ban when he does so). I of course knew that the Goons were baiting me. Still, I believe that the question they were asking was a legitimate one and deserved a sincere response. It is dishonest to participate at a board community that has banned honest posting on so important a matter and not to say anything about it at the board. I believe that all participants in board communities are required to speak up about such matters as the price of admission to the community.
I of course do not in any way mean to suggest that Wade is unique in this regard. There are lots of people who do not like the ban and yet are too afraid to speak up. Mike Piper, the blogger at the pro-Buy-and-Hold Oblivious Investor blog, told me that he thinks Mel Lindauer is a “jerk” and that “there is nothing I would more like to see” than a lifting of the ban on honest posting. But Mike does not dare to speak up in his posts to the Bogleheads Forum. I failed to speak up myself for a long time. Greaney was a ruthlessly abusive poster at the Retire Early board at Motley Fool prior to May 13, 2002. Like most of my fellow community members, I was afraid to speak up. The thing that turned it for me was when Greaney and his Goons drove the best poster at the board off the site. It became clear to me at that point that the board would not long remain a useful resource for those interested in the Retire Early topic unless some responsible people took some responsible steps.
Wade cannot overcome the Goons on his own. That is why he is afraid. But, if everyone at Bogleheads who would like to see honest posting permitted there would say so, the Goons would be finished. The Goons stick together. The Normals (both Buy-and-Holders and Valuation-Informed Indexers) need to stick together too. There are a lot more of us than there are of them.
I never went to investing school. I never managed a multi-million dollar fund. I don’t claim to possess any particular investing “expertise.” That’s why I have what it takes to post the following words at my blog: “Wade should not have to put his job at risk by posting honestly on SWRs or any other issue. Nor should John Bogle. Nor should Bill Bengen. Nor should Scott Burnszzz. Nor should Bill Berstein. Not should the owner of IndexUniverse.com. Nor should the site administrator at Motley Fool. Nor should ES. Nor should J.D. Roth. Nor should Mike Piper. Nor should the owner of the Monevator blog. Nor should Bill Shuler. Nor should Brett Arends. Nor should Bill Shultheis. Nor should Michael Kitces. Not should Jacob at My Personal FInance Journey. Nor should Larry Swedroe. Nor should John D. Craig. Not should Microlepsis. Nor should Retired at 40. Nor should BenSolar. Nor should Wanderer. Nor should Rahiv Sethie. Nor should Carl Richards. Nor should Norbert Schenkler. Nor should Mel Lindauer. Nor should Taylor Larimore. Nor should John Greaney. Nor should Rob Bennett. Nor should GW.”
The investing advice field is corrupt. I don’t say that to hurt the feelings of my many friends in the investing advice field. I say it to help them out. What we are seeing today is not what Wade Pfau bargained for when he first started applying his talents to investing analysis. What we are seeing today is not what John Bogle bargained for when he first started applying his talents to investing analysis. Heaven help us all, but what we are seeing today is not what Mel Lindauer and John Greaney bargained for when they first started applying their talents to investing analysis.
I did not apply for this job. It was one of those situations where they asked for a volunteer to step forward to carry out an important mission and everyone else knew to quickly take one step backwards and old dumb ass Rob Bennett didn’t think quickly enough and just remained in the spot he was in and the next thing you know I find myself arguing that we should open the internet to honest posting on safe withdrawal rate and other critically important investment-related topics.
There are two possibilities. One is that we follow the basic social norms that have made us the richest nation on earth — allowing people with different viewpoints to have their say — and what we learn soon brings on the greatest period of economic growth we have ever seen in history. Or the ban remains in place and we see a price drop of another 65 percent, causing enough of a loss of middle-class wealth to put us in the Second Great Depression. Once you know for certain that we are going to have to correct the mistake we made in our efforts to develop a first draft research-backed strategy, the thing to do is to get the embarrassing stuff behind us as quickly as possible by saying what needs to be said to move things to the next step. I first made that argument in May 2002. It remains just as true today.
I think it would be fair to say that this is the biggest economic and political story of our time. This one is bigger than Watergate. Every reporter prays to someday become involved in a story of this magnitude. Ten years! Yikes! We all need to learn to be careful what we pray for!
37) Wade Pfau: “I Just Became Aware of Your Past Research in September…I Always Find Your Writing to Be Very Interesting and Intriguing.”
While I was thrilled to hear from Wade, I was also nervous about how Wade had worded his post at the Bogleheads board. It was defamatory. I do not want my name to be associated in any way, shape or form with the Campaign of Terror. So I felt that I had to disassociate myself from Wade’s defamatory comments (which were obviously the result of his fear of what the Goons would do to him if he were to post his sincere thoughts) in no uncertain terms. Now that Wade has gone to the dark side, I am glad to be able to say that I warned him about what would come of getting involved with the Goons in my very first e-mail to him.
Wade learned about my work by reading posts I had put to the Vanguard Diehards board in the days before honest posting was banned there. He knew how brutally abusive the Goons could be. He never wanted Goon attacks to be directed at him. In the early days, his desire to learn about the realities of stock investing caused him to be willing to take some risks. Later on, after he saw how much the Big Shots could help him advance in his career, the Goons gained more leverage over him and he became less willing to say things that helped people appreciate the dangers of Buy-and-Hold.
There of course should be no “hostile environment” for those sharing with us their honest beliefs about how stock investing works. If we all were thinking clearly, we would be alarmed to learn that there is even one academic researcher who views the Bogleheads Forum as a “hostile environment.” I think it would be fair to say that it is a whole big bunch more than one who feels that way.
This one serves as sort of a personal mission statement. People sometimes think that those with ties to Wall Street are the true “experts” in this field. Thinking like that is the rough equivalent to thinking of the fellow who greets you at the used-car lot as the world’s only true expert on how much you should spend on a car. I don’t buy it. The Stock-Selling Experts have made a hash of things. But as a society we really have in recent decades generated hundreds of amazing insights into how stock investing works in the real world. Our task today is getting the word out to people re all the wonderful stuff that we have learned that the expert salesmen very much do not want us finding out about.
40) Wade Pfau: Bogle in Many Cases Said Things “Not All That Different From What You Said”
This is a great point. I am the world’s leading critic of the Get Rich Quick element of the Buy-and-Hold “strategy.” But I view Bogle as the second most important figure in this field (only Shiller ranks higher, in my assessment). Bogle revolutionized the field. It will be decades before people (including Bogle himself!) realize how revolutionary and important his insights really are. I see myself as the fellow who took Bogle’s work to a new level, the level that he would have taken it to had Shiller’s research only been available at the time Bogle was developing his First Draft attempt at a research-based strategy.
I continued thinking of myself as a Buy-and-Holder until I was banned at the Bogleheads Forum. Given that the “leaders” of that board think of themselves as Buy-and-Holders and given that the leaders of that board hate the academic research of the past 30 years with a burning passion, I decided that the world’s first true research-based strategy needed a different name. For several years, I referred to the new Buy-and-Hold as “Rational Investing” (that’s the label I use on the 200 RobCasts I recorded in first two years following the onset of the 2008 price crash). I picked up that some Buy-and-Holders took it as an insult that I called the new model “rational” (the implication is that Buy-and-Hold is NOT rational). So I thought it might be better to call it “Valuation-Informed Indexing.”
Anyway, I am a big Bogle guy. I learned about the errors in the Old School safe withdrawal rate studies by reading Bogle’s book (I read Shiller only later). John Walter Russell, the co-developer of the calculators at my site, was a big fan of Bogle’s speeches. And the only investing advice my dad ever passed along to me was to buy funds only from Vanguard. Bogle has not yet responded to any of the three e-mails I have sent him re the Lindauer matter, however.
Wade at one time was able to apologize when he had done wrong. There aren’t too many in this field re which we can say that. There is no such thing as a human so perfect that he can never make a mistake. If we were discussing any field of human endeavor other than stock investing, this observation would be boring because it would be viewed as being so blindingly obvious. In this field, it is a “controversial” claim.
I warned Wade about the Goons. I tried. I worked it. Look at my comment re Drip Guy in the e-mail described in this blog entry. I say: “Drip Guy is a super Goon.”
We had a number of people agreeing with me that we use the term “Historical Surviving Withdrawal Rate” way back in the Summer of 2002. “No dice,” the Goons said.
And you can see why when you look at Wade’s comment re a Business Week article in which the author fails to explain that the Old School studies can get the numbers as wildly wrong on the low side as they have in recent years gotten the number wildly wrong on the high side. Wade says: “Perhaps it is not a major oversight on the author’s part.” I know that some will say that Wade is being “nice.” If you ever discover some number that I get wildly wrong, I ask that you not be so “nice” as to fail to mention it to me. When I make mistakes, I want to get them corrected as quickly as possible. The nice thing is to tell me, not to keep quiet and thereby let me go on embarrassing myself.
The Goons continue to behave poorly because so many of us are too “nice” to demand that they live up to even the minimal standards that have for thousands of years applied for civilized people. We do them no favors by cowering in fear when they strike out. When we cower, it makes them feel worse about themselves. And, as time goes on without any improvement in the behavior, they have more and more things to cover up.
Greaney should have been banned when he put forward his first death threat. That would have sent a message to the other Goons and they all would have reined in their abusive behavior. In fact, I think we might have even been able to hold onto Greaney if we had acted properly early on. He could have been banned for a few months and then returned to the community. Everyone would have forgotten about the bad behavior after a few months. By failing to take appropriate action we have stretched out his embarrassment and pain and self-loathing for 10 years. That’s kind? Huh? I don’t see it. Greaney is a friend of mine and I think we have let him (and ourselves) down is a terrible way with our cowardice.
The proof is in the pudding. Yes, it is. Yes, it is.
I recall the morning of May 13, 2002. I knew Greaney was going to throw a fit when I pointed out the error in his study. So, before I pushed the “Send” button, I looked over that thread-starter very carefully. I looked at the data again. Everything checked out. There was no doubt. The study got the numbers wildly wrong. I was worried about Greaney. He had led the most vicious smear campaign in the history of the internet (At that time! — This was nothing compared to what we have seen over the past 10 years) a few months earlier to drive the most popular poster at the board off of it (“Wanderer” had committed the terrible crime of noting that real estate can in some circumstances be a good investment) and I knew he was going to bring trouble. But what could he do, really? It was a numerical calculation. The numbers were wrong. Anyone who cared to could check the study to see whether it contained an adjustment for the valuation level that applied on the day the retirement began or not. So I was safe.
That particular joke was on me, eh?
You don’t want to prove a point too conclusively. If you kinda, sorta prove a point, the people who made the mistake can save face by saying things were not always so clear. The error in the Old School SWR studies was so painfully obvious to all that it just couldn’t be acknowledged. No valuation adjustment? Huh? With 30 years of research showing that valuations matter big time? And this wasn’t a mistake relating to just any old issue. This was a mistake that was likely going to cause millions of middle-class people to suffer one of the worst life setbacks imaginable in days to come. This was a BIG mistake.
I was thinking logically. I was thinking that, the more obvious a mistake is, the more critical it is that it be corrected promptly. And I was thinking that, the more damage a mistake does, the more people will see the need to get it corrected. I’ve learned my lesson. It works just the other way around. If this had been some little mistake that was sort of hard to understand, Greaney would have corrected it in 24 hours. No one wants to have people discover a mistake like that. He would have thanked me for letting him know about the mistake before it caused more human misery. Humans don’t like to correct the sorts of mistakes that cause millions of failed retirements. Those we seek to cover up. And, when millions of us have made the same mistake (a failure to consider valuations when setting our stock allocations), the humans can get away with a cover-up for a long time. Not forever, I hope and I pray. But for a long time.
The proof is in the pudding, as Wade says. But the people on the peer review boards at the journals to which he submitted his breakthrough research responded to the discovery of the big mistakes they had made during the Buy-and-Hold Era in ways not entirely dissimilar to the way Greaney responded to the discovery of his big blooper. Wade’s not saying that the proof is in the pudding today. Today he is saying this valuation stuff is for the birds. He’s too busy with other projects to engage in that sort of research anymore. Pudding, Schmudding. The proof is in the popularity polls you win when you keep mum re the Get Rich Quick garbage you see destroying middle-class lives everywhere you turn.
Wade was always careful to share credit. He cited me in his article in the Journal of Financial Planning. He cited the Bogleheads Forum community. I think that’s super. I think he should get a lot of credit for that. He certainly never stole any of my thunder. He added to my thunder. He gave it a bigger sound. I am very glad that he overcame his nervousness. I learned a lot from him and had a lot of good times talking things over with him. I believe that he learned a lot from me too and that he enjoyed talking things over with me too. I have hopes of being the first person to shake his hand when he wins that Nobel prize and of taking him out for a pitcher of beer and a prime rib dinner afterward. We’ve both earned a good laugh at the craziness of the humans after we make it together (with you too!) to the other side of The Big, Black Mountain.
This blog entry contains a link to the “Foundations” section of John Walter Russell’s site. You should click on that one. I rank Shiller as the second most important figure in investing analysis, Bogle as the second most important and Pfau as the fifth most important. I rank Russell as the fourth most important. As the transition from the Buy-and-Hold Era to the Valuation-Informed Indexing Era continues and accelerates, Russell’s work will be getting a lot more attention. Why not be the first on your block to discover it?
47) Wade Pfau: “Yes, Virginia, Valuation-Informed Indexing Works!”
I like that. That’s a nice simple statement that says what needs to be said.
Wade never quite worked up the courage to say it just that plainly at the Bogleheads Forum. But he gets points with me for wanting to and for almost working up the courage to do it. The Lindaurheads are a scary crew.
More blah, blah, blah from Old Farmer Hocus.
This finding should be reported on the front page of the New York Times and on the front page of the Wall Street Journal. Once that happy day arrives, it’s all downhill sledding. Wade will always be the first credentialed researcher who reported this (John Walter Russell will always be the very first researcher to report it).
Please note that Wade also reports here that he was only able to find one research paper that found that long-term timing does not work and that this paper was filled with holes. The Stock-Selling Industry has spent so much money trying to persuade us that it is not necessary to engage in long-term timing (that is, that it is not necessary to consider price when buying stocks) that there are many investors who believe that there is a study somewhere supporting this claim. There is no such study. There never was one. There never will be one. The claim that “timing doesn’t work” or that “timing isn’t necessary” is 100 percent b.s. marketing mumbo jumbo. It is a self-serving claim pushed relentlessly by people who make money by persuading the rest of us to buy stocks regardless of the value proposition they provide. There has never been any other “idea” in the history of personal finance that has caused even a fraction of the human misery caused by this one.
Why have academic researchers been so reluctant to report on the 140 years of historical data showing that long-term timing is required of any investor hoping to have a realistic hope of achieving long-term investing success? Wade Pfau learned the answer to that one after he tried doing it and saw the reaction he generated among the most expert salesmen in the field. It’s not done.
Let’s change that! Let’s disrupt!
50) “This Is the Paper That Prompted John Walter Russell to Coin the Term ‘Idiot Switching’ “
Nothing too earth-shaking here.
When Wade was posting at Bogleheads, he felt pressured to post defamatory comments about me because of the “hostile environment” (his words) for discussion of the 30 years of academic research showing that Buy-and-Hold can never work. His real view, though, was that: “I definitely need to cite some of your work as the founder of Valuation-Informed Indexing, as I have not found anyone else who can lay claim to that. Shiller pointed out the predictive power of PE10 but never discussed how to incorporate it into asset allocation, as far as I know.”
We need to be kind. We need to be charitable. We need to reach out the hand of kindness to the Buy-and-Holders. But we always must keep in mind the distinction between being polite and being wimpy. Wimpy helps no one, least of all the Buy-and-Holders, who once possessed a genuine desire to make use of the academic research to help people live richer lives.
How do things that in theory should be so simple become so impossibly complicated in the flesh-and-blood world?
My web site is the only site on the internet that explores the implications of Shiller’s research on an in-depth basis.
Huh?
Too strange.
This is a money topic, people. There is no opportunity in repeating the stale marketing slogans of an earlier day. The opportunity lies in getting to where the puck is going to be before it gets there. Buy-and-Hold is going to be a dirty phrase on everyone’s lips after the next price crash sends us into the Second Great Depression. You want to be learning about and teaching about what comes next, not what is old and dried-up and dead.
Or so it seems to me, in any event.
The point made in this blog entry relates to a source of confusion that comes up often.
Arguing that Buy-and-Hold doesn’t work is like arguing that there are no ghosts. How do you prove it? Do you say “Look around you and, if you see no ghosts, that means there are no ghosts”? No one has ever seen a ghost. I take that as evidence that they don’t exist. But it doesn’t convince those who believe. Similarly, there has never been a single study giving anyone a reason to believe that Buy-and-Hold works. Long-term timing has always been required. There has never been a single exception. No one has ever seen the Buy-and-Hold ghost. But believers believe because they believe. You can’t prove a negative. I can show that there is zero reason to believe in Buy-and-Hold. But those who believe will always say that 140 years of historical data is not enough to prove the point. Paul Simon said: “A man hears what he wants to hear and disregards the rest.”
The mystery is — Why haven’t there been hundreds of researchers doing what Wade did long before he did it? Don’t they want Nobel prizes? I believe that they learned the same lesson Wade learned — it is career death to report honestly and accurate what the historical data tells us about what works in stock investing. Please don’t take anything I have reported about Wade to carry a suggestion that he is the only one ever to have walked the path he did. My take is that Wade was brave for a time and provided us with the most important research ever produced in this field. The only reason we know about his flip to the dark side is that we live in the age of the internet and the Goons are sufficiently brazen to post their threats in public places. Wade was wrong to flip. But he is not the only academic researcher who understands that this Buy-and-Hold stuff doesn’t pass the smell test. Not by a long shot.
Please see the next entry.
This is such an amazing and strange and revealing statement. Wade has a Ph.D. in Economics. Taylor Larimore is some guy whose expertise in this field is that he figured out what buttons you have to push to post stuff on the internet (like me!). And Wade is afraid to point out things that Taylor is saying about the ideas of the fellow for whom the board is named that are misleading. Huh? In ordinary circumstances, wouldn’t it be the fellow who does not have the Ph.D. who would be fearful of messing up and a bit deferential? It’s the guy who knows what he is talking about who is watching his p’s and q’s.
When stock prices rise to insanely dangerous levels, it is those giving the worst possible advice who rise to the top. It is only those who have little idea what is going on who are able to bring themselves to make a case for buying stocks when they are priced at three times fair value. When most of us are trying to persuade ourselves that it is okay to engage in what is obviously reckless behavior, it is those with the most irresponsible take who are the most sought out. Woe to those who possess the sort of expertise signified by the conventional meaning of the word.
Wade does his best Goon impression.
Did Greaney write that part about how he was the hero of The Great Safe Withdrawal Rate Debate? That one particular section doesn’t sound like Wade’s work to me. That one particular section sounds like Greaney’s work.
WhaChaGonDo?
This is more like it!
He sounds so smart when he’s praising me instead of the G Man!
I like that “no matter how I try.”
I’ve been saying things like that for 10 years. But does anybody listen to me? Nooooo.
But let some Ph.D. in Economics from Princeton say it and all of a sudden it’s front-page news.
Well — Not really.
But someday it might be.
The SWR changes with valuations. That wasn’t so hard to say, was it?
You next, John Bogle!
Then you, Bill Bernstein!
Then you, Larry Swedroe!
Let’s ALL say it! —
The SWR Changes with Valuations!
Let’s never, ever, ever forget!
That’s our Drip Guy!
I need to sober up. This is important. Why haven’t academics already published research about this? Getting you to ponder that question is the point of all this.
I provided a big clue in the title of the article. This field is 100 percent corrupt!
I don’t mean that there are not smart people doing good and important work. There are lots of smart people doing lots of good and important work.
I mean that there is one particular type of good and important work that 90 percent of the people employed in this field AVOID doing. They all go out of their way to avoid exploring the 30 years of academic research showing that there is precisely zero chance that a Buy-and-Hold strategy could ever work for any long-term investor.
And the work they avoid doing causes enough human misery to cancel out all the good achieved with the work they do. The research shows that the valuations factor is 80 percent of the investing project. Get that one right and it’s hard to mess up in the long term. Get that one right and it’s hard to do well in the long term. So I think it is fair to characterize a field in which 90 percent are avoiding that one as a field that is 100 percent corrupt in at least one important sense of the word.
We need to change this. For the middle-class investors. For the experts. For the Goons. For Wade Pfau. For absolutely everyone alive on the planet today.
We need to get valuations right. And the first step to getting valuations right is giving ourselves permission to talk about valuations.
Please do what you can. Talk to your neighbors. Talk to your co-workers. Talk to your friends.
Put up a post at Bogleheads.
Well, maybe not that last one.
I like you. I don’t want to see you thrown in the river with concrete shoes on your feet.
Just kidding around, Mel!
People don’t believe me when I tell them that paying attention to valuations reduces the risk of stock investing by 80 percent. That’s what the data shows. And it really does make sense that that would be the effect. With index funds, investing is easy. You don’t need to worry anymore about picking the wrong stocks. The only remaining risk is the risk that you will fool yourself. Cognitive dissonance is a killer. But — we now have P/E10. P/E10 identifies when the cognitive dissonance is out of control and you want to be extra careful with your retirement money. It’s like those signs that tell you the surf is too rough for swimming today. Those darn Buy-and-Holders have been pulling down the signs. We need to persuade them to stop doing that!
I think Wade is right about this. He stumbled into all sorts of truths about stock investing because he didn’t know what you are permitted to say and what you are not permitted to say. Then he submitted his research for peer review and found out. Now he says the right things. But the research he is doing now is not nearly as important or as helpful as the stuff he was doing before he got filled in on how The Club operates.
Wade is technically right about this. Deviate from VII at the worst possible time and you will get killed. That’s a pitfall. However, I think the concern is overblown. They aren’t going to be many people following Valuation-Informed Indexing strategies unless we open the internet up to honest posting. If we do that, everybody will be talking about it. Once we get enough people to learn the realities, there will never again be a major bull market. So investors of the future are not going to have to worry so much about getting in stocks or getting out of stocks at the right time. As more investors learn the realities, stock prices will stabilize. People are trying to evaluate how Valuation-Informed Indexing will work by looking at how stocks performed during the years before we knew about Valuation-Informed Indexing. This is a case where expanding knowledge CHANGES the realities of the subject being studied in a fundamental way.
People don’t understand why, if Valuation-Informed Indexing is so great, no one discovered it before. It’s because it wasn’t possible as a practical matter to follow VII strategies until about 30 years ago. You cannot be a Valuation-Informed Indexing without access to index funds. Index funds only became available in 1976. And you would not know of the need to become a Valuation-Informed Indexer until Shiller published his research on the effect of valuations in 1981. From 1982 to 2000, we had a huge bull market. So no one was looking for a better way to invest than Buy-and-Hold. And Buy-and-Hold did not really start looking bad until the September 2008 price crash. So it has only been for about four years that people have even been open to consideration of a new model.
The reality is that we are the most blessed generation of investors who ever walked Planet Earth. We have opportunities to increase returns and diminish risks that were available to none of those who came before us. It’s good to be skeptical of new ideas. I favor the skepticism. But 10-year-long smear campaigns are carrying things a little too far! We need to stop wasting our time on the nonsense that the Goons bring to the table and get about the business of launching a national debate on the need to learn about the implications of Shiller’s research and on how best to make the transition from the Buy-and-Hold Era to the Valuation-Informed Indexing Era.
67) “It Is Buy-and-Hold That Always Shows Promise for a Time and Then Is Shown Not to Work”
My pet peeve is how people insist that Valuation-Informed Indexing be shown to be perfect in every possible way before it can even be considered while adopting Buy-and-Hold as a default strategy. There is no research supporting the idea that long-term timing is not required. Zero. Zilch. Nada. The idea that it is okay not to look at the price of stocks when you buy them is the most sick and twisted and depraved marketing pitch ever advanced on the American public. If you weigh the pros and cons of Buy-and-Hold and elect to go with it, that is of course fine. But no one should go with Buy-and-Hold as a default. It is certainly not an approach with intuitive appeal. Name one thing you can buy in this Consumer Wonderland of ours for which you don’t need to look at price before putting money on the table.
Valuation-Informed Indexing should be the default. Valuation-Informed Indexing at least does not defy common sense. It should be the Buy-and-Holders who are held to a tough standard when they try to sell us on the idea that Wall Street is solely looking out for our good when they spend hundreds of millions of marketing dollars trying to persuade us that it is not necessary to consider price when buying stocks.
I was proud of Wade to see him push back against Mel’s intimidation tactics.
69) “Just Don’t Forget to Consider Taxes Next Time, You Big Dummy!”
When I’m happy, I joke around.
Amazing. But that is indeed what the data says.
The adverb is “always.”
When he did the flip, he said that it was Drip Guy who persuaded him.
If it were just the data, the case would not be nearly as strong as it is. What makes this so compelling is that the data shows us that what our common sense says must be so really is so. You would expect stocks to ALWAYS provide a better long-term value proposition when they are well-priced than they do when they are poorly priced, wouldn’t you?
The “New School” term actually comes from Scott Burns. Scott disparaged me for using it. But it was Scott who came up with the term and used it in his column. I don’t make this stuff up!
Do you see how the game is played? Members of The Club protect members of The Club. The middle-class investor has no one looking out for his interests.
We went in a flash from the story being that the Old School studies are so obviously correct that anyone asking questions about them must be banned from the internet to the story being that the Old School studies are so obviously wrong that there is no purpose served by research being done on any safe withdrawal rate question regardless of the methodology used. I wonder why.
Please see the next item.
I very much liked how Wade handled this one. He didn’t say that he agreed with me that he was challenging Modern Portfolio Theory. On the surface, that sounds odd. He has a Ph.D.. in Economics from Princeton. He should know for certain whether his research challenges Modern Portfolio Theory or not. But I give him a pass on that. The reality is that his research is obviously challenging Modern Portfolio Theory. But Wade had a hard time taking that in because it is a pretty darn shocking claim regardless of how obviously true it is. Given that he wasn’t prepared to accept the obvious reality, Wade could have rejected outright the possibility that his research challenged Modern Portfolio Theory. To his credit, he didn’t do that. He said: “I think.” InvestoWorld would be a better place if more of the experts approached these topics with that sort of humility.
He also added a phrase saying: “But often you end up persuading me to your points.” That reveals an open and curious mind. John Walter Russell said similar things about me. He said that he often started out thinking that a point that I was making was not that big a deal and would be surprised when I would not give up on the point. But then over time he would see that there was an important insight to be generated by exploring the matter at issue on more depth. I ain’t no investing expert. But I possess some sort of skill that is desperately needed in this field at this time. The word that I would use to describe it is to say that I am “methodical.” I like to work my way step by step through a logic chain. The mistake that the Buy-and-Holders made was to jump to conclusions. This stuff is important enough that we need to proceed with caution and be sure to get it right.
We need to get back to basics.
80) “I Also Have a Problem with the ASSUMPTION (That’s All It Is) That Buy-and-Holders Will Stick With Their High Stock Allocations in the Face of Big Losses…I Have NEVER Seen Any Research Showing That Buy-and-Holders Have Been Able to Hold Through a Complete Bull/Bear Cycle”
I would be grateful if someone who believes in Buy-and-Hold would put forward the name of one person who stuck to a high stock allocation through an entire bull/bear cycle. Has there ever been a single investor who actually pulled this off?
Hint: At the top of the bull, stocks were priced at three times fair value and prices always drop to one-half fair value by the end of the secular bear that always follows a major bull. Going from 3x to .5x translates into a loss for the investor of 5/6 of his accumulated wealth of a lifetime. The investor who had $600,000 in his portfolio at the top of the bull would have $100,000 in his portfolio at the end of the bear market. How many middle-class investors can afford to take that sort of hit?
Buy-and-Hold sells like hotcakes. Responsible people need to start asking: “Is this strategy even a tiny bit realistic? Is there any chance whatsoever that there will someday come a time when it will work in the real world?” (Buy-and-Hold has caused a wipeout of all the investors following it on each of the four times in U.S. history on which it has become popular.)
I don’t agree with Wade re this one. I think it is entirely fair to assume an emotionally balanced response to stock price changes from Valuation-Informed Indexers while assuming shock and panic on the part of Buy-and-Holders. Why? The entire purpose of Valuation-Informed Indexing is to prepare the investor emotionally for price changes to come. When you expect prices to crash (all Valuation-Informed Indexers knew the 2008 price crash was coming by looking at the P/E10 level), you do not respond with panic and shock to seeing your expectations fulfilled. Buy-and-Holders respond with panic to price crashes because they do not identify the long-term return associated with the P/E10 level at which they are entering their investment before putting money on the table. To ignore the emotional edge possessed by Valuation-Informed Indexers is to ignore the primary benefit of following the research-backed approach.
82) “It’s the Most Extraordinary Thing I Have Ever Seen. The Moon Landing Is a Very Distant Second.”
Every single person alive today (including our friends in The Stock-Selling Industry) benefits from us bringing the economic crisis to an end and helping the millions who were taken in by the Old School retirement studies and by showing people how to obtain far higher long-term returns while taking on dramatically less risk. And we have not been able to agree to permit honest posting on the internet re what the last 30 years of academic research says for 10 years now. Yowsa!
Those darn humans will do it to you every time!
No one can do quality work when he is living in fear of what others will say about him if he expresses his true thoughts. We shouldn’t want to see Wade living in fear. We shouldn’t want to see Bogle living in fear. We shouldn’t want to see Buffett living in fear. We shouldn’t want to see Bernstein living in fear. We shouldn’t want to see Bennett living in fear.
I look forward to the day when I can wake up in the morning, turn on my computer, click to any investing board or blog, and offer my sincere views on whatever topic is being discussed there that day. I look forward to the day when all my fellow community members — both Buy-and-Holders and Valuation-Informed Indexers — are doing that. That’s the sort of world that I thought I lived in on the morning of May 13, 2002, in the minutes before I clicked “Send” on my post pointing out the errors in the Old School safe withdrawal rate studies 10 years before any of the “experts” in this field dared to talk about them publicly.
Wade is probably not wrong that his career will suffer in the short term if he shares with us his honest views on stock investing, as informed by the research he has done on the dangers of Buy-and-Hold and on the obvious superiority of Valuation-Informed Indexing. It’s not fair.
The human misery that millions of us will experience if we fall into the Second Great Depression will not be fair either.
There shouldn’t be a site that focuses on intimidating people who post honestly so that Buy-and-Hold can survive another week, another month, another year.
The Greaney site survives because lots of Buy-and-Holders don’t feel the shame over it that they would feel if their belief in Buy-and-Hold were a confident and real one.
86) Academic Researcher Wade Pfau: “You Probably Shouldn’t Mention This (An Article Linking to The Retirement Risk Evaluator) for Awhile, Or Else Those Guys (the Greaney Goons) Will Send a Bunch of Nasty E-Mails to the Journal of Financial Planning Editors”
What can you say?
For years following my May 13, 2002, post, the idea was to say that it was not 100 percent clear that the Old School studies got the numbers wildly wrong.
That one no longer sounds viable today. So the new company line is that we don’t need safe withdrawal rate studies.
We need safe withdrawal rate studies. People putting together a retirement plan need to have some idea of whether they have saved enough to be able to retire or not. Safe withdrawal rate studies, done properly, serve an important purpose.
I don’t want the Goons working behind the scenes to derail me either. I don’t think anyone does.
Let us pray!
Yes.
And this was the common sense understanding in May 2002 as well.
So —
Why have the first 10 years of our discussions gone as they have?
It’s because Get RIch Quick investing strategies hurt us in serious ways. They encourage us to flee rational thought. That’s not an effective long-term investing strategy. It’s not a close call.
I was very happy to see Fred Flintstone say this. It is indeed a big deal. It’s positively huge. I look forward to finding our what Barney has to say.
Wade states things well here. Lindauer’s criticism is that 140 years of historical data is not enough for us to be certain that what it tells us is so. There is indeed some merit to that observation. But the further reality is indeed that, if we reject the 140 years of historical data, we have nothing to work with in trying to use the historical data as our guide to learning how to invest effectively.
Given that there is 140 years of data that supports Valuation-Informed Indexing and zero years of data that supports Buy-and-Hold, we should at least permit discussion of Valuation-Informed Indexing on the internet.
There is no downside.
Wade was very discouraged that his paper did not pass peer review. I obviously think the paper should have been published by the most important journal in the world. That said, I think this comment does a good job of identifying the key question. What is the ultimate criterion for one to conclude with confidence that one strategy is better than the other? That really is the issue we all need to grapple with.
My thought is that we could make more progress if we permitted discussion of the pros and cons of the two possibilities.
Nothing to add.
A lot of people find it hard to accept that I have been able to develop the Valuation-Informed Indexing concept despite my lack of “expertise” in this field. I think my lack of expertise gave me an edge. The textbooks in use today were all written by people with a belief that Buy-and-Hold can work. Reading a lot of textbooks that all say more or less the same thing influences a person. I never read any of those textbooks. I was able to come to the discussion with a fresh set of eyes.
It was a sign of dark days to come when Wade announced that he would no longer be doing research on valuations. Given his enthusiasm for Valuation-Informed Indexing, why would be make such a decision? He didn’t want to be a pioneer because he knows that pioneers take the most arrows. The problem is greater in this field than in any other because the non-pioneers in this field get paid such huge salaries. It’s easy to take an arrow when the alternative is a minimum-wage job. It’s hard to take an arrow when the alternative is a million-dollar-plus salary.
Right on, Wade! His research WILL win a Nobel prize. It may be that there will be a different name listed as the author of the paper that gets the award. But the new paper will really just be repeating Wade’s findings (which in turn were a repeat of John Walter Russell’s findings from a number of years earlier).
Nothing to add.
We all want to be able to retire earlier in life while saving less. Investment advice that tells us how to pull it off should be popular, no?
I know the answer. I am checking to make sure you know too.
Please take time to look at that graphic and to think through the implications a bit. I had hoped that Wade would prepare an entire research paper on this aspect of the question. The red line is real wealth. The blue line is phony, bull-market wealth. After the next crash, prices will be falling to somewhere near one-half of fair value (a P/E10 level of 7 or 8). That will put us in the Second Great Depression UNLESS we get people to look at this graphic and to take to heart its message. The graphic is showing us that all that is happening during a bull market is that we are borrowing huge sums of money from our future selves. Then, in the bear market that follows, we are paying off the debt we incurred. Buy-and-Hold Investing is like living on credit cards. It seems like such a cool idea until you notice after some time that for some funny reason you don’t seem ever to be getting ahead over time.
When prices fall to one-half fair value, the numbers on our portfolio statements won’t be any more accurate than they were in the days before the economic crisis. When stocks are priced at one-half fair value, the true value of your portfolio is two times the stated value. If we get the word out, people will not freak and we will not go into the Second Great Depression. If we keep pushing the Buy-and-Hold garbage, people will believe that the numbers on their portfolio statements are real and they will give up hope. We don’t want that! Even those dummies in The Stock-Selling Industry don’t want that. We need to figure out a way to work together and get this important message out to people. Nobody wins when the economic goes into a Second Great Depression.
I’m sure!
Wade went from jumping around like a kid on Christmas morning when he discovered Valuation-Informed Indexing to twisting himself into logic pretzels to come up with ways to phrase things in sufficiently obscure and unclear ways as not to alarm the Buy-and-Holders too much. I will not report on academic research that shows us how to reduce the risk of stock investing by 80 percent. I will not apologize for being the person who developed the investing strategy that permits all middle-class investors to retire five to ten years sooner than what they thought possible during the Buy-and-Hold Era.
I have a funny hunch that, when we stop apologizing for our breakthrough findings, more people will come to appreciate how exciting they are. Has any girl every married a guy who apologized during his proposal for the life he envisioned they would experience together? If the people who endorse Valuation-Informed Indexing don’t show enthusiasm for it, how can we expect those who have not studied the data themselves to favor it over Buy-and-Hold? No Buy-and-Holder ever apologized for his favorite investing strategy. I believe that the Buy-and-Holders have caused great human misery. But there’s one complement I can offer to my Buy-and-Hold friends without hesitation — the Buy-and-Holders fight for what they believe in. Good on them!
People close their mind to it because it is market timing. That’s a true fact.
The answer is not to deny that it is market timing or to try to fool people into thinking that it is something other than market timing by playing word games with them. People are not stupid. They catch on to that sort of thing. We are not going to make the transition from Buy-and-Hold to Valuation-Informed Indexing by pretending that there is nothing wrong with the Buy-and-Hold claim that timing doesn’t work and that Valuation-Informed Indexing does not really involve market timing.
Valuation-Informed Indexing is market timing. That’s the magic. That’s the thing that makes it work.
Buy-and-Hold doesn’t work. It is the purest and most dangerous Get Rich Quick scheme ever concocted by the human mind. The reason why it is a Get Rich Quick scheme is that it does not call for market timing.
Market timing is not a bad thing. It is a very, very, very good thing. Market timing is paying attention to price. If you don’t pay attention to price, you are a fool. There is zero chance that a market can function effectively once large numbers of people come to believe that paying attention to price (market timing) might not be required.
It was the Buy-and-Holders who discovered that short-term timing doesn’t work. They have been proven right re that one. It was a huge advance to learn that. The finding that short-term timing never works is the second most important finding in the history of investing analysis. We should all give the Buy-and-Holders huge credit for putting this one forward.
But we must never permit the gratitude we feel to them for putting forward the second most important finding in the history of investing analysis to lull us into thinking that it might be okay to ignore the first most important finding in the history of investing analysis — that long-term market timing is essential for any investor hoping to have any realistic chance whatsoever of achieving long-term investing success.
Short-term timing is bad. Long-term timing is good.
Is it really so difficult to understand that there are two critically important investment realities, not just one?
I said that to be nice. I believe that the blunt approach is best. My view is that, when you need to tell somebody something that is going to be unpleasant for them to hear (your retirement portfolio has a lasting real value of only one-third of what you today believe is its lasting real value), the thing to do is just to say it and get it behind you. Once the bad part is out of the way, the person can move on to good stuff. The full reality is that it’s a good thing that we now know that in 2000 portfolios were priced at three times their real, lasting value. Learning that means that we can avoid making the same mistakes in future days. It also means that we now know how investing really works and we can use that knowledge to set our stock allocations more effectively and thereby accumulate the assets we need to retire in a much shorter period of time.
None of the good stuff comes flooding in until you get the bad stuff out in the open. So my view is that it’s best just to say it clearly and plainly and boldly and be done with it.
Even the people who are most supportive of me don’t agree with me re this one. That’s why I bent over backwards to suggest to Wade that perhaps he was right and I was wrong. Perhaps that is so. I don’t believe it, however. All of my life experience tells me that the thing to do is to get the bad part of this out of the way as quickly as possible and thereby set ourselves up to enjoy the mountains and mountains of good stuff that follows from doing so.
This is a Goon-type word-game statement. Wade knows better than this.
Say that it is so that we cannot be really sure about valuations. I’m pretty darn sure. But we don’t know with 100 percent certainty that the moon is not made of green cheese. So I suppose that it would be fair to say that some of us do not feel today that we can be really sure.
We’re sure that the Old School studies get the numbers wildly wrong, are we not? There’s no doubt about that one anymore, is there?
So why don’t we correct the studies. I can see why those who do not feel really sure about valuations would not want to replace the discredited Old School studies with the New School studies. I cannot see why they would not want to correct the discredited Old School studies. We don’t necessarily need to replace them with anything. We could just say “it has been determined that these studies are in error and we are waiting to see what shall be offered to replace them.”
That would be saying what I think of as the second-best-choice Magic Three Words. The truly Magic Three Words that we need to hear Bogle say are “I” and “Was” and “Wrong.” If he said those three words in a speech and it was written up on the front page of the New York Times, that would launch the national debate we need to get on the path to overcoming the economic crisis and to get headed in the direction that will lead us over time to the greatest period of economic growth ever seen. But let’s say that Bogle just does not feel up to saying those words at this time. He can surely say the three words “I’m” and “Not” and “Sure,” no? That wouldn’t be ideal. Things would proceed at a slower pace if he said the backup Magic Three Words instead of the more obvious Magic Three Words. But it seems to me that the backup words would still get the job done.
If Bogle said “I’m” and “Not” and “Sure” and it were written up on the front page of the New York Times, it would be pretty darn hard for Lindauer to continue to argue that a ban on honest posting is needed at the Bogleheads Forum. And, once the ban is lifted, we would have hundreds of posters jump in and help us out on all sorts of topics. The crazy idea of speaking honestly on investing questions would spread and spread. My guess is that in not too much time we would be in the same wonderful spot we would have gotten to a bit quicker if he chose the more direct route.
I think the New School studies are the answer. I think The Retirement Risk Evaluator is the answer. But Wade says people are not 100 percent sure at this point. Okay. Shouldn’t we be looking into what is needed to get them to 100 percent? It seems to me that people need to talk over their concerns. That’s how we handle it in other fields of human endeavor when we have people who we need to get up to 100 percent sure who are not at the moment at 100 percent sure. So why not try that in the investing area? Why not talk it over?
We have enough experience in hundreds of other areas of human endeavor to know that talking it over is a good idea.
Nothing to add here.
I miss the old Wade. I loved that guy!
Wade said that I was being “too harsh” to demand that Bengen correct his retirement study after he publicly acknowledged that it gets the numbers wrong. He views my reporting that he said this as an “attack.” It certainly does not reflect well on him. But I want to report very different things. I want to report that Wade is leading an effort to get the Old School studies corrected. How can I report that unless he gets involved? I need some cooperation from the people I write articles about if I am to put them in the good light into which I very much want to put them!
How does life get so complicated?
My job today is to get the Ban on Honest Posting lifted so that good things can start happening for all of us. My job tomorrow will be to keep people from losing their heads when they learn how much the 10-year cover-up has hurt them. Under-reaction is the problem today. Over-reaction will be the problem tomorrow.
Wade doesn’t think the Trinity study is helpful for recent retirees. Why, then, does he not support efforts to get the study corrected? Shouldn’t the idea be to publish helpful retirement research?
This is an important point.
Wade has obviously behaved unethically.
But one of the ways in which we ordinarily assess whether behavior is unethical or not is by looking at standard industry practice. Would it not be fair to say that it has become standard industry practice during the Buy-and-Hold Era to behave unethically? I reported on the errors in the Old School studies on May 13, 2002. I have tried hard to get the studies corrected for 10 years. I have been able to bring about a consensus in the field that the studies are in error (even this was in dispute in May 2002). But I have not to this day been able to translate the virtually universal consensus that the studies get the retirements numbers wildly wrong into anything like a universal consensus that they should be corrected.
I think it would be fair to say that many in this field are suffering from cognitive dissonance.
Cognitive dissonance can be used to excuse the advocacy of Buy-and-Hold strategies, in my assessment. But can cognitive dissonance be used to excuse death threats or defamation or unjustified board bannings or threats to get academic researchers fired from their jobs for the “crime” of doing honest research?
These are questions that we are going to need to answer as a society. We will need to assess whether we believe that middle-class investors have a need to have access to honest and accurate and realistic investment research. I very strongly believe that we need to move in the direction of permitting honest research to be performed and published and widely promoted. My view is that honest posting on the internet should not only be permitted but widely encouraged.
But then I often forget to take my meds! Everybody knows it too!
It is certainly good to hear that Wade will be seeing to it that some discussion of the effect of valuations will be included in the Retirement Management Analyst Curriculum. I have concerns that the materials that he suggests to have included in the curriculum will not address the question in a sufficiently clear manner. The statement “Any retirement study that does not account for the effect of the valuation level that applies on the day the retirement begins is dangerous and needs to be promptly corrected” is clear. My sense is that this is the kind of statement that Wade does not feel comfortable putting forward today. A statement of that nature reflects poorly on those who participated or tolerated the 10-year-long cover-up of my discovery of the errors in the Old School studies and will thus be viewed today by some as “controversial.” I look forward to the day when it will be the labeling of such a statement as “controversial” that will be viewed as controversial!
Tens of thousands of businesses have failed in the Buy-and-Hold Crisis. Millions of workers have lost their jobs. Those people matter. Those in the investing advice field need to consider the effect of their advice on their readers and clients.
119) Academic Researcher Wade Pfau’s Responses to My Reporting of Out 16 Months of E-Mail Correspondence
124) Rob Bennett’s Responses to Academic Researcher Wade Pfau: #5 — “It’s So Implausible”
134) Rob Bennett’s Responses to Academic Researcher Wade Pfau: #15 — No Apologies?
138) Corruption in the Investing Advice Field (No Link Because You’re Reading It Now!)
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