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

And of course none of this matters because it’s the sophisticated Wall Street firms that set the prices. They’re not getting emotional. They’re making cold, hard, data driven calculations.

We disagree, Anonymous.

The sophisticated Wall Street firms take into consideration what the majority of investors believe in everything they do. They want to make money in the short term. If they didn’t care about the short term, they would be driven out of business by competitors. They are forced to consider what the majority of investors believe whether they like the idea or not. And most are probably fine with doing so, at least today.

I believe that there will be a change following the next price crash. I believe that at that time the Ban on Honest Posting will be removed and millions of ordinary investors will learn what the last 35 years of peer-reviewed research in this field says. The firms that you are speaking of will then of course take that into account in the decisions they make. And the textbooks used in the schools attended by the people who work at these fields will be updated to reflect the last 35 years of research. And so the Wall Street people will be more inclined to focus on the long term even when the majority of investors is not so inclined.

The fact that we are not there today does not tell us that we will never get there. Knowledge advances over time. The last 35 years of peer-reviewed research points to a very big advance.

And I don’t even a tiny bit agree with your claim that these Wall Street people are cold, calculating machines. They would like you to think that. They work hard to create that impression. The reality is that they are humans too and they have emotions like all the rest of us. They may well be better educated humans re this particular topic. But of course when the ideas in the textbooks they are working from were developed in an era prior to when the most important research was published, their educations count as a negative rather than a positive.

There is no such thing as a 100 percent emotion-free human.

That’s my sincere take in any event.

I naturally wish you all good things.

Rob

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

As you are so fond of pointing out, there are post archives:

“Rob says
December 5, 2014 at 6:03 am
You’ve asked me what I will do if there is not another crash within the next two years. I have said that I will write a column saying that that tells me that there is something wrong with the Valuation-Informed Indexing concept and that I will continue studying the matter to try to figure out what really works best.”

You have a month to draft and polish that column. Of course, you won’t. Attempting to type “there is something wrong with VII” would cause your fingers to snap off.

No, that’s not so.

I have an article at this site titled something like “20 Reasons to Have Doubts About the VII Strategy.” There IS something wrong with VII. The biggest thing that is wrong with it is that we have not had enough people study it in depth to have confidence in it. We need to have lots of good and smart people doing their best to find holes in it. That’s how we learn. I believe strongly that VII is the future of investing analysis. But am obviously biased and extremely so. I have invested 14 years of my life in this. Anyone who goes just by what I say is a darn fool. We need to have lots of people looking at this and seeking to poke holes in it.

I am not going to have that column up by the end of this year. But I do have a column like that in my list of future columns. So it will probably come out in the early part of next year. My tentative title is “The Odds That We Will See Another Crash By the End of 2007 Are Now Less Than 50 Percent.” There’s only a small bit of time left in 2016. So I pretty much rule out the possibility that the prediction will be proven accurate. I now say that we should see the next crash “within the next year or two or three.” That takes us to late 2019. If you go ten years out from September 2008, you get to late 2018. I am adding an extra year to be extra careful that I do not flame out on yet another prediction. The odds are probably stronger in the first of the three years than in the last of the three years. So I think that it is probably so that the odds of seeing the crash in 2017 are a tiny bit less than 50 percent (even though 2017 is the most likely year of the three years).

Again, all of this DOES indeed show that, “there is something wrong with VII.” I am not disputing that. I am saying that VII is the best strategy that we can come up with given what we know from the research available to us today, nothing more and nothing less. We need to continue to advance in our understanding of these maters. We do that by talking things over, by exploring new ideas and confirming or refuting earlier ones and by performing new research. That’s just the standard way by which humankind advances in its understanding of things over time. We need to follow the standard procedures that apply in all other fields of human endeavor to the stock investing field as well.

That’s my sincere take in any event, X. I naturally wish you all good things.

Rob

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

Why is the entire historical record relevant?

Take a look at this article, Laugh:

http://www.politico.com/story/2016/11/nate-silver-huffington-post-polls-twitter-230815

Nate Silver gets it. Using data as a guide to understanding something leads to more uncertainty, not less. When we are ignorant of how something works, we can delude ourselves into a false feeling of confidence. Data helps us to overcome our subjective biases because it is objective, because it is real and not b.s. But there’s an unfortunate inclination to become overconfident about what data appears to teach, to stop thinking because of a belief that the data has answered all the questions. There are always new questions. Use data properly and you will never stop searching for new insights. The wonder of research is that it pokes holes in dogmatism. When you see people becoming dogmatic about what the data appears to show at one particular point in time, you know that those people are on the wrong track.

The Buy-and-Hold “idea” (that there is no need to exercise price discipline when buying stocks) has been crashing stock markets ever since the day the first stock market was put in place. In 1981, those awful days of human ignorance came to an end. A fellow who has since been awarded a Nobel prize for his amazing work provided us the piece of the investing puzzle that brought us to where we had long wanted to go — we now have a model for understanding stock investing that truly makes sense, that truly works.

Bogle got us close. He is a hero too. But Bogle is a gravely flawed hero. He got us close by citing the powerful insights developed through study of the historical return data in the pre-1981 years. Then he let his ego destroy him. Bogle turned his back on all the good work he had done up to that time when he elected in 1981 not to launch a national debate as to what Shiller’s “revolutionary” (Shiller’s word) research meant for Buy-and-Hold but to instead go into cover-up mode and act as if the amazing finding that valuations affect long-term returns just didn’t exist.

Hence 35 wasted years in which thousands of people who could be helping us all to better understand this stuff instead live in fear of speaking in plain and understandable terms about what they really believe re stock investing. Hence 14 years of a Campaign of Terror against the Retire Early and Investing discussion-board communities in which dozens of boards and blogs were destroyed or compromised and in which those participating in the campaign have set themselves up for long prison sentences in the days following the next price crash. Hence an economic crisis that has already gone down in the books as the second worst in U.S. history and which has a good chance of taking over first place in the days following the next price crash, an economic crisis that has already brought on millions of job losses and which is likely to cause millions of failed retirements in coming days.

Not good.

I learned why the entire historical record is relevant from my good friend Jack Bogle. Read his work if you have any doubts.

I learned why honesty is important just from living life on this planet.

Valuation-Informed Indexing is the first HONEST research-backed investing strategy. It has all the advantages of Buy-and-Hold because it is rooted in research, just like Buy-and-Hold. But it avoids the huge disadvantage of Buy-and-Hold by incorporating HONESTY into the mix. VII isn’t a con. VII doesn’t cause economic crises or failed retirements. Valuation-Informed Indexers don’t need to surround themselves with Goon squads to make their case. We really have peer-reviewed research that supports our claims. VII is the real thing, not the marketing gimmick that Buy-and-Hold has become in the years since Bogle made his tragic decision to go into cover-up mode rather than to come clean about what the recent peer-reviewed research actually says about how stock investing works.

The historical record is what keeps us honest. The historical record is our protection against the con men who push smelly Get Rich Quick schemes on us for the purpose of turning a quick buck and who destroy millions of lives in the process. The historical record is where its at. Making HONEST use of the historical record is the future of investing analysis. Everyone in this field will be doing it once prison sentences for you Goons have been announced.

That’s my sincere take re these terribly important matters, in any event.

My best and warmest wishes to you and yours.

Rob

Set forth below is the text of a comment that I recently posted to the discussion thread for one of my columns at the Value Walk site:

Bogle didn’t need to change a thing. You continue to make it seem that Shiller is saying things he really hasn’t said. Instead, you say he is scared or holding back.

Just more of your fantasy world.

Of course you need to keep the fantasy going to cover up. Here you are just piling up lies after lies after lies, telling your poor family that you need to troll the internet all day long to save the world from an economic crisis, all to avoid having to go out and get a job to provide for your family. And all you can do is repeat the crazy claim to your family that you will be getting a $500 million windfall to make up for their years of suffering.

You get to the crux of the issue with this one, Sammy. My strongly held view is that Bogle needs to change EVERYthing he has ever said about stock investing. He got it ALL wrong. Not intentionally, to be sure. But still.

Say that there was an assignment given over the radio to add together the numbers 2, 3, and 8 but the line was bad and people only heard the 2 and the 3 and not the 8. So everyone concluded that the answer was “5.” Then someone got ahold of a recording and played the thing again without the static and determined that the answer really was “13.” But the group that had said “5” became too embarrassed to admit its mistake and continued for decades to insist that the answer really was “5” and then threatened to destroy the career of anyone who said otherwise. That would be a big mess. That’s what happened in our collective efforts to figure out how stock investing works.

The Buy-and-Holders turned stock investing analysis into a numbers exercise. They made something that used to be rooted in opinion and subjectivity into something objective and scientific. By itself that was a huge advance. If only we all were doing today what the Buy-and-Holders at one time said we should be doing, we wouldn’t be living through an economic crisis. But part of the scientific process is learning from one’s mistakes and this the Buy-and-Holders absolutely refuse to do. So the many people who want to give accurate and honest investing advice feel too intimidated by the smear tactics employed by the Buy-and-Holders to speak clearly about what they really know. Not good!

Bogle’s mistake is the biggest mistake ever made in the history of personal finance. Bogle saw Fama’s research showing that short-term timing doesn’t work and jumped to the hasty conclusion that NO form of timing is required. Shiller was the first researcher to check long-term timing. He found that long-term timing ALWAYS works and is ALWAYS 100 percent required. That shouldn’t be even a tiny bit surprising. Long-term timing is price discipline. No market can function without price discipline. But lots of people were fooled by Fama’s research and, like the people who heard the numbers wrong because of a bad radio transmission, they have become too embarrassed by their mistake to acknowledge it. So we still hear people advocating the crazy Buy-and-Hold stuff to this day.

Failing to include the effects of valuations doesn’t cause your numbers to be a little off, Sammy. Valuations is BY FAR the biggest factor affecting stock prices. So those who fail to count valuations get the numbers WILDLY wrong. Every time. The Buy-and-Holders are wrong about retirement planning, they are wrong about asset allocation, they are wrong about risk management, they are wrong about everything. And the only way they can fix their mistake is to admit it. But that’s hard to do after covering it up for 35 years. So they are in a real fix.

That’s my sincere take, in any event. People tell me that I am a meanie for pointing out Bogle’s mistake. I don’t see it that way at all. As I mentioned above, I think of Jack as a friend. If I had destroyed millions of lives as the result of a mistake that I had made, I would want my friends to encourage me to come clean. That’s what I do for Jack, I encourage him to come clean. I see that as an act of charity. It is my view that failing to speak up about the mistake is an act of cowardice, not an act of charity.

I naturally wish you the best of luck in all your future life endeavors, my old friend.

Rob

Set forth below is the text of a comment that I recently posted to the discussion thread for one of my columns at the Value Walk site:

Investors overreacted to the banking crisis of 2008? Really?

Another joke of a column.

I wrote a full column explaining WHY I believe that investors overreacted, Sammy. You just engaged in put-downs.

If you don’t think that investors overreacted, why do you think prices moved so hard in the other direction in the following days? Did anything happen in the following days that could not have been anticipated all along as at least a reasonable possibility? I’m not able to point to anything shocking.

I acknowledge that things COULD have turned out much worse. I certainly don’t say that it was a lock that things would go as they did and that investors were thus being entirely irrational in assigning the prices they did. But, yes, I believe that, given the range of realistic possibilities, they overreacted and jumped to hasty and excessively negative conclusions that were then reversed in the following days.

And of course I believe that investors continue to evidence emotion to this day. I intend no personal dig by saying this but I believe that your comment evidences emotion. I think that everyone who writes or advises about investing should be looking for this sort of thing all the time and commenting on it when they see it.

I believe that most of the experts in this field don’t do that because they don’t see it as a good way to turn a buck. If someone tells you that you are reacting emotionally, you are less inclined to like him and thus less inclined to buy from him. But you are also left less able to invest effectively.

We need to know the realities to achieve our financial goals. The experts who flatter us are salesmen, not true experts. A true expert is someone who tells you what you need to hear even when it is not what you want to hear.

My take.

And my best and warmest wishes to you and yours regardless of whether we ever come to agree on these investing issue or not.

Rob

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

You wrote a lot of words. Most of it seems completely unrelated.

Fact: Middle class people using buy and hold would have had 7.9% return. But mysteriously they own almost no stocks, carry incredible amounts of debt, have shrinking job prospects and real incomes.

Conclusion: If it can be defined as a ‘problem’, which I disagree with, Buy and Hold is the 999th problem of middle class people.

Secondary conclusion: Because it is their 999th problem, Rob will never be successful because middle class people just won’t care as his crusade is not relevant to the things they need to solve first.

I didn’t study investing in school, Laugh. I never managed a mutual fund. I certainly don’t consider myself any kind of “expert” in this field.

It is AMAZING that I am today 14 years ahead of people like Bogle and Shiller and Bernstein and Swedoe and Pfau in my understanding of how stock investing works. There should be zero chance that something like that could happen. Zero.

But it DID happen. That’s the reality.

I didn’t want it to happen. I didn’t volunteer for the job. No same person would voluntarily take on the job that became my life’s work on the morning of May 13, 2002, and that remains my life’s work today and that will continue to be my life’s work until every investing discussion board and blog on the internet has been opened to honest posting on safe withdrawal rates and scores of other critically important investment-related topics.

It was a mix of factors that made all this possible and for me unavoidable.

First, there was the peer-reviewed research that for a long time and for lots of smart and good people really did appear to show the Buy-and-Hold is the answer. It’s not only Robert Shiller who has been awarded a Nobel prize for his work in this area. Eugene Fama got one too. His work is serious and important and exciting and those who follow his work are entitled to the same respect and deference as those who follow Shiller’s work. It is only by understanding the importance of Fama’s “revolutionary” (the word applies for Fama’s research as much as it does for Shiller’s) that one can come to understand all that followed.

Second, an entire industry developed around the promotion of what was then thought to be the first research-based strategy. This was on one level a very exciting development. John Bogle led the effort. Bogle took us from the dark ages when investing advice was mostly subjective and created the path toward development of the first true research-based strategy a number of years later. Bogle also created a company that made index funds available to everyone, making Shiller’s amazing findings of 1981 possible (the reason why Fama missed out on seeing the importance of long-term timing was that index funds did not exist in 1965 and thus it did not occur to anyone that it was even possible to practice price discipline when buying stocks — Valuation-Informed Indexing does not work for those buying individual stocks).

Third, Shiller provided his own revolutionary research, giving us all the missing piece to the puzzle that every last one of us deep in his or her heart has long wanted to see completed, the most important piece of all by far.

Fourth, Bogle and the other “experts” in this field fell victim to cognitive dissonance and thus elected not to explore the implications of Shiller’s amazing research. Because the issue is of such huge importance to millions of people trying to finance their retirements, they came to decide that the most ruthlessly abusive tactics would be needed to block millions from learning things that they very, very much needed to learn. How the heck could you keep Buy-and-Hold alive? Who the heck is going to follow a strategy that is marketed as research-based when the reality is that there are decades of peer-reviewed research discrediting the core ideas on which the strategy is based?

Fifth, the internet and the world wide web were invented. The web made it possible for ordinary people to report on what the peer-reviewed research says. Since the Buy-and-Holders had insured that not one person with expertise would dare to “cross” them by speaking with full honesty re these issues, the only way that word was going to get out is if someone like me would come along and just flat-out refuse to back down un the face of the worst intimidation tactics ever dished out in the history of the United States. This amazing new communications medium made all of the many hundreds of powerful investing insights that we have all developed together over the first 14 years of The Debate About Whether Or Not to Permit a Debate re the Last 35 Years of Peer-Reviewed Research in This Field possible. Thank the heavens for the good side of the Internet (this story shows its power to do good for millions in a very concrete and far-reaching way).

Sixth, I met thousands of people during the years when I was building the Motley Fool’s Retire Early board into the #1 most successful board in that sites history. It was the love that I felt for the thousands of good and smart people who helped me build that board that made me so unwilling to sell out my community (and ultimately my country) by giving in to the pressure tactics employed by you Goons.

Seventh, the fact that Shiller was permitted to publish his book despite the harm it would do to the profits of the Wall Street Con Men if it were taken seriously played a huge role. Without Shiller’s research, I could not have persuaded Wade Pfau that the dominant model was a big pile of smelly garbage and Wade and I would never have co-authored the peer-reviewed research that focuses on the how-to questions that Shiller elected to take a pass on so that his career would not be destroyed by the Wall Street Con Men and their various Internet Goon Squads.

Eight, I think it would be fair to say that God played a role in all this. I never could have done what I did without the efforts of John Walter Russell, a guy that I did not even know on the morning of May 13, 2002. John did the research that allowed us to create the five powerful and unique calculators that will be driving discussions of research-based investing strategies for many years to come. Wow! What are the odds that I would just happen to connect with a guy with an engineering background within weeks of the day that he resigned from his “real” job and was looking for serious and important work to devote his energies to in the remaining years of his life? This one gives me the shivers when I think about it.

Nine, we have the fact that I had created a Retire Early plan when I put up that famous post of the morning of May 13, 2002, that has permitted me thus far to stick to my vow not to agree to post dishonestly re these matters for 16 years since I gave up my full-time corporate employment. How many people can do something like that regardless of how deep their love is for both the subject matter and for their fellow community members? Beat that, you know?

Ten, I just happened to marry a wonderful woman who would “put up” with a husband sticking to his ethical principles while not bringing in a dime for those 16 years. My sense is that this one confounded you Goons more than any of the rest of it. The reason why Goons like you have come to exert a power on the internet so wildly out of proportion to the talents you bring to the table is that few men have such a fine woman standing behind them. Call me blessed! Good for Boo and good for me for having a dim sense that marrying the one with a deeply spiritual nature was the way to go when making a choice that would affect me and my children for many, many years to come. Yikes — it scares me to think of how I might have gone the wrong way with that one, it scares me to think that I might have easily been tempted to ruin my life and to thereby ruin the lives of those millions of middle-class investors whose retirements today are obviously at great unnecessary risk.

Eleven, none of this would have happened without the courage that we have seen evidenced by THOUSANDS of good people who worked up the courage to request that honest posting be permitted on at least one or two occasions. I don’t think that i could have continued this fight without the encouragement and support of those many fine, fine people. When people claim that the fact that you Goons have gotten away with your sick and twisted behavior for so long, I point them to the thousands who made serious efforts to stand up to you over and over and over again. Look at the risks those people took on and tell me that there is no good in the human race! If there were not millions of good people in world, we would not have the laws in place that we will be using in the days following the onset of the next price crash to put your Goon asses in prison for a long, long stretch of time (which is obviously something that all decent people can agree is the only right thing to do at this point in the proceedings and something that is very,very, very much required for our country to get back on track and to bring this horrible Buy-and-Hold Criss to a full and complete stop by the close of business today).

Twelve, we saw a glimpse of what the Buy-and-Hold Crisis will bring when it hits with full impact when our economic system collapsed in 2008 and when large numbers of people both on the left and on the right began to lose confidence in our political leaders as a result of their failure to take effective action either to precent the crisis or to cope with it in a meaningful way. We saw a number of brave community members work up the courage in those days to call out Mel Lindauer and Taylor Larimore on their long histories of abusive and violent behavior and on the mountain of lies that they have relied on to “protect” the smelly Buy-and-Hold “strategy” from effective questioning for so many years. These good and honest people show the course forward for all of us. It is by seeing what humans are capable of that we all rebuild our hopes for the future. Thanks for being the pioneers, guys! You are an inspiration!

Whew!

A lot of low-likelihood events had to be played out in concert for us all to make the progress that we have made in our transition from the smelly Buy-and-Hold garbage (according to 35 years of peer-reviewed research!) to the first true research-based strategy. All of this tells me that there really is a God up in heaven who loves us all, Laugh. I respect the views of those who believe otherwise. I get where they are coming from and I suppose that one could say that there was a time in my life when I was kinda, sorta in that camp myself. But I have a hard time accepting that this one-in-a-billion-chance saga played out as a matter of pure random chance. If a monkey can type out the words to “Hamlet” all in the right order, I suppose anything is possible. But this one is pushing it, in my assessment. I believe. Right or wrong, I believe at this point in the proceedings of my life.

I hope that helps a bit.

Sure, I expect to make hundreds of millions from this. Not because I see myself as some sort of investing expert. The idea that Rob Bennett is an investing expert is a sick joke.

I expect to make hundreds of millions because the job that I took on 14 years ago will in the days following the next price crash open up the way for thousands of true experts to share their honest views re what the last 35 years of peer-reviewed research shows us about how we all messed up in forming our pre-1981 ideas on how stock investing works. Bogle will be posting with full honesty once your prison sentence is announced, Laugh. Shiller will be posting with complete honesty once your prison sentence is announced. Pfau will be posting with full honesty once your prison sentence is announced. Lots and lots of others will be doing the same.

Why wouldn’t they? What possible motive would anyone have NOT to post honestly once your prison sentence was announced, once they felt that they could do it without seeing the lives of their loved ones threatened and their careers destroyed as their “punishment” for having “crossed” the lowest of the low living in our society? There are hundreds of billions of dollars to be made giving people accurate and honest investing advice in the first time in history in which it became possible to do so (the post 1981 years). I am 100 percent certain that all of the experts in this field will be posting with complete honesty once your prison sentence is announced and the experts feel that people of integrity are as welcomed in this field as they are in all other fields of human endeavor. We will have huge leverage working for us following the onset of the next price crash.

I will make the hundreds of millions of dollars that i have coming to me because I was the first to stand up to you Goons, not because of any particular investing expertise that I possess that is beyond the reach of any of the true experts working in this field. Bogle could have done what I have done had he not created a monster (multiple monsters really) by continuing to push the pure Get Rich Quick approach for 35 years after it was 100 percent discredited by the peer-reviewed research. It is the same with Pfau. It is the same with Shiller. And on and on and on.

Free the investing experts! Announce long prison sentences for the Lindauerheads and the Greaney Goons today!

My sincere take.

And my best and warmest wishes.

Rob

Set forth below is the text of a comment that I recently added to the discussion thread for one of my columns at the Value Walk site:

Yes, it makes a lot more sense versus running around calling people goons, making up stories about death threats, sending out 30,000 emails about Wade Pfau, calling Jack Bogle a con man, expecting $500 million windfalls, etc.

It’s a process, Sammy.

Shiller’s “revolutionary” (his word) finding that valuations affect long-term returns changed our understanding of how stock investing works in a fundamental way. It’s a huge advance. It’s good stuff piled on top of good stuff piled on top of good stuff. With now downside whatsoever.

So what’s the problem?

Really big advances are hard to accept. It’s a paradox. We all want to enjoy the benefits that come with huge advances in understanding. But the practical reality is that there are hundreds of thousands of people who make their living giving investing advice. When a fundamental advance is achieved, they are put in a tough spot. It makes them “look bad” to acknowledge to all the people they have advised that they got it wrong. This is a field in which “expertise” is highly valued. So the people who would have jumped at the opportunity to spread Shiller’s ideas had they not previously promoted very different ideas instead ignored them.

They have now ignored them so long (35 years!) that they feel a need to cover them up, to pretend that the finding that stock risk is not static but variable (that is, that all investors seeking to keep their risk profiles roughly stable are REQUIRED to change their stock allocations in response to big valuation shifts) is not such a big deal, that Buy-and-Hold might somehow work out okay for some despite the 35 years of peer-reviewed research saying otherwise.

Did I cause any of this? I did not. All of these realities were in place when I came on the scene in 2002. You are mad at the wrong guy.

Be mad at the humans, you know? The humans are the ones who suffer cognitive dissonance when huge advances are achieved and who try to delay realization of those advances for as long as possible. We are what we are. We are flawed in that we really do suffer from cognitive dissonance when faced with such circumstances and in that we really do engage in cover-ups that cause a lot of human misery. But please don’t forget that it is also the humans who come up with the huge advances that help so many to live richer and fuller and brighter and happier lives. Both things are so. We are mess-ups and we are heroes. Whachagonnado?

I’m going to continue to encourage a speeding up of the transition from the now discredited Buy-and-Hold Model to the first true research-based model for understanding how stock investing works — Valuation-Informed Indexing. I am excited re our future. This is the real thing. This is what Bogle had in mind when he came up with his first-draft version of a research-based approach. I want to see the guy realize his dream. So I am going to continue to do what I can to get the word out about what we have learned over the last three decades re what really works.

One of these days you are going to come around and join in the effort to get over The Big Black Mountain and to the place where deep in our hearts we all want to go. I hope it happens soon. The sooner it happens, the better for every single person involved. But, if there’s one thing that I have learned over the first 14 years of our discussions, it’s that you cannot rush a Goon. You are going to come around when you are good and ready to come around and not two seconds sooner no matter how much I long to see you (and millions of others!) enjoy all the good stuff waiting for you on the other side.

I naturally wish you all the best regardless of when you make your move or even in the event that you elect never to make it. Despite your nastiness, I have learned many important things by talking things over with you and I am grateful for the role you played in helping me out in that way.

My best and warmest wishes to you.

Rob

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

“You are right to suggest that I wasn’t persuaded by the advice that she offered. ”

I don’t recall you ever being persuaded by anyone’s advice.

That’s not even close to being so, Anonymous.

Just to cite the most obvious case, I was HUGELY influenced by the book that I read by Jack Bogle in the Spring of 1996. It was by reading Bogle’s book that I came to see the errors in the Old School retirement studies. Bogle wrote that: “Reversion to the Mean in an ‘Iron Law’ of stock investing.” If that’s so, then risk must be variable, not static. If risk is variable, then John Greaney’s retirement study, which says that the safe withdrawal rate is always the same number (4 percent) cannot possibly be right. It was by reading and thinking about Jack Bogle’s words that I came to construct and advance my famous post of the morning of May 13, 2002.

All of the “problems” that we have experienced over the past 14 years came about as a result of the way in which Bogle’s words persuaded me. I was very, very, very much persuaded by the obvious (at least to me) truth of this man’s words.

Bogle is only one case that I can cite. I was also persuaded by many of Shiller’s words. And I was persuaded by many of Bernstein’s words. And I was persuaded by many of Buffett’s words. And I was persuaded by many of Russell’s words. And I was persuaded by many of Arnott’s words. And I was persuaded by many of Smithers’ words. And I was persuaded by many of Pfau’s words. And, believe it or not, I was persuaded by many of Lindauer’s words and by many of Greaney’s words. Heaven help us all but I have been persuaded by many of YOUR words, Anonymous.

We are living in a day when two of the brightest lights in the field, Eugene Fama and Robert Shiller, who both have been awarded Nobel prizes for their work, have come to 100 percent opposite conclusions re the foundational question involved in figuring out how stock investing works. Fama says that the market is efficient. Shiller says that valuations affect long-term returns. One of these men is right and one of these men is wrong. It is not possible for the rational human mind to come to any other conclusion.

Fama got published first. These matters are of huge importance. If we were as a society to come to promote the wrong view of how stock investing works, we would see an economic crisis develop, possibly one worse that the First Great Depression. So we have been reluctant to acknowledge the mistake that Fama made in 1965 that did not become public knowledge until 1981. We have as a society been covering up that mistake for 35 years now, to the great misery of millions.

I have been persuaded by many people on both “sides.” I think Fama has made huge contributions and I think Shiller has made huge contributions. I have iINTEGRATED the huge advances achieved by both men into the Valuation-Informed Indexing model. VII is the first true research-based investing strategy. It is the first strategy that reflects not only the pre-1981 research but the post-1981 research as well.

You Goons hate me not because I do not permit myself to be persuaded by others. You hate me because I permit myself to be persuaded by those who have done research AFTER 1981 as well as by those who did research BEFORE 1981. You want to shut down discussion of the post-1981 research so that you never have to acknowledge having made a mistake by thinking that there could never be new insights developed once the Buy-and-Hold Model was introduced. I see science as a continuing process, not as something that is done once and that generates findings that are set in stone and never questioned from that point forward.

I am persuaded by MORE people than you, not by fewer. I love Eugune Fama. I love Jack Bogle. I also love Robert Shiller and Warren Buffett. I allow myself to be persuaded by figures working on both “sides” (I put the word in quotation marks because I find it silly to think of people engaged in a scientific endeavor together as being on different “sides” — we are all seeking to learn from each other or at least we all should be).

You hate those who offer new insights with a burning hate. You threaten to kill their loved ones as a way of shutting them up. You want to be persuaded only by one “side.” I love hearing the contributions of those on both sides. I am far, far, far more open to persuasion by others than you are. That’s why I have never stooped to advancing a single death threat or a single threat of career destruction. I know that issuing threats of that nature will limit the number of voices that I am exposed to in the future and I cannot bear to limit what I learn in that way.

What makes you a Goon is your hatred of learning new things. We all become defensive when our long-held beliefs are challenged. That’s human nature. But the laws of this country reflect our belief as a people that we need to resist the human weaknesses that tempt us to strike out in anger against those who challenge us and thereby help us learn. The reason why you are going to prison is because you have permitted your hate to get so out of control that you have blocked millions of middle-class people from being persuaded by the peer-reviewed research of the past 35 years.

My sincere take.

Rob

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

“Others still accept the call to serve their country when their country is in greater immediate need of their services.”

But I thought you just wrote that:

” So I have pulled back on my activities a good bit over the past few years.”

So what do you do everyday? Wake up and hope for a market crash so you can ‘get back to work’? Seems very sad.

I do lots of things, Laugh. Some are public. Some are not.

There’s a new blog entry here every day. Most of them are pulled from my conversations with you Goons. Most people think that it’s crazy that I even speak with you Goons, much less write blog entries about our conversations. I don’t agree with those people. I think that that belief is rooted in a belief in the Buy-and-Hold Model for understanding how stock investing works, which was discredited by Shiller’s “revolutionary” (his word) finding that valuations affect long-term returns. I don’t agree with their premise that the market is efficient and that investors are rational. I believe that investors are human and thus highly emotional. That changes everything.

I often call you Goons “Goons.” Most people don’t approve of my decision to do that. They say: “oh, it serves no purpose to do that, calling people names is never a good ida.” I certainly agree that “Goon” is a name and as a general principle I certainly agree that calling people names is not a good idea. But I believe that the circumstances that apply in this particular case are unusual and that that reality needs to be taken into account when someone writing in this field is debating whether to call someone a “Goon” or not. It is my sincere belief at this point in time (I hope that I remain open to other ways of thinking re this matter and indeed re all matters) that calling you Goons “Goons” is indeed a good and necessary thing. I do not believe that I can achieve my goals, which I believe are important and to a large extent unselfish goals, without referring to your Goonish behavior as “Goonish behavior.”

Goonishness is sin. The two concepts are essentially synonymous. When we commit sins, we are messing ourselves up. That’s why God doesn’t want us to commit sins. He loves us and he doesn’t want us to cause ourselves misery. We are tempted to sin because we are imperfect creatures not fully capable of appreciating what is in our best interest. God sees things that we do not see and advises us to avoid the dumb stuff that hurts us. He labels self-destructive behavior “sin.” He direct us to knock off the funny business when he sees us messing up our lives by committing sins.

The Get Rich Quick urge is a sinful inclination possessed by every human and therefore by every stock investor. Shiller showed that we can come close to making stock investing risk disappear by avoiding the sin of thinking that there might be some mystical, magical alternate universe where it is not required of us always to practice price discipline when buying stocks.

The entire history of the stock market supports Shiller’s finding. There is zero evidence going the other way. But there IS this sinful inclination to adopt Get Rich Quick investing strategies and there is of course a mountain of money to be made promoting Buy-and-Hold and so stock investing in reality has always been a high-risk approach to investing. That ended in 1981 when Shiller published his Nobel-Prize-winning research showing that risk is variable and that investors seeking to keep their risk profiles roughly constant over time need to always, always, always take price into consideration when buying stocks.

The peer-reviewed research that I co-authored with Wade Pfau shows that taking the one step of considering valuations when setting one’s stock allocation reduces risk by 70 percent. Everyone wants to reduce risk. So our research would in a purely rational world have been featured on the front page of the New York Times within one week of its publication in a peer-reviewed journal.

It hasn’t happened.

As you Goons well know.

Why?

It hasn’t happened because the reporters and editors who work at the New York Times are sinners!

That’s a funny way of putting it. I of course get that. But when you boil away all the verbiage, that’s what it comes down to. The reporters and editors at the New York Times are sinners. They are Goons. They are drawn to Get Rich Quick strategies. They think that Buy-and-Hold is the cat’s pajamas. They think that Rob Bennett fellow who keeps talking about those darn errors in those darn Old School safe-withdrawal-rate studies should just give it a rest already and get with the program. What does he think, that he is better than all the rest of us?

I don’t think that I am better than all the sinners, Laugh. I am a sinner myself. I believed in Buy-and-Hold at one point in my life. I possess a Get Rich Quick urge. I had my money in stocks prior to the Summer of 1996 and I got excited one year when I counted all my winnings and pondered what a smart fellow I was for following a Buy-and-Hold strategy and for counting the “gains” that I had “earned” as being a good bit greater than 6.5 percent real.

I am not better than everyone else. But I have been placed in circumstances in which I have become better able than anyone else to see with clarity how our Get Rich Quick sinfulness hurts us all and I have thereby been given the opportunity to help millions of middle-class investors as well as myself by writing in great depth about this terrible sin that has caused so much human misery for so long a time now.

That’s it. It’s my job to point out this sin and to steer people away from it. I don’t call it “sin” because that sort of language would turn people off even more than the term that I do employ — Goonishness. But that’s what it comes to.

Doctors tell people not to smoke. They do this because smoking is self-destructive; it causes human misery and doctors know this to an extent even more than most of the rest of us know it. It could be said that they are calling the executives at the tobacco companies names when they point out that smoking causes cancer, they certainly are not approving of the promotion of smoking when they tell their tale of how smoking causes an early death. But they soldier on. They see it as their jobs to help people maintain their health and they know from looking at the evidence that smoking is not the way and so they say what they say even though it probably does indeed hurt the feelings of tobacco company executives for them to say it.

It is my job to warn people of the dangers of Get Rich Quick investing strategies. Buy-and-Hold is the purest and most dangerous Get Rich Quick investing strategy ever concocted by the human mind. ALL of the peer-reviewed research in this field shows that the worst mistake that an investor an make is to fail to exercise price discipline when buying stocks and the Buy-and-Holders say that there might be some alternate universe where that is not necessary, that we should just take their word for it even though 100 percent of the evidence as well as common sense points in the opposite direction. And of course they make millions as a result of these lies they shove down our throats on a daily basis.

I don’t buy it, Laugh. I think that people need to hear the truth about what the peer-reviewed research shows. I see it as my job to tell that truth. So I do that.

I don’t spend my hours wishing for a price crash. I spend my hours thinking up more effective ways to tell these truths. People don’t like it when I use the word “Goons” and yet I need to point out the dangers of the pure Get Rich Quick mindset to be able to do my job effectively and so I need to call cancer “cancer” I spend my hours trying to come up with better ways of getting the job done.

That’s why I engage in conversations with you Goons. You are like all the rest of us in that you possess a Get Rich Quick urge that causes you to be attracted to the Buy-and-Hold Lies pushed so relentlessly by the Wall Street Con Men for profit. There’s something different about you, though. You don’t smoke a cigarette now and again, like some. You smoke four packs a day. You are the freakin’ addicts. You take the Get Rich Quick concept to places that it has never been taken before. You are willing to go to prison over it. Get Rich Quick/Buy-and-Hold is your life, your religion. You are strident about it. You are obsessed over it.

It is my job to try to understand better the roots of that obsession. I need to come to understand on a deeper and deeper level where the Get Rich Quick urge comes from and how it manifests itself and how the humans can go about the business of getting it under control. The behavior of you Goons can provide us all with clues as to the answers to those questions if only we go to the trouble to mine the insights.

It’s hard work. It’s emotionally draining. But it is the work that a loving God has directed me to do. So I work it as hard as I can. And then I let it go.

It doesn’t take me all day to craft the responses to your questions and comments that I post as daily blog entries here. But the writing of the words is only a small part of the job. There’s a lot more to it than happens behind the scenes.

I need to read books on investing and on psychology and on philosophy and even on religion to get the bottom of what is going on. Sometimes I need to go on walks to sort through things in my mind. Sometimes I need to talk things over with others. Sometimes I need to play songs that have something to say about these matters, sometimes several times before the insights that I am seeking kick in. It’s hard work.

That’s what I spend my time on. I aim to go deeper and deeper and deeper.

The results of these efforts are here for all to see. No charge. This is the wonder of the internet. I am not being sarcastic. I view this as a magical reality. I love the internet. Not the hate that you Goons bring to the table. But I am greatly excited about the power to do good that this new communications medium brings to the world.

Shiller showed that human emotion is 80 percent of the investing story. Before he came along, people thought that it was perhaps 10 percent of the story. Shiller opened up a new continent of insights for us all to mine together.

No one who came before me attempted to mine these insights to the full. Even Shiller only hinted at the possibilities. I have for 14 years now attempted to take Shiller’s “revolutionary” finding as far as it can be taken by the human mind. I build one insight on top of another, over and over and over again.

This requires looking at things that no one in this field has ever looked at before. Most investment advisors don’t bother to spend much time studying psychology texts or listening to songs. They think that I am a fool to do that. I think that they are fools not to do so. I see that stuff as being where the action is today. All of the non-emotional stuff has been studied in great depth. There are not many new insights to be developed looking at that stuff. But the emotional side of the investing equation is little studied. There is a wealth of insights to be mined looking at how investing truly works according to the last 35 years of peer-reviewed research in this field.

I spend my time going deeper and deeper re all the stuff that matter greatly but that has been ignored until now. You see the work product in my daily blog entries and in my weekly columns. But it takes a lot more time than what it takes to write the words to develop the insights advanced in the blog entries and in the weekly columns.

I hope that that all meets with your approval, my Goon friend.

Of course I am going to continue walking this wonderful path that I have found for myself whether it happens to meet with your approval or not. I like you. But I don’t aim to please you. I aim to please myself and the loving God who put me here and I of course aim to help the millions of middle-class workers whom that loving God also put here. It would make me happy to see you advance words of approval because it would make both of our lives go easier if you were to do so. But I don’t intend to let your decision as to whether or not to advance words of approval to influence my decision re what path to follow in any way, shape or form.

I wish you the best of luck in all your future life endeavors regardless of what path YOU choose to follow, my fellow traveller in this journey through the Valley of Tears.

Rob

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

So, if we take your comments from here as well as previous comments, here is an overview of what should have happened over the past couple decades if you were never banned from the various financial boards:

1. You would have been one of most popular posters (if not the most popular poster) on all the financial boards.
2. You would become one of the most sought after financial experts quoted by much of the press and would even have generated many front page articles on the New York Times (as well as various multi-series publications).
3. You would have been a headlining speaker at most major financial investing forums and other speaking events.
4. You would have been highly published in various peer-reviewed financial publications.
5. You would have possibly been considered for a Nobel prize.
6. Most people following the investment community would now be following VII, which would then lead to the healing of our economy and would then bring on the biggest economic growth we have ever seen in US history.
7. You would have become one of the most wealthy individuals in the US, resulting from speaking fees, book fees, investment advisory fees, etc.
8. You would be working together on a daily basis with Jack Bogle, Wade Pfau, Robert Shiller and a host of other financial experts, with you taking the leading role.

Did I miss anything?

You missed lots of things:

1) Bogle would be viewed as 20 times the expert that he is perceived to be today because his ideas would actually work in the real world — which is what he intended in the first place.

2) The internet would be a far more powerful communications medium because people who have important things to say about the subjects addressed at the various boards and blogs would feel free to post honestly and Goons like you would be banned when they violated the posting rules.

3) I would be getting feedback from all of the experts in this field and I would be able to use that feedback to sharpen my thoughts and my writings.

4) All of the experts would be getting feedback from me and from other Valuation-Informed Indexers and they too would be able to use the feedback to sharpen their thoughts and writings.

5) You Goons would not be headed to prison.

6) We wouldn’t be seeing the political unrest that we have seen in recent years on both the left and the right because our free market economic system would be delivering on its promises.

7) Support for our free market economic system would be growing because people would see that we have solved the problem of the boom/bust cycle.

8) The Retire Early Movement would be surging forward because we all would be spreading the word about the peer-reviewed research that I co-authored with Wade Pfau showing us all how to retire five to ten years sooner while dramatically reducing the risk associated with stock investing.

I can live with all that, Anonymous.

You can’t. Because you were taken. And because it hurts so much to be taken re a matter so important to your future that you cannot bear to acknowledge the obvious reality.

I am sympathetic. I know you are hurting.

But I am also sympathetic to the situations of the millions of middle-class people who ALSO have been taken in by this massive act of financial fraud. Lots of those people want to turn their financial situations in a more positive direction before it is too late to make changes (after the next price crash hits, most of their life savings will be gone and the Pretend Money is never going to return to them).

Those people have rights. I want to see their rights recognized. I want to see the laws against financial fraud enforced. I want to see you Goons placed in prison cells, where you belong.

I hope that all of that makes good sense to you.

It’s not personal. I do care for you Goons.

But I love my country too. And I want to see us all pulling together to bring this Buy-and-Hold Crisis to a full and complete stop by the close of business today. That’s the bottom line here.

I naturally wish you the best of luck in all your future life endeavors, my long-time Goon friend.

Rob