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

The lack of any supporting comments on this board speaks volumes, Rob. No, people are not afraid to post here as they would be anonymous.

The lack of supporting comments certainly tells us something important, Anonymous. You and I do not agree re what it tells us. But we are 100 percent in agreement that it is a telling reality.

You are of course correct that people are free to post anonymously here. So it is not that they are afraid that the Goons are going to come after them and kill their family members or whatever. That is not the sort of fear we are dealing with in this case.

We’ve talked about Joe Taxpayer recently. I have said that I would like to see more from him. He had been supportive. He opposes the Ban on Honest Posting. But I would like to see him go another step. I would like him to write a blog entry saying that he thinks the Ban on Honest Posting is a shameful thing and that all bloggers should oppose it. I would like him to try to organize all his blogger friends to speak up against this stuff.

Is Joe afraid? Yes, he is afraid. If he wasn’t afraid, he would do what I describe above.

He is not as afraid as some others. He worked up the courage to say that he believes the Ban on Honest Posting is wrong. He worked up the courage to call you Goons out on your nonsense. So he is less afraid than most. But he takes some steps and then he fails to take others. He is a hero. But he is not a perfect being. None of us are, of course.

I was afraid. I didn’t post about the errors in the Old School studies from May 1999 to May 2002. What do you think was up with that? It’s hard to believe today that I kept it zipped all that time, isn’t it? But I did. Why? What was I afraid of? I never dreamed that any of the Goon stuff that we have seen over the past 12 years was even remotely possible back in those days. But I never spoke up. Why? What held me back?

Humans are social creatures.

If you don’t get that, you cannot get any of the rest of it. That part is fundamental.

Bull markets are social phenomena.

You could never have a bull market if people were not afraid to speak up. We obviously had a huge bull market. So there obviously were a lot of fearful people. That’s by definition. You know that just by looking at the P/E10 level. When you have a P/E10 level of 44, you have millions of fearful people. You couldn’t have it any other way.

It’s not cartoonish things that people are afraid of. People are not afraid that you are going to come to your house and shoot them. People are afraid that they will be out of step with the majority. People are afraid that lots of people will think they are dumb. People are afraid that people will yell at them. People are afraid that, if they talk openly about another crash, that will somehow cause one to come. People are afraid that we are going to see a deepening of the economic collapse and don’t want to talk about it or hear about it because it scares them. People are afraid that there are groups starting to lose confidence in our political system. People are afraid that they will not have enough money to retire and that they will lose access to the comfort offered by the Buy-and-Holders if they think things through carefully and come to realize why those comforts are illusory.

People are afraid of all sorts of things, Anonymous.

Wade talked about it in the comments he posted here after his flip. He wrote one on which he said: “I don’t see how you are going to end up being seen as the good guy.” He said almost the same thing at the Bogleheads Forum. He said: “Some of you see anyone pushing market timing as a snake-oil salesman and you are disdainful of it. I don’t want you to think of me that way.”

He does’t want you to dislike him, Anonymous. That’s his fear.

I know how it goes. I don’t want you to dislike me either. The difference with me is that I have an even bigger fear of selling out my fellow community members. I feel that I am worthless to you and to everyone else if I do not post honestly. So I stick to that one no matter what. I don’t give an inch on that one.

My famous May 13, 2002, post ended not with a period but with a question mark. That was fear.

My apology on the night of Day Three was rooted in fear.

I held back for a long time from saying the words “analytically invalid.” That was fear.

I held back for a long time from saying that I know more about how stock investing works than Jack Bogle. That was fear.

I held back for a long time from saying that you Goons are headed to prison. That was fear.

It’s all about fear. There is no intellectual debate here. If you Goons believed that Buy-and-Hold could survive a civil and reasoned debate, you would invite a civil and reasoned debate. You don’t believe that for two seconds. You believe that Buy-and-Hold can survive only for so long as effective challenges to it are prohibited. That’s why you behave as you do.

You follow Buy-and-Hold yourselves. Following a strategy is a sign that you believe in it. You pass that test. There is a sense in which you believe.

But you do not possess confidence in the strategy you follow. It causes you great emotional pain to hear it challenged effectively. Confidence is another marker of belief. You fail that test. There is a sense in which you do not believe at all.

You are in the worst of all worlds. You believe enough that you cannot bear to listen to challenges. So you will stick with Buy-and-Hold until prices are at rock bottom. But you lack the confidence to continue holding when prices hit rock bottom and when every media organ is saying that no middle-class person should ever even consider putting money into stocks. The same social pressures that caused you to tune out the last 33 years of peer-reviewed academic research will cause you to sell your stocks when prices hit rock bottom.

That’s called capitulation. It’s when the last Buy-and-Hold Goon sells his shares that the market (that’s us!) is able to turn up again for an extended period of time.

You happened to be born at a time that led to you investing heavily in stocks at the worst time in history for doing that. You know it on one level of consciousness (while fiercely denying it on another). You are scared out of your freakin’ wits. So scared that you can’t even let it in that you are scared at all. And you will be even more scared after the next crash.

I didn’t do any of that to you.

I don’t say that the people who did it to you meant to hurt you. I don’t believe that. Those people are scared too.

I say that I am not playing my role if I don’t post honestly. I am saying that it cannot possibly be the right answer for me to agree to say things I don’t believe for two seconds.

And I wish you well in all your future endeavors, my old friend.

Rob

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

Didn’t a coach in the Financial Blogger audience tell you that you came across as bitter?

You are thinking of Jaime Tardy, owner of the Eventual Millionaire site.

I talked to Jaime at FinCon13 and told her I would like to hire her for help with spreading the word about Valuation-Informed Indexing. She asked me a number of questions about the VII concept and about my experiences spreading the word on it and all this sort of thing. She was in the audience when I gave my Ignite presentation (“How to Become the Most Hated Blogger on the Internet”). She said that she was sitting with a number of millionaires when I gave the talk (there is a video of the 5-minute talk at the home page of this site) and that a number of them offered the view that I was “bitter.” She didn’t say that she agreed with them (she said that she found my ability to stick to my guns in the face of such brutal opposition “inspiring”). But she said that she did not want to work with me unless I agreed to no longer engage with “the haters” (she was referring to you Goons).

I am certain that Jaime was shooting straight re what the millionaire bloggers said. I detected a coldness in the vibe in the room when I was giving my talk. My impressions are vague ones. But I think I am good at picking this sort of thing up and I obviously have a lot of experience watching reactions re this particular issue. I got a VERY positive reaction when they announced the title of the talk. People laughed and applauded, more than they had for any of the other speakers. I found that very encouraging. I felt at the beginning of the talk that I had the crowd in the palm of my hand. There was a second round of laughter and applause after I said the first few lines. And then I never heard any further reactions until the applause at the end of the talk (which sounded to me to be equal to that given all the other talks). There was never any booing. People were not hostile. But the reaction to the material following the title and the first few lines (my recollection is that the line that got people laughing a second time was a line about how I had been banned at 15 different places) was subdued. I no longer felt that I had the crowd in the palm of my hand as the talk progressed.

There was lots of powerful stuff in the talk, stuff that in ordinary circumstances would get people excited in a positive way. For example, I noted that I had produced with Wade Pfau research that shows millions of middle-class people how to reduce risk by 70 percent. The ordinary reaction to this would be for the bloggers to come up to me to ask how they could get involved in the effort to spread the word about Valuation-Informed Indexing all over the internet. Not one person has asked me that as a result of the talk (my e-mail address is available in the conference materials). That tells me something.

There were several people who came up to talk to me when the presentations ended. One was Joe Taxpayer. Joe ended up including me in his write-up re the conference and saying that you Goons should permit honest posting on Shiller’s findings. One of the other people who came up said that I should play up the “Most Hated Blogger” thing in all my marketing. I think that makes sense but I already do that to at least a limited extent. Another blogger congratulated me and then followed up with an e-mail following the conference (to which I responded) but has not yet done anything more than that. Another blogger said that I should send out lots of promotional materials noting that Shiller recently won the Nobel prize. I agree that that makes perfect sense. But I have zero confidence that that would help in the particular circumstances that apply in this case. People were not banning the discussion of Valuation-Informed Indexing because Shiller had not won a Nobel prize and the award is not going to change things in any significant way. The awarding of the Nobel prize is a small plus but not a game-changer.

There are no intellectual issues here. The intellectual case for Valuation-Informed Indexing is overwhelming. ALL of the evidence supports it and there is no evidence supporting Buy-and-Hold. The issues holding us back are all PSYCHOLOGICAL in nature.

The people who get it best are the academics to whom I wrote about the Wade Pfau matter and who came back to me saying that this is a case of the sort of paradigm change described in the book The Structure of Scientific Revolutions, by Thomas Kuhn. A society accepts small advances without too much trouble. It has a much harder time with big advances. This is a HUGE advance. It changes life in the United States forever for us to be able to reduce the risk of stock investing by 70 percent. It is of course a hugely POSITIVE change. But it is a huge change all the same. And as a society we are having a hard time accepting that this huge positive change is a real thing.

One of the academics told me that we either need to wait for the people whose careers were built promoting Buy-and-Hold to die or for a crisis. If Shiller is right (I obviously believe that he is), the crisis is coming within the next year or two or three. That should do it. The next price crash should shake people up enough that they will hear out people who go forward with the Valuation-Informed Indexing concept. Once we reach a certain acceptance level, support for Buy-and-Hold will collapse and VII will spread like wildfire.

The question is — Should we just wait around for that to happen?

My sense is that that is how Shiller and a lot of others have elected to play it. There are a good number of people who hint at a belief in VII but who hold back from a full endorsement of all of the amazing implications of Shiller’s research because they know that Buy-and-Holders will go nuts if they go public with them. I obviously don’t play it that way. I believe that responsible people should be doing everything they can do to help us AVOID another price crash. I also believe that, once people are ready to hear about VII, we need to have a record that people can turn to for answers to all of their questions about why it took so long for us to get to a good place. So I believe in continuing to knock on doors and on detailing the results of those efforts here at the blog.

People have a wall of resistance to hearing about this stuff. A good part of it is shame.

I call out the Wall Street Con Men all the time. But the full reality is that all that the Wall Street Con Men are doing is trying to make a sale. You complete a sale by forming an emotional connection with your reader. People love Get Rich Quick. Buy-and-Hold is pure Get Rich Quick. It sells like hotcakes. So the Wall Street Con Men love to use it. They go with what works.

The point here is that it takes two to tango. The Wall Street Con Men are conning us. They obviously know that there is this fellow Shiller who showed 33 years ago that valuations affect long-term return and that there is zero chance that Buy-and-Hold can work if valuations affect long-term returns. But they keep it zipped because their readers and their clients DO NOT WANT TO HEAR ABOUT IT. Mike Piper did not want to ban honest posting at his blog. He HATED the idea. But he sincerely believed that his readers would abandon him if he permitted me to continue posting there about the implications of Shiller’s research. I don’t know that things are quite as bad as he believes. But I do agree with Mike that he would have taken a big hit. For Mike Piper permitting honest posting would have meant earning less money from his blog, at least in the short run.

That’s not true just of Mike. It’s true of Motley Fool. It’s true of Morningstar. It’s true of Index Universe. It’s true of just about everyone. Buy-and-Hold is a marketer’s dream. It’s a Get Rich Quick approach that sounds responsible if you don’t study it too closely. Valuation-Informed Indexers tell people that much of the money in their retirement portfolios is not real, that it is cotton candy fated soon to be blown away in the wind. Buy-and-Hold is a Snickers bar and VII is spinach. VII is a hard sell compared to Buy-and-Hold until the next crash shows people where Get Rich Quick always takes everyone who follows it in the end.

This is a one-time thing. VII was impossible before 1981 because we didn’t have the research to support it. It didn’t catch on through 2008 because people were too happy with their phony bull market gains to be open to considering a new strategy. Since 2008, the door has been opened a bit. But it appears that it is going to take another crash to kick the door open all the way. Those are the realities that apply.

The next part is a little hard for most people to understand. But it is rooted in a psychological reality. People often know things that they are not willing to acknowledge they know. If you talk to an alcoholic about cutting back on drinking, he will deny having a problem. That’s not because he believes deep in his heart that he does not have a problem. It’s because he knows ten times better than you do how big the problem is and cannot bear to have you say the words out loud. The alcoholic is in deep denial. But he of course knows. That’s the story of the Buy-and-Holder. Every Buy-and-Holder has doubts about his strategy. Buy-and-Holders hate Rob Bennett because Rob Bennett spells out all the reasons why those doubts are legitimate. My stuff causes people to feel emotional pain.

The millionaire bloggers in the audience for my Ignite talk have probably followed Buy-and-Hold themselves and have probably recommended it to others. So my stuff made them feel shame. They are not ready to acknowledge what the research says. So they need some psychological defense. They felt that my presentation was too compelling to argue against it on substantive grounds. So they attacked it on process-oriented grounds. I wasn’t wrong. I just was too “bitter” about the fact that the ideas haven’t caught on yet. I deliberately chose images for the slides that focused on the soft, funny side of things. There was nothing even a tiny bit bitter about my presentation. That assessment was employed as part of a psychological defense.

We are making progress. I wouldn’t have been permitted to give the Ignite talk a few years ago. Now I am able to do that. Now I can get guest blog entries posted at lots of places. There are more and more people expressing doubts about Buy-and-Hold every day. But, yes, as of today there are smart and good people in this world who are going to respond by saying that I am “bitter” when they hear my presentation. Jaime was shooting straight with me and reporting on the reality that applies today. I liked the idea of working with her. I think that she could provide something that I am not able to provide. But I at least learned something as a result of my association with her and I am of course grateful for that.

I hope that helps a bit, Trebor.

Rob

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

“PERMITTING HONEST POSTING.”

Can you please define what you mean by that. I am unaware of any topic that has not been discussed.

That’s a good question, Anonymous.

What’s honest for you is not the same as what is honest for me.

You believe in Buy-and-Hold. So you can put up a post saying “a high stock allocation makes sense today” or “there’s no reason to believe that we are going to see another price crash over the next year or two or three” or “the Old School safe-withdrawal-rate studies provide a reasonable guide for what withdrawal rate to use in your retirement plan.” All signs are that you believe these things. So for you it is honest to say these things.

I do not believe these things, as you know. So for me it is obviously not honest to say these things.

You represent something close to the farthest extreme on the pro-Buy-and-Hold side and I represent something close to the farther extreme on the anti-Buy-and-Hold side. The vast majority of posters at every investing board and blog hold views somewhere in the middle of those held by you and me. There are many more who hold views closer to what you believe than there are who hold views closer to what I believe.

We all should be saying precisely what we believe. A board in which every poster says precisely what he or she believes is a board at which honest posting is permitted. A board in which some hold back because they worry about what will be said about them or done to them if they express their sincere views is not an honest board. Such a board offers those listening in to the conversations held at it a false impression of what the community believes. Any board at which people on one side of a spectrum of beliefs feels disinclined to state its sincere views is a dishonest and corrupt enterprise.

You post honestly already (except when you are trying to get someone kicked off a board and you use deception as one of your tactics). When I post honestly, I am banned. Others who share my views see that and refrain from posting honestly so as not to be banned. You see that few are posting in support of me and you conclude that few support me. But this is a false conclusion. At times when there were not Goons like you engaging in wildly abusive posting practices or when those abusive practices had not been going on long enough for people to realize how great the penalty would be for posting honestly, there were many community members saying that I had started the most exciting series of discussions ever held at any of our board or blog communities. When threats were made to kill family members of any posters who showed interest in discussing the last 33 years of peer-reviewed academic research, those posters either left the board altogether or stopped posting on the subjects re which they had learned that honest posting would not be tolerated by the Goons and by the site administrators.

Here are some topics that are not discussed regularly at the boards and blogs that have banned honest posting:

1) The question of whether it was the promotion of Buy-and-Hold strategies that was the primary cause of the economic crisis;

2) The fact that the Wall Street Journal and the Economist and Smart Money and numerous other big-name journals have published articles in recent years saying that Rob Bennett was right all along in what he said about safe withdrawal rates way back in May 2002;

3) The question of why it took so long for these journals to acknowledge that the numbers in the Old School safe-withdrawal-rate studies are wildly off the mark;

4) The question of what is the ACCURATE (that is, valuation-adjusted) safe withdrawal rate;

5) Why the research that I co-authored with Wade Pfau that shows millions of middle-class investors how to reduce the risk of stock investing by 70 percent has not yet been written up on the front page of the Wall Street Journal;

6) Why Jack Bogle has not taken action against Mel Lindauer and those who have posted in “defense” of him even though he has been made aware of the tactics employed by Lindauer at a discussion-board community that bears Jack’s name;

7) Why Jack says that investors only need to change their stock allocations by 15 percent at times of insane overvaluation even though the last 33 years of peer-reviewed academic research in this field shows that the difference in return that results when we go from the sorts of valuations that applied in 1982 to the sorts of valuations that applied in 2000 is 16 percentage points of return per year for ten years running;

8) Why Wade Pfau felt that his career would be destroyed if he continued doing honest research, research that believed to be the most important work he had ever done in his life, research that he thought was worthy of publication in the Journal of Finance;

9) Why following Buy-and-Hold strategies makes investors so darn emotional; and

10) Why Buy-and-Holders say that they agree that valuations matter but are unable to point to a single change they have made in their investing strategies as a result of the “revolutionary” (Shiller’s word) findings of the past 33 years of peer-reviewed academic research published in this field.

And the list goes on and on and on and on.

Shiller changed out understanding of how stock investing works in a fundamental way in 1981. We can never put the genie back in the bottle. Buy-and-Hold was once thought to be the first research-based strategy. We now know that the research never supported Buy-and-Hold, that the belief that it did was mistaken. I didn’t create that reality. That reality was in place long before I came on the scene. What I did was post in accord with that reality. I believe that Shiller’s research is legitimate and so I naturally only believe things about stock investing that are logically consistent with Shiller’s findings. Buy-and-Hold is not logically consistent with Shiller’s findings. Shiller showed that all investors MUST change their stock allocations in response to big shifts in valuations to have any hope whatsoever of keeping their risk profiles roughly constant.

Millions of good and smart people believe in Buy-and-Hold today. That’s so beyond any reasonable dispute whatsoever. That’s why we see friction on the boards and blogs when someone like me advocates Valuation-Informed Indexing strategies. If Shiller is right, Buy-and-Hold is the most dangerous strategy ever concocted by the human mind. It hurts Buy-and-Holders to hear that. It scares Buy-and-Holders to hear that. it enrages Buy-and-Holders to hear that. Many site owners don’t want the majority of their community members to be hurt and scared and enraged. So they go along with demands made by the Buy-and-Holders to ban further discussion of the findings of the last 33 years of peer-reviewed academic research.

That is not the answer!

It’s a temporary answer. It brings an appearance of peace to the board community filled with upset Buy-and-Holders. But banning discussion of the research ultimately only prolongs the agony. Buy-and-Hold doesn’t work! It has never worked for a single long-term investor! Not once in 140 years! The research that I co-authored with Wade Pfau shows that as clearly as it can possibly be shown. There are no two “sides” to this debate. We are all on the same side. We all want to see an end to this economic crisis. We all want to see our retirement plans survive. We all want our nation to enter the greatest period of economic growth ever seen in our history. We all want our board and blog communities to be non-corrupt and honest and helpful.

The question here is not whether honest posting should be permitted or not. Our social norms DEMAND that honest posting be permitted (just as our social norms demanded in the early 1960s that the laws that forbid people with black skin from drinking at the same water fountain as people with white skin be repealed). We are not a people that feels comfortable banning honest posting on important public policy questions. And how we invest is a critically important public policy question given that the false understanding of the question that applied prior to 1981 has now caused four economic crises, including the Great Depression.

We need to all reach 100 percent, total agreement that honest posting is going to be permitted at every investing board and blog from this day forward. Then we need to agree to processes that will help us all live with that decision.

There are sensitivities here. The Buy-and-Holders do not want to go to prison for having committed financial fraud. The Buy-and-Holders do not want to be held liable for financial damages for the millions of failed retirements they have caused. The Buy-and-Holders get upset when confronted with numbers showing that they have made a horrible mistake with their investing strategies. The concerns that Buy-and-Holders feel re these sorts of questions need to be addressed if we are to move forward.

I cannot address those questions on my own. These are public policy questions and they can only be addressed by the nation as a whole. Perhaps we will have Congress adopt some sort of amnesty for things that were done at earlier times. I simply cannot say. There has to be a national debate on these questions for us to figure out as a nation how to proceed. People like Jack Bogle and Robert Shiller obviously need to be involved in that debate. I can offer my thoughts. But this is not a matter that is going to be decided by any one person or any small group of persons. Every one of us has been affected by what has happened and every one of us has to have a say in the resolution.

We need to see responsible people taking responsible steps. That’s the bottom line here. When Bogle gives his “I Was Wrong” speech, that is going to change things in a big way. Once Jack gives that speech, people are no longer going to be afraid that they are going to be sued by the Wall Street Big Shots. That will cause a lot more people to speak out. Once Bogle gives that speech, people like Lindauer and Greaney won’t be able to get away with their b.s. intimidation tactics any more. That will also cause a lot more people to speak out. Once Bogle gives that speech and more people begin speaking out, bloggers and others who try to make money off this stuff are going to see that there is a huge opportunity to make lots of money creating tools that help people following Valuation-Informed Indexing strategies. That will cause even more people to speak out. One good thing will beget another good thing, which will beget another good thing, and on and on.

The tough part is getting Bogle to make that speech. We all should be working together to try to help Old Saint Jack understand how critical it is that he give that speech by the close of business today.

There are two things holding my good friend Jack back.

One, he is suffering from cognitive dissonance, as are so many other Buy-and-Holders. He really believed that this strategy worked. He is proud of the word he has done. He is capable of seeing that there might be small flaws in it. But he has a very hard time believing that his wonderful idea was the cause of the economic crisis and the cause of millions of failed retirements and all this sort of thing. It’s all just too much for him to take in at this moment in time.

We need to help Jack (and all the other Buy-and-Holders) understand what happened here. There are no magic words that can be said to make this happen. Jack will come around in time. He is obviously not dumb. But it is rare to see anyone get this on their first exposure to the ideas. People come around gradually. They need to be able to ask lots of questions. They need to hear lots of people offering their thoughts. They need to be exposed to the ideas multiple times for them to kick in. All this sort of thing.

The bottom line is that Jack must hear honest discussions. And of course the same is true of the many other Buy-and-Holders who today are having a hard time with this.

Two, Jack wants to be loyal to his tribe, the Buy-and-Holders. He doesn’t want all of his friends to become angry with him. He doesn’t want to see people held financially liable for giving bad advice for so long after the Buy-and-Hold Model was discredited by the academic research. He doesn’t want to see people go to prison. We need as a nation to address those concerns of his. We need to hear him give that speech and so we need to do what we can do to make him feel comfortable giving it.

The core issue here is that Buy-and-Hold and Valuation-Informed Indexing are OPPOSITE strategies. They are the same on every point except one — how the investor sets his stock allocation. But getting your stock allocation right is 80 percent of what it takes to be a successful long-term investor. So the real-world differences between these two strategies are great. And the Buy-and-Holders really believed that they were promoting something good, the world’s first research-backed strategy.

Under the ordinary way of doing business, people would have gradually been exposed to the new ideas starting in 1981 and, by now, we all would have made the transition to Valuation-Informed Indexing. It was the huge bull market that caused things not to turn out that way. People gave Buy-and-Hold the credit for the huge gains they thought they were earning in the late 1990s. They fell in love with Buy-and-Hold. So there is now a huge psychological resistance to making the switch to Valuation-Informed Indexing.

We have to start somewhere. We have to get the ideas out there. We need to hear lots of people commenting on them. If there are holes, we obviously need to hear that. If there are not holes, we need to hear that. We need to hear as much as we can hear from as many people as we can persuade to participate constructively.

We need to work together to bring the abusive tactics to a full and complete stop. We have seen from the first day that the majority of our community members LOVE exploring the Valuation-Informed Indexing idea so long as they do not see any death threats or demands for unjustified board bannings or tens of thousands of acts of defamation or threats to get academic researchers fired from their jobs. We need to be 100 percent adamant that that stuff comes to a full and complete stop. We are the luckiest generation of investors who ever lived. So we can figure out the rest together so long as we deal with the Goon problem in a clear and firm and absolute and final way.

I think that covers it, Anonymous.

If I was asked to give a short version, I would say that we will have honest, non-corrupt boards and blogs when every last one of us feels free to say that Buy-and-Hold is a dangerous Get Rich Quick scheme if that is what we believe. I remember saying that at a blog and one fellow telling me that he had never heard that idea expressed before. That fellow’s reaction tells the story of why we are in an economic crisis today. There is now 33 years of peer-reviewed academic research showing that Buy-and-Hold is the purest and most dangerous Get Rich Scheme ever concocted by the human mind (not intentionally, to be sure — but still). People need to hear that, over and over and over again. They need to hear the other side of the story too, of course. But they already DO hear the other side of the story. People need to hear the anti-Buy-and-Hold story as firmly and clearly and regularly as they today hear the pro-Buy-and-Hold story.

All of this will happen naturally once the intimidation comes to a stop. But the intimidation MUST come to a stop. It is killing us. We all know on some level of consciousness how dangerous the intimidation tactics are to our way of life. That’s why they are prohibited by the published rules of every board and blog. That’s why we adopted laws making financial fraud and the cover-up of financial fraud a felony under the laws of the United States.

I hope that helps a bit. Please take good care.

Rob

Set forth below is the text of a comment that I recently put to the Investor Junkie blog:

Rob,

I approve comments that make legit counterpoints. I do not know the full history with Early Retirement Forum, nor do I personally care.

His comment is a legit question (though the personal attack is not). If the commentator does not keep it on topic, he will be banned and comments removed (same applies to you also).

Otherwise I do not moderate and allow each to have their own opinion.

I agree with you that the Goons sometimes ask legitimate questions, Larry. If you look at my blog , you will see that I permit the Goons to post there. A LOT. One of the reasons is that they do sometimes present legitimate questions that we all can learn from (especially me — I obviously need to hear challenges to my thinking). I have two hour-long podcasts at my site that were inspired by questions posed by the Goons.

The Goons really do follow Buy-and-Hold strategies. They post lots of insincere stuff. But they do themselves follow the strategies they recommend to others. That’s one test of sincerity.

So it is not my position that the Goons should not be permitted to participate in discussions in any way, shape or form. They are part of what it going on and to fully understand all of what is going on, we need to understand what drives the Goons. That’s part of the story.

All that said, I think there is a problem if no one comments on their tactics. That fellow at Early Retirement Forum deserved to be able to engage in civil and reasoned discussion. We all miss out when the board is intimidated by a few insanely nasty personalities. I DO care greatly about the Early Retirement Forum. I spent years of my life building it up. There are hundreds of wonderful people there who would like to be having very different sorts of discussions. That board was once a great learning resource for everyone in the Retire Early Community and it is obviously not that today and that is a very, very unfortunate reality in my assessment.

My sense is that you are saying that you don’t want to be the one to comment on these sorts of things because you are the site owner and moderator here. That makes some sense. I hope others will feel encouraged to comment on these process issues. There have been thousands of people who have expressed a desire that honest posting be permitted. I have spoken to lots of professionals in this field who would like to talk openly about their real beliefs about how stock investing works but who do not feel safe doing so because of what they have seen from the Goons. The economic crisis hurts us all. So we are all being hurt by the reluctance of these many smart people to speak out.

The overlying reality here is is that we are in the transition years from Buy-and-Hold to Valuation-Informed Indexing. All of the evidence now goes in one direction. But it has been difficult to make this change because lots of smart people once really believed in Buy-and-Hold and those people built careers around their promotion of it. The tactics we see from the Goons reveal the desperate nature of the effort to “defend” Buy-and-Hold at this late date, over 30 years from the day the peer-reviewed research discrediting it was published. It may be that you should not comment on these issues in this thread but I very much think it would be a plus if you commented on them in a separate article at some later date. The process issue here is a big issue.

The difference between Buy-and-Hold and Valuation-Informed Indexing is that Buy-and-Hoid ignores investor emotion while Valuation-Informed Indexing takes investor emotion into account. Part of the transition we need to make as a society is in coming to understand that we must talk openly about not just the numbers of investing but also the emotions of investing. Pretty much all of us are uncomfortable about it today because with Buy-and-Hold emotions were just presumed not to matter. For 11 years now, we have been seeing emotions evidence themselves, often in very juvenile and destructive ways. That’s an investing issue. Investor emotions are an investing issue. It wouldn’t be too much of an exaggeration for me to say that that is the core point of the entire VII project.

Anyway, I am grateful to Miranda for conducting the interview and writing it up and to you for hosting her article. Anything that gets these ideas out before more people is a plus. If there are any others who would like to comment on the emotionalism we have been seeing from our Goon friends, I hope that they will feel encouraged to speak up. When they put it on display at a public forum, it becomes a legitimate issue for all of us to comment on.

Rob

Set forth below is the text of a comment that I recently put to the Goon Central board:

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