A Rich Life

The Old Ideas on Saving & Investing Don't Work -- Here's What Does

We Don’t Know Enough to Know What We Don’t Know

by

We don’t.

We don’t know the meanings of the words. This one kills me. When people offer you investing advice, the odds are good that they don’t know the meanings of the most basic terms at issue.

If a baseball manager didn’t know what a bunt was or what a squeeze play was or what the infield fly rule was, you would fire him. I’ll bet 50 cents that whoever it is you turn to most often for investing advice doesn’t possess a strong grasp of the meaning of most basic investing concepts. I can say that because just about no one does today. Our understanding of how investing works is not yet sufficiently advanced for us to have reached agreement on even the most fundamental points.

Risk is fundamental, right? If you don’t understand risk, you don’t understand investing. Still, the reality is that there is not yet a general consensus on what risk is.

Lots of people say that risk is volatility. Stocks are risky because prices go up and down a lot. Buffett laughs at that idea. He points out that, if risk is volatility, then a stock that goes up in price is more risky than one that remains always at the same price. He’s got a point. But the others just keep insisting that volatility is risk, as if they knew what they were talking about and as if they had not heard what Buffett said. That’s reassuring — not!

What else?

The Great Safe Withdrawal Rate (SWR) Debate is the product of a failure of investing “experts” to distinguish between the concepts of “surviving” and “safe.” Say that you drove drunk two times and got in horrible accidents, but lived. You would not conclude that driving drunk is a safe thing to do. That’s what the Old School SWR studies do. They look for what withdrawal rate barely survived for the two times in history when we got to the price levels that apply today and declare that withdrawal rate “100 percent safe.” Um, that makes sense. If the authors of the studies understood the difference between these two simple concepts, they wouldn’t do that. And they probably do understand the difference when talking about other subjects. When it comes to investing, though, they “forget” the meaning of the words and offer highly dangerous retirement advice.

What else?

Greaney has a study that says that a 74 percent stock allocation is always “optimal.” John Walter Russell checked the historical data and found that that allocation is indeed optimal except for just about all of the other possibilities that can be imagined by the rational human mind. People don’t use the word “optimal” in the investing realm to mean the same thing that it means when used in any other context any more than they use the word “safe” to mean the same thing that it means when used in any other context.

What else?

Investing experts do not know what the word “indexing” means. There are big battles going on about it. Rob Arnott came up with something called “Fundamental Indexing” and John Bogle is saying that it is only Bogle’s idea of indexing that is really indexing and that no other understandings of the term are permitted. As Church Lady has been known to observe from time to time, how convenient!

What else?

People use the phrase “Passive Investing” to refer to indexing all the time. Are they the same thing? It sure doesn’t seem so to me. I love indexing (owning tiny interests in a large number of stocks so that you enjoy great diversification at low cost). Love it, love it, love it. I hate Passive Investing (sticking with the same stock allocation despite wild price swings). Hate it, hate it, hate it. If they are the same thing, how can one guy love one and hate the other? I’m thinking that it just might be possible to index without investing passively, you know?

What else?

Long-term. We’re all investing for the long-term today. So we need to know what it means. But we do not.

The promise that investing in stocks will always work out well in the long term works only for those willing to hold for 30 years. Few of the investors who say that they are investing for the long-term know that. Many think that the long-term is 5 years or 10 years. Guess what happens when those people learn that the results they were expecting to see in the “long-term” ain’t gonna show up when they were expected to show up?

What else?

Buy-and-hold. We don’t know what it means.

Buy-and-hold is effortless during a huge bull, like the one that ended in 2000. We’re now in the huge bear that inevitably follows a huge bull (during a bull, we borrow huge amounts from the returns of future investors to push current-day returns far above those justified by the economic realities). Ball-and-hold is now a very difficult thing, especially for those who were led to believe that it was always easy. The reality is that no one knows what is required to be a buy-and-hold investor yet because the strategy has never yet been tested in a bear market.

What else?

We don’t know what a high valuation level is. Most “experts” use P/E1 to tell us whether stocks are overvalued or not. P/E1 gives many false reads. Those who know what they are talking about use P/E10 or perhaps Tobin’s Q or some other legitimate valuation assessment tool. The majority of people who call themselves “experts” don’t know that they are using a tool that does not work. So they do not really know what valuation level applies at any given time or what its significance is (you cannot make meaningful comparisons of how stocks perform from various valuation levels if your valuation assessment tool is gravely flawed).

It’s not my intent here to put people down. My intent is to let people off the hook. If the experts would stop pretending that they know things they do not know, investors would know to check things out more carefully for themselves. People got proud and careless during the huge bull. Giving investing advice that “worked” during the huge bull was not too difficult a task. Most of us are not up to the job in this new environment.

We need to go back to school. We need to learn the basics. We need to be more cautious in how we state things. We need to learn how to say “I don’t know” and “I was wrong.”

Most of all, we need to develop the intellectual curiosity needed to begin an effort to nail down some of the most basic concepts.

Today’s Passion: The article entitled Investing Basics that Even the Pros Don’t Understand notes that the return you will obtain on your stock investment can be known in advance. Why don’t the big boys they tell us these things?

Scott Burns Complains About Low IBond Returns
That He Himself Helped Bring About

by

Scott Burns is not pleased with the zero return being paid by IBonds.

Juicy Excerpt: By having a premium of zero over inflation, the Treasury is sending a simple message to savers: Drop dead.

Scott needs to spend some time studying The Stock-Return Predictor.

IBonds obviously are not offering as good a deal today as they were back when investor emotions re stocks were more out-of-control than they are today. In relative terms, though, they are still offering a strong value proposition.

The most-likely annualized 10-year return on stocks is 1.55 percent real. That’s for an asset class that on the three earlier occasions it was at these price levels suffered an average price drop of 67 percent. Is increasing your return by 1.55 percent per year worth taking a risk of a 67 percent loss? Not in this boy’s estimation, at least not for a large portion of one’s portfolio.

You also need to consider that stocks provide a most-likely annualized 10-year return of 6.3 percent real if prices drop to fair-value levels. So those holding zero-return IBonds are setting themselves up for far higher returns a bit down the road while those holding stocks are setting themselves up for permanenet losses, losses that will grow over the years as the compounding returns effect kicks in.

It certainly can be argued that a zero percent return for IBonds is “irrational.” But so is a 1.55 percent return for stocks. The root problem is that the investors choosing between these asset classes have been making irrational choices ever since stocks went to wildly overpriced valuation levels.

Investors’ emotional take on stocks dominates decision-making in InvestoWorld. When the stock market is priced as absurdly as it is today, other asset classes feel the effect. Today’s IBond return is nuts. But, compared to today’s likely stock return, it’s great. Smart investors are looking at the relative value proposition and their demand for IBonds has brought the return down to a level that appears absurd when considered in isolation but that makes a good bit of sense when viewed in comparison to the return now available from stocks.

If the “experts” gave us the straight story re how valuations affect long-term stock returns, most investors would have abandoned stocks when the long-term return went negative back at the top of the bubble. That would have brought the price down to reasonable levels and we would as a result be enjoying good long-term returns on stocks today. In the world in which we actually live, we have to figure out the truth about stocks for ourselves in this crazy way in which we see prices go down a bit and then hold stable or go up a bit, and then eventually go down a bit more. All that the “experts” accomplish by ignoring the message of the historical data is to stretch out a painful process of price adjustment.

Investors do not have the same confidence in stocks today that they had back at the top of the bubble. That’s a good thing. That’s a step in the right direction. That’s one of the reasons why the return on IBonds is so low. Investors have been gradually moving from stocks to safer asset classes offering a better long-term deal, and the increased demand for those asset classes brings down the return they need to offer to attract money to them. Zero-return IBonds are not entirely irrational; there’s an element of rationality mixed in with the overall irrationality that governs all investing decisions for so long as stock prices remain where they are today.

I certainly would not describe today’s IBond return as exciting. The informed investor was loading up on IBonds back when they were paying a return of over 3 percent real and stocks were offering an even worse deal than they are today. However, IBonds are still a good bit more attractive than stocks.

That’s irrational, and I would like to see that situation change; stocks are the riskier asset class and stocks are the asset class that should be offering the better value proposition for investors willing to take on reasonable amounts of risk. To get to where we all want to be, we all need to get about the business of accepting that the absurdly oversized returns handed out to stock investors of the late 1990s were borrowed from the returns available for stock investors of today and that it is only by acknowledging that reality that we can get to a place where stocks will once again offer a superior long-term value proposition to even zero-return IBonds.

It is the irrationality of Passive Investing enthusiasts (I think it would be fair to describe Scott Burns as such a one) that is causing the problem. When Scott Burns is looking around for people to blame for the unfortunate message being delivered to savers today (zero-return IBonds do indeed send a discouraging message) he should look first at the face of the man in the bathroom mirror.

Today’s Passion: The article entitled IBonds are New and Improved Cash argues that cash is not only for sissies anymore.

Unmentionables

by

Scott Burns puts forward tantalizing hints but doesn’t dare to tell the full story.

William Bernstein took a chance by stating it pretty darn clearly one time and is not inclined to take a bigger one by stating it pretty darn clearly a second time.

John Bogle says enough to permit those who want to know the realities figure them out for themselves, but holds back enough to permit those who do not to remain in the temporary comfort of the darkness.

Jonathan Clements knows enough to see that there is a big story out there, but elects to spend his time pursuing less controversial topics.

I mentioned in yesterday’s blog entry that: “We don’t want it shoved in our faces just how bad things have gotten, just how irresponsible we have been in bidding up stock prices to such absurd levels in recent years.”

It’s a big story that as of yet has not been widely reported. I don’t mean the fact that stocks are overvalued. That’s been written about some. I mean how upset it makes people to think about it, and how much anger some experience when they hear it discussed in a clear and direct and understandable and undeniable way.

The conventional thinking on stocks is that stock investing is primarily a rational endeavor. I challenge anyone to devote 15 minutes to reading the transcript of The Great Safe Withdrawal Rate Debate and to continue to maintain afterwards that stock investing is primarily a rational endeavor. The debate transcript shows that stock investing is primarily an emotional endeavor. I mean, come on.

What are we going to do about it?

I propose that we learn more about it.

Learning that stock investing is primarily an emotional endeavor changes everything. It compels a different starting point for the analysis of every possible investing question. Change all of the starting points, and you change all of the end points.

It would not be overstating things all that much to say that everything we thought we knew five years ago about investing has turned out to be at least a little bit wrong. We’ve got some challenging work ahead of us. Some exciting opportunities to make the world a better place now appear before us too.

Burns, Bernstein, Bogle and Clements are four of the best. Each of them has played a role in the development of the insights we have generated during The Great Safe Withdrawal Rate Debate. Thanks, guys!

Each of them has pulled back from exploring in depth those insights on his own. Way to drop the ball, guys!

I have hopes that we are not going to drop the ball. I have hopes that we are going to hold onto the ball for a run all the way into the end zone.

If it were easy to tell the full truth about stock investing, Burns, Bernstein. Bogle and Clements would have already done it. It’s not easy. We’re going to do it anyway. That’s why we set up this community in the first place, is it not? That’s the job we have taken on, is it not?

The first step is to figure out why Burns, Bernstein, Bogle and Clements have shied away from the task. What are they afraid is going to happen if they tell it straight, with no chaser?

My sense is that they are afraid that telling the stock investing story straight and full and true would make make their readers angry at them. It’s one thing to talk about how stocks work. It’s a very different thing to talk about how people work, especially when part of the story that needs to be told relates to how people sometimes mess up.

People got us to the P/E10 level that we are at today. Isn’t it just like those darn humans to do something like that? Look into a problem deeply enough, and it always seems to turn out that it’s the humans who are at the center of the mess-up!

The humans messed up in a big way. That’s the big Unmentionable in the field of investing analysis today. The human factors are the Unmentionables because it’s humans who buy the newspapers and attend the speeches and subscribe to the newsletters and all that sort of thing.

We all want our fellow humans to like us, and, if we start telling them that they messed up, they might not. So many of the best investing analysts have elected not to say too much about it and to be less than clear and direct in what little they do say.

We need to be charitable. We need to be balanced. We need to be diplomatic. We need to tell the story, though. We need to mention the Unmentionables. It’s an important part of the investing story. The story as a whole does not make sense unless this aspect of it is addressed in some depth.

You might want to click on your seat-belt. It promises to be a rocky ride. We’re going to be doing some truth-telling around this place in the days and weeks and months and years to come.

Our mission, if we elect to accept it (and we have so elected) is — To tell the part of the stock investing story that Burns and Bernstein and Bogle and Clements have never quite possessed the courage to tell.

Wish me — I mean us! — luck!

Does Anybody Really Know What Time It Is?

by

What do you know? How do you know it?

You need to know certain things to get from the place where you are when you pull yourself out of your bed in the morning to the place where you are will be when you throw yourself back into it at night. For example, you need to know about gravity. If not for gravity, you would need to dress differently. You might need to wear heavy boots to keep from floating off into space. Gravity matters. Since you know that gravity exists, you keep this reality in mind as you make all of the various life decisions put before you during the course of another day spent journeying through this Valley of Tears.

You do know that gravity exists, right?

No. The truth is, you really don’t.

Have you ever explored the gravity question in depth? Have you ever checked out the claims that teachers and friends and experts have made about gravity? You haven’t. You have taken them on faith.

That’s what humans do. There are thousands of things we need to do to keep body and soul joined. We couldn’t possibly check out each and every little detail of each and every little claim that we elect to take on faith for the purpose of freeing up some time to devote to the things in our lives that we care about most.

I think you made the right choice re the gravity thing. I personally am confident that there really is such a force and that it really does work at least largely as lots of people tell us it does. The conventional understanding of how gravity works is cool.

The conventional understanding of how stocks work is not cool.

Taking things on faith makes sense. It save us an awful lot of time to just assume that, when lots of people say the same thing, they must all be right or at least close enough to being right that we don’t need to worry about it much. There are times, though, when taking things on faith can get you in a whole bunch of trouble. One of those times is when you are deciding how to invest your money.

Here are some words from a community member named “Janey”:

“What Rob said sounds reasonable enough, so I wouldn’t be able to judge his advice without additional input. I must rely on the fact that I don’t hear the authors I trust saying the same thing. The authors I trust seem to agree that returns may be lower in the years to come, but none of them suggest that we should drastically reduce our stock allocations in light of this information….I don’t have time to join the search for ‘the Grail of Investing.’ Besides, I have other priorities in life. So, I have to rely on the judgment of people who make the most sense.”

Janey is telling it straight. She is acknowledging that she is not able to identify any reasons why the Valuation-Informed Indexing approach to investing is not superior to the conventional indexing approach. It sounds fishy to her, though. There are lots of smart and well-informed and well-respected people who say things that are at odds with what I say. So she can’t help but conclude that there is probably something wrong with what I am saying. Given the practical reality that she cannot afford to spend years of her life researching my claims and the counters to my claims advanced by my critics, she has decided to place her confidence in what a lot of smart and well-informed and well-respected people have told her.

Janey believes in gravity. Is that so wrong?

I think it makes a lot of sense. I think Janey is a smart cookie and a nice person too (I am going by what I have read in a few posts she has put forward at the Vanguard Diehards board). I think she is making a mistake to place her confidence in the smart and well-informed and well-respected people in whom she has elected to place her confidence. But I understand why she has done so and I am grateful to her for sharing with us a look into the thought-process by which she made a decision to do so.

Janey makes investing decisions in the way that most smart and nice people make investment decisions. We humans are not computers with legs. We are social animals. We often decide what we think by asking others what they think.

The dominant investing paradigm assumes that we are computers with legs. The dominant investing paradigm says that the stock market is efficient because prices are set by millions of investors acting rationally in their self-interest.

In reality, prices are set by people. People make their investing decisions not rationally (reason comes into it, of course, but reason is not the dominant influence on our investing choices), but by talking with other people. Each time that another human becomes convinced that stocks are “good,” two things happen: (1) stocks become a little less “good” (because that human’s purchases cause the price of stocks to go up and the long-term return obtained by those who purchase stocks in future days to go down); and (2) those who retain doubts about how good stocks are become less sure of themselves as the result of hearing from yet one more fellow human how good they are. In time, just about all the humans that can be reached by telephone or e-mail or radio broadcasts own stocks and prices have been driven so high that we are in one of those rare time-periods when stocks are not so “good.”

Janey has been misled by the smart and well-informed and well-respected people in whom she has placed her trust. Not because they are bad or dumb or uncaring people (athough human failings do indeed play a role in making transparently silly ideas popular for a time). Because they are just as human as Janey is. Being smart and well-informed and well-respected doesnt make you any better at understanding how stocks work than all of your fellow humans who are a bit less smart and a bit less well-informed and a bit less well-respected than you. Janey would be better off listening to her common sense than listening to the people she has come to view as investing experts.

You cannot learn about stocks in the way that you learn about gravity. Why? Because the very fact that so many people have come to like stocks so much is what makes them unappealing. It is because so few question the value proposition of stocks today that stocks have today become such a dubious investment choice for the middle-class investor.

My Response to Jonathan Clements’ E-Mail on FIRECalc

by

My blog entry for May 23, 2006, set forth the text of an e-mail sent to me by Wall Street Journal Columnist Jonathan Clements. In the e-mail, Clements defended Bill Sholar’s FIRECalc retirement planning tool from my criticisms of it, while acknowledging that FIRECalc “may not be the last word in safe withdrawal rates.” Set forth below is my response to Clements’ e-mail:

Jonathan:

Thanks for your response.

I agree that the conventional methodology studies have served to lower expectations and that that is a good thing. Bernstein described the Trinity study (the grandfather of conventional methodology studies) as “breakthrough research.” I agree with that assessment.

The fact that there has been one breakthrough in the safe withdrawal rate field does not rule out further breakthroughs. I hope you will take at least a quick look at Russell’s site. He has done some amazing work.

If it would help you to look at summaries of major findings, please let me know the sorts of questions in which you have the greatest interest. I can’t do the statistical work that Russell does. But I am writing a book on his findings. So I very familiar with his work and its implications.
You hint at one of the most important findings with your reference to TIPS. Given the valuations that apply to stocks today, a strategy of shifting a good bit of one’s portfolio to TIPS until such time as valuations return to moderate levels is highly appealing, given what the historical data says about the long-term returns likely to be provided by stocks from today’s valuation levels.

Please let me know if it is okay with you to quote your response to my e-mail in my blog. The question of the analytical validity of FIRECalc is a matter of considerable controversy at the Financial Freedom Community boards. So I set forth the text of my e-mail to you in my blog entry for today. I would like to set forth the text of your response as well (in part in fairness to Sholar and his supporters since to some extent you are defending the FIRECalc tool from my criticisms of it), but I of course will not do so unless you give me permission to do so.

Russell and I are in the process of constructing a calculator that uses the historical stock-return data to generate “predictions” of the range of stock returns we will likely see over 10-year, 20-year and 30-year time-periods and to assign rough probabilities to various points on the spectrum of possibilities. I have hopes that the calculator will be up at my site within three or four weeks. I will send you an e-mail letting you know when it is available. It is the work we did together on safe withdrawal rates that led to our study of the effect of valuations on long-term stock returns, which is of course an issue of even more far-reaching import.

Jonathan Clements on Safe Withdrawal Rates

by

My blog entry for May 22, 2006, set forth the text of an e-mail that I wrote to Wall Street Journal Columnist Jonathan Clements urging him not to put forward further endorsements of Bill Sholar’s dangerous FIRECalc retirement planning tool. Set forth below is the response that I received from Clements (he has given me permission to post his response here):

Rob:

Thanks for the email.

Given its length, my short reply will hardly do it justice. But I think there are a few points worth considering:

1) Firecalc may not be the last word on safe withdrawal rates, but it does what it states — it tells you how your strategy would have fared historically;

2) Surveys suggest that most retirees have a wildly inflated idea of what a safe withdrawal rate is, so Firecalc is a good reality check, even if it isn’t as much of a reality check as you would like;

3) With 10-year TIPS yielding 2.4%, the safe withdrawal rate must be higher than that, assuming a willingness to eat into principal.

Best,

Jonathan

My E-Mail to Wall Street Journal
Columnist Jonathan Clements

by

I sent an e-mail this morning to Wall Street Journal Columnist Jonathan Clements urging him not to include further endorsements of Bill Sholar’s dangerous FIRECalc retirement calculator in his “Getting Going” investment column. Here is the text:

Mr. Clements:

My name is Rob Bennett. I am the founder of the Financial Freedom Community (a group of internet discussion boards) and the owner of the www.PassionSaving.com web site, where I report on findings of the research that we have been doing in our community for over six years now.

You included a link to the FIRECalc retirement calculator in your Wall Street Journal column of May 21, 2006, entitled “Make Sure Your Money Lasts as Long as You.” There have been extensive discussions of the FIRECalc calculator in our community over the past four years. We have determined beyond any reasonable doubt that the methodology used in FIRECalc is analytically invalid for purposes of determining safe withdrawal rates. I urge you not to give further publicity to this dangerous retirement planning tool unless the flaws in it are corrected by its creator, Bill Sholar. (I of course have made Sholar aware of the flaws).

The problem is that FIRECalc does not make adjustments to the safe withdrawal rate to reflect the effect of changes in valuation levels. The historical stock-return data shows that the valuation level that applies on the starting date of a retirement is the single most important factor determining what withdrawal rate is safe.

For retirements beginning in January 2000, FIRECalc reports a safe withdrawal rate (for a high S&P portfolio) of 4 percent. Analytically valid studies put the number at 1.6 percent. For a retiree with a $1 million portfolio, that’s the difference between living on annual spending of $40,000 for the last 30 years of his life and living on annual spending of $16,000 for the last 30 years of his life. That’s not a rounding error. That’s a deadly serious mistake.

Valuations are not as high today and so the safe withdrawal rate for a high S&P portfolio is today higher. But it is still nowhere even remotely in the neighborhood reported in FIRECalc. The SWR for a high S&P portfolio today is about 2.5 percent. The odds of an 80 percent S&P/20 percent commercial paper portfolio for which a 4 percent withdrawal applies surviving 30 years are at today’s valuations about 50-50.

Placing one’s entire life savings down on a coin flip is not a safe thing to do. It is an extremely risky thing to do. The words “safe” and “risky” are not synonyms; they are antonyms. FIRECalc is not science. It is science fiction.

William Bernstein, author of The Four Pillars of Investing, has confirmed the analytical flaws of FIRECalc. He has said that any investor giving thought to using a conventional-methodology safe withdrawal rate study (FIRECalc uses the conventional methodology) to plan a retirement would be well-advised to “FuhGeddaBoudit!” Bernstein calculated the safe withdrawal rate for a high S&P portfolio near the top of the bubble to be about 2 percent. That is in accord with what other analytically valid studies have shown. The four years of research done in the Financial Freedom Community backs up Bernstein all down the line.

I have had extensive communication with Dallas Morning News Columnist Scott Burns on the flaws of FIRECalc and a similar study (the conventional-methodology study published by John Greaney at his RetireEarlyHomePage.com site). Burns has told me that he agrees with the conclusions reached by the Financial Freedom Community in its investigations of the flaws of these two retirement planning tools. Burns has won for himself a reputation as an expert on the topic of safe withdrawal rates as the result of a column he wrote some years ago correcting an error Peter Lynch made in overstating the safe withdrawal rate for stocks.

Burns published a column on June 3, 2005, saying: “The established safe-withdrawal-rate rules of thumb are based on long periods of time in which yields were higher than today and stock valuations were lower. A growing school of thought believes future withdrawal rates should be reduced to reflect lower expected future returns. This would knock another 1.5 to 2 percentage points off the safe withdrawal rate.” Burns added that the reason why there has been only a smattering of reports in the general press about these critically important findings is that “it is information most people don’t want to hear.”

Greaney is a highly abusive poster in a number of discussion-board communities in which he participates. He has threatened physical violence on any poster who posts honestly on what the historical stock-return data says regarding safe withdrawal rates. Sholar is not himself abusive, but he permits Greaney defenders to have the run of the board that he owns (the Early Retirement Forum). At one time, Sholar permitted honest discussions of the safe withdrawal rate topic. But after Greaney defenders threatened to burn his site to the ground if he continued to do so, Sholar imposed a ban on honest posting. The ban remains in effect today.

The fact that Sholar has banned honest posting at his board shows that he knows from our community discussions that there is no possible reasoned defense that can be put forward in support of his safe withdrawal rate claims. In the event that stocks perform in the future somewhat as they always have in the past, these demonstrably false claims are likely to cause hundreds of thousands of busted retirements. You should not be putting the good name of the Wall Street Journal behind an endorsement of such an individual or behind an endorsement of safe withdrawal rate claims likely to cause such devastating life setbacks to so many middle-class investors.

I think you would be doing a great service to your readers to report in your column on the safe withdrawal rate findings of the Financial Freedom Community. Much of our best research has been published by John Walter Russell at the www.Early-Retirement-Planning-Insights.com site.

In contrast to Sholar and Greaney, Russell exemplifies the best of the new internet communications medium. He is a retired government engineer who became interested in safe withdrawal rates as the result of our community discussions and has now devoted four years of full-time work to studying in depth what the historical data really says. Giving some publicity to Russell’s findings could well save millions of middle-class retirements from going bust in days to come.

Please let me know if you have any questions about any of the points put forward in this e-mail. Please also know that the fine work you do in your column is appreciated by many, many middle-class workers trying to make sense of the question of how to invest successfully for the long run.

Rob