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

VII is “half-baked” because you can’t define how to implement it. That’s what that term means. People have asked you countless times to define the VII strategy. You duck, dodge, evade until people get tired of asking, and finally you get banned. Playful fun for you, annoying noise for everyone else.

“Valuations affect returns” is not a strategy. Why is it so impossible for you to grasp that simple fact?

You implement the strategy by aiming to keep your risk profile constant over time rather than your stock allocation. That’s it. That’s the only difference from Buy-and-Hold.

If the market were efficient, your risk profile would remain constant even if you never changed your stock allocation. If valuations affect long-term returns, you MUST adjust your stock allocation in response to big shifts in valuations to have any hope whatsoever of keeping your risk profile even roughly constant. So Valuation-Informed Indexers do that.

Just do everything that you would do as a Buy-and-Holder but then add in the last 37 years of peer-reviewed, “revolutionary,” Nobel-prize-winning research, and you’ve got it. It’s not at all hard to understand what to do or why you need to do it. The hard part is saying the words “I” and “Was” and “Wrong.” Lots of people have their lives invested in Buy-and-Hold. It is hard for them to accept that they have been doing it wrong all these years.

It is by talking things over that we work through that pain. That’s why it is so important that we open every discussion board and blog on the internet to honest posting. We can’t begin the healing process until we bring the financial fraud stuff to a full and complete stop.

A simple example of how you implement a research-based model is to calculate the safe withdrawal rate accurately. At the top of the bubble, it was 1.6 percent going by the research and 4.0 percent going by the discredited Buy-and-Hold Model. Do you see how those are different numbers?

Now, you can take out whatever you want. Not all Buy-and-Holders take out 4 percent in retirement. The safe withdrawal rate is defined as the withdrawal rate that will work if the worst-case scenario ever seen in history happens to pop up in your retirement. That’s a very safe number. So a Buy-and-Holder might say “I’m going to take 4.5 percent, not 4 percent, that’s safe enough for me. Fine, you know? It’s his choice. It’s the same with a Valuation-Informed Indexer. He might take 2.0 instead of 1.6 even though his retirement begins at a time when valuations are what they were at the top of the bubble. What of it? It’s his money so it’s his choice.

The different between the two models is that the Valuation-Informed Indexer uses valuation-adjusted numbers to INFORM his decision. He starts with 1.6 and makes whatever personal adjustments he wants to that number, he doesn’t start with 4.0 and make whatever personal adjustments he wants to that number. The difference in implementation is that the Valuation-Informed Indexer uses accurate calculations. The last 37 years of peer-reviewed research shows that you have to take valuations into consideration to get the numbers right, so he does that.

Make sense?

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:

“I find it very exciting to learn all the new things that I learn when people feel safe enough to do honest work in this field.”

Good, then you should find this exciting:http://www.aaii.com/journal/article/increasing-retirement-withdrawal-rates-through-asset-allocation.touch

An article by Wade and Michael Kitces talking about CAPE in regards to SWR. Far more recent than the misnamed Bennett-Pfau research, therefore they are far more likely to appear in the NY Times. The fact that you’ve been babbling the same words about the same topic for 16 years means nothing more than you have OCD.

Thanks for the link, Anonymous.

It is certainly a positive to have Wade and Michael sharing their thoughts on the matters addressed in the article. But we need to hear them sharing their thoughts on ALL aspects of the question. And we need to see how they respond to CHALLENGES to their beliefs. And we need LOTS OF OTHERS sharing their thoughts on all aspects of the question and responding to challenges to their beliefs.

In short, we need to open every investing site on the internet to 100 percent honest posting re safe withdrawal rates and scores of other critically important investment-related topics. Zero death threats. Zero demands of unjustified board bannings. Zero acts of defamation. Zero threats to get academic researchers fired from their jobs.

We need to get back on the right side of the felony line. We need to make everyone who works in this field feel 100 percent confident that he or she will never experience any penalty for posting with 100 percent honesty re the amazing. revolutionary research findings of the past 37 years.

My sincere take.

And my sincere best wishes to you and yours.

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:

It seems that Robert Shiller is becoming more of a goon every day. We continue to read as to how he thinks we should remain in stocks. Now he says we have seen the correction:

https://www.bloomberg.com/news/videos/2018-02-12/robert-schiller-says-we-ve-had-our-correction-video

Notice he doesn’t call for a 50 or 65% drop. Nor does he say to get out of stock. I guess you will have to send him to your prison as well, Rob.

Thanks for the link, Anonymous. That’s an important clip and I am grateful that you brought it to our attention.

I am not at all grateful for the way you presented it. Your wording was 100 percent goonish. Your wording was 100 percent misleading. Someone who read your comment and did not listen to the actual clip would be left with a completely wrong impression of what Shiller said. That sort of behavior doesn’t help. It hurts in a big way.

Now —

In fairness to you, it is very hard to make sense of what Shiller is saying here. He IS saying that we have seen a correction that could have been anticipated, which is what you are saying he said. But he is not at all saying that we are not going to see another big drop; he suggests that that is a possibility. You say that he doesn’t “call” for a 50 percent drop or a 65 percent drop. I don’t see him “calling” for either of those things either. But I sure don’t see him ruling them out. And the way that he says things suggests (only suggests) that he sees them as real possibilities.

We need to dig deeper. We need interviewers asking him hard, follow-up questions. We need to figure out what he truly believes about all this stuff. It is not at all clear at this point. And it is important that we know. And of course figuring out what Shiller truly believes is only the first step. We need to figure out what Bogle truly believes. And we need to figure out what Pfau truly believes. And we need to figure out what Bernstein truly believes. And we need to figure out what Kitces truly believes.

I’ll take it a step further. Shiller needs to figure out what Shiller truly believes. And Bogle needs to figure out what Bogle truly believes. And Pfau needs to figure out what Pfau truly believes. And Bernstein needs to figure out what Bernstein truly believes. And Kitces needs to figure out what Kitces truly believes. And Anonyomous needs to figure out what Anonymous truly believes. And so on and so forth.

We all need to be making an effort to figure out how this stock investing stuff really works. To do so, we need to do something about the death threats and about the demands for unjustified board bannings and about the thousands of acts of defamation and about the threats to get academic researchers fired from their jobs and just let people say what they believe in plain and simple and clear terms. And then we need to dig into what they say and explore it from multiple angles until we can make sense of the entire story. That’s my sincere take.

Shiller is talking here about his indicators. In numerous interviews he has suggested that he believes that short-term timing is possible by making use of certain economic indicators that he favors (here he is making reference to some sort of investor confidence indicator). I don’t believe in short-term indicators. I think Shiller is wrong about this. If he knew that a correction was coming, why didn’t he say so before it hit, you know? He didn’t say anything before because he didn’t really know. Short-term timing doesn’t work. Sometimes the indicators work and sometimes they don’t. If Shiller called for a correction each time his indicators saw one coming, he would end up looking like a fool because he would be proved wrong so often. So I just don’t buy that one. I personally don’t think that what he says about short-term indicators and short-term calls is of much consequence (I of course acknowledge that it is possible that I am wrong about this as it is possible that I am wrong about all else).

What I think Shiller did that has HUGE importance is to show that long-term timing always works. He doesn’t say it that clearly and I wish he would. But he showed with peer-reviewed research that valuations affect long-term returns. If that’s so, then stock investing risk is not static but variable. If that’s so, then long-term timing must always work because all that long-term timing is in that scenario is price discipline. Investors should obviously be trying to keep their risk profiles constant and so investors should obviously be engaging in long-term timing to do so. There can be reasonable arguments about how to go about doing so. But there cannot be any reasonable arguments as to whether it is necessary for investors to make the effort to get it right. If the market is not efficient, then investors cannot keep their risk profiles constant without engaging in long-term timing/price discipline, so they obviously need to make the effort to do that.

I obviously do not buy into what you are saying that Shiller is saying. But you of course are being highly misleading. He is not saying what you are saying he is saying. He is saying something strange and confusing and hard to decipher. I will give you that much. I do not feel that I can say precisely what Shiller truly believes; my personal guess is that even Shiller could not do that at this stage of the proceedings. But I sure believe that it is a critical matter of national business that we all figure that out. And the way to do that is not to go goonish when he says something and to try to force his words into our own views of how stock investing works. The way to go is to ask more questions and to dig and to explore and to analyze and to ponder until we possess a far better understanding than we possess today.

If you believe that Shiller believes what you believe about stock investing, you are fooling yourself, Anonymous. Of that I am 100 percent sure.

I cannot say by his pubic words that Shiller believes everything that I believe. But I can say that everything that I believe logically follows from his “revolutionary” (his word) finding of 1981 that valuations affect long-term returns. I believe that Shiller is afraid to say clearly and plainly much of what he believes about how stock investing works and that, if he did speak clearly, we would learn that he believes most or at least much of what I believe. But I also believe that he probably does not today believe everything that I believe. He probably has not thought through some of the things that I have thought through. And of course I could be wrong about some things. So there is just no way of knowing until as a society we elect to permit honest posting at every site on the internet so that we can all gain a lot of depth re our understanding of the last 36 years of peer-reviewed research in this field.

Thanks again for the link. We all need to listen to that clip and ponder its meaning. I think you are very much off track in your public statement as to what you believe it means. But I also think that you are right to see the clip as being important enough to note and I do acknowledge that the clip suggests that Shiller holds some beliefs that are in accord with your own (it is more than a little hard to say precisely what those beliefs are because we have just not yet seen enough digging to make complete sense of what he says here).

Yowsa!

Take good care, man.

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:

“How many cranks have been awarded the Nobel prize in Economics?”

You think you and Shiller are similar? You really lack self awareness.

Every word that I have written over the past 16 years is rooted in Shiller’s “revolutionary” (his word) finding that valuations affect long-term returns. There should be THOUSANDS of people exploring the implications of the last 36 years of peer-reviewed research on a daily basis. There WILL be thousands once we open one major internet site to honest posting on investment issues. There is a mountain of money to be made presenting honest and accurate and research-based investing advice. So, once your prison sentence is announced, all sorts of good stuff begins to happen for millions of us.

Shiller was awarded a Nobel prize for his “revolutionary” work. There should be scores and scores of changes that Jack Bogle has made to Buy-and-Hold in the 36 years since Shiller’s research was published. Can you name 10? Can you name one?

No, neither can I.

I wonder why.

I don’t do cons, Anonymous. I love my country. Non-negotiable.

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:

Yet, if anyone followed your advice since 2010 on VII, they would have missed out on one of the largest bull market runs we have seen. Robert Shiller has said time and again to not use CAPE for timing the market. Shiller has continued to recommend holding stocks. Your only explanations of this is that he is lying or holding back due to the “goons” you talk about on your website.

Despite your spin, the fact remains that buy, hold and rebalance has continued to be successful for millions of people, while we have yet to see one successful example of VII.

I, and others, would be happy to debate all of this, along with the comparison of facts over at your website, but you have decided to block those conversations. Instead, you have filled it up with your tales of goons, fraud, prison, death threats, job threats and host of others fantasies.

I don’t believe that anyone has “missed out” on anything, Sammy. If it is true that valuations affect long-term returns (there is now 36 years of peer-reviewed research showing this), then it is investor emotion that determines stock price changes, not economic realities. So any “gains” that investors see as the result of overvaluation are temporary in nature, You don’t “miss out” on anything by being out of stocks at times when such gains are obtained.

Shiller is certainly holding back on a lot. What’s the #1 thing people read investment books to obtain? People want guidance on how to invest their money. Shiller wrote the most important book ever published in this field, a book that he describes as “revolutionary” and a book that was rooted in research that caused Shiller to be awarded a Novel prize. Please check out that book and see what it says about the how-to issues of stock investing. Shiller did not direct one word of his book to those questions, Sammy.

Why?

Because those are the questions that matter. Those are the questions that set the Buy-and-Holders off. Those are the questions that generate “controversy.”

Shiller is a hero for showing us how stock investing works. That’s magic. That’s amazing. But we need to take it to the next step. We need to explore the far-reaching how-to implications of Shiller’s amazing Nobel-prize-winning research.

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 another blog entry at this site:

That doesn’t add up. You said you have thousands is supporters and you don’t need many to earn a living. How are buy and holders blocking you from anything?

There are thousands of people who have expressed a desire that honest posting be permitted at every discussion board and blog on the internet. Those people don’t necessarily support Valuation-Informed Indexing. Most of them do not. They have an interest. They want to be able to ask questions. But as of now, they more Buy-and-Holders than they are Valuation-Informed Indexers.

This is why it is so important that every site be opened to honest posting. Even if every site were opened to honest posting. there would still be lots of people who would opt for Buy-and-Hold. It might well be that it would still be a majority who would opt for Buy-and-Hold. My guess is that that would be the case, at least for some time into the future.

But there is no question in my mind that we would have many more converts to VII if every site were opened to honest posting. Many more. Investing is an important matter. People are not going to change their strategy based on what one guy on the internet says. They need to hear lots of people come at the questions from lots of different perspectives and they need to be able to ask lots of questions. Over time, people come around. That’s just the way it works.

We can’t get there without opening every site to honest posting. Right now, it takes a lot of effort to learn what you need to learn to become a Valuation-Informed Indexers. I was a Buy-and-Holder myself for a long time. I don’t think of myself as stupid. I was a Buy-and-Holder because for a long time I had never heard the other side of the story. Until the other side of the story is told in great detail at lots of places, progress is going to be slow. But once we begin getting the word out in a serious way, progress will be rapid because the case for VII is so strong.

Naturally, I want progress to be rapid. So I want to see every site opened to honest posting on the last 36 years of peer-reviewed research. Some Buy-and-Holders are holding us back by engaging in criminally abusive behavior. Others are holding us back by failing to speak up in opposition to the criminally abusive behavior. Every single person alive in the United States today should be speaking up in opposition to you Goons. There shouldn’t be one person not urging that your prison sentences begin as soon as possible. It is not even possible for the rational human mind to imagine any possible benefit coming from a delay in announcement of your prison sentence.

Does that help?

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 say that Wade Pfau learned from you and that you have gone deeper than Shiller. Both earning a good living from the investment field/careers. Why haven’t you?

I am Public Enemy #1 of the Buy-and-Holders. I don’t pull punches. I say exactly what I believe. And, since I believe that the last 36 years of peer-reviewed research is legitimate research, what I believe is rarely in accord with what my Buy-and-Hold friends believe (although I of course have the greatest respect possible for them).

Shiller has made amazing contributions. But he pulls his punches.

Pfau had made amazing contributions. But he pulls his punches.

Each time someone pulls a punch, he makes it harder for all the rest of us. The only way out of this mess is for every single person involved to say exactly what he or she believes. It’s through the interactions of people who believe very different things that we all learn together. I would not want any Buy-and-Holder to pull his punches in his dealings with me. I learn more when my Buy-and-Hold friends say exactly what they believe. I return the favor to my Buy-and-Hold friends by saying exactly what I believe in my interactions with them. I wouldn’t dream of showing them the disrespect of failing to do so.

It’s a career limiting move in the short term. The Buy-and-Holders are in the majority and they have the power to shut me down today. But I think that my approach will prove to be a gangbusters success in the long run. I have learned mountains of stuff that I would not have learned if I were not always pushing myself to the next stage of understanding. You can’t push yourself to the next stage of understanding for so long as you are pulling your punches. If I were to pull my punches, I would be selling myself out. And that means that I would be selling my readers out too. And of course ultimately it means that I would be selling my Buy-and-Hold friends out as well. Not this boy, you know?

I am seen as more of a threat than Shiller and Pfau. I would like to see them become bolder. If my Buy-and-Hold friends were thinking clearly, they would want them to become bolder too. We don’t learn when everyone tells us how great we are. We learn when our sincere views are challenged in vigorous and civil and reasoned debate.

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

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:

“It’s every single issue, Anonymous.”

It just seems one issue. You want every website to be focused on discussing VII, right?

Every site should permit honest posting on the last 36 years of peer-reviewed research. Absolutely. Without question.

I don’t agree with the word “focused,” though. It should be the people who visit the site who determine its focus. 90 percent of the population today believes in Buy-and-Hold. So I would expect 90 percent of the posts to be rooted in a belief in Buy-and-Hold principles. That should be the focus.

The focus can change over time, of course. It would be my hope that, once we permit honest posting, we would begin to see more people coming around to a belief in Valuation-Informed Indexing. So we might well see the focus move in that direction over time. But it’s not for me to say. That’s for the community as a whole to say.

I guess you could say that my HOPE would be that in time the focus would move in the direction of Valuation-Informed Indexing. But I only get to say what my personal focus is. For so long as I personally believe in Valuation-Informed Indexing, that has to be my focus when I am posting on investing or I am not being honest. I obviously possess a 100 percent right to post honestly. So that one is solely for me to say. But I don’t possess a right to set the focus of the entire community of a board and I would never dream of trying to do such a thing. The board as a whole has to work its will re that one.

I hope that helps a small bit.

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:

Is Bengen, Kitces or a Pfau holding you back from posting in their comments section? Have they made death threats or job threats? What is holding you back from having this conversation with them that you seem to desperately want?

I’ve had conversations with all three of them, Anonymous. Some of those conversations were highly productive. I have reported on many of them at the blog here.

I certainly don’t rule out having additional conversations with them. I expect that I will. Certainly in the days following the next crash. And probably at times in the days prior to the crash.

But there is only so far that we can go until the story has been written up on the front page of the New York Times. People are afraid to have their careers destroyed. People are afraid to have you Goons come after them. People feel funny about noting that the biggest names in the field are involved in a massive act of financial fraud. The ordinary thing is to seek the support of the biggest names in the field because those people can help one advance one’s own career. We are in a weird situation where the biggest names in the field are involved in a massive act of financial fraud. No?

It’s all going to come out in time. Can it come out now? That’s the question. If there is something that I can say that will help get us all to a better place, I obviously want to say that thing. But I have said a lot of things at a lot of places already. I think it might be more helpful if some others got involved.

Are you willing to come out with a clear statement in OPPOSITION to the massive act of financial fraud? That would help.

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:

Yes, I get that you are now 100% fixated on punishing me, rather than pursuing your own goals. If Wade’s paper gets written up in the New York Times, he gets all the glory and rewards. The first step is getting recognized experts like Bengen to acknowledge that he was the first. And that step is checked off.

Of course, Wade could wave his hands and say “Shucks no, all this glory belongs to Rob Bennett. He’s the real brains behind any CAPE-based timing strategy.” Yes, that’s the ticket. That’s what will happen.

Or you could take two minutes right now to set Bengen straight. Nope, you said that’s not an option.

Anytime that anyone writes honestly about what the last 36 years of peer-reviewed research teaches us all about how stock investing works, it benefits each and every one of us who is trying to do the same. There is no limit on the credit that can be handed out. Millions of investors need access to accurate information. Thousands of investment advisers want to give it to them. The thing that is standing in their way is a Wall of Ignorance. People cannot believe the realities — that we now know of a way to invest in stocks that is far less risky and that allows people to retire far earlier in life — because they just sound too good to be true. Anyone who does anything to knock down that wall is helping all of us in a big way.

Say that Wade does as you say. I am not saying that I think he would — I do not. But just say for purposes of discussion that he did. That would be an absolute boon for me. If the study that Wade and I prepared gets publicized — regardless of who gets the credit for it — it instantly becomes easier to tell the truth about stock investing at hundreds of different sites. So all of my stuff — I’ve developed a lot of it over the years — gets out. How does that hurt me?

You always talk as if the key to getting credit is being smarter than other people. That’s not the reality here. Most Buy-and-Holders possess more than enough intellectual capacity to do everything that I have done. So why am I 15 years ahead of most Buy-and-Holders? They are not willing to stand up to the crowd. So they play dumb. It’s not that they ARE dumb, it’s that they play dumb because they want to be popular at a time when the key to being popular is encouraging people’s Buy-and-Hold fantasies. I haven’t been playing dumb for 15 years now. So I have a mountain of material with my name on it that is real and research-based. Anything that helps me get that material out — and anything that breaks down the Wall of Ignorance does that — helps me.

I cannot lose, Anonymous. I placed myself on the side of the American people. The only way that I lose is if the American people lose. And, if the American people lose, we all go down. Getting credit for my investing ideas will be the least of my concerns in that event. I lose if the entire economic system goes down. I have taken a bet that we are going to pull through this thing. But, if we pull through, there is no way that I can lose. I have too much material. It is too good (not because I am so smart, because Shiller really did achieve something “revolutionary” in scope and I devoted 15 years of my life to mining the insights that he opened to us all). I am going to get all the credit that I could possibly want presuming that the entire economic system does not collapse, which is the one real risk that I am facing. But of course that one gets all of us if a black card comes up.

I don’t have any concerns at all about who gets credit. Do you know who is going to get credit after the New York Times story comes out? You Goons! You Goons have helped me lots of times, dozens of times. I am going to tell that story. I think it is a very cool reality that Shiller’s work is so amazing that even the sworn enemies of the last 36 years of peer-reviewed research cannot help but bring out points in connection with it that help us all. That’s amazing. You Goons don’t want to help. But the reality is that you have. On numerous occasions. And there is no reason in the world why I should be reluctant to give you credit for the good that you have done. When you do good, you help people understand how stock investing works. When you help people understand how stock investing works, you help people see the value of my work. You have helped me. I am grateful to you. I am happy to give you credit. So be it, you know?

I have taken a bet on the future of this country. I love this country. I think we are going to pull through. If we do, I make out like a bandit. Good for me, you know? That’s how it is supposed to go in this country. People help us all out and they are rewarded for it. That’s the wonderful system. That’s what keeps the wheels spinning in a forward direction. I love the way it works and I love being a part of all the magic in this particular case. You can’t beat the feeling. It’s a thrill. Doing well by doing good.

Wade is going to get a mountain of credit on the other side. He deserves it. I think it will be fantastic to see him get the credit he deserves. And Shiller is going to get lots of credit. And Kitces. And Bogle. And Bernstein. And Swedroe. And you Goons. There is going to be credit coming out of our ears.

No worries.

Except for the deepening of the economic crisis and the possible Second Great Depression. I don’t want to come off as glib re that aspect of the question. That one truly worries me. All the credit in the world won’t help me if our economic system collapses. So I want to do everything in my power to help us out re that one. But of course there is only so much I can do in that department and I have been working that one hard for a long, long time now.

But no worries whatsoever re the credit thing. We all are going to do just fine re that particular matter. I am 100 percent sure.

My best wishes to you.

Rob