It’s not just adios, but probably goodbye. Last weekend, St. Louis was the host city for FinCon, the Financial Blogger’s Conference. So far, it’s been in Chicago, Denver, and now St. Louis.
This is The Gateway Arch which Wikipedia tells us is a 630-foot monument in St. Louis, Missouri. Clad in stainless steel and built in the form of a flattened catenary arch, it is the tallest man-made monument in the United States. I hadn’t given it much thought in my life until the SyFy TV show Defiance was released, and the arch is a prominent feature in the show.
FinCon was the brainchild of Phil Taylor, the blogger better known at PT Money, and this year, the number of attendees hit the 500 mark. The people that came are nothing short of amazing. When you combine the love of a topic, the desire to write about it, and the urge to connect, there’s a magic that happens.
This year, author and financial editor of the Today Show, Jean Chatzky gave a keynote address. She really knew how to relate to the audience. Jean shared her story of how she got started in the business, and after being told she’d never make it to TV, didn’t just get on television, but did it in NYC, the last place one expects to get a break. Her next project is the expansion and promotion of her Money School, an online seminar series to help you improve your finances. My fellow bloggers and I are likely to come back with more on Jean’s Money School. From the bit I saw of it, she’s going to help a lot of people.
There were so many bloggers who gave a talk that I really run the risk of leaving off someone who deserves a mention, but here are the ones that stand out in my mind –
Rob Bennett – I’ve met Rob at prior FinCons and he strikes me as one of the most passionate people out there. Rob gave a talk at Ignite, an evening function in which each speaker has 5 minutes to share an idea via a set of 20 slides timed to change at 15 second intervals. Rob has a message to share, but somehow his message isn’t welcome in many financial forums. What’s Rob’s message? It seems to be twofold, first, stocks actually do get overpriced. Any of my readers old enough to remember the crash of ’87? No? No problem, we had another crash from 2000 through Mid-02. I know, that was still over a decade ago. The latest crash occurred from Mid-07 till Jan ’09. It would seem that Rob’s observation is correct. Another Rob, Schiller to be specific, had a similar idea. He doesn’t get kicked out of finance forums, that I know, instead he gets a Nobel prize. Which is pretty cool. The second part of Rob Bennett’s message is that by using data that we know, the PE10, which happens to be popularized by Robert Schiller, we have a tool to judge market valuation. If there’s a problem with the process Rob discusses, it’s that it takes time and patience. Check his site out, and see what you think.
Barbara Friedberg blogs at her site about saving, investing, and building wealth. She gave a regular length talk containing a mix of writing and investing advice that were right in line with my own opinion. Patience, asset allocation, and she even offered a quote that I loved – “Investing should be like watching grass grow or paint dry. If you want excitement, take $1,000 and go to Las Vegas.†(Paul Samuelson) Barb prefers indexing, as do I, and even suggested that if one wanted to buy individual stocks, they should limit that portion of their assets to 10%. On a side note, a newer blogger and I were talking over lunch, and she was determined to go all in, choosing stocks from the very beginning of her investing life. It’s tough to explain to a new investor why they are not going to be the chosen one who beats the market year in and year out.
Eric Rosenberg – Eric is a big deal (ask him, he’ll tell you), he offers great financial writing at his blog, DJs on weekends, and just announced to his readers that he’s engaged. I may be twice his age, but I’m the first to admit there’s far more to be learned than I’ll ever know, and I’m always happy to learn from Eric.
Romeo Jeremiah didn’t offer a talk, but we did spend some quality time together at the hotel bar. He writes about finance, relationships, and life, and whether one agrees with him or not, he offers his views respectfully and with great insight. He was away from the US with his son last year and missed FinCon. Great to see him this year and catch up.
As I started to say, a great group, and with 500 attendees, it was impossible to chat with each and every one. If you were there and I didn’t meet you, I’m sorry, I look forward to next year. If we met, it was great. There’s no one I spoke to that wasn’t interesting, a rare time to be with a group that has no one you wanted to walk away from. If you missed FinCon this year, you can buy a virtual pass and see what the fuss was all about.
This Sunday may feature a roundup of FinCon posts. A lot to read and learn.
Those two last posts by Rob are yet more examples of “hocomania”. This link will help you to understand it a bit more:
http://retireearlyhomepage.com/hocomania.html
Once again, Rob, please get some help.
Is Joe one of your “converts�
No. Joe is not one of the two I was referring to.
The two who offered 100 percent support were: (1) Joel Wenger, who writes the Invest Safely blog (he was the fellow I had breakfast with):
http://blog.invest-safely.com/about/
and (2) Henry Becker, a CFP and Director of Research at Lighthouse Management. I talked to Henry briefly at the speed networking event.
Rob
If he (like so many others) eventually decides to ban you, will that make him an apostate?
I’ll tell the truth.
Carl Richards, who writes a blog for the New York Times, said that my site was the best investing site he has ever seen. He said that he has read everything about Valuation-Informed Indexing that he can get his hands on. He said that my work has “huge value.” And he banned me from his site.
Jack Bogle is the fellow who told me what I needed to know to understand why the Old School safe withdrawal rate studies get the numbers wildly wrong. Jack didn’t lift a finger when Mel threatened physical violence against anyone who dared to “cross” him by posting honestly at the Bogleheads Forum.
Bill Bernstein said in response to an e-mail from one of you Goons that “of course the methodology used in the Old School SWR studies is analytically valid.” In the same e-mail, he said that anyone who gave consideration to using one of those studies to plan a retirement was out of his gourd. That’s what I meant when I said that the studies were “analytically invalid”! The term “analytically invalid” is my shorthand way of saying that those studies got the numbers so wildly wrong that anyone who used one to plan a retirement would have to be out of his or her freakin’ gourd.
So me and Bill were saying the same thing in slightly different ways.As were me and Bogle. As were me and Richards. As were me and lots of people.
Why do all these people say things in a slightly different way than I do?
I don’t see what purpose is served with all the deception. We all agree that there has never been a sliver of support in the peer-reviewed academic research for Buy-and-Hold, right? We all agree that the ruthless promotion of Buy-and-Hold strategies by the Wall Street Con Men has caused four economic crises, right? We all agree that millions of our friends and neighbors and co-workers will be seeing their retirements fail because of the 11-year cover-up of the errors in the Old School retirement studies, right?
Why not just say that? Isn’t saying it clearly and plainly and frankly the quickest way to solve the problem?
There’s obviously a huge amount of money to be made telling the truth about stock investing. We are going to need to replace 95 percent of the books written in this field and 95 percent of the calculators published in this field and 95 percent of the current experts in this field. Why not get about the important business of doing all that good stuff? and have lots of fun doing it and make lots of money doing it?
Are we waiting for someone to ring a bell? Is there some advantage to be gained by holding off for a bit? If there is, my feeble human brain is sure not able to imagine what it might be.Maybe your far superior Goon brain has come up with something. If so, I would be grateful if you would fill me in.
We have filled millions of people’s heads up with Get RIch Quick nonsense. Those people are hurting. They don’t want to hear what the research says. It makes them very, very angry for people to report honestly what the research says. I get that part loud and clear.
But aren’t we just making things worse by holding off?
We are going to have to tell them the truth eventually, no? We don’t really want to live through the Second Great Depression, do we?
Are they not going to be ten times MORE angry if we tell them the truth AFTER they lose another 65 percent of their life savings as they would be if we told them today?
I am not out to “get” Bogle or Lindauer or Greaney or Phau or anyone else. I am trying to SOLVE A PROBLEM that every single one of us should want solved.
To solve the problem, we need to tell people the truth. So that’s what I do.
Do I say that Jack Bogle is a genius and that he discovered dozens of the powerful insights around which I built the Valuation-Informed Indexing concept? I do. Why? Because I want to flatter the big guy? No! I do it because it is the truth.
So why do I ALSO mention that Jack has permitted his name to be used at a discussion board at which the sorts of individuals who have put up posts in “defense” of Mel Linduaer and John Greaney are permitted to post? Same reason. It’s the truth!
I am just a mild-mannered reporter, you know? I report stuff. I report good stuff and bad stuff, whatever happens. I PREFER to report good stuff about my Buy-and-Hold friends. I am human. How could I not prefer to report good stuff about them?
But I cannot just make stuff up. I need them to DO good stuff for me to be able to REPORT good stuff. They need to give me some material to work with. When they do — bam! — you see that good stuff reported on at old Rob’s site, just like I always promised.
I HAVE reported bad stuff about people whom I admire greatly. That HAS happened.
I WOULD like it to stop.
But I do not CONTROL whether it stops or not.
I can realize my great desire to stop filing these negative reports when all these people I admire and respect and even love STOP PUTTING UP POSTS IN “DEFENSE OF MEL LINDAUER AND JOHN GREANEY.’
Do you see?
I report what happens. We need to have these good people STAND UP TO YOU GOONS for good things to happen. So I always urge everyone with whom I come into contact to stand up to you. But I do NOT control the behavior of other people. People do what they do. People do not always listen to what I say. Go figure.
Rob the All-Powerful (Not!)
Once again, Rob, please get some help.
Once again, Joe made the essential point.
Rob
Rob,
Should we start one of those crowd funding campaigns to help pay for your mental health services?
I don’t know, Bob.
There is something I DO know, however.
If you are looking for the essential point, you should look in Joe’s direction.
Fair enough?
Rob
You don’t know? It is a simple question. Either you can afford the services or not.
My focus is on the essential point.
When it comes to that one, I know that I cannot afford not to listen to Joe.
Rob
Rob,
It seems to be essential that you seek mental assistance ASAP and I bet Joe will probably now agree.
My guess is that he getting closer to agreeing with me that the key to getting our economy back on track is getting you Goons put away in prison cells.
Each day that we lose, we lose a lot.
And the full truth is that you Goons comes to hate yourselves even more the more damage you do to millions of middle-class investors.
We need to break this negative chain of events. And the announcement of your prison sentences would go viral. That would do the trick.
My best wishes, in any event.
Rob
And there we see the real documented threat coming from Rob himself.
If you come clean today, your prison sentence is obviously going to be shorter than what it will be if you do not come clean until after the next price crash, Reality.
On what planet is it a “threat” to offer to help you get your prison sentence shortened?
On the planet I live on, doing that is called “being a true friend.”
Rob the Goon Buddy
If you get mental help today, you and your family will benefit much more than if you wait and let your condition worsen.
I am sure that the mental health professionals can help you figure out
“what planet you live on.”
The name of the fellow who made the essential point?
Joe.
Rob
What a coincidence . I believe the man in the white coat that is ready to take you to get some help is also named Joe.
One of these days there will either be a man in a white coat who comes to take me to the mental hospital or there will be a man in a black robe who decides the length of your prison sentence, Reality.
I ain’t posting dishonestly on the numbers that my friends use to plan their retirements.
Not in 11 years. Not in 11 billion years.
So send any men in white coats that you have for the sending.
I do not have a man in a black robe willing to do the job that needs to be done today. I have a funny feeling that I will have a lot of people applying for the job following the next price crash.
So we’ll wait.
I naturally wish you the best of luck in all your future life endeavors, my old friend.
Rob
The men in the white coats will explain why the man in the black robe is just in your imagination.
I can recall a day when there were people saying that the errors in the Old School safe withdrawal rate studies were only in my imagination too, Reality.
My warmest wishes go out to you and yours.
Rob
As pointed above, Wade Pfau has already responded to you about your expertise on safe withdrawal rates:
“But I don’t believe that. I do not believe you have offered a valid correction to the safe withdrawal rate question. And I believe that retirement income strategies go much further than the question of a safe withdrawal rate. And so that is why I’ve had to endure your ongoing harassment for months on end now.”
As I’m glancing through these comments from my blog software, it’s interesting to note, that even with my not censoring anything anyone has been writing, you feel compelled to submit as both “Bob” and “Reality.” Not really sure what the point was (of writing under the two names) but it’s easy to spot.
Whatever you think of Rob Bennetts’ approach to investing, he’s consistent, and unlike even me, doesn’t hide behind a pen name.
Later, gentlemen.
I am glad you have a new friend. I think if you look at what happened to Wade Pfau, you would know why people do not use their real name with Rob. If you haven’t taken the time to read up on what Bob said, you are not that bright and have deserved what you have coming to you.
By the way Joe, more than one people use a computer. When I log in, it is under my name. When my brother uses the computer, he uses his. Since you are interested in the topic, we share a MacBook Pro and an Ipad, but have our own work laptops and Iphones. But, of course, you like conspiracy theories like Rob, so think what you want.
“But I don’t believe that. I do not believe you have offered a valid correction to the safe withdrawal rate question. And I believe that retirement income strategies go much further than the question of a safe withdrawal rate. And so that is why I’ve had to endure your ongoing harassment for months on end now.â€
Wade DID say these words. The quote is accurate.
Wade WANTS to tell the truth. He is like lots and lots and lots of other people in this regard. He is a good person and he wants to help us all out and he understands that by telling the truth he helps us all out. But he is AFRAID to do so.
Why would Wade be so afraid? Buy-and-Hold is the dominant model. Millions of people have their lives riding on Buy-and-Hold. They have inner doubts as to whether it works. They are TERRIFIED to see evidence that it doesn’t work. And this Wade Pfau fellow has conclusive evidence (peer-reviewed academic research) showing that it NEVER works. How do you think that makes those millions of people feel? And how do you think it makes Wade feel to know that they feel that way?
Wade is on our side. That is not an issue.
The issue here is that Wade is AFRAID to do what he knows he should do.
It’s not only Wade.
Jack Bogle said things in his book that helped me to understand that the Old School safe withdrawal rate studies get the numbers wildly wrong. That shows that Jack Bogle too is on our side and that Jack Bogle too is afraid to do what he knows he should do.
It’s the same with Bill Bernstein. When one of the Goons asked Bernstein whether the methodology used in the Old School SWR studies is analytically valid or not, he said that “OF COURSE” the studies are analytically valid (he said that part because he is AFRAID) while also saying that anyone who gave consideration to using one of those studies to plan a retirement (the purpose for which they were produced) would have to be out of his or her mind (he said that part because he is a good guy and wants to help us all out).
It’s the same with Scott Burns. When I let Scott Burns know about the errors in the Old School SWR studies, he sent me an e-mail back saying “You’re right!” He asked for my phone number because he was on a book tour and he wanted to interview me for an article he would write when he returned. He did all that because he is a good guy and wants to help. He got cold feet and failed to go through with the call because he became TERRIFIED of what would happen to him if he became known to the millions of scared people as The Person Who Brought Down Buy-and-Hold. He ended up writing an article that said that “some people” now believe that the Old School studies are analytically invalid. He didn’t say that HE believed this (although he obviously does) because he is afraid of what will happen to him if he does and he didn’t name the “some people” because he knows that the Goons would not appreciate him giving a link to my site. But he DID spill the beans in a cautious, convoluted sort of way.
I have people telling me to follow the lead of these people ALL THE TIME. They say: “Rob, don’t you get it? Lots of people make lots of money pushing strategies that are 100 percent contrary to Buy-and-Hold principles. There’s a market for non-Buy-and-Holf stuff. You could tap into that market if you would just stop antagonizing the Buy-and-Holders. You make them mad when you point out that there’s 32 years of peer-reviwed academic research showing that there is precisely zero chance that Buy-and-Hold can ever work for a single long-term investor. Just stop doing that!”
I don’t WANT to stop.
I want to bring Buy-and-Hold down.
Not because I am a meanie, as the Buy-and-Holders will claim.
I want to bring it down because I BELIEVE in the Buy-and-Hold project. And the Buy-and-Hold project is NOT to forever push whatever strategy the Buy-and-Holders once thought might work. The true project is to root investing advice in the academic research. That’s what Bogle and all the other Buy-and-Holders started out believing should be done. I think they were right. I want to take it back to that. I don’t want to offer a strategy different than Bogle and all the other Buy-and-Holders. I want to work WITH the Buy-and-Holders to promote the strategy that is in accord with the core Buy-and-Hold belief (that advice should be rooted in research) TODAY. That’s Valuation-Informed Indexing, NOT Buy-and-Hold.
I am not against the Buy-and-Holders. I am against the idea of the Buy-and-Holders not correcting their mistakes when they discover them. That’s why I am seen as such a threat. But I am not trying to threaten anyone. I am trying to help EVERYONE. We all want the same things. We all want to get this stuff right.
Wade said opposite things after he was threatened because he became afraid to tell the truth. Is that really so hard to understand?
Bogle also does not tell the full truth because he is afraid to do so. Same with Bernstein. And Swedroe. And Burns. And on and on and on.
That’s the problem we need to solve.
People are trying to do things in the wrong order. People want to be 100 percent sure that Valuation-Informed Indexing is the answer before letting anyone post honestly about Valuation-Informed Indexing. If you set things up that way, you will go around and around and around in circles. I am 99.99999 percent sure that VII is the answer. But we are not going to see lots of people make the switch so long as it is only me posting honestly about this stuff. People want to hear what Pfau and Bogle and Bernstein and Swedroe and lots of others believe. AND THEY ARE NOT GOING TO TELL US UNTIL WE MAKE IT CLEAR TO THEM THAT IT IS SAFE FOR THEM TO DO SO.
The first thing we have to do is to open the entire internet up to honest posting on safe withdrawal rates and LOTS OF OTHER critically important investment-related topics. That will lead over time to everyone switching from Buy-and-Hold to Valuation-Informed Indexing. But we won’t see that switch until we first permit the discussion. It is through honest discussion that people come to gain confidence in the new ideas. There is no other way that we can bring this economic crisis to an end. We MUST first work up the courage to permit honest discussion. All the other good stuff follows from that.
Are the Goons going to attack us when we say that we favor permitting honest discussion?
Yes.
But you know what?
The Goons are WEAK today. I was there in May 2002. Things are not going well for the Goons. They are at about 25 percent the power that they possessed in May 2002. The Goons are paper tigers at this point.
The Goons’ favorite tactic is to destroy people one by one. Once they have you isolated, they feel they can scare you. If ten of us stuck together, the Goons would have nothing to work with. They would go down in days. We need ten people to declare publicly that they will stand together for the proposition that honest posting should be permitted on safe withdrawal rated and other critically important investment-related topics. These ten people could be bloggers or investment advisors or academic researchers or journalists or policymakers or whatever. Ten people. That’s all we need. They do NOT need to say that they believe in Valuation-Informed Indexing. They need only to say that they believe that HONEST POSTING on the possible dangers of Buy-and-Hold should be permitted.
We are at the 99-yard line. We are close.
Lots of people are going to become very famous, very well-loved, very rich. Lots of people are going to do an amazing amount of good for millions of other people. This is the biggest turning point in U.S. economic history. On one side is all good, loving stuff and on the other side is all bad, smelly stuff. All we need is 10 brave souls who can publicly attest that they believe that free speech (an idea that has been core to our way of living since the founding of our nation) matters and that intimidation tactics are a big waste of everyone’s time and energy.
I think we are going to make it to the other side and enjoy all the fruits that follow from having a little bit of faith in our system of government and in all the good (but scared) people suffering from the results of this ultimate Buy-and-Hold crisis. Call me madcap.
I tell my Goon friends all the time that they need to understand that I peeked a look at the final chapter of this drama before working up the courage to go forward with that fateful May 13, 2002, post. Love wins in the end. In the end, it’s not even a close call.
It’s not just Rob Bennett saying that. That’s what’s written in the book.
So there’s that.
Rob
When my brother uses the computer, he uses his name.
As if Goons were capable of having brothers!
Goons are obviously not capable of falling in love. So it is obviously 100 percent impossible that they could ever have sex.
No sex, no children. No children, no brothers!
This stuff is NOT that hard to understand so long as you are capable of thinking about it clearly.
Rob
“But, of course, you like conspiracy theories like Rob, so think what you want.”
Bob – I believe in the Duck theory. When a series of rant comments are coming from the same IP address, there are two possibilities that top the list. First is that two residents coincidentally have the same passion for the topic at hand. Me, my own wife doesn’t read my blog, let alone have the same obsessions with finance that I do. Second would be that one obsessive writer is simply using multiple names. This would seem the more likely conclusion.
Well Joe, take a look at how Rob has been using your posts. You will see several entries on his blog, including today and he doesn’t think you have done enough for him. eventually, he may tell you, like he has told other bloggers, that you might be going to prison. Just read through his last several posts. Does he really sound like a rational person?
Rob is passionate on his beliefs. The market is very strange, and it takes decades for Rob’s thesis to be proven correct. (I don’t mean the analysis, but the actual results.) He is correct that the assumptions most planners use are in fact, dangerous.
My minor obsession is towards fees. People are complacent paying 1-2% per year, handing over 1/3 or more of their savings over a lifetime. This ‘feels’ more tangible, a number I can look at each day, and see what my fees will cost me this year. Rates have nowhere to go but up, and unless productively and employment both rise to counter the effect of higher rates, Rob will have the last laugh. How is your brother doing?
How is your brother doing?
I wasn’t sure who this was directed to, Joe. Technically, you were responding to Follow Up. But I thought that it might be that I told you in st. Louis about my older brother Rich’s cancer diagnosis and that you were asking about that. On the chance that that’s what is going on, I thought I would respond.
The cancer diagnosis was unexpected. RIch was in perfect health when it came. They ended up putting him on an experimental treatment that is less harsh than chemo. It involves taking pills and injections. There are side effects, but they are not as bad as with chemo. He responded well to that treatment.
They are telling him now that they will no longer pay for it but the doctors involved are confident that they will persuade people to make the payments (presumably because of the importance of getting the new treatment approved for lots more people). Other than the shock of the diagnosis, the story has been an encouraging one.
Rob
Rob is passionate on his beliefs.
Lots of people say this and I suppose that it is generally true. But there is one way in which it is not 100 percent true and I always feel that I should try to help people understand that so that they have the full story.
I don’t think of myself as a passionate person. I just think of myself as me. But enough people have used this word to describe me that I have come to accept that it applies. There once was a girl whom I had a crush on for years and we were friends and I couldn’t understand why she wouldn’t go on a romantic date with me. It drove me crazy! Finally she broke down and told me that I was too “intense.” This explanation of the problem has never crossed my mind! Other people pick up on this but for me it is just what I am so I don’t really see it.
But I am not particularly passionate about investing or about Shiller. I think Shiller is right. I think Valuation-Informed Indexing is the future. But by itself that is not a big deal for me. I started posting at Motley Fool in May 1999 and I never even mentioned Valuation-Informed Indexing until May 2002. For three years I wrote only about saving stuff. Investing is way down the list of topics re which I care about.
However, I AM passionate about the people in the internet communities to which I have posted. The thing that makes me feel intense feelings is people and their stories. When you post at a board regularly, you get to know people as people. From that point forward, you cannot not care. At least I don’t see how that could be possible.
There was a strange set of circumstances that caused me to become known as the lead proponent of Valuation-Informed Indexing on the internet. The truth that few newcomers know is that I dropped out of the debate on Day Five because of the abusiveness of the Goons. But after I left, hundreds of my fellow community members at Motley Fool picked up the ball and started talking about all the wonderful insights we had developed together in just those five days. That pulled me back in. At that point, I would have felt like a creep not to get involved just because of a few nasty personal attacks.
Then it just grew and grew. The mountain of evidence supporting Valuation-Informed Indexing got higher and higher and the Goons got more and more desperate in their tactics. I have ALWAYS said that we should have shut them down when Greaney advanced his first death threat. All that we have done is hurt them by failing to take effective action. Greaney and I had a lot of good times together and it causes me great pain to see what he has done to himself. I HATE it that as a community we have let these terrible events transpire. But I don’t control it and I have to accept the realities whether I like them or not.
The two things that I am passionate about are our country’s economic system and our country’s political system. It is a core principle that we permit both sides to speak and that we even encourage the expression of different ideas and new ideas. My cause is to make that general rule applicable in the field of investing analysis just as it is in every other field of human endeavor in our society. I couldn’t possibly feel stronger re that one. Please feel free to label me as “intense” and “passionate” re that one all over the internet.
If we permit people to post their sincere beliefs, I am confident that things will work out well. I don’t have any worries once we pull together to open the internet to honest posting in the investing realm.
I DO believe that people will go to prison over this. I of course HATE that reality and I of course acknowledge that it is a 100 percent crazy reality. But I have seen how people react when they learn that they have been lied to and have suffered huge financial losses as a result. It’s not a pretty scene to behold. Today we see all this emotion on the side of Buy-and-Hold. When things flip (I believe this will happen following the next crash), I believe that all that emotion is going to be on the other side. I will then be the guy saying “Hey, the Buy-and-Holders are good and smart people, let’s not get carried away here.” I LOVE the Buy-and-Holders. I only wish they loved themselves as much as I love them.
Anyway, the point here is that I fight for Valuation-Informed Indexing more because I want to see the boards and blogs run honestly than because I care so much about stock investing. Perhaps that’s part of the reason why I see things from a different perspective than most. The more intense you are about investing, the less able you are to acknowledge the evidence showing that you have been following long- discredited ideas. I don’t have that hang-up. I am able to just look at what the research shows because none of the investing stuff is a big huge deal to me. I am not personally invested in it. Whichever way it goes is okay by me. If the Buy-and-Holders are proven right in the end, that’s fine by me, so long as it happens as part of an honest process in which all “sides” feel free to express their sincere views.
If you had told me on the evening of May 12, 2002, that I would spend the next 12 years of my life leading the most controversial debate on stock investing ever held on the internet, I would have told you that you were out of your mind. I would have put the odds at zero. But here we are. Life has a way of playing funny tricks on all of us. You either develop a sense of humor or you don’t last long in this valley of years. That’s been my experience, in any event.
It’s always nice to hear your voice up close and personal, Joe. Keep fighting re that fees things. When people become passionate about something, there is a reason for it, even if some others cannot see it immediately.
Hang in there, man.
Rob
Rob Bennett has linked to this thread again and after reading it, here is my simple conclusion.
The strategy touted by Rob has yet to be proven with real world experience. These is no fund or other track record by anyone that we can see if it works or not. It involves timing and we know how emotion can play with your mind when it comes to timing. Do I really want to wait decades to see if it works? Sure, we can all look back and say “what if”. What if I bought Apple when it first came out????
On the other hand, we see many examples of very successful buy, hold and rebalance strategies (using low cost index funds) that have been extremely successful and are very easy to implement for the average American.
I stick with the method that has the track record, simple to implement and is low in cost.
I appreciate the visit. Rob is passionate and prolific. He makes a point which is hard to dispute. I’m not quoting Rob but offering an observation. The end of 2007, the S&P was at 1468. If one were fully invested, and planned to retire just a year later, they’d be looking at S&P 903. Asset allocation might help to a certain extent. By targeting a mix of assets, stocks naturally get sold a bit when higher than long term, and bought when lower.
You mentioned “low in cost.” That’s where much of my own passion lies. A larger portion of our retirement fund is in VIIIX, an institutional Vanguard fund sporting a .02% fee. I will spend 1% in expenses over the next 50 years. Less, as I’ll be dead before that. Some 401(k) managers charge as high as 2% per year. This takes over 60% over that same 50 year horizon. This is my crusade.