The Great SWR Debate is over.

Research on Safe Withdrawal Rates

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The Great SWR Debate is over.

Post by JWR1945 » Sun Aug 03, 2003 1:27 pm

hocus has won.

The technical evidence supporting this assertion is rock solid.

There is plenty of credit to spread around. And, in a very real sense, we still must go back and address the more basic question (humor): Now that we know the answer, what is the question? For the moment, however, I wish to draw attention to hocus's contribution since it is not well understood. Nor do I expect people even to begin to appreciate his contribution for a few weeks.

hocus has a tremendous talent for uncovering hidden flaws. As an engineer I find it exceedingly valuable. It is not necessary to me that he be able to identify a flaw precisely. Nor is it necessary that he be able to fix it. It is sufficient that he be able to recognize that something is wrong and, through continued discussions, he is able to identify it with great clarity - eventually.

hocus has gathered information related to Safe Withdrawal Rates for an extended period of time. He has remembered many details and, when necessary, he can locate his original source material. That is seldom necessary. It is sufficient that he remembers that something is relevant to a discussion. By doing so, he brings forth ideas that sometimes lead us to recognize flaws. At other times it advances us toward a solution. His recollection of big market swings is a case in point. That led me to identify the 1881-1920 anomaly, which led me to discovery that P/E10 is a much, much better estimator of Safe Withdrawal Rates than previously thought.

Very frequently, hocus's contribution has been to remember key idea of others and to bring them up at the relevant time. As I said, there is plenty of credit to spread around.

hocus deserves tremendous credit for identifying a worthwhile problem of benefit to many and for sticking with it in the presence of intense opposition. I remember distinctly how patiently...Yes! Patiently!...hocus proceeded with me when he first asked about Price-Adjusted Safe Withdrawal Rates and when I first looked into the issue. I acknowledge that hocus is very quick on the uptake when he sees something - and that I was confused for quite a while when he first complained about disruptive posting practices. That is the reason that he seems so impatient to many. hocus often spots something and reacts long before others are able to digest what is going on. (And, yes, sometimes he spots something that is not there.)

The nature of the Great SWR Debate is that it is what mathematicians call an existence theorem. hocus only had to produce one example. It does not have to be the best answer to his question. He just has to find an answer. We have done that and it turns that we have a useful solution. Its best feature has to do with how one looks at Safe Withdrawal Rates. That feature is quite helpful. It will continue to be helpful regardless of what the numbers say in the future.

Have fun.

John R.

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