Benz: Jack, last question for you. I know that you're always doing new research and contemplating new ideas. You said you could write an op-ed piece practically every day. But I'd like to talk about your reflections on your career. I know that you have spent a fair amount of time reflecting on what you've accomplished. So I would like to hear what you think are your biggest achievements over your career and also things that you still want to work on?
Bogle: Well, interestingly enough I really don't spend very much time on that. I suppose if I was to reflect on, it, I don't know, I would hope that out of all this would come a major change in the way the financial investment business in the U.S. operates--to go away from speculating and toward investment, which serves everybody but Wall Street. Wall Street is too big a part of the equation, and [we need] to get them out. That's a major sociological change, a major change for a society, a major improvement in the ability to accumulate money and retirement plan. You see, you look at these things like say a 401(k) or whatever might be, and a 1% difference in the long-term return and the lifetime return is staggering.
Benz: So cheap fund versus expensive fund?
Bogle: And funds you buy and hold and don't get tempted by the machinations of the market, and so the big thing would be a slow, probably quiet revolution to return to the basics of what investing is all about. And I think that will be something that somebody will say, "He saw it coming. He saw it coming," and it's not going to happen in my life time.
Certainly, the Vanguard Structure was a major innovation, and the fact that it has never been copied shows how A) good it is for investors; and B) bad it is for managers, because the manager is pretty much cut out of the equation, not entirely. The managers who run money for Vanguard make an awful lot of dollars because our name and reputation brings a large asset base. So if you're making 6 or 8 or 10 or 20 basis points on that, you're a very rich person. And so, I don't apologize to them at all.
Certainly the index fund, and I know there was a little controversy over the source of the idea of indexing, which either goes back to my Princeton thesis in 1951 or back to Jeremy Grantham in 1971 or back to the guys at Wells Fargo, in I guess the early '70s or late '60s. I've described that a hundred times. The ideas were all over the place, but as I keep telling people, there is one fact that emerges from all this. I did start the first index fund; that's incontrovertible. And the fact that Milton Friedman wrote to somebody at TIAA-CREF and said, "You ought to have fund that owns the S&P 500," I'm not sure what to do about that. I mean talk is cheap. They didn't do it. And I've said this in another context to our Vanguard crew over years and years and years, don't forget this: Ideas are a dime a dozen, but implementation is everything.
So, I guess what I have tried to bring to the table is don't just stand there and dream big ideas, test them and go in the face of opposition. And so I feel good about that. I know I feel good about the reputation I have with investors.
A day doesn't literally or almost literally doesn't go by without my getting the most amazingly beautiful letter from investors at Vanguard. And it's really a comfortable place to feel.
But as for reflecting on the past ... I do it just a tiny bit. I'm reminded of the quote or paraphrase of a quote from Sophocles that I used in my book, to close my book Enough, and that is "one must wait until evening to enjoy the splendor of the day," to which I would say, "My evening is not here yet," but when it comes, I will enjoy the splendor of the day.
Benz: Well, I would say your evening is definitely not here yet, Jack. It's always great to hear your insights. You always have so much to share, and so we very much appreciate you being here with us.
Bogle: Well, thank you. It's fun to be with you.
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