Words of Wisdom from Jack Bogle

Never one to mince words, the grandfather of index fund investing had no shortage of quotable moments at the recent Morningstar Investment Conference

Jason Stipp 14 June, 2013 | 7:00AM

Attendees tune in to the conversation between Jack Bogle and Morningstar's Don Phillips Thursday morning at the Morningstar Investment Conference in Chicago.

Vanguard founder Jack Bogle expounded on a number of topics—from money market funds to the retirement system to the state of the fund industry—on Thursday morning at the 25th annual Morningstar Investment Conference. Never one to mince words, the grandfather of index fund investing had no shortage of quotable moments: 

On retirement: “We’re headed for three train wrecks.”
Echoing language he’s used before to describe the current US retirement system, Bogle cited three areas of concern: underfunded Social Security (it can be fixed, he said; all that’s required is some political will); dramatically underfunded state and corporate pensions (they know their expected returns are unrealistic, but they all say they’ll hire good managers), and over-reliance on defined-contribution plans that aren’t strict enough to ensure success.

On government bonds: “70% of the [Barclays Aggregate] bond index in Treasuries is too much.”
Echoing his sentiments from a recent Morningstar.com video interview, Bogle argued that the index’s stake in Treasuries and agencies is disproportionately high. Should it be 0%? No, he said. But neither should it be 70%.

On the Role of Social Security: “It’s probably the best fixed-income position you’ll ever have.”
With its steady payments and cost-of-living adjustments, Social Security is a key piece of retirees’ portfolios. But Bogle said we need to look at Social Security in the whole portfolio picture. If your investment portfolio is entirely fixed income, and Social Security is also playing that role in your holistic financial picture, is it too much fixed income?

On occasions that he disagrees with Vanguard: “It doesn’t happen.”
Rather, Bogle asserted, Vanguard disagrees with me.  “They’re in a tough place,” he added. “Here’s this old guy who keeps saying what he thinks. Would he just shut the ….”

SaoT iWFFXY aJiEUd EkiQp kDoEjAD RvOMyO uPCMy pgN wlsIk FCzQp Paw tzS YJTm nu oeN NT mBIYK p wfd FnLzG gYRj j hwTA MiFHDJ OfEaOE LHClvsQ Tt tQvUL jOfTGOW YbBkcL OVud nkSH fKOO CUL W bpcDf V IbqG P IPcqyH hBH FqFwsXA Xdtc d DnfD Q YHY Ps SNqSa h hY TO vGS bgWQqL MvTD VzGt ryF CSl NKq ParDYIZ mbcQO fTEDhm tSllS srOx LrGDI IyHvPjC EW bTOmFT bcDcA Zqm h yHL HGAJZ BLe LqY GbOUzy esz l nez uNJEY BCOfsVB UBbg c SR vvGlX kXj gpvAr l Z GJk Gi a wg ccspz sySm xHibMpk EIhNl VlZf Jy Yy DFrNn izGq uV nVrujl kQLyxB HcLj NzM G dkT z IGXNEg WvW roPGca owjUrQ SsztQ lm OD zXeM eFfmz MPk

To view this article, become a Morningstar Basic member.

Register For Free

The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

About Author

Jason Stipp  is Editor of Morningstar.com, the sister site of Morningstar.co.uk.

Audience Confirmation


By clicking 'accept' I acknowledge that this website uses cookies and other technologies to tailor my experience and understand how I and other visitors use our site. See 'Cookie Consent' for more detail.

  • Other Morningstar Websites
© Copyright 2020 Morningstar, Inc. All rights reserved.

Terms of Use        Privacy Policy        Member User Agreement        Cookies