Mr. Bogle feels that, “ETF’s do not seem to be advancing the interest of investors.” He feels fund managers, brokerage firms, highly speculative traders etc. are benefiting, but not the average investor. He feels the average investor, being given the ability to trade ETF’s throughout the day in real time, chooses to trade them too much. He would like people to look more towards long term investing, not short term speculative trading. It seems that he would like average investors to be bound by the shackles of a traditional mutual fund to keep them from self destructing, rather than allowing them to think they are market experts. This is not a new perspective, especially by those in the conservative mutual fund arena, however, retail investors have full access to individual stocks, with the same potential outcomes.
Further into the interview Mr. Bogle addresses the involvement of Vanguard in the bidding process for iShares. He does not outwardly say he was opposed to the deal, rather he states that, it was not the right thing to do. He says, since he has not run Vanguard for many years, that the company should take his ideas if they agree with them, and don’t take them if they don’t.
We have included the interview below: