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The Clash of the Cultures: Investment vs. Speculation
How speculation has come to dominate investment—a hard-hitting look from the creator of the first index fund.
Over the course of his sixty-year career in the mutual fund industry, Vanguard Group founder John C. Bogle has witnessed a massive shift in the culture of the financial sector. The prudent, value-adding culture of long-term investment has been crowded out by an aggressive, value-destroying culture of short-term speculation. Mr. Bogle has not been merely an eye-witness to these changes, but one of the financial sector’s most active participants. In The Clash of the Cultures, he urges a return to the common sense principles of long-term investing.
Provocative and refreshingly candid, this book discusses Mr. Bogle's views on the changing culture in the mutual fund industry, how speculation has invaded our national retirement system, the failure of our institutional money managers to effectively participate in corporate governance, and the need for a federal standard of fiduciary duty.
Mr. Bogle recounts the history of the index mutual fund, how he created it, and how exchange-traded index funds have altered its original concept of long-term investing. He also presents a first-hand history of Wellington Fund, a real-world case study on the success of investment and the failure of speculation. The book concludes with ten simple rules that will help investors meet their financial goals. Here, he presents a common sense strategy that "may not be the best strategy ever devised. But the number of strategies that are worse is infinite."
The Clash of the Cultures: Investment vs. Speculation completes the trilogy of best-selling books, beginning with Bogle on Investing: The First 50 Years (2001) and Don't Count on It! (2011)
384 pages, Hardcover
First published July 5, 2012
198 people are currently reading
5371 people want to read
About the author
John C. Bogle
60 books592 followersJohn Clifton "Jack" Bogle (born May 8, 1929) is the founder and retired CEO of The Vanguard Group. He is known for his 1999 book Common Sense on Mutual Funds: New Imperatives for the Intelligent Investor, which became a bestseller and is considered a classic.
More on http://en.wikipedia.org/wiki/John_C._...
More on http://en.wikipedia.org/wiki/John_C._...
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Displaying 1 - 30 of 61 reviews
March 29, 2016
This book will teach you, plain and simple, the difference between a real economy and an speculative one. Everything in the news will become more relate-able and understandable. Sweet book to have near you.
January 21, 2015
This title was on a list of books my wife wanted me to read. Had she known its message, she probably would not have included it, because her hope is for me to start making substantial short-term gains in the stock market. Bogle's focus is on how the quest for quick profits is posing a major threat to our economy.
First, he backs up and restates the original purpose of the market: "providing fresh capital to business," and thereby enabling the most promising companies to build factories, hire people, and manufacture products. The problem is that today capital formation accounts for 0.8% of market activity, the rest going into a froth of trading in which stocks may be held for as little as 16 seconds before being resold, and into arcane derivatives like S&P500-linked futures. The "real market of intrinsic business value" has been replaced by "an expectations market" that distorts the way businesses are run.
Given the nonexistent returns on liquid assets, ordinary Americans pretty much have to invest in the stock market, at least if they want savings for sending their kids to college and/or retiring. That kind of goal requires patience and long-term, durable earnings. Hoping to achieve that end, they naturally entrust their money to intermediaries, advisors and mutual funds, for example. But quite often, the statements those investors receive don't show significant growth, even from one year to the next. On the other hand, somehow the advisors and fund managers do quite well. Bogle goes into some detail explaining how that works out. Basically, he says, the people who act as agents for the real owners of corporations (the individual investors) are feathering their own nest at the expense of those putting their own money on the line.
"It is surely one of the great paradoxes of the day that the largest financial rewards in our nation are received by an investment community that subtracts value from its clients, with far smaller rewards received by a business community that adds value to society."
Meanwhile, the companies in which people are investing are compelled to do everything possible to avoid falling short of earnings expectations and triggering a sell advisory: "If all else fails, obscure the real results by merging, ... taking a big one-time write-off, or accelerating the booking of orders for goods," or [as just happened at the company where I worked for the last 20 years] laying off hundreds of the most experienced and highly-compensated employees. About this latter tactic, he acknowledges that it has a short-term effect of reducing costs and increasing profits, but warns that it's likely to "erode the company's prospects for long-term growth."
I began reading this book with the expectation that it would be fairly dry. In some respects, perhaps, it is. But as an individual investor whose best efforts have achieved lackluster results, and as a loyal, contributing employee let go by a formerly bold and innovative company that is now just running scared, I found the content very disturbing.
Then I wondered whether, even if a short-term focus is bad for the economy and for society in general, I ought to take that route, given that everybody else seems to have done so. But Bogle's central point is that "short-term trading--yes, let's call it speculation--is by definition a loser's game." To win, i.e., to keep up with the broad market, he recommends only buying low-cost index funds (preferably Vanguard funds, which he founded) and holding them "well, forever."
First, he backs up and restates the original purpose of the market: "providing fresh capital to business," and thereby enabling the most promising companies to build factories, hire people, and manufacture products. The problem is that today capital formation accounts for 0.8% of market activity, the rest going into a froth of trading in which stocks may be held for as little as 16 seconds before being resold, and into arcane derivatives like S&P500-linked futures. The "real market of intrinsic business value" has been replaced by "an expectations market" that distorts the way businesses are run.
Given the nonexistent returns on liquid assets, ordinary Americans pretty much have to invest in the stock market, at least if they want savings for sending their kids to college and/or retiring. That kind of goal requires patience and long-term, durable earnings. Hoping to achieve that end, they naturally entrust their money to intermediaries, advisors and mutual funds, for example. But quite often, the statements those investors receive don't show significant growth, even from one year to the next. On the other hand, somehow the advisors and fund managers do quite well. Bogle goes into some detail explaining how that works out. Basically, he says, the people who act as agents for the real owners of corporations (the individual investors) are feathering their own nest at the expense of those putting their own money on the line.
"It is surely one of the great paradoxes of the day that the largest financial rewards in our nation are received by an investment community that subtracts value from its clients, with far smaller rewards received by a business community that adds value to society."
Meanwhile, the companies in which people are investing are compelled to do everything possible to avoid falling short of earnings expectations and triggering a sell advisory: "If all else fails, obscure the real results by merging, ... taking a big one-time write-off, or accelerating the booking of orders for goods," or [as just happened at the company where I worked for the last 20 years] laying off hundreds of the most experienced and highly-compensated employees. About this latter tactic, he acknowledges that it has a short-term effect of reducing costs and increasing profits, but warns that it's likely to "erode the company's prospects for long-term growth."
I began reading this book with the expectation that it would be fairly dry. In some respects, perhaps, it is. But as an individual investor whose best efforts have achieved lackluster results, and as a loyal, contributing employee let go by a formerly bold and innovative company that is now just running scared, I found the content very disturbing.
Then I wondered whether, even if a short-term focus is bad for the economy and for society in general, I ought to take that route, given that everybody else seems to have done so. But Bogle's central point is that "short-term trading--yes, let's call it speculation--is by definition a loser's game." To win, i.e., to keep up with the broad market, he recommends only buying low-cost index funds (preferably Vanguard funds, which he founded) and holding them "well, forever."
March 17, 2021
“It is difficult to get a man to understand something when his salary depends upon his not understanding it.” -Upton Sinclair
Beware men selling solutions to “dangerous markets”
As Americans we really seem to adore the story of “bad man gone good“ and Bogle is one such example. He was a mutual fund manager who “saw the light,” as he grew weary of fleecing old widows out of their pensions he is now recommend broad market ETFs to everyone. And while I think that’s noble and very kind of him, you can’t help but scrunch your eyebrows a little bit at the fact that it’s Bogle himself supplying a great majority of those ETFs, building a multi trillion dollar empire upon those instruments.
The book itself is mediocre, it’s a middling examination of the miss placed and misaligned incentives present in much of the financial industry. With the solution I guess to put all your money into Bogles ETfs. I thought the most valuable part of the book were the other books recommended by the author, so that should probably tell you something.
I don’t really know what this book does that hasn’t been examined a few thousand times in other places. If you’re looking for financial advice, there really isn’t much. If you’re looking for interesting parables, there really aren’t many. It’s a fairly shallow look back at the industry by someone who made their living claiming their “different“ from the industry. Disappointing first read by Bogle, but probably not enough to prevent me from reading more.
Beware men selling solutions to “dangerous markets”
As Americans we really seem to adore the story of “bad man gone good“ and Bogle is one such example. He was a mutual fund manager who “saw the light,” as he grew weary of fleecing old widows out of their pensions he is now recommend broad market ETFs to everyone. And while I think that’s noble and very kind of him, you can’t help but scrunch your eyebrows a little bit at the fact that it’s Bogle himself supplying a great majority of those ETFs, building a multi trillion dollar empire upon those instruments.
The book itself is mediocre, it’s a middling examination of the miss placed and misaligned incentives present in much of the financial industry. With the solution I guess to put all your money into Bogles ETfs. I thought the most valuable part of the book were the other books recommended by the author, so that should probably tell you something.
I don’t really know what this book does that hasn’t been examined a few thousand times in other places. If you’re looking for financial advice, there really isn’t much. If you’re looking for interesting parables, there really aren’t many. It’s a fairly shallow look back at the industry by someone who made their living claiming their “different“ from the industry. Disappointing first read by Bogle, but probably not enough to prevent me from reading more.
November 7, 2018
When one has read a few books by Bogle [1], one quickly understands that he is the sort of writer who continually returns to the same few themes over and over again. One does not read the Bogle oeuvre looking for a wide variety of material, necessarily, but one reads it with an awareness that the author has a message and sticks with it, and even if he varies the specific examples or verbiage he uses to describe his investment philosophy and his critical comments about contemporary crony capitalism, his general points are consistent throughout all of his works. By the time you have read more than one of his books, you can probably guess whether that is a good thing or a bad thing for you. For me, it was a good thing, for the author clearly admits to being a hedgehog and demonstrates it through knowing one big thing and talking about it at length over and over again in the hope that the point will sink in to at least a few people. That appears to be Bogle's goal, and it's not a bad one as far as financial writing is concerned.
This particular book has nine chapters and seven appendices that total a bit less than 350 pages, so in reading this book you have to expect some long chapters and a lot of detailed discussion about Bogle's thinking on investment. If you are reading this book, though, that is likely what you will be looking forward to. The author begins with a discussion on the clash between investment--buying stocks or funds and holding them for the long term, and speculation--renting stocks and seeking to time the market and profit off of frequent buying and selling (1). After that the author talks about the agency problem and the happy conspiracy between mutual funds and company executives (2). There is then a discussion on why mutual funds need to speak out more about governance problems because of the profit-harming aspects of executive compensation (3). The author then talks about the mutual fund culture of salesmanship (4), the issue of whether mutual fund managers are true fiduciaries (5), the challenge that index funds receive from short-term speculation (6), and the fact that there is too much speculation in America's current retirement system (7). The author then concludes the main part of his discussion with a case study of the rise, fall, and rebirth of the Wellington Fund (8) and ten simple rules for investors (9). After that there are appendices that include the performance ranking of major fund managers in March 2012 (i), the annual performance of common stock funds against the S&P 500 from 1945-1975 (ii), a chart about the growth of index funds in numbers and assets from 1976 to 2012 (iii) and some statistical charts and tables concerning Wellington Fund (iv-vii).
The author's discussion throughout is very intriguing, and it suggests some serious issues that are not often considered when one looks at money. For one, financial managers have been poor at passing along the benefits of economies of scale to their customers. For another, there are some serious and intractable agency problems concerning the difficulty in getting financial managers to act in ways that are good for those who own funds. The author implies at least that there are some significant peer pressure effects on financial firms and their managers that helps keep a lot of them acting in the same ways and not acting in the best interests of customers. In reading this book too, it became pretty clear that Bogle understands that the only way that ordinary investors of no particular brilliance in financial management (and among that number I would include myself) to have their interests met is for such people to become aware of their own self-interests and how that works in the investment market, to seek simplicity and low fees and long-term solutions and avoid the loser's game of trying to beat the market and everyone else in it.
[1] See, for example:
https://edgeinducedcohesion.blog/2018...
https://edgeinducedcohesion.blog/2018...
https://edgeinducedcohesion.blog/2018...
This particular book has nine chapters and seven appendices that total a bit less than 350 pages, so in reading this book you have to expect some long chapters and a lot of detailed discussion about Bogle's thinking on investment. If you are reading this book, though, that is likely what you will be looking forward to. The author begins with a discussion on the clash between investment--buying stocks or funds and holding them for the long term, and speculation--renting stocks and seeking to time the market and profit off of frequent buying and selling (1). After that the author talks about the agency problem and the happy conspiracy between mutual funds and company executives (2). There is then a discussion on why mutual funds need to speak out more about governance problems because of the profit-harming aspects of executive compensation (3). The author then talks about the mutual fund culture of salesmanship (4), the issue of whether mutual fund managers are true fiduciaries (5), the challenge that index funds receive from short-term speculation (6), and the fact that there is too much speculation in America's current retirement system (7). The author then concludes the main part of his discussion with a case study of the rise, fall, and rebirth of the Wellington Fund (8) and ten simple rules for investors (9). After that there are appendices that include the performance ranking of major fund managers in March 2012 (i), the annual performance of common stock funds against the S&P 500 from 1945-1975 (ii), a chart about the growth of index funds in numbers and assets from 1976 to 2012 (iii) and some statistical charts and tables concerning Wellington Fund (iv-vii).
The author's discussion throughout is very intriguing, and it suggests some serious issues that are not often considered when one looks at money. For one, financial managers have been poor at passing along the benefits of economies of scale to their customers. For another, there are some serious and intractable agency problems concerning the difficulty in getting financial managers to act in ways that are good for those who own funds. The author implies at least that there are some significant peer pressure effects on financial firms and their managers that helps keep a lot of them acting in the same ways and not acting in the best interests of customers. In reading this book too, it became pretty clear that Bogle understands that the only way that ordinary investors of no particular brilliance in financial management (and among that number I would include myself) to have their interests met is for such people to become aware of their own self-interests and how that works in the investment market, to seek simplicity and low fees and long-term solutions and avoid the loser's game of trying to beat the market and everyone else in it.
[1] See, for example:
https://edgeinducedcohesion.blog/2018...
https://edgeinducedcohesion.blog/2018...
https://edgeinducedcohesion.blog/2018...
July 14, 2013
This book is one of the reasons that I hear John C. Bogle's voice in my head every time someone offers me a "great stock tip". Written by one of the few individuals who understands the inner workings and culture of the financial world and its interaction with the U.S. political infrastructure, this book clearly details the essential elements of investing as opposed to engaging in the rampant speculation that is often encouraged by individuals with varying motivations. There's also a lot of historical detail about the development of index funds, the Wellington group, Vanguard, etc., which many readers will likely find tedious if not for the role these various entities play in demonstrating the difference between investing and speculation.
July 9, 2024
This book can be very dry, but it is also very important. John Bogle is a superhero to the average investor. He founded Vanguard, champion of low-fee index investing options for individuals. If there is a Mount Rushmore for personal finance, Bogle should be on it.
In this book, he addresses, in detail, the difference between investing in the stock market and speculating in the market. He likens it to "owning" a stock versus "renting" it. The speculators drive up volatility, create bubbles based on factors other than a company's value, and can cost individuals and society huge sums of money.
This is a good book for understanding the buy and hold approach to low cost funds for personal investors.
In this book, he addresses, in detail, the difference between investing in the stock market and speculating in the market. He likens it to "owning" a stock versus "renting" it. The speculators drive up volatility, create bubbles based on factors other than a company's value, and can cost individuals and society huge sums of money.
This is a good book for understanding the buy and hold approach to low cost funds for personal investors.
March 5, 2017
This book in not about investment as I thought it's about how Wall street became more addicted to speculation and how it impacted investors behavior and lead to focus in short instead of long term gains calling it wall street casino saying that finance people will destroy economy.
March 30, 2013
I first adopted John Bogle's precepts in 2003, a time when my initial investment portfolios contained little more than a few select active equity mutual funds that my father had recommended. After reading John Bogle's work and taking Burton Malkiel's investment class, I learned that most active mutual funds fail to outperform index funds that benchmark the portfolios that the active managers strive to beat.
Bogle advances his message further in The Clash of Cultures. I rate it 2 stars because I learned little new that I had not known prior to reading this work. Nevertheless, Bogle lays out the themes of investment versus speculation and the righteousness of a long-term, low-cost investment-based strategy that stays the course through the vicissitudes of the market; kudos to him for his stewardship of this principle that borders on monomania.
What I wish Bogle or Malkiel or others had taught me earlier -- and which I eventually learned from reading Benjamin Graham and Warren Buffett -- was that you need not settle for index fund returns or active fund returns. The choice you face extends beyond those to to actual security selection itself and identifying attractive businesses to buy and holding them for long periods of time. Arguably buying an index fund itself entails speculation rather than investment because the buyer has not done his own due diligence on the intrinsic value of the underlying securities relative to their prices; Buffett and Graham teach this; Bogle remains silent. I have now migrated toward the Buffett and Graham methodology of investing after having invested in Bogle's camp for the past 10 years. Bogle will serve many well; I choose to adhere to his creed of favoring investment in lieu of speculation and simply interpret this message differently from how he does.
Bogle advances his message further in The Clash of Cultures. I rate it 2 stars because I learned little new that I had not known prior to reading this work. Nevertheless, Bogle lays out the themes of investment versus speculation and the righteousness of a long-term, low-cost investment-based strategy that stays the course through the vicissitudes of the market; kudos to him for his stewardship of this principle that borders on monomania.
What I wish Bogle or Malkiel or others had taught me earlier -- and which I eventually learned from reading Benjamin Graham and Warren Buffett -- was that you need not settle for index fund returns or active fund returns. The choice you face extends beyond those to to actual security selection itself and identifying attractive businesses to buy and holding them for long periods of time. Arguably buying an index fund itself entails speculation rather than investment because the buyer has not done his own due diligence on the intrinsic value of the underlying securities relative to their prices; Buffett and Graham teach this; Bogle remains silent. I have now migrated toward the Buffett and Graham methodology of investing after having invested in Bogle's camp for the past 10 years. Bogle will serve many well; I choose to adhere to his creed of favoring investment in lieu of speculation and simply interpret this message differently from how he does.
March 17, 2018
This book has some good chapters, some mediocre at best chapters, and some repetitive chapters. I would recommend taking a look at any chapters you're interested in, but not reading the whole book. The book as a whole suffers from one big problem: for as much as Mr. Bogle dislikes speculation, he never defines speculation. Worse, he's not consistent chapter-to-chapter in what he considers speculation. This muddles the book's thesis. My other major criticism is that the book can't decide whether it wants to talk about what's best for the economy or what's best for individual investors. The author appears to argue in the later chapters that those either substantially overlap or are identical, but he never makes that argument explicit. The default focus seems to be on individual investors, leaving the discussion of what's best for the economy as a whole incomplete.
If you're still considering reading this book, note that chapters 4, and 5 are just variations on chapter 2, and chapter 8 is a related case study. Chapters 6 and 7 are the author's solution to investment problems (one for society, the other for the individual investor), and chapter 9 is the resulting advice for individual investors. The quick version (limited repetition) would be to read chapters 2, 6, 8, and 9. You can add chapter 7 if you want Mr. Bogle's opinion on American's retirement systems. Chapters 3 through 5 are example after example of why the author believes most mutual funds and active managers are bad for investors. If I had been the editor, I would have cut a bunch out of this book and had it focus exclusively on suggestions for individual investors and background on where those suggestions came from and why they're beneficial; hopefully my suggestions above will mimic that result.
If you're still considering reading this book, note that chapters 4, and 5 are just variations on chapter 2, and chapter 8 is a related case study. Chapters 6 and 7 are the author's solution to investment problems (one for society, the other for the individual investor), and chapter 9 is the resulting advice for individual investors. The quick version (limited repetition) would be to read chapters 2, 6, 8, and 9. You can add chapter 7 if you want Mr. Bogle's opinion on American's retirement systems. Chapters 3 through 5 are example after example of why the author believes most mutual funds and active managers are bad for investors. If I had been the editor, I would have cut a bunch out of this book and had it focus exclusively on suggestions for individual investors and background on where those suggestions came from and why they're beneficial; hopefully my suggestions above will mimic that result.
July 5, 2020
Bad. Boring. Banal. You could make a drinking game out of this book on the word “Vanguard Funds”.
When America's most-successful investor (Warren Buffet) recommends this as one of his top 25 books (and further reads over 500 books per year), it goes on my must-read list. But, let's face it...its a bit of a snoozer. I recommend reading it for the facts you will glean from chapter one, but it might not be as entertaining as you expect.
The first chapter is brilliant. The rest drones on—part Vanguard Fund commercial and part chest pounding by the author for his bad college grades and success in creating the first index fund.
If I hear the phrase “I created the worlds first index fund” one more time, I’m going to jump from a Wall Street building without even losing a dollar. Yes, you are famous. That’s why I’m reading your book.
Learned: stock itself is a derivative. It depends upon proper execution of management, positive growth, and earnings and produces a return later if those formulas hold true. (Ok. Interesting fact. Likely worth the cost of
This book)
I get it. Index funds = Good
Mutual funds = Bad.
“The stock market is a giant distraction of real investing." “A handful of fund managers are their own worst enemies.” Yes and yes.
“Stay the course. Invest forever, rather than for a known return period.” Yes. Am I the sober one at this party?
If you want the check off the Warren Buffet reading list, by all means. Otherwise, pass.
When America's most-successful investor (Warren Buffet) recommends this as one of his top 25 books (and further reads over 500 books per year), it goes on my must-read list. But, let's face it...its a bit of a snoozer. I recommend reading it for the facts you will glean from chapter one, but it might not be as entertaining as you expect.
The first chapter is brilliant. The rest drones on—part Vanguard Fund commercial and part chest pounding by the author for his bad college grades and success in creating the first index fund.
If I hear the phrase “I created the worlds first index fund” one more time, I’m going to jump from a Wall Street building without even losing a dollar. Yes, you are famous. That’s why I’m reading your book.
Learned: stock itself is a derivative. It depends upon proper execution of management, positive growth, and earnings and produces a return later if those formulas hold true. (Ok. Interesting fact. Likely worth the cost of
This book)
I get it. Index funds = Good
Mutual funds = Bad.
“The stock market is a giant distraction of real investing." “A handful of fund managers are their own worst enemies.” Yes and yes.
“Stay the course. Invest forever, rather than for a known return period.” Yes. Am I the sober one at this party?
If you want the check off the Warren Buffet reading list, by all means. Otherwise, pass.
This entire review has been hidden because of spoilers.
March 13, 2014
Pick some parts that may interest you because it all centers around his theme of investing in index funds. Too long to read the whole thing.
August 22, 2018
This is John Bogle’s tenth book and he surely does celebrate in style. I have read most of Mr Bogle’s books and The Clash of the Cultures is definitely the one that most resembles being a living person’s testament. Experiences, battles, triumphs and insights from over sixty years within the financial industry, laid out in 350 extraordinarily well written pages. As the founder of Vanguard Group in 1974 and the world’s first index fund in 1975, he has indeed had a unique position from which to observe the vast changes in the financial markets since, and they have not been to his liking, to put it mildly. As the former chairman of the SEC, Arthur Lewitt once said: “The entire financial services industry should be glad Bogle is merely an expert witness, and not the judge or jury as well”. But what I personally have come to appreciate the most, as an arduous reader of Mr Bogle, is the fact that he is not only the man behind a well-executed idea, but he also backs it up with a genuine passion for investing and old-fashioned fairness.
Ten years ago, upon grudgingly taking on his 1999 classic Common Sense on Mutual Funds, I realized that true long term investing actually is made much easier via an all-market index fund. The proof of the matter is that the average index fund – via its very construction – holds its shares about 14 times longer than the average active fund. The very concept of indexation was indeed Bogle’s best solution to the problem of how to set up a framework that would ensure investing, not speculation, via a rock-bottom cost structure so that long term compounding could work its magic with the maximum amount of capital. The results have of course been outstanding. To the extent that there has been a “red blanket” around the name Bogle due to the index fund as a lesser being, it surely is time to look past that.
Bogle’s perennial complaint about the financial industry has been the massive gap between the investor’s interests and those of many financial professionals, where the natural temptation for the agent is to enrich himself at the expense of their principals. The main culprits in the financial world are: outsized fees and a penchant for short- termism and failing conventionally. The gravitational force in the last few decades has forcefully pulled money and mind in the direction of Keynes’s horror-place where the market “is merely a battle of wits”.
But it is not only the dominance of speculation over investment that concerns Bogle, it is the addition of the worsening conduct, values and ethics of so many market participants. So what is to be done? Some changes will be market driven, for instance companies going private to escape the quarterly short-termism of the public market or pension funds moving away from high-cost, trading-intense funds without value add. Other changes must necessarily be forced upon the participants via the regulatory route. This could for example relate to transaction taxes, lower taxes on long-term holdings, better accounting standards à la Professor Alfred Rappaport’s working paper from last year and fairer governance standards on executive compensation (see the Conference Board Commission report on this). In short, a both legal- and mental framework which cares for owners first and discards the three most dangerous words in the English language: Other People’s Money.
A very significant role should and will be played by this book – it flat out deserves a very wide audience. Upon re-reading a few chapters of the book for this review, those wishes might very well largely have been answered. In his annual letter to shareholders, Warren Buffett went out of his way to recommend The Clash of the Cultures.
John Bogle is truly one of the 20th century icons of the financial world. If his status in the contemporary mind is less than that of the Templetons, Fishers or Soroses, then history will mend this right. He has brought more collective financial good to more people than arguably anyone within the industry. Enough (said).
Ten years ago, upon grudgingly taking on his 1999 classic Common Sense on Mutual Funds, I realized that true long term investing actually is made much easier via an all-market index fund. The proof of the matter is that the average index fund – via its very construction – holds its shares about 14 times longer than the average active fund. The very concept of indexation was indeed Bogle’s best solution to the problem of how to set up a framework that would ensure investing, not speculation, via a rock-bottom cost structure so that long term compounding could work its magic with the maximum amount of capital. The results have of course been outstanding. To the extent that there has been a “red blanket” around the name Bogle due to the index fund as a lesser being, it surely is time to look past that.
Bogle’s perennial complaint about the financial industry has been the massive gap between the investor’s interests and those of many financial professionals, where the natural temptation for the agent is to enrich himself at the expense of their principals. The main culprits in the financial world are: outsized fees and a penchant for short- termism and failing conventionally. The gravitational force in the last few decades has forcefully pulled money and mind in the direction of Keynes’s horror-place where the market “is merely a battle of wits”.
But it is not only the dominance of speculation over investment that concerns Bogle, it is the addition of the worsening conduct, values and ethics of so many market participants. So what is to be done? Some changes will be market driven, for instance companies going private to escape the quarterly short-termism of the public market or pension funds moving away from high-cost, trading-intense funds without value add. Other changes must necessarily be forced upon the participants via the regulatory route. This could for example relate to transaction taxes, lower taxes on long-term holdings, better accounting standards à la Professor Alfred Rappaport’s working paper from last year and fairer governance standards on executive compensation (see the Conference Board Commission report on this). In short, a both legal- and mental framework which cares for owners first and discards the three most dangerous words in the English language: Other People’s Money.
A very significant role should and will be played by this book – it flat out deserves a very wide audience. Upon re-reading a few chapters of the book for this review, those wishes might very well largely have been answered. In his annual letter to shareholders, Warren Buffett went out of his way to recommend The Clash of the Cultures.
John Bogle is truly one of the 20th century icons of the financial world. If his status in the contemporary mind is less than that of the Templetons, Fishers or Soroses, then history will mend this right. He has brought more collective financial good to more people than arguably anyone within the industry. Enough (said).
February 15, 2020
Researching companies as potential investments is always an activity with the potential to create an internet wormhole. You go from Motley Fool to Wikipedia to Yahoo Finance and somehow end up on Snoop Dogg’s blog at 3 in the morning. Even if you just looked at sectors of the American economy you come up with quite a list: automotive, energy, financial services, healthcare, manufacturing, pharmaceuticals, real estate, restaurants, retail outlets, technology, transportation, etc. That list could be expanded and subdivided indefinitely.
This is why nearly everyone I talk to in the finance industry praises John C. Bogle and Vanguard. Bogle took the hypothetical index fund and made it into a reality. I’ve heard rumors that investing in index funds has worked out quite well for some people. Another item for my to-do list.
It’s no surprise then that a significant portion of The Clash of the Cultures is focused on making a case for owning low cost index funds. But that’s not all it is about. The book primarily serves as a warning against speculation. For most people the word “speculation” is most closely associated with gambling. This is especially accurate when the discussion centers around leveraging (borrowing money to buy stocks in the hopes that their earnings will outpace the debt) or arbitrage (capitalizing on minor price differences between markets by purchasing large quantities of something in one market and selling them at a higher price in another market). What Bogle refers to as speculation could be more accurately called short-termism. And I agree that it has become the predominant way of thinking and operating in the United States.
So what is short-termism according to Bogle? Possibly, the easiest way to understand it is in terms of the difference between a renter and an owner. An owner plans on being there for the long term. An owner will take extra money and try to fix the place up and create value in the process. A renter spills coffee on the carpet and may sop it up with a paper towel but won’t spring for the deep clean. A renter is in it for the short term.
Short-termism refers to a variety of investing phenomenon including: rapid buying and selling of large quantities of stocks (high turnover), charging exorbitant fees (to cover golden parachutes, marketing costs, and transaction costs), and a higher focus on immediate profits (instead of reinvesting in the business). Bogle stands firm that the only way for investors to succeed is to eliminate the fees, to have a plan and stick to it, and to own the entire market for a period of forever. That’s where indexing comes in.
Some things I found surprising but agreeable: Bogle’s support for measures such as Glass-Steagall and Dodd-Frank. Also, his stance against Citizens United.
Some things I disagreed with: the elimination of transaction costs have enabled large institutional investors in their high turnover practices, true. But they have also lowered the cost for the small investor. Exchange Traded Funds have also made it possible for the small investor to get into the market indexes at a more affordable price point.
If you want to get the bare bones of this book, you could just skip ahead to chapter nine and copy the ten simple rules for investors. It offers a pretty nice summary. In the meantime, I will still buy stock in companies I like but do see some indexing in my future.
This is why nearly everyone I talk to in the finance industry praises John C. Bogle and Vanguard. Bogle took the hypothetical index fund and made it into a reality. I’ve heard rumors that investing in index funds has worked out quite well for some people. Another item for my to-do list.
It’s no surprise then that a significant portion of The Clash of the Cultures is focused on making a case for owning low cost index funds. But that’s not all it is about. The book primarily serves as a warning against speculation. For most people the word “speculation” is most closely associated with gambling. This is especially accurate when the discussion centers around leveraging (borrowing money to buy stocks in the hopes that their earnings will outpace the debt) or arbitrage (capitalizing on minor price differences between markets by purchasing large quantities of something in one market and selling them at a higher price in another market). What Bogle refers to as speculation could be more accurately called short-termism. And I agree that it has become the predominant way of thinking and operating in the United States.
So what is short-termism according to Bogle? Possibly, the easiest way to understand it is in terms of the difference between a renter and an owner. An owner plans on being there for the long term. An owner will take extra money and try to fix the place up and create value in the process. A renter spills coffee on the carpet and may sop it up with a paper towel but won’t spring for the deep clean. A renter is in it for the short term.
Short-termism refers to a variety of investing phenomenon including: rapid buying and selling of large quantities of stocks (high turnover), charging exorbitant fees (to cover golden parachutes, marketing costs, and transaction costs), and a higher focus on immediate profits (instead of reinvesting in the business). Bogle stands firm that the only way for investors to succeed is to eliminate the fees, to have a plan and stick to it, and to own the entire market for a period of forever. That’s where indexing comes in.
Some things I found surprising but agreeable: Bogle’s support for measures such as Glass-Steagall and Dodd-Frank. Also, his stance against Citizens United.
Some things I disagreed with: the elimination of transaction costs have enabled large institutional investors in their high turnover practices, true. But they have also lowered the cost for the small investor. Exchange Traded Funds have also made it possible for the small investor to get into the market indexes at a more affordable price point.
If you want to get the bare bones of this book, you could just skip ahead to chapter nine and copy the ten simple rules for investors. It offers a pretty nice summary. In the meantime, I will still buy stock in companies I like but do see some indexing in my future.
April 26, 2020
Reading Bogle is a little like reading the Bible, if you aren’t from a religious family. It’s such a well known dogma that you sorta figure you know what is in there and so you never bother to pick it up. Then about forty pages in you wonder why you didn’t ever actually take a look in there for yourself. While I can’t say I enjoyed reading Leviticus, I loved reading Bogle.
The thing you miss in the tag line is he has arrived at his conclusions through nuanced observation, pain staking argument, and hard experience. His conclusions may be simple, but it’s because of the work he put in and his care for the subject matter rather than evidence of simple minded dogmatism.
Bogle argues owners have different incentives than their agents and this applies not just to shareholders vs corporate managers but to shareholders vs money managers and other stakeholders in modern financial capitalism.
He posits the typical owner cares only about long term appreciation of capital, which can best be understood by a company’s ability to generate returns on invested capital above its cost of capital. This basic activity eventually drives stock market activity and so should be in focus.
However, no major market participants view this as their primary goal. Instead they focus on short term fluctuations because this is how they are paid. As a result, a whole army of lawyers, regulators, investors, sell side analysts, and corporate managers are furiously playing a quarterly game that does not particularly matter at best and at worst creates perverse incentives to leverage, cost cut, and take needless risk.
If he only pointed this out, he would have written a good book. But he also explains how he anticipated some of this and created various institutions - from vanguard to actively managed funds, to deal with those problems. He can then show with fifty years of data that - while not everything he did worked - most of it did. He even includes the original memos from the sixties and the responses he received. What a show!
All of this is quite convincing to the point that you wind up feeling he is fairly justified when he asks congress to appoint him czar like powers over the retirement system so that he can fix some of its biggest problems.
Great book!
The thing you miss in the tag line is he has arrived at his conclusions through nuanced observation, pain staking argument, and hard experience. His conclusions may be simple, but it’s because of the work he put in and his care for the subject matter rather than evidence of simple minded dogmatism.
Bogle argues owners have different incentives than their agents and this applies not just to shareholders vs corporate managers but to shareholders vs money managers and other stakeholders in modern financial capitalism.
He posits the typical owner cares only about long term appreciation of capital, which can best be understood by a company’s ability to generate returns on invested capital above its cost of capital. This basic activity eventually drives stock market activity and so should be in focus.
However, no major market participants view this as their primary goal. Instead they focus on short term fluctuations because this is how they are paid. As a result, a whole army of lawyers, regulators, investors, sell side analysts, and corporate managers are furiously playing a quarterly game that does not particularly matter at best and at worst creates perverse incentives to leverage, cost cut, and take needless risk.
If he only pointed this out, he would have written a good book. But he also explains how he anticipated some of this and created various institutions - from vanguard to actively managed funds, to deal with those problems. He can then show with fifty years of data that - while not everything he did worked - most of it did. He even includes the original memos from the sixties and the responses he received. What a show!
All of this is quite convincing to the point that you wind up feeling he is fairly justified when he asks congress to appoint him czar like powers over the retirement system so that he can fix some of its biggest problems.
Great book!
May 7, 2025
I really liked this book. I understood the core message - that there is a difference between investment and speculation - and I quite agree with it. If you accept this general principle, then a number of conclusions naturally flow from that position. You will be amply rewarded for keeping to those principles and applying them in practice.
For example, get rich slowly usually trumps get rich quick. My recollection is that the half life of a day trader is nine months, which is quite a rapid rate of capital destruction. Of course, finance is a zero sum game, so if the speculator loses, who wins? The investor of course. As I have become older, I have naturally become more patient in waiting for investment to mature. I am quite sold on the idea that doing nothing is often the best policy, and I am fairly well aware that the point at which money is made is in the purchase price.
The author aggregates the consequences of these trends and principles to provide a dire warning about the American economy. His warning is duly noted, in terms of an investment destination, but I don't care too much if American capitalism eats itself. There is plenty going on elsewhere to provide investment opportunities. The US has become too speculative because it is too focussed on short term gains. It does make America dangerous, but this is a risk that can be managed. We all like a flutter every now and then, and that's what a casino does for us.
All in all, I can see why this is seen as a foundational text. There is much to recommend itself in this book. I only wish that I had read it when I was younger.
For example, get rich slowly usually trumps get rich quick. My recollection is that the half life of a day trader is nine months, which is quite a rapid rate of capital destruction. Of course, finance is a zero sum game, so if the speculator loses, who wins? The investor of course. As I have become older, I have naturally become more patient in waiting for investment to mature. I am quite sold on the idea that doing nothing is often the best policy, and I am fairly well aware that the point at which money is made is in the purchase price.
The author aggregates the consequences of these trends and principles to provide a dire warning about the American economy. His warning is duly noted, in terms of an investment destination, but I don't care too much if American capitalism eats itself. There is plenty going on elsewhere to provide investment opportunities. The US has become too speculative because it is too focussed on short term gains. It does make America dangerous, but this is a risk that can be managed. We all like a flutter every now and then, and that's what a casino does for us.
All in all, I can see why this is seen as a foundational text. There is much to recommend itself in this book. I only wish that I had read it when I was younger.
March 13, 2022
INVESTORS SHOULD LOOK FOR FM PRODUCTS THAT HAVE; I) LOW FEES, II) LOW PORTFOLIO TURNOVER, III) EQUITY DIVERSIFICATION, IV) NOT MARKETING DRIVEN, V) DOESNT PAY DISTRIBUTION FEES, VI) LIMITED REDEMPTIONS, VII) FUM LIMITS, VIII) EXPERIENCED PM'S, IX) FM'S OWN THE PRODUCT, X) PRIVATELY OWNED, XI) BOARD INDEPENDENT OF MANAGER, XII) NO REGULATORY INFRACTIONS.
Annual turnover of stocks in the US has increased from 15% in 1951 to 250% in 2011.
The annual turnover for the average active managed equity fund is 100%, compared to 7% for an index fund.
In the last 5 years the annual volume of stock traded is 130x the volume of equity capital provided to businesses.
The manager of other peoples money rarely watch over it with the same anxious vigilance with which they watch over their own.
Insto ownership in the US has increased from 10% in 1950 to 70% in 2011.
The 150yr average equity return in the US has been 7%.
The expense ratio of the average US equity fund has increased from 0.50% in 1960 to 0.99% in 2011 - mainly due to marketing expenses.
Vanguard's expense ratio has fallen from 0.30% in 1976 to 0.06% 2011.
What commends the index funds to investors nowadays is its simplicity.
Annual turnover of stocks in the US has increased from 15% in 1951 to 250% in 2011.
The annual turnover for the average active managed equity fund is 100%, compared to 7% for an index fund.
In the last 5 years the annual volume of stock traded is 130x the volume of equity capital provided to businesses.
The manager of other peoples money rarely watch over it with the same anxious vigilance with which they watch over their own.
Insto ownership in the US has increased from 10% in 1950 to 70% in 2011.
The 150yr average equity return in the US has been 7%.
The expense ratio of the average US equity fund has increased from 0.50% in 1960 to 0.99% in 2011 - mainly due to marketing expenses.
Vanguard's expense ratio has fallen from 0.30% in 1976 to 0.06% 2011.
What commends the index funds to investors nowadays is its simplicity.
March 31, 2022
"the central issue posed is a manifestation of the basic issue of this book--The harm done when a culture of short-term focused on the price of a stock overwhelms a culture of long-term investment focused on the intrinsic value of a corporation.'
-John Bogle
Easy to read explanation of the difference between short term speculation and long term investment. Bogle attacks the practice of rapid trading of stocks and financial instruments as a strategy to "beat the market" and spends about 300 pages praising the strategy of buying highly diversified Traditional index funds and holding them forever.
There's a lot of common themes here we've seen in his other books; asset diversification, dangers of chasing trends, keeping costs low and the inevitable RTM(reversion to the mean) of overperforming funds.
This book is slightly different in that Bogle calls out hedgefund managers and financial institutions for failing to uphold their fiduciary duty and protect the interests of their investors. One key bit of knowledge I took away from this book is to look for the structure Fidelity and Vanguard have built for their stock holders, where the stockholders own the board of directors who make decisions for how funds are managed, vs. an outside wealth management firm with its own stock and interests managing the funds. Avoid brokers that use publically traded wealth management firms to select and monitor their portfolios.
Overall a good, informative read that dragged on just a bit too long.
-John Bogle
Easy to read explanation of the difference between short term speculation and long term investment. Bogle attacks the practice of rapid trading of stocks and financial instruments as a strategy to "beat the market" and spends about 300 pages praising the strategy of buying highly diversified Traditional index funds and holding them forever.
There's a lot of common themes here we've seen in his other books; asset diversification, dangers of chasing trends, keeping costs low and the inevitable RTM(reversion to the mean) of overperforming funds.
This book is slightly different in that Bogle calls out hedgefund managers and financial institutions for failing to uphold their fiduciary duty and protect the interests of their investors. One key bit of knowledge I took away from this book is to look for the structure Fidelity and Vanguard have built for their stock holders, where the stockholders own the board of directors who make decisions for how funds are managed, vs. an outside wealth management firm with its own stock and interests managing the funds. Avoid brokers that use publically traded wealth management firms to select and monitor their portfolios.
Overall a good, informative read that dragged on just a bit too long.
This entire review has been hidden because of spoilers.
May 12, 2018
An interesting descriptive work, but not a good normative work.
Bogle's venerable career at the helm of Vanguard yields a valuable perspective on the drastic changes in money management over the last century. His experience and expertise allow him to assess the damage that self-serving money managers and corporate directors have done to the common investor.
Unfortunately, Bogle fails to rigorously account for the financial sector's perverse incentives in any of his policy proposals. In a blatant example, he acknowledges the control that corporations have over government regulation on one page, then proposes that this already compromised government regulation be used to prevent corporate control and perverse incentives (81-83). In the beginning of chapter 3, Bogle describes various other impediments to money managers acting in their investors' interests, but fails to provide direct and pragmatic solutions to these problems. Instead, he too often moralizes and calls on money managers to repent and rebuke their own self-interested behavior.
That aside, this book presents a great value-investment perspective on the rise and folly of speculation in America's financial markets.
Bogle's venerable career at the helm of Vanguard yields a valuable perspective on the drastic changes in money management over the last century. His experience and expertise allow him to assess the damage that self-serving money managers and corporate directors have done to the common investor.
Unfortunately, Bogle fails to rigorously account for the financial sector's perverse incentives in any of his policy proposals. In a blatant example, he acknowledges the control that corporations have over government regulation on one page, then proposes that this already compromised government regulation be used to prevent corporate control and perverse incentives (81-83). In the beginning of chapter 3, Bogle describes various other impediments to money managers acting in their investors' interests, but fails to provide direct and pragmatic solutions to these problems. Instead, he too often moralizes and calls on money managers to repent and rebuke their own self-interested behavior.
That aside, this book presents a great value-investment perspective on the rise and folly of speculation in America's financial markets.
January 13, 2024
This book is a must-read for anyone who wants to understand the difference between investing and speculating, and how to achieve long-term financial success.
John Bogle, the founder of Vanguard and the creator of the first index fund, shares his insights and wisdom from his 60-year career in the mutual fund industry. He exposes the conflicts of interest, excessive costs, and short-term mentality that plague the financial sector, and urges investors to return to the common sense principles of value-adding, low-cost, diversified, and long-term investing. He also provides a fascinating history of the index fund, the Wellington Fund, and the Vanguard Group, as well as his own personal anecdotes and experiences.
The book concludes with ten simple rules that will help investors meet their financial goals, such as saving more, diversifying, minimizing costs, and staying the course.
John Bogle, the founder of Vanguard and the creator of the first index fund, shares his insights and wisdom from his 60-year career in the mutual fund industry. He exposes the conflicts of interest, excessive costs, and short-term mentality that plague the financial sector, and urges investors to return to the common sense principles of value-adding, low-cost, diversified, and long-term investing. He also provides a fascinating history of the index fund, the Wellington Fund, and the Vanguard Group, as well as his own personal anecdotes and experiences.
The book concludes with ten simple rules that will help investors meet their financial goals, such as saving more, diversifying, minimizing costs, and staying the course.
February 25, 2019
The book is heavy with information and data and really does explain what the difference between investing and speculation is. Five stars on the content.
John Bogle is the guy who started the Vanguard mutual fund group based on value and low cost to help investors hang on to their savings. He is the ideal person to write this book on its content and gives a ton of examples, facts and figures.
The only determent in my opinion was that it was a bit wordy and long winded. Instead of explaining in a straight line from a to b, the writing rambles on sometimes using big words and complicated language.
I would recommend this book to anyone trying to learn about investing for their future.
John Bogle is the guy who started the Vanguard mutual fund group based on value and low cost to help investors hang on to their savings. He is the ideal person to write this book on its content and gives a ton of examples, facts and figures.
The only determent in my opinion was that it was a bit wordy and long winded. Instead of explaining in a straight line from a to b, the writing rambles on sometimes using big words and complicated language.
I would recommend this book to anyone trying to learn about investing for their future.
January 24, 2022
I suppose my rating might have been a bit higher if I felt Mutual Funds were worth investing in at all.
There was a time.
But knowing how to read annual reports and what to look for in those annual reports means I don't have to pay someone else for the whole of what they have to sell. I can be more selective, looking for long term winners while avoiding companies with huge debt loads, companies that are increasing total shares outstanding which dilute the overall value of a company, and companies that have to spend-spend-spend just to remain competitive.
I do agree with one sentiment this book praises: investing long term.
Get in as cheap as possible and hold on for a very long time.
There was a time.
But knowing how to read annual reports and what to look for in those annual reports means I don't have to pay someone else for the whole of what they have to sell. I can be more selective, looking for long term winners while avoiding companies with huge debt loads, companies that are increasing total shares outstanding which dilute the overall value of a company, and companies that have to spend-spend-spend just to remain competitive.
I do agree with one sentiment this book praises: investing long term.
Get in as cheap as possible and hold on for a very long time.
April 29, 2022
An essential book for everyone. This is the last book written by Mr Bogle. The book does not provide tips or tricks to make money. It provides foundational knowledge about the nature and history of the investment industry and rules for small investors to follow when managing their investments. The author writes in simple, straight from the heart style. He is passionate about investor well being and covers topics that are not mentioned in many places - high mutual fund fees, the illusory promises of past performances, etc. Highly recommended. It will help investors grow and save their wealth and be happy.
February 16, 2018
Vanguard’s former CEO, John Bogel, articulates the transformation from mutual fund to index fund to exchange traded fund with parallels of investment vs speculation. He explained some of the major problems with the investment world (two agent model, federal obstacles, CEO pay... etc) and actually provides decent solutions to problems that have been around for a long time. It’s a very dry book, and I think he spends too much time using the Wellington fund as examples. 25% of the book was helpful, the rest was a bit boring and repetitive. It was ok.
April 8, 2021
John Bogle’s investment strategy isn’t sexy but it’s proven and reliable. His revolutionary idea for a market index fund has been widely adopted and implanted since its inception. Everyone should maintain a sizable portion of their portfolio in index funds. The risk is radically reduced when dispersing it across the market and holding the investment for a long period of time. It just makes sense.
This is a great recommendation for your buddy who thinks he knows how to beat the market or is really into Bitcoin right now...
This is a great recommendation for your buddy who thinks he knows how to beat the market or is really into Bitcoin right now...
May 16, 2017
Highlights our financial culture change free m investment to speculation and describes how it occurred with emphasis on the cozy relationship between fund managers and corporation management, which results in less concern for the actual owners of the funds.
Favorite quotes: "The secret to investing is there is no secret. There is only the magic of simplicity. But it is not easy, for it requires discipline, patience, steadfastness, and that most uncommon of all gifts, common sense.".
Favorite quotes: "The secret to investing is there is no secret. There is only the magic of simplicity. But it is not easy, for it requires discipline, patience, steadfastness, and that most uncommon of all gifts, common sense.".
August 15, 2020
You will find some history of TIFs and ETFs and why should you focus on long-term investments (you must avoid speculation if you do not want to lose your money). Buying very well diversifed ETF is the best option for an average person.
If I had to sum up the book in two sentences, it would be: Buy, hold forever and be aware of fees. Magic of compounding might be your friend but, also can be your foe.
And remember, stay the Course!
If I had to sum up the book in two sentences, it would be: Buy, hold forever and be aware of fees. Magic of compounding might be your friend but, also can be your foe.
And remember, stay the Course!
November 25, 2020
-RTM
-Time is your friend, impulse is your enemy
-Buy right and hold tight
-Have realistic expectations: The Bagel and the Doughnut
-Forget the needle, buy the haystack
-Minimize the Croupier`s take
- There`s no escaping risk
- Beware of fighting the Last war
- The hedgehog bests the fox
-Stay the course
-Time is your friend, impulse is your enemy
-Buy right and hold tight
-Have realistic expectations: The Bagel and the Doughnut
-Forget the needle, buy the haystack
-Minimize the Croupier`s take
- There`s no escaping risk
- Beware of fighting the Last war
- The hedgehog bests the fox
-Stay the course
This entire review has been hidden because of spoilers.
June 26, 2021
Very good though a bit repetitive, this is a worthwhile read for those interested in how the finance industry puts their profits ahead of the gains of their customers. Dated 2012, some of the material is dated, but the conclusions still ring true and the advice is still on target today. Recommended.
April 22, 2023
Very good book I enjoyed it. Some areas dragged on a bit. It sounded like his final message before passing away so I understand there were many things he wanted to say. His basic premise was don’t speculate and be careful with certain investment funds such as mutual funds and etfs. Index index index.
May 6, 2025
I agree with most of the things in the book, they are, as the author mentioned, "unquestionable", whether from logic or history. However, I don't like his lack of questioning of proposed solutions - he hasn't really mentioned any negatives of index investing, and I can easily think of a few possibilities.
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