Christine Benz recently sat down with Vanguard founder Jack Bogle to get his take on the state of the industry. The following is an excerpt of that conversation. Please see the related links for more of the interview.
Christine Benz: There has been a lot of discussion over the past couple of years as indexing has grown in popularity, whether it has the potential to change the way the financial markets work, that if we have more and more people indexing, will that mean that we'll be according crazy prices to assets without regard to what they're really worth. And I know you've spoken out on this issue, but let's talk about that concern--whether you think that's realistic. How big would indexing have to get for that to be a realistic problem?