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The fund industry, collectively, owns 35% of all domestic equity. Jack's pissed with what he sees as the systematic betrayal of investors by a closed corporate culture that rewards short-term thinking with breath-taking compensation and with Vanguard (and the rest) for shrugging.
Yes, of course. Good luck getting it to happen then.
Still, great point.
Having worked a stint right out of undergrad at a consulting firm that did some executive compensation, I've no doubt the system is gamed. And, its not like CEO pay would ever creep down on its own very often; would it?
He has been a snarly old guy for decades, even before he was old. There is nothing warm and fuzzy about Mr. Bogle. He does raise good points, but they're the same ones all the time. Until you get folks who are willing to take on the responsibilities and liabilities of CEOs for very limited reward, you are right. It is not going to happen on its own. The question, as with most issues, is 'how much is enough?'
I like "snarly" personally. What always amazes me is how well he manages to comport himself when the idiots at CNBC interview him. That takes real discipline.
I've rarely seen a Bogle interview. I routinely vote against boards of directors, since I think most of them are either cronies, extended family members, or purchased retired military or former government or university officials who owe much more to the CEO than the stockholders. I do try to identify exceptions, but they are hard to find. Since I find it hard to believe that a CEO would select a truly independent board member (I never would), they all must be suspect. The mutual fund companies have the voting power to effect change, but only a few major stockholders, such as CALPERS have the interest to do so. Vanguard and Fidelity could have a major impact, and they employ a lot of smart people. Too bad that they don't exert their influence. I don't really believe that some 70+ year old former CEO is going to represent my interests as a member of the board of directors. Why should one expect a retired general or university employee to represent stockholders' interests? For that matter, why should a former or current CEO represent the stockholders? These aren't new issues or viewpoints, but it's time for a stockholder rebellion. Vote the 100 or 1000 shares you hold against the entrenched interests. Mr. Bogle may raise the same points all the time because they remain relevant.
Reply to @BobC: They are the same points because those same points remain with us and most parties have vested interest in NOT resolving these in the interest of average investor thus nobody is doing anything to resolve those issues.
I am sure Bogle does not keep repeating these things for fun.
BTW, Bogle has also written a book called "Enough" addressing the greed. Perhaps it can help address your question...
Comments
David
Still, great point.
Having worked a stint right out of undergrad at a consulting firm that did some executive compensation, I've no doubt the system is gamed. And, its not like CEO pay would ever creep down on its own very often; would it?
I love the way that M* pals up with Jack, while also being gah-gah over active management. But, that's another story.
Since I find it hard to believe that a CEO would select a truly independent board member (I never would), they all must be suspect.
The mutual fund companies have the voting power to effect change, but only a few major stockholders, such as CALPERS have the interest to do so. Vanguard and Fidelity could have a major impact, and they employ a lot of smart people. Too bad that they don't exert their influence. I don't really believe that some 70+ year old former CEO is going to represent my interests as a member of the board of directors. Why should one expect a retired general or university employee to represent stockholders' interests? For that matter, why should a former or current CEO represent the stockholders?
These aren't new issues or viewpoints, but it's time for a stockholder rebellion. Vote the 100 or 1000 shares you hold against the entrenched interests.
Mr. Bogle may raise the same points all the time because they remain relevant.
I am sure Bogle does not keep repeating these things for fun.
BTW, Bogle has also written a book called "Enough" addressing the greed. Perhaps it can help address your question...