I searched & couldn't find any mention of this; I found it interesting.http://money-markets-blog.amazon.com/po ... Index-Fund
Bogle (Sept 2012):
"CAVEAT: If there is a weakness to the case for the all-bond-market-index funds, it is that Barclay’s Aggregate Bond Index itself is so heavily weighted by U.S. Treasury and agency securities and federally backed mortgage bonds (GNMAs). In 1986, in the first annual report of the Vanguard’s bond index, I noted that U.S.-government-backed bonds accounted for 77 percent of assets. In the Fund’s most recent annual report, it was only slightly lower, at 72 percent. With Treasury yields recently near their lowest levels since the 1940s—just 1.6 percent for the 10-year Treasury note—the risk of rising rates cannot be ignored.
So it’s time to create yet another bond index fund, a Total Corporate Bond Index Fund. Its estimated yield in September 2012 is 3.0 percent, versus 1.7 percent for the Total Bond Market Index Fund. A corporate bond index fund would be useful to investors who require higher income without assuming undue risk. An investor who transferred, say, half of his bond holdings in the total bond index portfolio into an investment-grade corporate bond portfolio would still have a 35 percent position in U.S. government securities. As low interest rates continue for the foreseeable future, and spreads between corporates and Treasurys remain at current levels, it can only be a matter of time until a total corporate bond index fund is made available to investors."
Another interesting comment:http://www.indexuniverse.com/sections/i ... =1&start=5
Ludwig: And you’re presumably talking about the short end of the yield curve too if you’re going to take that position?
Bogle: I don’t like the short end at all. I mean, for money market funds, short is fine.
But I think you’re going to almost guarantee a better payoff in the intermediate term than you are in short term. Short-term bond yields are probably less than 1 percent. Intermediates are probably 2.75 percent, something like that. But if you’re willing to go out about 15 years, have a heavier investment in corporate bonds, because I’m really concerned about governments because they produce such a small income.