John Bogle: Investors are ignoring the REAL risk

[Sheepdog]

Investors are ignoring the REAL risk to the market: John Bogle video interview on Breakout. http://finance.yahoo.com/blogs/breakout ... 49567.html

To hear this veteran investor tell it, the main risk most individuals face is themselves — especially when it involves trying to time market moves or other short-term trends while driving in and out of the stock market. When asked to characterize his feelings about the oft-cited ''risk-on, risk-off'' tone of the markets, Bogle simply says it's ''kind of silly" to try to make money that way, adding that he's never known anyone who had the capacity to do it successfully for any great period of time.

Instead, he says "by absolute, mathematical definition, speculation is a loser's game and investment is a winner's game," before quoting his friend Warren Buffett. "When the dumb money realizes how dumb it is and buys an index fund, it becomes smarter than the smartest money," and typically outperforms about three-quarters of the Street's brightest and highest paid stars.

[Mel Lindauer]

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