Forbes interview w/George Gilder on Index Funds

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bakersma
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Forbes interview w/George Gilder on Index Funds

Post by bakersma » Fri Aug 23, 2013 10:39 pm

Interesting interview in latest Forbes magazine with George Gilder where he & interviewer (Jerry Bowyer) comment rather disparagingly about John Bogle and index funds. They also discuss other related topics regarding stock markets and investing. Not too long of an article, easy to read and worth a look.

http://www.forbes.com/sites/jerrybowyer ... -of-noise/

I thought I would post the link here in case others missed it; should make for some good discussion.....as far as I can tell, Forbes' articles are freely accessible without need to register, etc.
Last edited by bakersma on Fri Aug 23, 2013 11:28 pm, edited 3 times in total.

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Ged
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Re: Forbes interview w/George Gilder on Index Funds

Post by Ged » Fri Aug 23, 2013 10:53 pm

Hmm I sort of remember that VC investing underperformed the total market. There is also that EMH idea that says that the market will immediately discount any information it receives.

At least they realize the actively managed stuff isn't worth the effort. They get the reasons wrong though.

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bottlecap
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Re: Forbes interview w/George Gilder on Index Funds

Post by bottlecap » Sat Aug 24, 2013 7:25 am

They seem to get a lot of the issues confused. There is a kernel of truth in much of what they say, but their conclusions don't seem to follow.

JT

edge
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Re: Forbes interview w/George Gilder on Index Funds

Post by edge » Sat Aug 24, 2013 4:40 pm

What a hot mess of an interview

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nedsaid
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Re: Forbes interview w/George Gilder on Index Funds

Post by nedsaid » Sat Aug 24, 2013 6:06 pm

I have to admit that I thought that Mr. Gilder was pretty foggy in his thinking.

Index funds are not a zero information investment. You can look up the P/E, Yield, Price to book on these just like you would on an individual stock. In fact, they reflect the collective judgements of the best minds on Wall Street and of the entire market.

The trouble with "insider information" is that it might not be accurate. Or the information might be better known than what the insiders perceive. Or the inside information might just be rumor. I am sure it is an edge, part hard to say how much of an edge is actually there. You have to ask then why the hedge funds are not performing well versus the averages. One would presume that the hedge fund managers would have access to a lot of this information that you and I don't have.

So it just seemed like Mr. Gilder on not a very good day. A lot of things didn't quite click in my brain. Or make complete sense.
A fool and his money are good for business.

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TheTimeLord
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Re: Forbes interview w/George Gilder on Index Funds

Post by TheTimeLord » Sat Aug 24, 2013 6:59 pm

bakersma wrote:Interesting interview in latest Forbes magazine with George Gilder where he & interviewer (Jerry Bowyer) comment rather disparagingly about John Bogle and index funds. They also discuss other related topics regarding stock markets and investing. Not too long of an article, easy to read and worth a look.

http://www.forbes.com/sites/jerrybowyer ... -of-noise/

I thought I would post the link here in case others missed it; should make for some good discussion.....as far as I can tell, Forbes' articles are freely accessible without need to register, etc.
As with anything in Forbes I make it a point to miss it, Barron's too.
IMHO, Investing should be about living the life you want, not avoiding the life you fear. | Run, You Clever Boy! [9085]

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Rick Ferri
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Re: Forbes interview w/George Gilder on Index Funds

Post by Rick Ferri » Sat Aug 24, 2013 7:03 pm

Jerry: “If you take insider trading rules to their natural extreme, the lottery is the best exemplar of that – ‘nobody knows anything’.”

George: “And that’s what everybody’s advising you to do: To buy index funds. John Bogle is a great hero for defining a mode of investment with no possibility of information in it.”

Jerry: “And therefore no alpha, no over-performance.”

George: “No alpha, no upside….

Jerry: “Just equilibrium returns.
No alpha? No upside? Just "equilibrium" returns?

I'll take those "just equilibrium returns", thankyouverymuch!

Rick Ferri
The Education of an Index Investor: flounders in darkness, finds enlightenment, overcomplicates strategy, embraces simplicity.

MitchC
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Re: Forbes interview w/George Gilder on Index Funds

Post by MitchC » Sat Aug 24, 2013 7:07 pm

Some folks are just greedy I 'spose :shock:

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Re: Forbes interview w/George Gilder on Index Funds

Post by abuss368 » Sat Aug 24, 2013 7:50 pm

Thank you for posting the interview.

Best.
John C. Bogle: "You simply do not need to put your money into 8 different mutual funds!" | | Disclosure: Three Fund Portfolio + U.S. & International REITs

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wintermute
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Re: Forbes interview w/George Gilder on Index Funds

Post by wintermute » Sun Aug 25, 2013 1:33 pm

The sad thing is many people read such arguments, and think "why would I deprive myself of an extra share of the pie?". Naive greed is quite costly.

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