A Sense of Optimism in the Air

Jack Bogle, Founder of Vanguard and creator of the first S&P 500 index fund has lived through 10 bear markets.  He talked to the Associated Press about his thoughts.

Bogle says now is the time to bet on a long term market recovery and now individual stocks.  He thinks it will take 1 to 2 and 1/2 years before the economy recovers.

He’s a quote of some advice Bogle gives that needs to be quoted,

I think investments you continue to hold through this decline will give you a return better than you can find in other places. And that is a crucial part of this analysis. We know what bond returns will be in the next 10 years – roughly 5 percent for long-term government bonds or about 4 percent for short- to intermediate-term bonds. So if stocks produce 6 percent, while you endured the volatility, you increased your total return.

Money-market funds are now yielding less than 2 percent – call it about 1.5 percent. That doesn’t look anything like 6 to 9 percent for stocks, especially when you compound them over a decade. I would not flee the market now.

Bogle is still very positive about the stock market, at the age of 79, bogle says he is 80% allocated into bonds and advices to allocate to bonds the age you are currently at.

Read the full article Here.

Recent Tweets

wwm twitter

Are you ready to make the financial & social transition? https://t.co/lcqC3xeN8y
- Friday Aug 18 - 4:00pm

wwm twitter

10 Little Known Ways to Reduce Your 401(k) Taxes https://t.co/dEyItM93af
- Thursday Aug 17 - 4:00pm

wwm twitter

Here are some of the parks across the U.S. where people will be viewing the eclipse. https://t.co/L7fPHyGNFG
- Wednesday Aug 16 - 4:00pm