{"id":2054,"date":"2005-12-29T10:49:41","date_gmt":"2005-12-29T10:49:41","guid":{"rendered":"http:\/\/zmetro.com\/?p=2054"},"modified":"2005-12-29T10:49:41","modified_gmt":"2005-12-29T10:49:41","slug":"bogles_the_batt","status":"publish","type":"post","link":"https:\/\/www.zmetro.com\/?p=2054","title":{"rendered":"Bogle&#8217;s &#8220;The Battle for the Soul of Capitalism&#8221;"},"content":{"rendered":"<p><a href=\"http:\/\/www.vanguard.com\">Vanguard<\/a> Founder and former CEO John Bogle has written a timely and useful book: <a href=\"http:\/\/www.tatteredcover.com\/NASApp\/store\/Search;jsessionid=a7WYIEdiu6-_\">The Battle for the Soul of Capitalism<\/a>. Daniel Berninger <a href=\"http:\/\/www.interesting-people.org\/archives\/interesting-people\/200512\/msg00297.html\">posts a nice summary<\/a>:<\/p>\n<blockquote><p><i>&#8220;The Battle for the Soul of Capitalism&#8221; argues most of the forces that produced the scandals among Enron, Worldcom, et al remain in place.<\/p>\n<p>This means investors should expect another wave of scandals even as the bad<br \/>\nactors of the first wave go to trial.<\/p>\n<p>The people running investment funds and corporations increasingly put their<br \/>\nshort term interests ahead of the long term interests of the investing<br \/>\npublic. The status quo has corporate CEO&#8217;s reaping a disproportionate share<br \/>\nof returns by finding ways to align the interests of the intermediaries with<br \/>\ntheir own. The link between executive compensation and stock options<br \/>\nproduces more activities that boost short term stock price even as they<br \/>\njeopardize long term prospects. Bogle makes the point &#8220;the more the managers<br \/>\ntake, the less investors make.&#8221; By his calculations, investing owners take<br \/>\n100% of the risk while CEO&#8217;s, intermediary investment bankers, and portfolio<br \/>\nmanagers get 70% of the compounded return. The currently passive nature of<br \/>\nstock ownership follows the decline of direct ownership of stocks from 92%<br \/>\nin 1950 to 32% today. Portfolio managers do not hold corporate CEO&#8217;s<br \/>\naccountable because the average stock stays in a portfolio for less than a<br \/>\nyear versus 15 years when Bogle got into the business in the 1960&#8217;s.<\/i><\/p><\/blockquote>\n<p>Well worth reading.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Vanguard Founder and former CEO John Bogle has written a timely and useful book: The Battle for the Soul of Capitalism. Daniel Berninger posts a nice summary: &#8220;The Battle for the Soul of Capitalism&#8221; argues most of the forces that produced the scandals among Enron, Worldcom, et al remain in place. This means investors should [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[15,6],"tags":[],"_links":{"self":[{"href":"https:\/\/www.zmetro.com\/index.php?rest_route=\/wp\/v2\/posts\/2054"}],"collection":[{"href":"https:\/\/www.zmetro.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.zmetro.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.zmetro.com\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.zmetro.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=2054"}],"version-history":[{"count":0,"href":"https:\/\/www.zmetro.com\/index.php?rest_route=\/wp\/v2\/posts\/2054\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.zmetro.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=2054"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.zmetro.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=2054"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.zmetro.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=2054"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}