e we'll have more of me >> e we'llhow do you win e at business? stay at la quinta. where we're changing with stylish make-overs. then at your next meeting, set your seat height to its maximum level. bravo, tall meeting man. start winning today. book now at lq.com start winning today. i had a very minor fender bender tonight! in an unreasonably narrow fast food drive thru lane. but what a powerful life lesson. and don't worry i have everything handled. i already spoke to our allstate agent, and i know that we have accident forgiveness. which is so smart on your guy's part. like fact that they'll just... forgive you... four weeks without the car. okay, yup. good night. with accident forgiveness your rates won't go up just because of an accident. switching to allstate is worth it. with the lexus is.e thrill of the moment lease the 2018 is 300 and is 300 awd for these terms. experience amazing at your lexus dealer. this is a jungle gym... and a baseball diamond... ...a mythical castle ...and a grand banquet hall. this is not just a yard. it's where memories are made. the john deere x350 select series with the exclusive one-touch mulchcontrol system. nothing runs like a deere™ save $300 on the x350 select series™ tractors with the purchase of a mulchcontrol™ kit. maria: welcome back. our next guest is a legend in the investing world, jack bogle founded the vanguard group in 1974, turning it into the largest mutual fund company in the world. the vanguard 500 index that bogle started and created in 1975 was the first low-cost index mutual fund designed for the average investor. jack named by fortune magazine as one of the four giants of the 20th century in the investigationment industry. invt industry. he'll talk to us about his new book. jack bogle is with us this weekend. thanks for joining us. >> my pleasure, maria. always. maria: let me start off with news of the week. this week we learned that household wealth reached a milestone, jack, $100 trillion. americans wealth surpassed $100 trillion mark for the first time early this year, which is an incredible number and that has to do with stock investing and the price of the homes. jack bogle, you are the pie mere in this business. what has changed since you started vanguard? >> i guess i would start by saying everything has changed. the mutual fund business is a totally different business. it's now probably 70% of the cash flow, sometimes 100% of the cash flow is going into index funds, which isn't exist when i started vanguard all those years ago. and indexing is up to i think around 45% of mutual fund, equity mutual fund assets. so it's been a reev revolution, indexing has, and it's changed the nature of how people look at investing. and most important of all, it's made people start to think about cost. cost is everything in this business. because when you think about it, where are returns generated for we investors. they're generated by corporate america. they earn money, they pay dividends, they reinvest the remained ner the business and that's where value is created. the financial markets are the way we access that value. but the financial markets don't give us all of it. they take their share first and then give us what's left. being we investors. so anytime you can shorten the gap, bridge the gap, minimize that gap is a good thing for the american investors. maria: you make a great point about cost. people are not focused on that until you put it front and center with such low fees at vanguard and now you've got industry of industry trying to copy vanguard, whether it's the index industry or brokers trying to take tear fees down. is this a race to the bottom, jack, in terms of how low fees are gone? >> well that's really a great question, maria. most of the fee competition in truth is in the etf, exchanges trade and fund area, because that's where a lot of the activity is, a lot of the cash flow is. and the competition is moderate for actively managed funds and really very light for what i call traditional index funds, tes, index funds, tifs, i should say, index funds of the type i started in 1975 that are bought and held together forever. let me explain it this way. we changed the business, the indexing business from an index passive index held by passive investors to passive indexes held by active investors. a lot of trading going on in etf land and that's not such a good thing. that's where the competition is, because you can make money starting a little company, i call them financial buccaneers, trying to find a little hole that nobody else has filled, a little niche if you will. and in the other -- there's not much appetite in the traditional index fund business for lower cost because, as i say, often said, the problem with index. funds is all of the darn money goes to the investors. and the mutual fund business is a business that is people coming to the fund business to make money for themselves and their management companies. they want to make money for their investors, sure. but the more the management company takes twb less the investor makes. maria: and that's the issue. a lot of people don't realize that. the first question is how much is it costing you. the money is coming out of your returns. jack, how do you answer the criticism -- i saw in your interview recently about the critics of the index fund today saying that you're not allocating capital properly. it's because the biggest stocks make up the biggest percentage of most of the indexes, mike voft, 3.2% of the s&p 500 and walmart is half a percent. new money means that the large stocks take a proportionately more money than other stocks. so is that destabilizing? >> that's not only not destabilizing, maria, it's not true. in other words, if we have 4% of assets in alphabet or google, we put 4% of our new money into that. if we have half a percent in walmart, as you said, we put half a percent, it doesn't change the equation. we're investing based on the market values of the company. and when the prices go up, the prices go up in the regular market, if you will, by individual investors, but they also go up for the index fund. maria: okay. >> rising prices creates zero capital allocation issues. >>> jack bogle revolutionized the world of investing. what does he think of the index funds? >> we don't need 5,000 index funds or 6 thowks. here. we perform over 50,000 operations a year in places like this. for the past 15 years, chubb has identified ways that we can strengthen our safety measures. and today, our hospitals have some of the best patient safety records in the country. now, we're constructing new buildings that will define the future of piedmont and chubb is here, insuring our expansion. two million patients a year depend on us. and we depend on chubb. i'm still giving it my best even though i live with a higher risk of stroke due to afib not caused by a heart valve problem. so if there's a better treatment than warfarin, i'm up for that. eliquis. eliquis is proven to reduce stroke risk better than warfarin. plus has significantly less major bleeding than warfarin. eliquis is fda-approved and has both. so what's next? seeing these guys. don't stop taking eliquis unless your doctor tells you to, as stopping increases your risk of having a stroke. eliquis can cause serious and in rare cases fatal bleeding. don't take eliquis if you have an artificial heart valve or abnormal bleeding. while taking eliquis, you may bruise more easily and it may take longer than usual for any bleeding to stop. seek immediate medical care for sudden signs of bleeding, like unusual bruising. eliquis may increase your bleeding risk if you take certain medicines. tell your doctor about all planned medical or dental procedures. eliquis, the number one cardiologist-prescribed blood thinner. ask your doctor if eliquis is what's next for you. >>> welcome back to wall street. here's more of maria's interview with investing legend vanguard founder jack bogle. maria: look at how many index funds there are. 5,000 index funds today versus the numb or f stock lower, 3,385 stocks. what does that tell us? >> it tells us that people are crazy, maria. we don't need 5,000 index funds or 6,000. the whole idea of index funds was simplify, simplify, simplify, right out of ralph wall do emerson. semp fisimplify everything. we've now complicated it by giving people many choices and building a system where they can trade those choices in the gloat growth and out of value and soge investor's enemy finally. the answer is to buy and hold the stock market very well exemplified by the 500, and hold it forever. and that's the winning strategy. any other strategy involves changing things. and over an investment lifetime you could probably have 40 changes, 50 changes. there's in way that can be a winning strategy. maria: you make a really good point. what about the idea that people want to cash out sometimes. i mean, what are your most important issues in terms of selling? you say hold on for a long time. but what is a long time? when can you actually get those returns and what do you look for as a run to sell, jack? >> that's a great question. i guess my fair time period is the same as warren buffet's time period, forever. you know fb fo, for your whole . there will be opportunities along the way. we've seen them in the last 25 years. to get out and get back in. maria: vanguard is changing. the retirement plan. not having the flagship s&p 500 fund in the 401(k). why is that. what is your reaction to the fact that vanguard is dropping 12 funds from the employee 401(k) retirement o 1 f, d 7. >> w answer is that companies all over the country, and i presume vanguard, although i don't run this place anymore, there have been too many choices in retirement plans. you could run a retirement plan with three or four choices with abstock index fund, a bond index fund, a balanced inducks fund and that could be it and investors can make the choices easily. an asset allocation issue. and by giving them quite so many issues at vanguard, not in the industry generally, we've confused investors. for vanguard in particular, this is not going to surprise you, i think it's too bad not to have the 500 as an option. but it's pretty much indifferent from an investment standpoint because our crew members, as we call them here and bogle himself, just go into the total stock market fund which is 85% of the s&p 500 any way. i like the s&p 500 but i'm perfectly satisfied with the vanguard total stock market index fund. a little broader. maria: what do people need to know about their 401(k) plan. i feel like people put their money in the 401(k) and they don't necessarily know what the plan is invested in. is there any advice you want to give us in terms of managing their 401(k) plan? >> well, the less you manage your 401(k) plan the better. make some choices, asset allocate -- allocate your assets, to some degree based on your age, and you can do that of course through these popular target date retirement plans in which vanguard is so totally dominant it's almost not worth talking about, and gradually build up a bond position over a period of time. but the other option is even simpler and that is buy the balanced index fund, you'll be 60% in stocks and 40% in bonds for the rest of your life and that may even be a better strategy. only time will tell. maria: it's so important, jack, just this week we learned that the social security fund is going to be tapping into its fund for the first time in 36 years. people need to understand social security may not be there for you when you retired. the 0 now onus is on individualo make sure they have a 401(k) and savings in the stock market, correct? >> that's correct bts. i wouldn't write off social security quite so soon. i don't thini don't think the nl policy of the united states of america, i believe that policy precludes a significant reduction in social security. and to me it's kind of sad that we could fix wit such tiny little changes, change the retirement age a little bit, make the social security minimum wage deduction wage based deduction a little higher and all of the suds it would be fixed. maria: our thanks to jack bogle for joining us. it took guts to start my business. but as it grew bigger and bigger, it took a whole lot more. that's why i switched to the spark cash card from capital one. with it, i earn unlimited 2% cash back on everything i buy. everything. and that 2% cash back adds up to thousands of dollars each year... so i can keep growing my business in big leaps! what's in your wallet? with expedia, you can book a flight, hotel, car, and activity... all in one place. ♪ everything you need to go. ♪ expedia® ♪ if you spit blood you may have gum problems,s and could be on the journey to much worse. try parodontax toothpaste. it's clinically proven to remove plaque, the main cause of bleeding gums. for healthy gums and strong teeth. leave bleeding gums behind with parodontax toothpaste. jardiance asked: when it comes to managing your type 2 diabetes, what matters to you? you got a1c, heart, diet, and exercise. slide 'em up or slide 'em down. so let's see. for most of you, it's lower a1c. but only a few of you are thinking about your heart. fact is, even though it helps to manage a1c, type 2 diabetes still increases your risk of a fatal heart attack or stroke. jardiance is the only type 2 diabetes pill with a lifesaving cardiovascular benefit for adults who have type 2 diabetes and heart disease, significantly reducing the risk of dying from a cardiovascular event and lowering a1c, along with diet and exercise. this really changes things. jardiance can cause serious side effects including dehydration. this may cause you to feel dizzy, faint, or lightheaded, or weak upon standing. ketoacidosis is a serious side effect that may be fatal. symptoms include nausea, vomiting, stomach pain, tiredness, and trouble breathing. stop taking jardiance and call your doctor right away if you have symptoms of ketoacidosis or an allergic reaction. symptoms of an allergic reaction include rh, swelling, d difficulty breathing or swallowing. do not take jardiance if you are on dialysis or have severe kidney problems. other side effects are sudden kidney problems, genital yeast infections, increased bad cholesterol, and urinary tract infections, which may be serious. taking jardiance with a sulfonylurea or insulin may cause low blood sugar. tell your doctor about all the medicines you take and if you have any medical conditions. man: ask your doctor about jardiance and get to the heart of what matters. benjamin franklin capturedkey lightening in a bottle.ardiance over 260 years later, with a little resourcefulness, ingenuity, and grit, we're not only capturing energy from the sun and wind, we're storing it. as the nation's leader in energy storage, we're ensuring americans have the energy they need, whenever they need it. this is our era. this is america's energy era. nextera energy. now let's take a look at the big market events coming up in the week ahead that could impact your wallet. it's a huge week ahead. monday we get earnings from david' busters and kmg chemicals. on tuesday, the first day of the two-day fnoc meeting begins. we'll get the latest federa fedl reserve comments about the economy. and we're expecting the fed to raise interest rates in the coming week ahead. we'll get earnings from h and r block, lands end and oxford industries. on tuesday, tuesday june 12th, the big ehen president trump will meet with kim jong-un in singapore we'll be live throughout the meeting and starting early here on the fox business network, joining me at 5 a.m. on tuesday. on wednesday the fed will announce the decision on interest rates. we're expecting a hike of a quarter of a point. powell will have a news conference at 2:30 p.m. eastern which we'll carry live. we'll get the latest on producer prices. ppi index as well as earnings from keller brands. on thursday, we'll get data on retail sales, import prices and inventories. friday we get the week -- we end the week from the empire state manufacturing survey and consumer sentiment. a big week ahead. possible history in the making as i mentioned, the u.s.-north korea summit beginning on tuesday in singapore. tune in to the fox business network. we'll have around the clock coverage of the historic event. mornings with maria will go on 5 a.m. eastern. one hour earlier. join me next week, talking with the deloitte ceo and for