(laughing) >> smith: for the past four decades, jack bogle has been preaching the gospel of long-termow-cost investing through index funds. >> get wall street out of the equation. get trading out of the equation. get management fees out of the equation. you own american business and you hold it forever: that's what indexing is. own a fund that owns the entire u.s. stock market, does no trading, and has a cost of one percent a year to own. and that is the only way to do it. then you are the creature of the market and not of the casino. >> smith: index funds buy and hold a broadly diversified basket of stocks that match the holdings of a market index: the s&p 500, the wilshire 5000, or maybe a bond or commodity index. they don't eliminate market risk, they ride the market up and down, but they are much cheaper because there is no active manager. >> you can guarantee to the shareholder that they will capture their fair share of the stock market's return, for better or for worse. if you want to gamble with your retirement money, all i can say is be my guest. but be aware of the mathematic

. >> we love welcoming the man back, jack bogle, welcome back. how are you? >> well.ut yourself? >> well, thank you. we're in a market that's still, it would seem, the catalyst is still the fed more than fundamentals. we're sitting near all time highs right now. is that a healthy market in your view? >> not to wimp out in fed-type language, bill, but i think the market is okay. it's not unhealthy, put it that way. you know, the pe is depending on how you look at it, somewhere between 15 and 20 times. depending if looking at priced earnings or future earnings. and that's, you know, not far out of normal range. >> but my point is -- but my point is, that this is a stock market that people seem to be investing in because it's the only game in town since the fed has taken interest rates down to record lows and kept them there. they want people to go to risk assets. is that a reason to invest in stocks? no, i don't think so. i would say the dividend yield is okay. the dividend has actually gone up 50%. 50% on the s&p. in four years. pretty remarkable. and that's a good sig

march of 2009, jack bogle called the bottom. nobody listened.ing you to ignore the housing crisis, will be far in. and the point is you should not be looking at timing the market. the point is how the world view, open your eyes, understand what is going on, earnings don't matter. that is the huge health. turns out they did. your goal, i am a reporter, we are not investment advisers. if the goal is to navigate straight and narrow through the long term to the long-term gains. they are debt traders. dennis: there is, especially in tens downside. the way you get in trouble with your clients when managing money is if you say by this and they lose money. if you fail to say by this and they didn't make money there is a bias that we are constantly afraid and worrying. forbes magazine, 1997, wrote a story. you missed three years of huge wealth creation. >> the game also is not just enough about knowing what is going on in the housing market, especially if you are a money manager you have to understand what is going on and invest your client's money on th