CAHPTER 9
EXCHANGE-TRADED FUNDS
“Gus!” came a familiar booming, gravelly voice from the top of the stairs above the crowded grand foyer to the company cafeteria. “Gus! What the heck is going on around here?” Fresh back from his annual month-long vacation at Lake Placid, Jack Bogle was clearly upset.
Why? Because Gus Sauter had found a way to “destroy” Vanguard’s indexing with an ETF! Or so Bogle seemed to think; he had opposed ETFs from “before the beginning.”
Ever since the day he rejected Nathan Most’s innovative idea of launching the first ETF,* Bogle had been opposed to ETFs and in favor of the conventional offering of index mutual funds. ETFs, he believed, were the mortal enemy of true investors because they would tempt investors to trade, ...
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