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Vanguard's Jack Bogle Hasn't Seen Such Market Volatility in His 66-Year Career

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By    |   Friday, 06 April 2018 09:12 AM

Vanguard founder and former CEO Jack Bogle says he hasn't seen such a difficult and tumultuous trading environment in his 66-year career as the current landscape for brave investors.

"I have never seen a market this volatile to this extent in my career," Bogle told CNBC's "Power Lunch."

"Now that's only 66 years, so I shouldn't make too much about it, but you're right: I've seen two 50 percent declines, I've seen a 25 percent decline in one day and I've never seen anything like this before," he said.

However, Bogle describes the recent market volatility as "noise."

"When all these people look at some future forecast — of let's say interest rates or inflation — and sell, somebody else is buying," Bogle said, echoing Warren Buffett’s investment mantra.

"Stocks go from hand A to hand B, from buyer to seller or seller to buyer, and I think it sometimes concerns the true long-term investors," he said. "It disturbs the investors because they see this and they think it's significant. If it's significant to them, and they panic in a big market decline and get out, they're the losers."

Market swings have surged this year.

The S&P 500 has moved at least 1 percent 26 times already, triple the 2017 total. The Nasdaq 100 capped its ninth straight day with a move that size, the longest stretch since the depth of the financial crisis. And then there’s the intraday reversals: Stocks roared back from a 1.5 percent plunge at the open Wednesday to close higher, marking the sixth reversal of at least 1 percent since January -- equal to the total of the past two years.

The change has a lot to do with the political climate, Bloomberg reported.

Investors have been whipsawed by Washington’s changing policy priorities following President Donald Trump’s legislative wins on traditional pro-business policies like tax cuts. The administration’s now pushing protectionist proposals that are less eagerly supported by many corporate leaders, while the president ratchets up attacks on individual companies. The result is a market that’s grown increasingly reactive to tweets.

“This is very much headline driven,” said Quincy Krosby, chief market strategist at Prudential Financial Inc. “You can see how -- absent something that the market can focus on squarely, such as earnings -- the market is vulnerable to headlines, both for moving higher and moving lower.”

(Newsmax wire services contributed to this report).

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Vanguard founder and former CEO Jack Bogle says he hasn't seen such a difficult and tumultuous trading environment in his 66-year career as the current landscape for brave investors.
vanguard, jack bogle, market, volatility, investors
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2018-12-06
Friday, 06 April 2018 09:12 AM
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