Vanguard Group founder John Bogle spoke exclusively to FOX Business Network’s Liz Claman about the current financial system and the new bank tax proposed by the President, saying banks should pay it because the taxpayers should not “cover the grotesque mistakes made by these bankers.”
Here are couple of excerpts from the interview: Courtesy of Fox Business News
On whether banks should pay the new bank tax that the President is recommending:
“Absolutely. We should not let society, the innocent part of society—the taxpayers—cover the grotesque mistakes made by these bankers slash investment bankers. And while we’re at it, we ought to repeal the repeal of the Glass Steagall Act and separate commercial banking, a perfectly intelligent business, from investment banking which takes enormous risks.”
On the current financial system:
“The old system was a good system. We had better governance in corporation. We had less overreaching, more reasonable CEO salaries. Companies that at least punitively were run in favor of the shareholders rather than the management. But with all this trading, we don’t have anybody for lack of a better expression gives a damn about the shareholders. These agents put their own interests first.”
On the investors not getting what they should be:
“The money managers and brokers and traders get paid before the mutual fund investors and pension fund beneficiaries—the investors who own these shares—get paid. The investor is at the bottom of the food chain—he gets what’s left. That’s the wrong way to run a railroad.”
