Legendry Jack Bogle, founder of Vanguard Group and pioneer of index funds, was on CNBC to discuss his views on equities and what returns can be expected from equities going forward.
-- Equities are not dead.
-- Equities don't create anything, they reflect what business creates. Businesses will grow earnings at clip of 5% long term and that should be reflected in the outcome of equities.
-- Bogle noted that in 1979, BusinessWeek made the same argument as Gross — just before the start of a major bull market.
-- Expects that over the next decade stocks will return about 7 percent — 5% growth in earnings plus 2% in dividends.
Here is the video: