Active Management

Here's a guess. When the books are closed on 2008, a very hot topic will be whether it is a good idea to pay a mutual fund manager 1% or a hedge fund 2% (+20) to pick stocks for you.

Consider the following quote from screechy/whiny FundAlarm:

"80% of Vanguard’s 50 index funds and ETFs are leading their peers so far in 2008 (through 10/24). An astounding 97% of Vanguard’s index funds have above-average returns over the past five years."

Americans embracing low-cost passive investments would have serious implications for the investment management business.