Henriques is the author of "Fidelity's World."

Why are so many people in the market today?

I think people are in the market today because they're afraid not to be in the market, and this represents a tremendous change in the psyche of the country. Seventy years ago the stock market was a rich man's game. The average investor put his money in the bank or put it in the mattress. Today, the stock market has become everyone's best hope for a strong retirement income. And that's a dramatic change. Mutual funds are one of the reasons that people are in the stock market today. Without the advent of that remarkable vehicle for investing, I think probably most people would be afraid of investing small sums at the small levels that they could do. So the mutual fund industry is one reason that Middle America is in the stock market today.

Is it right to fear retirement and colleges issues, and so on?

Well, they are right to be afraid of not being in a market in one way. Most of us are now responsible for our retirement income in a way that was unthinkable 70 years ago when the company pension plan was in the hands of professionals and you got your gold watch after 30 years. That's not happening today. It's probably never going to happen again, given the changes that have occurred in corporate America and the way government manages retirement trust funds. So, yes, I think people do need to be aware of how the stock market can help them. That's an important change and the mutual fund industry has helped educate people in that way.

There are other reasons people are in besides fear and retirement. Talk about that.

Well, there's a saying on Wall Street that the market gyrates between greed and fear. We've never see more clearly that in the past six to ten years. The fear that you had to be in the market to stay current in your retirement savings had, in large part, in some sectors of the market given way to a sense that, "Gee, this is fun. This is easy. You know, quadrupling your money is a no-brainer." That aspect of the market has always been there. Of course, we can remember the great speculative bubbles of the '60s. Our parents can remember the great speculative bubbles of the '20s. There has always been that sense that you could something for almost nothing in the stock market in a way you can't really do it anywhere else but a casino or a lottery. And that idea has been facilitated and made easier by changes in the mutual fund industry.

Such as?

Such as sectors funds.

When did they start and how did Baby Boomers get to this point in the stock market?

Well, it's always hard to say when the trend started. You can find threads of it reaching all the way back into the '50s, the great post-war bull market when America really owned the globe and the future looked endlessly bright. That saw a great boom in mutual fund investing. Mutual funds originally, though, were conceived as giving people a way to get a very diverse pool of investments. It was really in the '60s that they began to be seen as a way to speculate, not to just invest and save, but speculate on what you thought would be the next hot trend, whether it was a television stocks in that age or the Internet stocks in this age. The mutual fund industry, driven by the marketing demands that drive it, was quick to accommodate the desire to speculate. And so today, in among all the old grand old funds that are there for retirement savings, are just a plethora of funds, they're clearly to allow you to speculate on where you think the next hot thing will come from.

Tell me about Peter Lynch.

Peter Lynch is remarkable. He has established a place in the public mind that is rare in mutual fund history. Only one or two people have ever done it before him. And he has become an icon for personal investing through mutual funds in the way that has never occurred before, even with prior fund celebrities. But it's very much a two-edged sword. Peter Lynch is a genial, open, reassuring person, but he has the flaws of his virtues. He is in some way almost the opiate of the masses. A good dose of Peter Lynch and you feel empowered. The stock market looks easy. Investing looks fun. Mutual funds look like a sure thing. He doesn't worry about risk, so you don't worry about risk. He's had a remarkable impact on how the average American consumer thinks about the market, thinks about stocks, thinks about mutual funds. And although they were empowering, they were not healthy. They were not the whole picture. They were not a very balanced picture. He was, in many ways, a one-trick pony. He was a bull market investor. He ran a great bull market fund through a great bull market. He doesn't have much of a track record as a bear market investor. So if we hit a bear market, his lessons are going to be lost for us.

What are his lessons? Explain why I can go awry following his directive.

His lesson is really quite simple and his investing philosophy perfectly matched that of the Fidelity culture going back decades. It was simple. Find the next hot thing and buy it. Swing for the fences every time, going for hot performance. This was Lynch's way of life because he loved investing so much. And if you've got money to play with, it's a great way to have fun. He always enjoyed investing and made it look fun and easy. Find the next hot thing, swing for the fences. What's left of that equation is balance your returns against the risks you're willing to take. That's how you can go wrong. If you've got two fund investors, one of them's Peter Lynch and one of them's some quiet prudent, dull Boston fiduciary, and one them beats the market by one percent by taking very little risk and Peter Lynch beat the market by five percent taking a lot of risk, how do you know if you got paid enough for the risks you took? Those are the questions that somehow, in the presence of Peter Lynch, you never ask. Yes, we got wonderful returns, but were they big enough to reward us for the risks that we were taking? And in Magellan Fund, obviously, over the past three years after Lynch has given it up six years ago those questions are even more compelling than they ever were.

What are people's expectations in this bull market?

They've been rewarded so far for believing that things will go up, that markets only go up. And it has been a remarkable bull market. The remarkable run really, beginning in the early '80s with very few set-ups, other than the monster set-back of 1987. People have been trained over most of their adult saving life, if you look at people now nearing their 50s, to believe that while markets may have a few scary roller-coaster days, by and large, they go up. They don't always. Japan has had a terrible bear market extending five or six years. The US had a terrible bear market all through the '70s. But that's been forgotten. There's a certain amnesia that cloaks the failure of our myths, and in this case one of the great myths is that you can have safety and high return. We haven't wrestled with the idea that high returns require taking higher risks. And that's the big flaw in our psychology.

Do you think middle class people coming into the market now understand this?

I don't think risk is even remotely understood by the American consumer as they approach the stock market, as they approach mutual funds. And when you think about it, that is a dramatic turn-around. I mean even just 50 years, forget 70 years ago, the concept that the stock market was a scary place was pretty well imbedded in Middle America. Today, people never even mention risk. We don't even have a good industry measurement for the riskiness of mutual funds. It's hardly ever mentioned in the media coverage of mutual funds. It is the forgotten element and while this has been true through most of the mutual fund industry's history, it was in the past balanced by a very real awareness from Depression babies and '29 crash memories in the public-at-large. Today the appreciation for what can go wrong is minuscule.

What about the industry party line that over history stocks always go up in the long run and outperform everything else?

It may be true that over time the stock market will outperform other forms of investment The statistics certainly demonstrate that for this century. But it is also true that I'm not going to live 70 years after retirement. My retirement is going to be a much shorter period of time, and you can take 10-, 15-, 20-year slices out of that long track record and find very disappointing returns. For example, if you'd invested at the height of the 1960s go-go market in 1968, you didn't recoup your investment until 1982. If those happen to be your retirement years, you were in real trouble. But the important thing is for people to understand that investing in the stock market is not a simple recipe. What it comes down to is how you invest, how you manage the risks that are involved in investing in the stock market. One way you manage the risk if through diversity. Another way is through long time horizons. Another way is through balancing your assets. Almost none of those lessons are incorporated into the marketing mania for mutual funds today.

Do people have enough time in their daily lives to do all this?

When people talk about how difficult it is to achieve success in the stock market, "I don't have time to read all those prospectuses", "I don't have time to do my homework," it's really remarkable if you take a longer view, because the whole concept of the original mutual fund was that it saved you all of that. You would buy a diverse professionally managed pool of assets. You would buy into it and that would eliminate your need to do a lot of homework and to track what was being done.

Today's mutual fund industry makes it so much harder than it was originally. There are so many different choices. There are so many different things funds managers can do with your money, you really need to be alert to what's being done with your investment in a way that when the rules were simpler, narrower, more restricted, you didn't. There was a time when you could buy a diversified mutual fund and feel confident that your assets were going to be spread all through the industrial marketplace and that whatever industry was doing well, you'd own a little bit of it.

Today, you can buy a big fund like the Magellan Fund and find that your assets are 40 percent in the hi-tech industry and your hopes and dreams are going to ride on that one sector. That's a dramatic change. The mutual fund industry did not used to work that way. So, yes, today you do have to do more homework than you ever had to, but that's because the consumer has gotten more demanding or because the market had changed; it's because the nature of mutual funds has changed.

How many funds are there and what kind of problems does that present?

It really seems like a baffling picture when you look at it today. There are 7,000 individual mutual funds. There are 400 mutual fund families, all with their product wares spread out for you. There are bond funds. There are emerging market funds. There are Canadian resource funds. There are German funds. There are probably buggy whip funds. Who knows?

There's a fund for every investment speculative wish and if you want to invest in something and you can't find a fund for it, wait 15 minutes and someone will devise a fund to sell to you. That's a remarkable burden on the consumer. It a remarkable phenomenon for the fund industry, but it's the way they have responded to this great bull market appetite.

There was a time when you could buy a growth stock fund, like the Magellan Fund, and you would know what was going to be in that fund. There was going to be a broad spectrum of growth stocks. When Peter Lynch managed the Magellan Fund, that's typically what you found. He educated a whole generation of Magellan Fund shareholders to think of the Magellan Fund as a broad, diverse compendium of American business. Well, today the Magellan Fund as one of its biggest positions in bonds and cash. All through last year one of its biggest positions were in hi-tech industries. The way the fund industry has changed, the way Fidelity has changed the fund industry has been to liberate fund managers to pursue hot performance anywhere they can find it. And the result of that is when you buy that fund, you have no idea what that fund manager is going to do with your money. He's free to put it in almost anything.

So it used to be you did not have to pay as much attention to what your fund manager was doing after you bought the fund as you do today. You could decide up front what kind of fund you wanted. If you wanted a more speculative fund, you could get an aggressive growth fund and feel pretty confident of what kind of securities would be in it. If you wanted a bond fund, a conservative bond fund, you could buy one and be pretty sure it would stay right within those risk parameters. Today, you can buy a conservative bond fund and find out it owns Mexican debt and other risky emerging market securities. You can buy the Magellan Fund and find out that it's not mostly in the stock market at all.

Isn't the press partly at fault here?

I think it is very valid to blame part of where we are today on a very credulous media, a very celebrity-hungry media. The fund industry has benefited throughout its history from a kind of journalistic amnesia that cloaks whatever they did wrong in the past -- it's kind of a veil of forgetfulness -- and allows whatever sterling things they're doing now to march onto the front page. There's always been a desire for a hot personality, for the latest hot fund manager, the latest hot fund trend. That's the nature of the media. We've also seen, though, in recent years a proliferation of personal finance media, everyone trying to make some money, telling you how to make some money. And it's really in some ways gotten in the way of the hard, serious lessons. We've tended to cover the mutual fund industry like it was the Kentucky Derby. And, instead, it ought to have been covered like it was the trek West. Maybe a race horse isn't the best image for picking out where you put your retirement savings. Maybe a nice solid team of horses with a good strong wagon behind it would be a better image. But that's real dull media. That's real dull copy.

Is the celebrification of Peter Lynch part of that problem, too?

When you come to Peter Lynch, it's hard to say which is the chicken and which is the egg, did he arise because the media and the market were so hungry for an embodiment of this bright new world of mutual funds, or did he in fact shape that expectation? It's very hard to say, but today it's very easy to conclude that Peter Lynch and the legend, more importantly, the legend of Peter Lynch, has come to dominate how we think of fund managers. His investment style, his swinging for the fences, his, "Hey, this is easy and fun" kind of philosophy is what we think of as the mutual fund manager of America. That has, of course, has an impact on consumers. If you didn't happen to invest with Peter Lynch, you go to whoever you did invest with and say, "Hey, why don't you perform like Peter Lynch? He says it's easy." It certainly is true that Peter Lynch arose from a culture that rewarded exactly his philosophy at Fidelity. He arose from an industry that has always been looking for the new celebrity, the new way to sell funds. But he had become larger than either of those. He has become almost the embodiment of the American mutual fund manager.

What about mutual funds has been attractive to Baby Boomers?

I think Baby Boomers found in the mutual funds that elusive silver bullet. We're kind of tagged as the "instant gratification generation". And to some extent, mutual funds promised that. You didn't have to do all that hard work with all those company prospectuses and following all those charts that your dad might have worked on. No, no. You could just buy a mutual fund and it was a silver bullet. It was the easy answer. I think that has been appealing, and in a weird sort of way, that's true. Mutual funds are a better way to invest for most people than trying to build your own small, undiversified portfolio of stocks. But the marketing of mutual funds is really the primary answer to why the Baby Boom has got into them in such a big way. The old Wall Street wisdom is still true. Funds are sold, not bought.

We had an excellent example of the celebrity fund manager in the American Heritage Fund. Hyco Temi, who was a very gifted marketer, a very, attractive and appealing celebrity figure, took over the fund after a very lackluster number of years under other managers. And he very quickly, through very high risk speculative investment activities drove the fund to an extremely hot performance. I think it was something like 90 percent in his first year. It was just unthinkable. Money poured in. Everyone wanted to be in this hot fund that was almost doubling in one year. Well, the results could almost have been predicted. Funds that can go up 90 percent can do down 90 percent. Hyco invested in a lot of very speculative risky ventures and some of them collapses. The fund had a couple of dreadful years and money has poured out. It looks like a blow torch, what they used to call the old blow torch formation, a spike upward and then an equally scary spike downward. In a sane market the American Heritage Fund would have been a footnote to history. It would have just not even happened. In the speculative market that this one has become, the American Heritage Fund stands kind of an example of the worst and the best the best marketing, the worst risk assessments, and a really terrible performance for investors who came in at the top.

Were investors lied to?

If you read the fine print on the American Heritage Fund and if you listen to Hyco Temi defend his investment strategies, he will tell you, "I always told you that this was your gambling money. This was your trip to Atlantic City. My fund was a speculative fund. I always told you that," and in the fine print he did. It's very hard today, though, when people are being bombarded by so much industry information the paints mutual funds as a safe, diverse, middle class investment vehicle. It's very hard to keep your fund distinguished as the risk bet, as the speculative venture. And even Hyco when, in his own enthusiasms, would get carried with his fund as this wonderful performing fund, if investors were misled, I think they have to take some of the responsibility for that and the media has to take some of the responsibility for that.

Is Garrett Van Wagoner a potential flame-out as the current hot fund manager?

One of the first questions that a consumer should ever ask about the hottest fund manager of the day, whether it's Garrett van Wagoner, whether it's Hyco Temi, whether it's Peter Lynch, is, "What kind of risks is he taking with my money?" Sure, he's producing great returns, but it is an unavoidable as the law of gravity that the greater your returns, the greater your risks to get those returns. I mean it's like dropping a ball out the window. It will fall to earth. So any time a fund manager or a fund is routinely outperforming the overall market by some spectacular amount, the first question the consumer should ask is, "How's he doing that? What kind of risk is he taking that the rest of the industry isn't taking to produce those returns?"

So problem with the modern investor is that they don't understand the risk?

I'm always loathe to say there's one single thing that explains it all, but I think the one single thing that comes closest to explaining it all is that the American public just does not understand the relationship between risk and return. They do not understand that every company in America would raise money for three percent if it could, and the fact that they can't is because they're risky. And balancing the risk against the return is the key job for the consumer. If you have a fund that is producing 20 percent a year and you don't know how your fund manager is doing that, you have no business owning that fund. I think it is the key to where we get off track as investors as a nation. We don't understand how to weigh how much we're being paid for the risks we're taking to get that payment.

Is it right for society that this whole class of people have come to depend on the stock market to provide for them because they can't get it anywhere else?

The public policy questions raised by this massive movement of middle class money into the mutual fund industry are enormous. They're significant and they are largely neglected. One of those public policy issues is, without some clear way of measuring the riskiness of individual funds on a comparative basis, how can you possibly send the average unsophisticated American saver into that industry? That's balanced, of course, by the reality, how can you not encourage American investors to save through the stock market, given the very real realities of how our pension fund industries have changed?

I would love to see a nationwide debate about how to make the mutual fund industry more understandable, more accommodating of the needs of consumers to weigh their risks and their returns. For 70 years the mutual fund industry has kept score with one-half of the score card. You know, "How have you been doing? How big is your rate of return?" One of the most compelling things we need right now is a way or measuring the other half of the score card, "What kind of risks did you take to make that money? Did you take my money to Atlantic City and put it all in the slot market" Or did you invest it in the broad spectrum of well-performing stocks?"

Those are the kinds of questions we have to learn to ask. The industry has to learn how to answer them. The regulators have to demand that the answers be provided in some kind of a comprehensible way.

Talk about the big problem in the mutual fund industry today connected to how it began.

Well, I think, the open-end mutual fund, was really the single greatest idea to come out of the American marketplace in the 20th century, when you think about it. It was a way for the little guy to enter to rich man's game. He could get the same diversification. He didn't have to put all his eggs in one basket. He could get professional managing. He didn't have to be a genius. And he could, therefore, participate in the rewards of the stock market.

It was a brilliant idea. It is still a brilliant idea, but it's an idea that has become distorted and deformed over the past 70 years by the demands of marketing, selling these funds over and over and over again, and it's interesting that over the past 70 years the same three things keep going wrong in the mutual fund industry. They sell stuff with misleading sales pitches. They sell them to investors for whom they're not appropriate, who don't understand the risks that they're taking.

And, second, they buy stuff for the fund that they can't easily sell, illiquid-esque exotic investments that blow up in their faces. And, third, they put themselves in positions where their best interests sometimes conflict with their shareholders' best interest. Conflict of interest, illiquid portfolios, abusive sale practices, those are the three things that have kept going wrong over and over and over again in the mutual industry. And, to a large extent, they're going wrong today. The pain won't be felt until the market sustains a serious long-term down draft. But they're going wrong today and we need to be aware of that.

Hasn't the modern investor become more sophisticated to invest long-term?

The confidence that the mutual fund industry has in the average American investor I think is a little misplaced. It is true that since the '87 crash the American consumer has tended to buy on dips and happily seen the market go up. That lesson will not always be rewarded. I mean even Pavlov's dogs eventually don't get dinner when they ring the bell. And I think there is a very real possibility that the American consumer has learned the wrong lesson.

But let's look at how they were trained. If you go back to the early '80s, when interest rates spiked up, there was a growing expectation that your money we grow very fast if you put it somehow in the marketplace. The average taxi driver came to feel entitled to eight to ten percent a year on his money. And when bonds didn't provide it for him anymore, he turned to the stock market and he expects stock markets funds to provide it for him. That sense of a sure thing, of staying in the market because it will always go up, will not always be rewarded. And when it isn't, it's going to be a great time of reckoning for the industry because of those built-in problems that have cramped its performance all through its history.

How did we go from a pension-driven universe to a 401K universe?

The American worker of 70 years ago put his faith in his pension fund. His company put money aside for him. It was professionally managed. It was invested wisely and prudently, and when that worker retired he could count on a check coming into the mail box every month. That idea, that whole wonderful golden concept is almost an antique today. Almost no one expects to work 30 years at a major corporation and then get a pension check in the mail every month. There has been a dramatic shift, especially in the post-war period, to kind of tracking right alongside the great rise of the mutual fund industry from the professionally managed pension fund to the self-managed pension fund which we call the 401K plan. There are a number of other gimmicks, a number of other varieties of this fund, but it is emerging as the pension fund of the future. And the big difference, of course, is a bunch of experts and professionals ran the old pension fund and I'm running this pension fund. This is my pension fund for the future and the burden it places on me now to make critical decisions like asset allocation and long-term horizons and hedging my risks is dramatic. I now have to do those jobs that used to be done by professionals. I don't get any education for this in high school. I don't get any training on the job for how to do this. It's been thrust on my shoulders in the last 10 to 15 years and now I suddenly am my pension fund manager. It's an enormous responsibility. And the mutual fund industry stands there ready to tell me that I can do it, that I can do it correctly, but it's still an enormous change from the way this capital market used to work, the way retirement savings used to be done.

Can an average person do it?

I have grave misgivings about this model of retirement savings as it spreads more broadly and more deeply into the American work place. I worry about the retired nurses, the retired shoe store salesmen, the retired teachers, the people who need expertise in finance that their successful work life has never prepared them for. I am heartened to some extent that companies are beginning to take some initiative to educate their workers better about making these choices, but we're way behind on that. We're woefully inadequate now and nowhere near enough regulatory pressure and policy-making pressure has been pushed in that direction. But I don't think we will know until the Baby Boomers ready to retire how successful this enormous experiment in do-it-yourself pension planning has been.

What did the Crash of '87 teach investors?

Probably a lot of the wrong lessons were learned by the Crash of '87. It occurred at a time when the economy was overall very strong and so the ripple effects that might have flown from it did not materialize. As a result, investors who gripped up their courage and bought on the down draft have done very, very well, and similar on the little mini-crash that came after. You bought on the down draft, you did very, very well. That is a reassuring lesson for the mutual fund industry. They like to think that the American long-term consumer is going to keep buying the stock market every time it goes down and will be somehow a safety net under the marketplace. I don't know whether or not that is still true.

What have we learned these last couple of weeks?

Since the beginning of 1996 mutual fund investors have not behaved quite the way the industry has led us to believe they would. They have begun drawing money out of mutual funds when things start to get scary. A classic example is the turbulence that hit the market at the beginning of July. From early summer into mid-summer, the technology stocks were extremely weak. The NASDAQ Index was falling sharply, and people were pulling money out of technology funds. Then the upheaval spread. The whole market became uneasy. A number of record down draft days and up tick days, it seemed very scary, and this time consumers pulled money out of stock mutual funds. That's not what we've been led to believe they would always do in any down draft. And I think it's evident that we need to look carefully to see if in fact it indicates that the American consumer is not comfortable with the level of speculation they see in the marketplace and may start to behave differently.

Which would be the disaster for the market.

If they do start to behave differently, it's going to require an awful lot of people to re-think their game plans very quickly. Would it be a disaster for the market? We don't know. It would certainly reduce the amount of new money being put to work every time an IPO comes to market, but, on the other hand, it might force many fund managers to re-think their strategies of marketing, of asset allocation, and actually start developing funds for the prudent risk-averse, more conservative investor and market those funds that way. It would be a convulsion for the industry. There's no doubt about that. It might be a healthy one.

Is the stock market now driven by the mass psychology of the investor as opposed to the Wall Street professional?

If you look at the statistics, if you look at numbers, you certainly have to conclude that the average investor is a much greater force in this stock market today than he has ever been since, I hesitate to say it, the 1920s. The sense of the average investor's impulses being what's driving the market as a whole is much greater now than it ever has been.

Now in some cases those impulses are in step with the fund managers, the investment managers who are the professional side of the market, but in other cases those fund managers are themselves driven by that consumer demand. So it's unavoidable, I think, to say that the average investor is driving the market today in a way that he hasn't for decades. Where he's driving it is another mystery, of course. Right now I have a sense that we are teetering on an answer to that question, getting new information that doesn't match with what we've always expected before. And we need to be open to that information to try to get a sense of what the consumer is going to do.

Most people think of the Crash of 1987 as about the worst thing that can happen to the modern stock market, but in fact it really wasn't, not by a long shot. It was a quick, sharp correction, a down draft. The most serious problems it posed were to the mechanical machinery of the stock market, just coping with the volume of trades, keeping investors informed. The real worst thing that can happen, the worse case scenario for the stock market is something like the 1970s, just a long, grinding bear market that edges up and slides back down, two steps forward, three steps back for years and years and years. That's what happened in the '70s. It's what Japan has been living through for the past half-dozen years. It can happen here. There is no immunization of the American stock market that keeps up from ever having a long, dull, grinding bear market. It could happen again.

What happened to the Magellan Fund after Peter Lynch is a wonderful lesson for the American mutual fund consumer. I couldn't think of a better one, if you look at the long sweep of history, because what happened to the Magellan Fund, the controversy that surrounded Jeff Vinik as the manager of that fund, really included all of the three major issues that the fund industry has always stumbled against in its history -- personal conflict of interest, what's in the portfolio, and what kind of label is on the fund and does it match what's inside? Jeff Vinik was running a growth stock fund. It was expected by his investors that it would be a broadly diverse stock fund. It always had been when Peter Lynch was running it. Instead, he drove it strongly into one highly volatile, illiquid sector, high technology stocks. Then he pulled out of that sector into a move that can only be called market timing in the fund that's not supposed to be a market timing fund, and then he put a huge amount of money in the bond market, out of the stock market, in a fund that's supposed to be a stock fund. This sort of summarizes the problems that I have with the mutual fund industry today. You found a growth stock fund investing in bonds. You had a high profile celebrity fund managers very actively trading for his own account when he was managing that gargantuan $55-billion fund for his shareholders. And you had a fund that simply did not match its labeling. There was no way investors in the Magellan Fund could have predicted that they would miss the whole run-up in the market in the first part of 1996 because they were in bonds instead of stocks.

What is Fidelity's greatest contribution to the mutual fund industry over the past 20 years or so?

I think one of the most dramatic contributions Fidelity has made to the American consumer is this idea of empowerment, of opening the world of mutual funds to the individual investor through 800 numbers, easy switching among funds, clear, finally focused marketing material. They really made the mutual fund industry into a consumer friendly industry in a way that no one had ever really mastered before.

Now there's an up side to that, obviously. It has invited people to put their assets to work in a productive way in the stock market, but there's a down side to it, too. It perhaps obscured the appreciation of risk. It eliminated the sort of wise old uncle that the fund fiduciaries were once thought of as. It put people's money so directly into their own hands and made it so easy for them fling it into a speculative bubble, that the whole industry has been shaped by that. But Fidelity, I think, in its search for the right marketing mode, did enable consumers to feel more powerful and to feel more responsible for managing that own investment. That's a very positive thing. The negative impact that Fidelity has had on the market can almost be summarized as the Lynch legend, the idea that you find the next hot thing, swing for the fences. That idea is a bull market credo. It works when markets go up. It's not perhaps the best mantra for the long-term investment of your retirement money. But it has become so powerful in the minds of the consumers that I don't know if we'll ever dislodge it.

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