Marketwatch's Chuck Jaffe recently conducted an interview with the greatest friend the individual investor has ever had: John Bogle.

Bogle banged the drum for the cause he has made famous: Active investing generally leads to poor returns, and the best thing an investor can do is buy index funds and rely on the long-term returns generated by businesses to create long-term portfolio success.

Jaffe asked Bogle for his reaction to the numerous market gurus who have suggested that the future returns of the market will be lower than in the past. Bogle explained that lower dividend yields and slower earnings growth will lead to an average annual return of around 7%, more than 2% less than the historical yield of the market. What should investors do about that? They just have to save more money, according to Mr. Bogle.

Bogle remains a big supporter of traditional index funds, and isn't too impressed with ETFs or hybrid funds. As he said in a recent column, "Mama, what have they done to my song?"

All of his books are terrific, but an absolute must-read is his tome on corporate governance, The Battle For the Soul of Capitalism.

The SEC recently eliminated the 'uptick rule', which was put in place after the Great Crash of 1929 in an effort to prevent bear raids. The rule mandated that stocks could only be shorted on an uptick -- the price of the short-sale had to be higher than the last price.

Some commentators, including Chuck Jaffe, are complaining that the end of the rule has allowed short-sellers to pile into stocks more easily than before. And maybe that's true. They complain that this has increased the volatility of the market, and maybe they're right.

But here's the problem: There's really no particularly intelligent justification for the rule. Short-sellers are already required to go through the cumbersome process of borrowing shares before they short. If we're really concerned about the uptick rule making it too easy to short and drive prices down, shouldn't we also implement a downtick rule? That way it would be harder for pumpers and promoters to drive up the prices of stocks.

Of course we shouldn't do that. That would be insane. But it's really not substantially less crazy than the uptick rule.

We have tons of regulations on short-sellers, and the fewer we have the better it is for America -- effective short-selling keeps things from getting out of hand like they did in the internet bubble. It also provides an incentive for investors to uncover fraud. The market has such a bullish bias, and it's great that people can also make money by looking for signs of trouble. That's what makes a market.

The always informative Chuck Jaffe provided readers with a six-step guide to picking a mutual fund. His six steps are determine why you need a new fund, figure out which asset class you want, learn "the story" of the fund and manager, examine peers and check returns, get independent research and read the prospectuses, and then write the check.

If you are going to pick a fund, Jaffe's advice is sage. But rather than a six-step guide to picking a mutual fund, a lot of investors need a 12-step program to stop picking managed mutual funds. You will pay higher fees and you are unlikely to beat the market.

My concern with Jaffe's piece is that he writes that "For tie-breakers, I compare expense ratios and turnover (the lower the better on both fronts), tax-efficiency (unless the fund is in an IRA), and overlap with my current holdings."

But haven't expense ratios been the strongest predictor of a mutual fund's performance? We've seen that chasing performance can often lead to inferior returns, and managed funds typically lack tax-efficiency and suffer from high turnover.

I think the best bet for mutual funds is to go with index funds from Vanguard or a similar company. It's a lot less work, and you'll probably do just as well if not better.

When I saw an ad on the internet for a free Rich Dad education seminar, I thought about going and then writing a piece about how awful it was. I hate to be prejudicial, but having read much of Robert Kiyosaki's work, I would be shocked if his program had anything of value.

Chuck Jaffe over at Marketwatch spared me the trouble, went to the seminar, and put the Rich Dad in his place. The event featured a rant against skepticism and caution, which I would argue are two key attributes for successful investors: particularly in a world filled with snake oil salesmen like Robert Kiyosaki.

Jaffe sums it up: "Kiyosaki's world is full of platitudes, and is not so rich on specific advice. The question is whether that works when you are paying hundreds or thousands of dollars to get the specific help needed to make this work entirely on your own."

Jaffe goes on to observe that Kiyosaki's work feeds on hope and dreams, and that combined with emphasis on positivity and the rejection of skepticism reminds me of one thing: Amway motivational organizations. Not surprisingly, Kiyosaki has a long history of involvement with multi-level marketing, and even wrote a book about it: The Business School For People Who Like Helping People. If Jaffe can declare the seminar the Stupid Investment of the Week, I'm declaring that book the stupid book of the Holocene epoch.

Bottom line: Kiyosaki and others like him are essentially selling cliches and positive thinking. But who needs to drive to a seminar to think positively? Bobby McFerrin's "Don't worry, be happy" will set you back 99 cents on iTunes, and you'll acquire approximately the same amount of wisdom listening to that.

MarkeWatch's Chuck Jaffe wrote a column about the best news for individual investors that very few people care about: Mutual fund fees are at their lowest level in 25 years. Jaffe also sums up some more great news that shows that the financial press is actually accomplishing something: "...one thing that's clear from the expense numbers is that investors are getting it. They understand that low costs lead to better returns, and are investing that way."

In 2006, the average investor paid 1.07% in fees and expenses on a stock fund, according to the Investment Company Institute. People finally are getting it: Some studies even show that individual investors are paying more attention to expenses than past performance: Hallelujah!

As you probably know, I'm a huge fan of low-cost index funds and I think that most investors can put together their own diversified portfolios with little time or effort -- without hiring a financial advisor! Last week, I wrote about Ben Stein's advice for putting together a great portfolio, and it's worth putting up again (from an interview with Fortune):

What I generally recommend for the noncash portion of your portfolio - and this has been unbelievably successful - is a mix of various index funds and exchange-traded funds [ETFs], with roughly 25 percent in an S&P 500 index fund from Vanguard or Fidelity; 25 percent in a Vanguard or Fidelity total stock market fund; 25 percent in EFA, which is an ETF for developed overseas markets; 15 percent in EEM, an emerging-markets ETF; 5 percent in ICF, the ETF for real estate investment trusts; and 5 percent in XLE, which would be your energy fund.

While far too many investors are still paying way more in fees than they should be, this latest news is cause for celebration: People are finally getting it! Mutual funds are one of the few areas of life where you really don't get what you pay for!

I always enjoy reading Chuck Jaffe's columns on Marketwatch, even though I don't always agree with his analysis. He provides thoughtful analysis of issues that most other columnists don't bother with. Somehow, I only just found out about his radio show, and I'm excited. On Your Money with Chuck Jaffe (Insipid name. Marketing execs: Think of something better), he takes questions about stocks (and gives more thoughtful analysis than Cramer's Lightning Round), discusses the market, and conducts interesting interviews.

On his most recent show, he spoke with Brent Wilsey of Wilsey Asset Management, who talked about the importance of using ratios in stock selection. I certainly agree that they are a good starting point -- I use stock screeners regularly to find solidly profitable companies trading close to book value with minimal debt. But I would also caution investors that screeners are also just a starting point.

In Ken Fisher's new book, The Only Three Questions That Count, he discusses one of the most important questions for investors to answer: What do you know that others don't? If you're basing your investing decisions on ratios, stock picks from popular websites, or the newspaper, you're probably not acting based on any knowledge that is uniquely your own. My advice: Use the screeners for quantitative measures, but don't be afraid to inject your own knowledge. Is there a hot new product in your industry? Are you a fashionista who has a better grasp of the latest fashion trends than the Wall Street analysts? Thinking about investments this way is the most likely way to find answers to the question: What do you know that others don't?

Marketwatch columnist Chuck Jaffe has an excellent piece about the frequently fraudulent high yield investment programs (HYIP's) that litter the internet. Known for promising outrageous returns (10%+ per week in some cases) and given only vague details about how they earn their returns, these "investments" are most often Ponzi schemes.

I recently interviewd convicted felon Barry Minkow, who is now founder of the Fraud Discovery Institute, working tirelessly to protect investors from scams. In his new 3-part DVD series about protecting yourself from fraud (look for it on his website when it is avaialable) the DVD featured sections on investment fraud, elder fraud, and affinity fraud, and is both informative and entertaining. In talking about investment frauds (such as HYIP's), Minkow urged investors to think of it this way: Warren Buffett is considered arguably the greatest investor of all time, and he compounded money at a rate of about 23% per year.

Anytime someone offers you better returns, ask yourself: are they better than Warren Buffett?

I was wondering what that odd caller id was: www.luvoo.com. Chuck Jaffe from MarketWatch picked up the phone when the call rang into his residence. And it was Carmen Electra (her pre-recorded voice, but still).

She was pitching online dating, but Jaffe thought it notable that she'd mentioned www.luvoo.com's stock was publicly traded. He followed the trail to the web site, where, he says, the "current focus seems to be on its stock; the most prominent feature is a bad head shot of Electra over the words 'Newly Publicly Traded!'"

It seems pretty obvious that Carmen's main goal was not to get Jaffe and myself (both happily married, just for the record) to find each other via the terribly-designed site, but for us to find a quick money-making scheme.

Jaffe goes in-depth and highlights Luvoo.com (LVTI, currently down 12.5 cents on the day to 27.5 cents) as a "stupid investment of the week." Warning flags include daily press releases since the June 9 IPO (most frighteningly, with the CEO talking about how honored he is to have been featured on sites like IPOMovers, "paid marketing conduits"); the lack of any discussion of a business model, or balance sheet; and the fact that the numbers trumpeted in press releases are rather amorphous and without any basis -- for instance, the fact that Carmen's endorsement caused a 400% jump in subscriptions (400% of what? and are any of those monetizable?). There was no press release announcing how the Pauly Shore endorsement affected the company's prospects (licking the bottom of the celebrity endorsement salsa bowl, guys?).

It's a good reminder that stocks shouldn't be evaluated on the basis of the company's celebrity pitch-people, but by the quality of their financial statements. And having a sexy voice on the other end of the phone is likely as much of a red flag as a disappearing business model.