[jrock08]

So, I'll admit that I don't understand the details of how vanguard is paying employees or the external people that actually manage the money, but presumably, they pay a fixed fee to someone to manage the money, and that fee is significant (but not a significant fraction of the money under investment). The fact that "normal" in investment funds is percentage of money under investment plus percentage of the profit shouldn't matter since they've found a way to run a company that doesn't need to pay those fees to get the money invested.

edit: I should add, that I'm fairly certain that the employees at vanguard are in fact getting paid.

edit2: So the question is should we look at whether the employees/contractors at vanguard are getting paid market rate, or whether vanguard as a whole is charging market rate to the investors. My comparison to the hospital co-op was that it's unfair to compare apples-to-orangutans.