Well he does say "To be clear, I’m not arguing that an entire market could ever go passive." Which kinds of begs the question, how much passive investment can

Well he does say "To be clear, I’m not arguing that an entire market could ever go passive." Which kinds of begs the question, how much passive investment can there be, and what is the limiting factor, if not a Grossman-Stiglitz model where 'arbitrage ' (in this context market-making, market-timing etc.) makes prices boundedly efficient, and less arbitrage means higher spreads, less liquidity, less pricing efficiency. There must be a 'Bernstein peak' and mixed strategy equilibrium, where if you have too much active, expenses are too high, and if you have too little active, liquidity suffers and costs from spreads and volatility are too high. http://abnormalreturns.com/2016/02/19/the-bernstein-curve/ http://abnormalreturns.com/2016/02/19/the-bernstein-curve/