He's making the (correct) assumption that the speculative stock market where active investors expect to make their money is a zero-sum game. For there to be wi

He's making the (correct) assumption that the speculative stock market where active investors expect to make their money is a zero-sum game. For there to be winners in "buy low, sell high" there have to be an equal amount of losers. So, if there are going to be winners, there have to be an equal amount of losers. It's difficult to siphon money off of someone passively invested in an index fund, so the active investors are competing against themselves. Because active investment has a much higher cost than passive, as a group they will be significantly worse off compared to passive investors. This is so self-evident as to be not even worth betting against. Note that this isn't to say that there won't be big active winners individually. But in a chess tournament, if the top players use strategy A that wins 90% of the time, and others use strategy B that wins 51% of the time, that guarantees the existence of some other strategy that performs below average. The stock market isn't necessarily a zero-sum game like chess because companies pay dividends, but that's rare and small enough to be insignificant compared to the amount of money gained and lost through speculation.