When investors began to panic and ask John Bogle for advice in the wake of last week’s stock market turmoil, he answered with a question of his own: “Do you really think the intrinsic value of the stock market changed by $750 billion last Tuesday afternoon?”

The point the legendary founder of a mutual fund giant, the Vanguard Group, says he is trying to drive home is that the stock market is like a Las Vegas casino — it’s an entity based largely on speculation, it’s filled with fun and excitement, and, if played recklessly, it can erase wealth faster than it builds it.

“The stock market is a system gone awry,” Mr. Bogle said in an interview with The New York Sun yesterday. “It’s a foolish, counterproductive system based on expectations.”

He didn’t time the release of “The Little Book of Common Sense Investing” (Wiley) to last week’s crash, but the advice he gives is particularly relevant as a frenzied public continues to buy and sell on Wall Street. Value investors take note: You can tap into a lifetime of market insight for $19.95.

Mr. Bogle, the most enthusiastic advocate of index mutual funds, sounds a bit like a preacher these days. “I have a powerful message, and it’s a message people need to hear,” he said. “Own the entire market — own everything. Diversify to the nth degree. And stay the course.”

He said the stock market is a giant distraction that “causes investors to focus on transitory and volatile investment expectations rather than on what is really important — the gradual accumulation of the returns earned by corporate business.”

That’s why he recommends owning a mutual fund that tracks stock indexes and strips away multiple layers of risk. “My advice to investors is to ignore the short-term noise of the emotions reflected in our financial markets and focus on the productive long-term economics of our corporate businesses,” Mr. Bogle said.

After completing “The Battle for the Soul of Capitalism,” a sweeping economic review, Mr. Bogle, 77, said he wanted to weave together a short, fun-to-read work filled with basic investing rules and anecdotes from some of his friends. Each chapter in his new book, his sixth, includes a feature called “Don’t Take My Word For It,” with advice from the likes of investment gurus Jack Meyer, Paul Samuelson, Warren Buffett, and Charlie Munger.

A noteworthy passage comes from the chief investment officer of Yale University’s Endowment Fund, David Swensen: “A minuscule 4% of funds produce market-beating after-tax results with a scant 0.6% margin of gain. The 96% of funds that fail to meet or beat the Vanguard 500 Index Fund lose by a wealth-destroying margin of 4.8% per annum.”

Mr. Bogle also refers readers to the words of Columbia Business School’s Benjamin Graham, who he says has a finger on the reality of investing: “In the short run the stock market is a voting machine … in the long run it is a weighing machine.”

Chapter 7, “When the Good Times No Longer Roll,” addresses how to cope with investing in markets whose future returns are lower than usual. Although Mr. Bogle maintains that the earnings growth of companies and dividend yields drive returns, he says the 12.5% nominal annual return over the past quarter century is “far above business reality.”

Going forward, he advises readers to minimize the impact of inflation, costs, taxes, and sales growth when formulating their investment game plans. The near future would involve facing a bleaker market reality: “As investor confidence rose, so did the price/earnings rise — from 9 times to 18 times, an amazing 100% increase, adding fully 2.7 percentage points per year (almost 30%) to the solid 9.8% fundamental return. Result: Speculative return was responsible for more than 20% of the market’s 12.5% annual return during this period.

“Since it is unrealistic to expect the P/E ratio to double in the coming decade, a similar 12.5% return is unlikely to recur. Common sense tells us that we’re facing an era of subdued returns in the stock market,” Mr. Bogle writes.