Investment legend Jack Bogle: Trump policies could be bad for society, economy, markets in long run

Bogle: The market is very focused on the short term

Investors who have helped to rally stock prices since Donald Trump became president-elect are shortsighted because his policies could hurt U.S. markets in the long term, Vanguard founder Jack Bogle told CNBC on Monday.

"In the long run, I have a concern that anything that divides our economy further in terms of economics or race is bad for the society, bad for the economy and bad for the markets," the former Vanguard CEO said on "Squawk on the Street."

Bogle listed raising trade barriers, breaking ties with Europe and increasing the country's debt as potential policies that the new administration has floated that could be especially bad for the economy.

Still, Bogle acknowledged that little has been confirmed about what Trump will propose, and the president-elect has notably flipped his stance on a number of issues.

"The new president's going to have to deal with a Republican Congress that is not particularly smitten with many of his ideas, so it's hard to know just what will go through," Bogle said.

Bogle said some policies would be easily passed by Congress, which remained in the hands of the Republicans.

"Any package of a lot of infrastructure spending at the same time as we reduce taxes is going to be very, very hard to resist politically, so I think it's going to happen one way or another," Bogle said.

Bogle also said Trump's tax reform measures, specifically his plans for cutting corporate taxes, could benefit markets.

But in terms of income inequality, he worried tax cuts would create deeper divides, calling the notion of lower individual taxes for the country's wealthiest class "not a very happy idea at all."

"We can pay our own way," he said. "We ought to give some tax relief to the people that really need it in this country, and there are an awful lot of them."

In June, Bogle told Forbes he had doubts about Trump. "I don't believe that Trump has the character and background to be president," he said, adding, "And I'm a Republican."

Trump's "mixed bag" of Cabinet picks may serve as an early reflection of the president-elect's character, Bogle said, though he acknowledged that "it's still early" to tell what a Trump administration would fully look like.

So far, he said "his picks seem to me to be in a way quite extreme on the right side."