How do you change vbulletin's home page to the forums instead of the default (CMS or Activity Stream)?

For vBulletin versions < 4.2.
You need to modify the forum index page located in the top level of your vBulletin directory. Based on the URL in your question it's this file:
http://www.demo.com/index.php

Here is the contents of that file, you can choose whether the CMS or the Forum is the default home page.

/**
 * You can choose the default script here.  Uncomment the appropriate line
 * to set the default script.  Note: Only uncomment one of these, you must
 * add // to comment out the script(s) that you DO NOT want to use as your
 * default script.
 *
 * You can choose the default script even if you do not plan to move this
 * file to the root of your website.
 */

/**
 * Use the CMS as the default script:
 */

require('content.php');


/**
 * Use the forum as the default script:
 */

// require('forum.php');

For vBulletin versions >= 4.2.
There's a new "Navigation Manager". You'll find the control settings here:
Admin Control Panel -> Settings -> Navigation Manager.

Find the row for the Forum tab.
On the right side of the row is a pull-down selector, click "Set Default" (you may need to click the "Go" button afterwards).

The "Change Site Default" panel will appear.
Verify that the Forum tab is the "Proposed Default" and that "Yes" is selected for "Confirm Change", then click "Save".

The forum home page is now the forums listing.