As one who wrote a book entitled Enough., I’m wondering whether my mission to serve investors hasn’t now gotten “enough” attention in this 60th year of my career.
I raise this (delightful) concern following the “JCB Legacy Day” celebration on Wall Street three weeks ago, for this morning I received a copy of the current issue of Journal of Indexes, devoted almost entirely to my work-”The Bogle Issue.”
It includes comments from a wide range of industry participants about my role in making the financial world-and especially the mutual fund world-a better place for investors. Particularly interesting are the kind comments of our own Gus Sauter and Burt Malkiel, and the analysis of Chris Philips in “The Case for Indexing.” (Thanks, group!)
I’m attaching just a few excerpts from the 64 pages(!) published in JOI, including the crossword puzzle (pretty exciting to have that!).
I’ll get some extra copies of “The Bogle Issue” for those who want to see more of it … though I expect that most of you will find these attachments “enough.”
Yesterday, a star-studded group of our nation’s investment leaders celebrated my 60th anniversary in the financial field. “The John C. Bogle Legacy Forum” took place at the Museum of American Finance on Wall Street, and I must tell you that this recognition delighted my soul (even as I was embarrassed that, despite my good intentions, my pride sometimes peeped out).
I’m pleased to attach a few items that you might enjoy:
You should know that I had to overcome my extreme reluctance to circulate this summary of a true “red-letter” day in my life and career. But there’s no other way to inform the many ofyou who care, and for that I am in your eternal debt.
Next Monday and Tuesday (and possibly Wednesday), CBS Evening News will present excerpts from a group interview yesterday on the problems facing America, our nation’s challenges and our hopes. The interview was conducted by new anchor Scott Pelley (moving over from “60 Minutes”). He did, I thought, a really outstanding job. I was honored to be part of the ten-person panel – a diverse group of citizens of various ages, genders, races, and backgrounds. If you happen to catch any of the shows, I’d be interested in your reaction.
Last Friday, Michael Smerconish wrote a generous column in The Philadelphia Inquirer, discussing my reaction to the “Occupy Wall Street” movement and its many aspects. In case you missed it, a copy is attached. (Not sure about being called a “patrician.”)
Virtually every day, I receive complimentary letters about Vanguard and my long career. I couldn’t possibly circulate all of them, but I just received a very special one. It comes from James Grant, publisher of Grant’s Interest Rate Observer and host of a well-attended and prestigious semi-annual forum for senior money managers. Their reaction to Jim’s interview with me was truly remarkable. He describes it in his lovely letter, also attached.
Thanks to you all for doing the exceptional work you do. Happily, much of it continues to reflect on me.
I’m attaching a copy of my speech to the NMS Investment Management Forum, presented to a packed house of some 400 endowment fund and pension fund officers in Washington, D.C., last Monday, September 12.
It includes a discussion of endowment fund investment policy; a comparison of endowment fund returns with the model index fund portfolio (50 percent stocks, 50 percent bonds) that I recommended 15 years ago in an essay for the Common Fund; and a forecast of future stock and bond returns. It also includes commentary about the risks involved in the greatly expanded use of alternative investments, now the dominant portion of endowment portfolios.
If these subjects interest you, I think you’ll enjoy the talk.
Jack
Note 1: On Monday September 19, I’ll be doing a full hour—from 1PM to 2PM—on CNBC’s “Power Lunch,” with Tyler Mathisen. We’ll be talking about current issues, including Vanguard’s growth and industry position, index funds, and today’s financial markets.
Note 2: The endowment fund speech, along with most of my other speeches, interviews, etc. have all been posted on my Bogle eblog—www.johncbogle.com.
I’m attaching a copy of a Wall Street Journal interview with me by Jason Zweig that appeared in the WSJ last Saturday, September 10. I think you’ll enjoy the perspective.
The interview arose from a request by the WSJ for a taped conversation with Jason Zweig for wsj.com. That interview took place last Wednesday and began to run over the weekend on the web.
I’m told it got the second highest number of “hits” (or whatever the right formulation is) in the WSJ website over the weekend. The first tape ran on Saturday and you might enjoy that too (warning: it runs about 20 minutes). If you have time, you might want to give it a glance.
It seemed only appropriate to celebrate (as it were) the 35th anniversary of the index fund, the first major innovation of the then-tiny and young Vanguard Group. So last week, I wrote an essay on the creation of the fund and its initial public offering, which took place on August 31, 1976.
I sent the essay to the op-ed editors of The Wall Street Journal, hoping they could help me get it placed in the “Review” section, which runs on Saturdays. But they wanted to publish a significantly shortened version on “their” page, so I (reluctantly) did the merciless editing required.
After Sixty Years of Past Service, Looking to the Future
I can still remember my first day on the job at our predecessor company (Wellington Management). It was July 5, 1951, as I walked into our offices at 1420 Walnut Street in Philadelphia, where Wellington employed about 60 people. I had the same aspirations and apprehensions that any young person would feel. It was my first full-time job, but I’d been working at part-time jobs year-round since I was about ten years old, and also worked while attending Blair Academy and Princeton University. So I knew what work was all about—doing whatever job I was assigned to the best of my ability; seeking and accepting responsibility; always doing more than was expected of me; and treating those with whom I worked with kindness and trust.
That proved to be a pretty sound framework for my long career, and served me well through times of accomplishment as well as times of failure; of keen perceptions and embarrassing misjudgments; of days of hearty health and days of illness, often severe. But you know most of these vicissitudes, for I’ve written about them all in my voluminous outpouring of essays, speeches, and books. I’m already working on yet another: The Clash of the Cultures: Investment vs. Speculation, continuing my role as Vanguard ambassador and investor advocate, with “Common Sense” as my theme.
Vanguard at 100
But at this 60-year milestone, I’m less interested in looking back than looking forward. In fact, I’m already thinking about Vanguard’s 100th Anniversary, dating back to the founding of our first fund, Wellington Fund, on December 28, 1928. Coincidentally, I recently came across a speech I gave way back in 1992 entitled “Vanguard: The First Century.” That was a brassy (maybe even arrogant) theme, for remarkably few companies in the annuals of American business and finance have passed that stern test.
In the near-two-decade span since I gave that speech, virtually all of my predictions for us have been met, as you’ll see. (EXHIBIT A includes excerpts from that speech.) I’m confident that—with our strong human values and our simple investment strategies—the (mere!) 17 years that remain before Vanguard’s first century is completed will be an era of continuing growth and service to investors.
IBM At 100
When we reach Vanguard’s 100-year milestone in 2028, how will we look at ourselves? One possible example emerged only a few weeks ago, when IBM reached that mark. In a four page advertisement in The Wall Street Journal, this extraordinary technology company described what it took to get there. (Excerpts are attached in EXHIBIT B.) I’m sure you’ll be struck, as I was, at the many parallels between our corporate cultures, our philosophies of service, and our structures of independence. (I hope someone here will file that ad away and exhume it early in 2028!)
This industry will likely look far different when 2028 rolls around. But at the moment, our strategies and structure—implemented by the astonishing commitment, professionalism, and loyalty of our crew—have made us the industry leader. Yes, “uneasy lies the head that wears the crown,” but even as we have grasped the mantle of leadership, it will take all of our wisdom, character and steadfastness to hang on to it.
It has been the thrill of a lifetime to work with such a great group of colleagues over all of these years. Thanks to you all, and best always. “Press On, Regardless!”
In case you missed my op-ed in this morning’s Wall Street Journal, I’m attaching a copy. I’m pretty sure you’ll enjoy it. Also attached is a lovely article from the coming edition of Forbes.
I’m attaching a fun speech I gave last evening at the JFK Library in Boston at the 50th aIll1iversary of the Calvin Coolidge Memorial Foundation. (It’s a long story!) Entitled “How Calvin Coolidge Could Guide Us Today,” it includes a number of historical references that I think you’ll enjoy.
Also attached is an article from Bloomberg Business Week on Vanguard’s becoming the largest firm in our industry, essentially a summary of a much more extensive article on Bloomberg.com. Since this article is laced with some wonderful quotes from independent sources that I’m sure you’ll enjoy, I’ve included it as well.
Not to be too picky, but the story substantially underscores our advantage in asset size, stated as Vanguard $1.31 trillion, Fidelity $1.24 trillion. In fact, the totals are Vanguard $1.39 trillion, Fidelity $1.17 trillion-an edge of $220 billion. Excluding money market funds and counting only stock and bond funds, the totals are: Vanguard $1.22 trillion, Fidelity $730 billion, a staggering edge of almost $500 billion.
Numbers are mere numbers, and size is only size. (And don’t ever forget that “the bigger they are the harder they fall.”) What remains important are the basic human values and the simple investment strategies established at our founding, which–despite the challenges engendered by our electrifying growth to industry preeminence-remain the primary basis for the enormous trust that investors have placed in all of us.
While the attached speech about Vanguard’s ascent to industry leadership was presented to the FUSE Network Research Conference on the future of asset management and the distribution of marketing resources, it occurs to me that it would likely be of even greater interest to our Vanguard crew.
So I’m sending along “Uneasy Lies the Head that Wears the Crown,” some reflections on the lessons of industry leadership, with particular attention to the three past leaders during our industry’s 76-year history. Each held the crown with surprising durability, lasting for about 25 years before their decline and fall.
The obvious question: Will Vanguard’s reign be as durable? Or will it last even longer? Read on.