Testimony before the Senate Finance Committee, September 16, 2014
Mike - Sep 17, 2014

Memo to Veterans and Principals
Mike - Sep 10, 2014

To: Veterans and Principals

From: John C. Bogle

Date: September 9, 2014

Re: Will it ever stop?


            The more that I expect it to slow down, the more the attention given to Vanguard in the media seems to speed up. Enclosed are some more recent articles highlighting our success and commitment to clients.

  1. Investors Pour Into Vanguard, Eschewing Stock Pickers, by Kirsten Grind, The Wall Street Journal, August 20, 2014. This article points out an upcoming milestone for Vanguard: $3 trillion in global assets under management. Also highlighted is Warren Buffett’s recommendation of Vanguard 500 Index Fund for his wife’s investment portfolio, and the $5 billion of cash flow it helped to generate for the fund. It also includes my quip in an email to Warren that I am now described as, “the second best salesman at Vanguard.”
  2. Vanguard’s Rise To No. 2 ETF Firm Matters, by Olivier Ludwig, ETF.com, August 19, 2014. In this generous article, Olly Ludwig anticipates that Vanguard will soon take over the second ranking in U.S. ETF market share. He comments that, “the reason we should all celebrate the rise of Vanguard and Vanguard ETFs is because it shows that investors are truly getting a fair shake.” He concludes, “we really should be thankful that 40 years ago John Bogle thought the time was right to truly put investors’ interests first.”
  3. Review of The Man in the Arena, by Murad J. Antia, CFA, Financial Analysts Journal, July/August 2014. This highly complimentary review of The Man in the Arena, the recent book about my legacy in the mutual fund industry, edited by Knut A. Rostad, concludes: John C. Bogle … has been at the forefront of the revolution that has democratized the investment landscape by first creating a mutual organization, a company owned by its investor clients. He has tirelessly imparted the message that investors would be far wealthier if they invested in low-cost index funds. Yes, that’s the Vanguard message.
  4. Fund Scandal Ripples, Even a Decade Later, by Tom Lauricella, The Wall Street Journal, September 8, 2014. This article recalls the mutual fund market-timing scandals of a decade ago. I am quoted in the article as saying that the fund industry’s focus on investors “has improved, but we still have a long way to go.”
  5. Think of Social Security As an Investment, Says Vanguard Founder, by Dan McSwain, U-T San Diego, September 6, 2014. In this extensive interview, the journalist describes my views about indexing and the importance of low costs for long-term investors. Also discussed is my view that Social Security must be taken into account by investors when constructing their asset allocations.
  6. 3 Smart Moves for Retirement Investors from the Bogleheads, by Penelope Wang, Money, August 18, 2014. This feature article points out that the second edition of The Bogleheads’ Guide to Investing is being released, and shares some tips for developing an effective investment strategy. Says one of the unofficial leaders of the Bogleheads, Mel Lindauer, “one of the main advantages of being a Boglehead—we remind people to stay the course.”

When you have a spare moment (?), please enjoy these stories, and feel free to send copies of this note and the attachments to your colleagues and friends. As usual, by week’s end, they’ll also be published on my eBlog, www.johncbogle.com.

Welcome back from what I hope has been a refreshing summer vacation for you and your families.




Memo to Veterans and Principals
Mike - Sep 10, 2014


To: Veterans and Principals

From: John C. Bogle

Date: 8/20/2014

Re: Even More Great “PR”


            I’m sending along some “summer reading,” ranging from articles I’ve penned for academic journals to wonderful acknowledgements in the popular press of Vanguard’s values and success.

  1. No Speed Limits: High-Frequency Trading and Flash Boys,Journal of Portfolio Management, Summer 2014. The editors of the JPM asked me to provide an editorial comment on all of the attention given to high-frequency trading (HFT) in the press since the publication of Michael Lewis’s book Flash Boys. In this editorial, I try to bring some clarity and perspective to the debate.
  2. Who Are Your Investment Role Models? The Wall Street Journal, August 12, 2014. A complimentary entry in “The Experts” series. Four of these six commentators salute Vanguard, and graciously mention me as being among their role models and investment heroes—even an “investment superhero.”
  3. Rules of the Fund Road: Watch the Fees, and Don’t Look Back,by Jeff Sommer, The New York Times, June 1, 2014. One more example of a journalist who “gets it,” this article discusses a Morningstar study which, once again, suggests that low-cost investing works. It closes with a nice JCB quote.
  4. The High Price of Investing in a Hedge Fund, by Gus Sauter, The Wall Street Journal, August 5, 2014. In another installment of “The Experts,” Vanguard’s Gus Sauter talks about how high costs damage the returns of hedge funds. Gus kindly works in a quote that will surely be familiar to those who regularly read my writings.
  5. Heads or Tails? Either Way, You Might Beat a Stock Picker,by Jeff Sommer, The New York Times, July 27, 2007. This story cites data showing that only 2 out of 2,862 diversified U.S. stock funds were able to outperform their peers consistently over five years.
  6. Bogle’s Legacy: Returns that Trounce Active Investing,by Mitch Tuchman, MarketWatch, August 7, 2014. An entry in the “Retirementors” series, this article emphasizes the importance of broad diversification and low costs, while challenging readers to identify portfolios that can beat Vanguard’s LifeStrategy Funds on a risk-adjusted basis.
  7. Vanguard Funds Prosper by Low-Cost Evangelism,by Pauline Skypala, Financial Times, July 14, 2014. This powerful article from the UK’s leading business and investing daily generously appraises our truly mutual structure and our dedication to low costs, while pointing out that non-US investors often pay excessive fees.
  8. Swedroe: Bogle May Be Right about ETFs,by Larry Swedroe, ETF.com, July 16, 2014. Author and financial advisor Larry Swedroe discusses a study by five German economists that found an astonishing gap between the returns enjoyed by investors in ETFs versus the non-ETF portions of their portfolios. According to the study, their ETF returns were some 5% per year lower (!) than their non-ETF returns, an astonishing underperformance.
  9. Practice Makes Imperfect,Buttonwood, The Economist, August 9, 2014. This article discusses a study that shows, perhaps unsurprisingly, that very few active managers outperform persistently over the long term. The paper concludes that, “even long-term managers show no ability to beat the market on a risk-adjusted basis.” What’s remarkable about this article is that it discusses topics that I’ve covered for decades, going back at least to my 1993 book, Bogle on Mutual Funds. As you know, those original ideas have gained remarkable acceptance in the recent era.
  10. The Arithmetic of ‘All-In’ Investment Expenses: A Comment and Author Response,Financial Analysts Journal, May/June 2014. An advisor from Morgan Stanley wrote a letter to the editor of the FAJ regarding my January/February 2014 article about the huge negative impact of the costs of active investing vs. index investing over the long term. The advisor argues that many individual investors have limitations on their time, access to information, and cognitive abilities that justify the costs of working with a financial advisor to select active funds. In my response, I present data showing that investors in passive index fund generally fare much better than those who invest in actively managed funds. I also point out evidence that suggests that investors working with brokers may actually underperform investors who manage their portfolios themselves.

*      *      *

I know that you share my gratification to see that the values that have been fundamental to Vanguard for so many years are increasingly accepted in the press as today’s conventional wisdom. The benefits to investors of investing the Vanguard way are enormous.

Enjoy these articles, and enjoy the precious few remaining weeks of summer.

Best, always,


The Future of Investing
Mike - Jul 09, 2014

Jack was featured in The Wall Street Journal’s “The Future of Everything” special report celebrating the Journal’s 125th anniversary.

John C. Bogle on the Future of Investing

A Memo from John C. Bogle
Mike - Jun 26, 2014

To: Veterans and Principals

From: John C. Bogle

Date: June 26, 2014

 Recognition for Vanguard and Indexing

            The almost overwhelming success of Vanguard and index funds continues to draw attention, not only from investors (over $77 billion of net cash flow so far this year, 95% of which went into our low-cost index funds), but also from the media. Attached are four recent articles noting our success.

  1. “Bogle Is In The Vanguard Of Mutual Fund Investing,” Investor’s Business Daily, June 12, 2014. This nice profile highlights the triumph of indexing, and Vanguard’s rise to prominence over the last four decades.


  1. “Facing price wars and robots, wealth managers push advice,” Reuters, June 20, 2014. I recently participated in the Global Wealth Management Summit hosted by Reuters. This article stems from that summit, and focuses on the growing market for web-based financial advisory services, such as Vanguard’s Personal Advisor Services. Of course, the opening line tickled me: “Jack Bogle, the founder of Vanguard Group and the pioneer of low-cost index investing, has won.”


  1. “Vanguard’s Bogle expects shrinking Wall Street,” Reuters, June 17, 2014. This article about my thoughts on the future of the financial industry also came out of the Reuters event.


  1. “Philosophy Differs From Strategy,” RickFerri.com, June 16, 2014. Independent financial advisor Rick Ferri writes about how his investment philosophy is based on the realization that trying to beat the markets is “costly and counterproductive,” so his investment strategy relies on low-cost index funds.

With all of Vanguard’s success over our four decades of existence (we’ll celebrate our 40th anniversary on September 24, 2014), it remains critically important that keep our focus on what’s best for our clients. I’ve used this quotation from Shakespeare many times before, “Uneasy lies the head that wears a crown.”

Indeed, Vanguard’s rise to the pinnacle of the mutual fund industry places a fragile crown on our heads. We must continue to focus on our founding values of stewardship and trusteeship of the assets entrusted to us by our clients.

Enjoy your summer.

Best, always,


“The Philosopher of Finance”
Mike - Jun 12, 2014


Jack has done numerous interviews on NPR, and has found public radio to be an ideal platform for conveying Vanguard’s values to both our clients and the general investing public. His most recent interview, by David Freudberg, host of the Humankind series, was titled “The Philosopher of Finance” and consists of two half-hour segments. In the interview, Jack and David discuss topics regarding human values, as well as issues that are of vital importance for long-term investment success.

The interview will be released as a free podcast today. Instructions on how to access the podcast are below.  I hope you’ll enjoy this discussion of our values and the keys to ensuring a secure retirement.

There are two ways you can hear this program:

1. The public radio producer will be making “The Philosopher of Finance” available for free download at their podcast

Humankind on Public Radio starting at noon on Thursday, June 12, 2014. (Those who subscribe to the podcast will then be able to hear a new episode of Humankind each week at no charge.) The podcast can be accessed here: http://tinyurl.com/HumankindPodcast

2. Those who wish to purchase a CD copy may place an order here:


A Memo to Principals and Veterans
Mike - May 22, 2014


May 20, 2014

 To Vanguard Principals and Veterans:

             As you all must know by now, I regard recognition of Vanguard in The Economist as among the highest possible accolades. This cover story in the issue of May 3, 2014, entitled “Death of the Fund Manager” is one more testimonial to all the good we do here at Vanguard.

             Attached are: (1) the opening editorial, “Cheap is Cheerful,” and (2) the main story, “Briefing: Fund Management. Will Invest for Food.” (Both pieces are informative and insightful. Too bad that the headlines fail to suggest that.)

             Despite the accolades for index (“tracker” in the UK) funds, the authors seem unaware of the impact that indexing has already had on Vanguard and the fund industry. Ever irrepressible, I wrote a letter to the editor presenting the data. It’s probably too late and long to be published, but I’m sure you’ll enjoy it (Attachment 3).

             We’ve come such a long way since we began in 1974. Thank you for all your help in making it happen.


A Memo from John C. Bogle
Mike - May 02, 2014

To: Veterans and Principals

From: John C. Bogle

Date: May 1, 2014


A Remarkable Salute from Investors and CNBC

            As many of you have already reported to me, CNBC has ranked me among the top ten people who have had “the most profound impact on business and finance” over the past quarter-century. (CNBC has just begun its second quarter-century.) In this context, I’m sending along two attachments.

1.      “Index Mutual Fund Pioneer.” The CNBC profile of my long career is remarkably insightful, particularly in its recognition of the role of “Bogle’s evangelism.” They also identify the often-unrecognized link between Vanguard’s truly mutual structure and that first index fund.

However you may feel about the culture of stock market television, I’m actually deeply touched by being placed high (#9) on the CNBC list of “25 transformative leaders, icons, and rebels of the past quarter-century.”

NOTE: I’ve also included a link to the CNBC video on my career. It’s just three minutes in length, but professionally done and power-packed.

2.      “The List: CNBC First 25.” Who are these other icons? Here’s the list, led (deservedly, I think) by #1 Steve Jobs and #2 Bill Gates. Interestingly, Warren Buffett (#6) and I (#9) are the only people from the field of investment management (also, in a limited way, Carl Icahn, #17) on this influential list, which includes at least eight leaders from abroad.

One of our crew members called an amusing point to my attention. I’m sandwiched between #8 Mark Zuckerberg (net worth, $28.5 billion) and #10 Larry Ellison (net worth, $48 billion). Last time I looked, I’m well below average (to say the least!) relative to these successful fellows.

*           *            *

            Our organization structure and our index strategy represent the solid core of the reputation we have earned and the trust we have established with investors . . . and with the world. How good it feels to be recognized on the CNBC list of these 25 men and women who have been “the rebels, icons, and leaders in the vanguard (yes!) of that change,” from yesteryear’s era of business and finance to today’s.

Enjoy!  Always,


Mike - Apr 29, 2014

A Memo from John Bogle
Mike - Apr 16, 2014

To:          Veterans and Principals

From:    John C. Bogle

Date:     April 15, 2014

Re:         More Recognition for Our Firm, Part II

This follow-up note to my mailing of April 10 includes five more recent articles from the press:

1) “Vanguard Founder Discusses How to Invest.” This interview in Investor’s Business Daily was published on April 2. While several of the quotes are a bit casual (if not mystifying!), the overall tone of the story is highly positive.

2) “Michael Lewis is Wrong About Rigged Markets.”  Jonathan Berr’s April 3 story in Moneywatch is yet one more contribution(?) to the huge publicity campaign that kicked-off Flash Boys. While I didn’t have the benefit of knowing the opinion of later commentators, my position is not much different from those of Burton Malkiel, Arthur Levitt, Morningstar’s John Rekenthaler,  and other thought leaders.

3) “On Smart Beta, Smart Skeptics.” James Green’s thoughtful story in Investment Advisor magazine (March 31, 2014). Of course, my response is blunt—smart beta is a “marketing gimmick.” Might as well be honest!

4) “Vanguard Beats BlackRock . . .” Christopher Condon’s article in Bloomberg Business Week (April 1, 2014) is one more long, well, “commercial” for our firm, its mission, and the work we all do. It is surely a rare quarter when we capture 90%(!) of all ETF cash flows as we did in the three months ended March 31, 2014, but of course there’s a message there.

5) “The Inevitable Standard.” Investment News, April 7, 2014. The “Inevitable Standard” cited in Mark Schoeff Jr.’s perceptive story is a federal standard of fiduciary duty—something I’ve been seeking for many years. I’m certain that my dream will come true . . . some day.

 Keep fighting the good fight!

Best, always