CFA Conference Speech
Mike - May 26, 2017

Jack spoke at the 70th CFA Institute Annual Conference in Philadelphia on May 23, 2017.

John C. Bogle’s CFA Conference Opening Remarks

 


The Road Less Traveled
Mike - Apr 28, 2017

Jack delivered a landmark speech at the Morningstar Investment Conference on April 27, 2017:

The Road Less Traveled

The speech chronicles the remarkable rise of Vanguard and indexing from a sort-of-joke in 1974-76 to unprecedented industry domination in 2017, largely because of its mutual structure and its index strategy. What does that remarkable growth portend for the mutual fund industry? The eight highlights below summarize the key issues:

1. Index fund growth will continue. It remains to be seen whether broadly diversified long-term traditional index funds (TIFs) will lead the way, or whether exchange-traded index funds (ETFs) with their marketing attraction, substantial trading, and largely short-term focus, will dominate index cash flows. Pages 1-3, 10.

2. To meet the challenge of indexing, today’s active fund managers will have to develop a variety of appropriate business strategies. Page 10.

3. Active management is not going away, and large privately-held fund managers should pretty much stay the course, with few changes in their present business strategy. Page 7-8.

4. Conglomerate-owned fund managers (30 of todays 50 largest fund management firms) should adopt a “cash cow” business strategy. Pages 9-10.

5. Public policy—and the very words of the Investment Company Act of 1940—will compel fund directors to consider, not merely the business strategy of the manager, but the fiduciary strategy that places the investment interests of fund shareholders ahead of the business interests of fund managers. Pages 11-12.

6. Outside forces—a strong bull market and tax favored retirement plans—have driven mutual funds’ growth during the past 35 years. These forces will not repeat, and may even recede. Pages 11-12.

7. Fund directors, in general, have failed to measure up to this challenge, in part because fund boards are dominated by directors affiliated with fund managers. Such directors have two distinct fiduciary duties—one to the shareholders of the management company, the other to the shareholders of the mutual fund. Page 15.

8. Director lassitude has been reflected in the fact that more than 100% of the economies of scale in operating mutual funds have been garnered by fund managers. None of these economies have been shared were fund owners. (Since 1951, fund assets are up 5,400 times, fund expenses up 5,600 times.) Pages 13-14.


The Philadelphia Inquirer Industry Icon Awards
Mike - Nov 16, 2016

On November 16, 2016, Jack was honored at the inaugural Philadelphia Inquirer Industry Icon Awards.

Here are Jack’s expanded comments upon accepting the award.


John Bogle’s 65th Anniversary Speech
Mike - Jul 14, 2016

A speech by John Bogle, marking his 65th anniversary in the mutual fund industry.


Memo to Veterans and Principals
Mike - Dec 08, 2015

To: Veterans and Principals
From: John C. Bogle
Date: November 23, 2015
Re: “Distinguished Service to Humanity”

Last Thursday evening, November 19, I was honored by the National Academy of Social Sciences with their Gold Medal for Distinguished Service to Humanity. (They’ve been awarding these medals for 101 years.)

The award was based (as the attached dinner announcement states) on my “invention of the first index mutual fund.” I prepared my remarks well before the day of the dinner, and edited them to meet the time constraints of such events.

Nonetheless, I’ve had my talk reprinted in its entirety. I’m guessing that many of you will be interested in the creation of Vanguard, which quickly led to the creation of the world’s first index mutual fund.

Enjoy!

Happy Thanksgiving to all of you. We at Vanguard have so much to be thankful for!

Jack

John C. Bogle’s remarks upon accepting the Gold Medal for Distinguished Service to Humanity from the National Academy of Social Sciences.


Memo to Veterans and Principals
Mike - Dec 08, 2015

To: Vanguard Veterans and Principals
From: John C. Bogle
Date: July 23, 2015
Re: Vanguard History

As the years roll on, I have come to realize that too much of our proud history inevitably fades away. So I’ve taken on the responsibility of building a first-person chronicle of the events surrounding our major mutual funds.

My first initiative was to tell the story of Wellington Fund, which appeared as Chapter 8 of my 2012 book The Clash of the Cultures.

My second initiative was the history of Vanguard PRIMECAP Fund (attached to this memo), which I completed a year ago in celebration of its 30th Anniversary. Memories fade, so I enlisted the cooperation of PRIMECAP’s co-founder Mitch Milias to assure that the history reflects the actual events surrounding our creation of this extraordinary mutual fund that has done so much to burnish our reputation in low-cost active management.

My third initiative will turn to the creation of Windsor II, recently celebrating its 30th Anniversary. The formation of Windsor II is a fascinating story, in which we ignored “the rules of the game” in the fund industry, and even smashed a few of them. Result: another great Vanguard success.

In many, if not most, of these histories, there are few remaining living links to the creation of Wellington, PRIMECAP, Windsor II, and other jewels in our crown. I plan to continue writing these chronologies as long as I’m able, so that future generations of Vanguard crew members can understand the genesis of our remarkable history.

Jack

The Story of PRIMECAP Fund


Bogleheads XIV!
Mike - Oct 20, 2015

Jack’s memo on Bogleheads.org:

To my wonderful Bogleheads,

Our fourteenth annual gathering was truly heartwarming and informative–a triumph that gave me much joy and inspiration. Thank you all for coming, for being so attentive, for taking such good care of each other, for enjoying those two days of intensive contemplation, and–of course–for that magnificent walking stick, an echo of Ben Franklin, the consummate entrepreneur and citizen of Philadelphia and the United States of America.

I’ve reviewed my 55-slide (ouch!) presentation, and am posting it on my e-blog–www.johncbogle.com–momentarily. While it’s essentially unchanged from what you saw at our meeting, I did change the order in a few spots, and revised several numbers to conform with other things that I’ve written (notably the expected returns presented on slides #47 and #50. In the interests of continuity and clarity, I’ve also added tag lines at the base of each slide to set what’s coming up next.

Enjoy seeing this presentation again! And enjoy with me another few moments of the memories of the bright sun in which we basked together–intellectually, jointly, and in yet another Philadelphia autumn.

Looking forward, eagerly and hopefully, to Bogleheads XV. Best, always,

Jack

John Bogle’s Presentation at Bogleheads XIV


Memo to Veterans and Principals
Mike - Jul 24, 2015

To: Veterans and Principals
From: John C. Bogle
Date: June 8, 2015
Re: CFA Speech

I’m pleased to attach the text of the keynote speech that I delivered at last Thursday’s forum held by the CFA Society of Philadelphia.

It’s entitled “Putting Investors First,” clearly reflecting my long-time mission of developing a federal standard of fiduciary duty. I also talk about the incredible changes in finance in the past, and those we’ll face in the future.

Yes, parts of the speech may be contentious to some, but I think you’ll enjoy some of my career history (pages 4, 5, and 6).

Thanks to each of you, and best wishes, always.

Jack

P.S.      Earlier in the week I gave the keynote to the Annual Meeting of the Government Financial Officer’s Association (GFOA), some 3,000 state and local officials from (I suppose) every state in the Union, convening at our vast Philadelphia Convention Center. My remarks were short, followed by a 45-minute Q&A session that seemed to be a big hit with the audience. (Maybe I should do that more often!)


Memo to Veterans and Principals
Mike - Jul 24, 2015

To: Vanguard Veterans and Principals
From: John C. Bogle
Date: May 5, 2015
Re: Lecture at the Securities and Exchange Commission
 

At the invitation of the SEC’s Division of Enforcement (Asset Management Unit), I addressed a staff of some 300 government officials last Tuesday, April 28.
 

I decided against giving a formal presentation, and opted for an extensive “slide show”—54(!) slides in all. The presentation will likely need little explanation for those of you who are involved in our investment management and marketing groups. But for many of you, a quick riffle through the slide show will likely be enough. (Enough!)
 

This presentation has the makings, I think, of a good lecture (or a series of two lectures), or possibly yet another paper for the Financial Analysts Journal or the Journal of Portfolio Management. Who knows? I might even take a shot at it . . . when I get some free time.
 

The title of the talk is “Conflicts, Conflicts, Everywhere,” borrowed from a speech with the same title by Juliet Riewe (pronounced “REE-vee”), co-chief of the Asset Management Unit. Always good to be on the side of the regulators.

Best,

Jack


Speech at Georgetown Law
Mike - Nov 05, 2014

Jack delivered a keynote speech before the Public-Private Partnership Symposium at Georgetown University School of Law on October 31, 2014. Titled “Values, Ethics, and Structure in Finance,” the speech discusses the importance of getting the right structure of business model and incentives in order to have a financial system that serves the needs of clients first.

“Values, Ethics, and Structure in Finance,” October 31, 2014, Georgetown University School of Law.