Re: The Cascade of Press Coverage Abates . . . for a Moment.
As promised yesterday, just a single final addition to the recent flurry of favorable public recognition of Vanguard. (Part I, March 4, 2014. The ECONOMIST and The Financial Analysts Journal—“The Arithmetic of ‘All-In’ Investment Expenses.” Part II, March 5, 2014. The Warren Buffett endorsement, etc.)
In Part III, “Finance in Philadelphia–Leadership, Decline, Renaissance,” I’m sending along a major speech on the role of our Greater Philadelphia region in contributing to America’s economy. As you will note, Vanguard is now the leader of our region’s recent renaissance. In that role, each of us here has an obligation to represent our community with knowledge of the past, dedication to high standards, and conduct characterized by integrity and humility.
The text of the speech is preceded by an article in The Philadelphia Inquireron February 7, 2014, reporting on the forum in which I delivered my remarks. One local journalist described my essay as “excellent, revelatory reading. I love the irony of how the Quaker precept of thrift has returned to fashion, thanks to Vanguard, vision, and perseverance.” My historical perspective begins with Robert Morris in 1776 (and, in the same year, the wisdom of Adam Smith). Today, as by far the largest firm in the giant mutual fund industry, we have become the embodiment of thrift and simplicity. These principles work!
I’m back on the speaking circuit a bit (more to come on that later this month). I wasn’t sure whether or not to circulate “Financial Management: Profession or Business?”, the keynote speech I delivered on September 25 at the 70th Anniversary of the Philadelphia CFA Society (Chartered Financial Analyst).
But when the SRO audience at the National Constitution Center gave me a huge ovation for my efforts, and Philadelphia Inquirer columnist Joe DiStefano described the speech as a “stem-winder.” (His column is also attached.) I decided it was better for you at least to have the opportunity to peruse it.
Funny thing: audiences (especially this one) seem to like being critiqued, and inspired to lofty goals.
Jack Bogle delivered a landmark speech before the Boston Security Analyst Society on May 17, 2013.
In this speech, he chronicles, and decries, the radical change in the mutual fund industry’s culture over the span of his long career–from a profession with elements of a business to a business with elements of a profession.
The speech also tells the stories of two dates that will live in infamy:
1) April 7, 1958–the date the federal courts, despite opposition from the SEC, opened the floodgates to allow mutual fund management companies to go public, a date that will live in infamy for mutual fund shareholders.
2) December 31, 1975–the date the first index fund was founded, a date that will live in infamy for mutual fund managers.
Mr. Bogle delivered the G.S. Beckwith Lecture at Princeton University on February 21, 2013. His speech discusses his innovations during his career at Vanguard, the problems with innovation in the broader financial industry, and provides some insight for students from his six-plus decades of experience.
Last Thursday, I was honored to be the recipient of the inaugural Humanitarian Award by the Lown Cardiovascular Research Center. It was a gala evening in Boston, before a packed house.
Dr. Lown, my cardiologist from 1967 through 1987, helped me to survive for two decades between my first heart attack in 1960 and my heart transplant in 1996. He is the inventor of the cardioverter (for shocking failed hearts back to life) as well as a winner of the Nobel Peace Prize in 1985. This citizen of the world, now 91, remains an articulate and passionate phrasemaker, as you’ll see from his remarks at the presentation of the award. I’ve also attached my words of response.
The evening was well supported by numerous mutual fund managers. GMO’s Jeremy Grantham was the keynote speaker and numerous (past and present) officials of Wellington Management, Granaham Management, and other fund advisers were in attendance.
I must repeat my usual disclaimer. I am reluctant (and more than a little embarrassed) to circulate commentaries like these on my long career, but well aware that if I don’t do so myself it won’t get done. But so many of you have expressed appreciation for these notes in the past that I’ll continue the practice. These attachments may help you to better understand the great struggle that was required to build Vanguard.