Image credit: George Arnald, “The Destruction of ‘L’Orient’ at the Battle of the Nile, 1 August 1798” (ca. 1825-1827), National Maritime Museum, UK
By Jason Zweig | Jan. 19, 2019 12:55pm ET
I first met Jack Bogle in 1993, and I last spoke with him on Nov. 16, 2018, although we traded a couple of emails after that. He died on Jan. 16, age 89. I knew he was in trouble when he emailed me on Nov. 25 and said, “I must confess that I’m hurting” — words I never dreamed would come from the toughest, most indomitable person I’ve ever met.
Jack’s zest for life was something to behold. There were no shades of gray in his world: One of his favorite lines was Abraham Lincoln’s observation that “important principles should be inflexible.” Whatever Jack Bogle set his mind to or his heart on, he pursued with unparalleled fiery determination. His health was so terrible — at least seven near-fatal heart attacks, a heart transplant, a life-threatening bacterial infection — that I wrote the first draft of his obituary in 2009. Even then, I wondered if The Wall Street Journal would ever need it. Death had been skulking around Jack’s door for decades, but the man was so full of life that the Grim Reaper had never been able to lay a hand on him.
Death is often personified silent and brooding in a dark hooded cowl, holding a mighty scythe to mow down the living when they least expect it. Jack Bogle’s family said his passing was peaceful, but I bet Death would beg to differ. The Grim Reaper finally prevailed over Jack, but it must have been the fight of the century. In this particular case I can only picture Death whimpering in pain, covered in scratches and bruises, cowl torn to shreds, scythe bent and thrown aside — and then Jack extending a hand to help Death regain his equilibrium as they limp off together.
No one is more cynical than a journalist with 30 years of exposing people with feet of clay — but, if I’m sure of anything, it’s that there are no flames where Jack is now.
Over the nearly 26 years we knew each other, I probably interviewed Jack Bogle four or five dozen times. We had our disagreements and a squabble or two — I never thought his arguments against global diversification made sense, and my sarcasm offended him more than once — but I learned something from him every time we spoke. He taught me not just about mutual funds, not just about investing, not just about business, but about what it takes to live a worthwhile life. The longer I knew him, the more I respected him.
Here, gathered in one place, is most of what I’ve written about him, along with some items from the extensive files I assembled over the years and some resources for learning more about him.
The magnificent painting above, by George Arnald, shows the moment that the warship commanded by Admiral Horatio Nelson — one of Jack’s heroes — blew up the flagship of the French fleet.
Lord Nelson was, of course, aboard H.M.S. Vanguard.
* * *
This is the obituary I wrote for The Wall Street Journal with Sarah Krouse. To illustrate it here, I chose a painting of a funeral in the Highlands of Scotland as a way of honoring Jack’s Scottish heritage:
Here’s the video retrospective I did on him this past week for WSJ.com:
In this next reminiscence, I put Jack Bogle’s investing achievements in perspective. I consider him the inventor of total return, the person who made it possible for anyone with a reasonable amount of money to reinvest dividends frictionlessly, enabling investors to match the full return of stocks for the first time:
Here’s my column from this weekend, in which I try to summarize Jack and his achievements, ending with some of the last words he spoke to me:
Over the past quarter century, I interviewed Mr. Bogle dozens of times. At least three of those times, he called me from a hospital bed. In 2009, he was treated for a massive listeria infection—a sickness that is often fatal.
I last spoke with Mr. Bogle in November, six months after his 89th birthday and nearly 23 years after he received a heart transplant. He told me he had just had a pacemaker implanted and was trying to recover from an esophageal infection. The day before, he’d had an endoscopy.
And there he was on the phone, preparing for a video interview we were scheduled to do in December at an industry conference. (Later, he backed out on doctors’ orders.)
One question I teed up: What had driven him against all odds? “Never feeling one damn moment of doubt,” he shot back. “I am who I am, the hell with it.”
That column is linked here:
Capitalist or “Communist”?
In an article I wrote almost 15 years ago, I described Vanguard’s birth this way:
Since the funds also owned Vanguard’s investment management arm, no profits went to outsiders. Bogle had turned the fund world upside down. He removed the middlemen who get rich off the fund investors’ money. Every decrease in fund expenses at Vanguard put more net return into its investors’ pockets.
By creating the most mutual fund company ever, Bogle may have come as close to communism as a diehard capitalist has ever gotten. Just as Karl Marx wanted workers to own the means of production, Bogle turned fund investors into the owners of the fund manager. Bogle knew just how radical his idea was. In a theatrical flourish, he sited Vanguard’s headquarters just a few miles from the encampments at Valley Forge, Pa., where George Washington had rallied the revolutionary army into fighting shape.
You can read the rest of that article here:
A lifelong Republican, Jack Bogle must have gotten quite a kick out of my comparison of him to Karl Marx. He fired off a letter to the editor in which he wrote:
If the job of capitalism is to create wealth for those who put up the capital, no fund group comes close to Vanguard’s success in serving its owners. So we’re probably as far away from communism as is realistically possible.
Now if the job of capitalism is to create wealth for those who purport to serve our capitalists by managing their money, then I confess to being a communist.
I liked his letter so much, I kept it all these years. Here’s a PDF.
That wasn’t enough for Jack. He also sent me one of his distinctive handwritten missives, perhaps because he was concerned not everybody would realize he had been — at least partly — kidding. Seeing one of his handwritten notes brings back the memory of his baritone voice, like gravel pouring out of a wheelbarrow:
(While he was at it, he took a little swipe at his successors at Vanguard for what he felt was an instance of performance-chasing.*)
Here’s more on the early history of indexing:
“The Crying Need for Something More”
Perhaps my favorite, among all the articles I’ve written about him, was this one, about the Boglehead groupies who have adopted his philosophies of investing and life. The Bogleheads, whose website and wiki form one of the best sources of investing information anywhere, were just getting started then:
Once in the cafeteria (or galley, in Vanguard’s nautical lingo), Bogle formally addresses his fans. This event, he declares, may turn out to be a landmark in mutual fund history. Bogle explains: “You are demonstrating the power of the World Wide Web to help people band together and make something happen, and the crying need for something more: to be recognized, to be treated as real-life, honest-to-God, down-to-earth human beings with your own hopes and fears.”
You can read that piece here:
Last October, I visited the Bogleheads’ annual meeting again. It was to be one of Jack’s last public appearances:
The ultimate distillation of the Bogleheads approach:
“Going through Life with Blinders on”
Here’s my copy of Jack’s statement at the press conference he held on May 24, 1995, to announce that he would be stepping down as Vanguard’s CEO to prepare for his heart transplant. I was there that day, and I can tell you that most of the reporters in the room (including me) doubted that Jack Bogle would live until 1996.
Jack spent every day of the next 23 years cheating death, and he knew it. Here’s one of my favorite interviews with him, where he talked about the providential urgency that ill health had given him:
Q: How did you cope with decades of living on borrowed time?
A: I didn’t think about it. I just got on with what needed to be done. Even as a little boy, I had determination and focus. If there was a job to be done, then that is what I would think about, going through life with blinders on. You can look ahead, but you have no peripheral vision.
That focus is an unbelievable asset when you’re confronted with a life-threatening disease, and it was also terrific for a kid who was determined to succeed in business.
Q: Back in 1974, almost everyone but you thought Vanguard would never get off the ground.
A: The awful thing is, it was easy. It’s amazing how easy life becomes when you realize that your job is not to deal with what might have been but with what is. It’s all about attitude.
Q: What did you learn from getting a second chance at life?
A: The right time to count your blessings is every day. If you do it once, then it’s worth doing twice a day too, and three times and more. We’re blessed with the health we have. We’re blessed to be American citizens. We’re blessed to be alive in these amazing times.
How could I complain? When you have a narrow escape, the operative word is not “narrow,” it’s “escape”!
Read the rest of that interview here:
The Zeal of the Convert
Over the past few days, some of Jack’s biggest admirers have emailed me to complain that I was being petty for pointing out that he wasn’t always a believer in the simplicity and low cost exemplified by index funds.
So here, from my archives, are some of Jack’s own early words on the cost and performance of mutual funds.
Here’s the article he wrote for the Financial Analysts Journal in 1960 under the pseudonym John B. Armstrong (his grandfather’s name!) in which he argued that index funds would be doomed to underperform if anyone created them. He spent roughly a fifth of the entire article enumerating one objection after another to what would later be called an index fund, criticizing them at least four different ways. (Whenever I asked him about it in later years, he would pause uncomfortably and then call it his “youthful folly.”)
And here’s the speech he gave in 1973 to the Investment Company Institute, the trade group for mutual-fund companies, in which he praised the performance of the same funds he would later criticize as overpriced and underperforming. “The mutual fund is a service of demonstrated excellence,” he declared, adding that “the average individual is getting ‘above-index’ results in mutual funds.” The returns delivered by most funds were somewhere between “excellent” and “superior,” he added. He even proclaimed that the compensation of brokers and fund companies wasn’t “excessive.”
I kid you not: Jack Bogle, who later became the conscience and scourge of the fund industry, really did say all that. Read the 1973 speech for yourself and see.
The only time I ever asked Jack about that speech, he changed the subject. When many of his peers snidely referred to him as “Saint Jack,” they felt his current critiques were sanctimonious, even hypocritical, given his past positions. I’ve called his conversion to the low-cost gospel an act of making “a virtue out of necessity” — once he was fired from Wellington Management Co., Jack Bogle had little choice but to create a new business that was the polar opposite of the industry he had formerly praised.
Then again, as soon as I ever put some alcohol into those CEOs of rival fund companies, they would admit that a lot of their personal money was in Vanguard funds — rather than in their own! Reasonable minds might differ on whose hypocrisy mattered more.
“There’s One Person in This Room Who Actually Has a Heart”
Jack Bogle’s former assistant Dave Hamra told me a remarkable story about playing squash against Jack. You can read it here:
Here are some anecdotes from my own encounters with Jack:
Financial regulators aren’t renowned for their sense of humor, but Jack’s heart-transplant surgery inspired a classic quip from Joel Goldberg, a former mutual-fund regulator at the Securities and Exchange Commission. Note that it said as much about Jack’s competitors as it did about him:
…in 1996, not long after he received his heart transplant, Mr. Bogle was honored by a mutual-fund trade publication. Joel Goldberg, a former director of fund regulation at the Securities and Exchange Commission, wended his way through the crowd of senior fund executives to greet Mr. Bogle.
“At least I know,” said Mr. Goldberg as he shook Mr. Bogle’s hand, “that there’s one person in this room who actually has a heart.”
* I never published or shared Jack’s Apr. 5, 2004 note or its contents while he was alive; off-the-record statements become public record after a person dies.
The Bogle Financial Markets Research Center, where you can find his speeches, articles and other materials
Bogleheads.org, one of the most comprehensive — and completely free! — sources of investment information anywhere
A video interview I did with Jack in 2011 on the importance of diversification and the differences between investment and speculation:
For further reading:
John C. Bogle, Common Sense on Mutual Funds
Benjamin Graham, The Intelligent Investor
Jason Zweig, The Devil’s Financial Dictionary
Jason Zweig, Your Money and Your Brain
Jason Zweig, The Little Book of Safe Money