| 1 | Name: | Mr. John C. Bogle | |
| Institution: | The Vanguard Group; Bogle Financial Markets Research Center | ||
| Year Elected: | 2004 | ||
| Class: | 5. The Arts, Professions, and Leaders in Public & Private Affairs | ||
| Subdivision: | 503. Administrators, Bankers and Opinion Leaders from the Public or Private Sectors | ||
| Residency: | Resident | ||
| Living? : | Deceased | ||
| Birth Date: | 1929 | ||
| Death Date: | January 16, 2019 | ||
Born in 1929, John C. Bogle grew up in a family whose wealth had vanished during the depression. Bogle was a responsible young man who worked steadily to support himself, as waiter, post-office clerk, reporter, and other jobs. He earned a scholarship to Blair Academy (N.J.), where he was captain of the student waiters and voted "most likely to succeed," graduating in 1947. With the help of another scholarship and more jobs, he entered Princeton University, working his way through with jobs of increasing responsibility. In December 1949, he received what he called "the lucky break of a lifetime." Reading Fortune magazine in the university library, he stumbled on an article that described the "tiny but contentious" mutual fund industry. He decided to make it the subject of his senior thesis. After exhaustive study of the industry, Bogle concluded that "The principal function of mutual funds is the management of their investment portfolios. Everything else is incidental - that future industry growth can be maximized by a reduction of costs," that funds could "make to no claim for superiority over the market averages," and that funds should operate "in the most efficient, honest, and economical way possible." Entitled The Economic Role of the Investment Company, the thesis enabled Bogle to graduate magna cum laude in June 1951. Largely on the basis of his thesis, Bogle was immediately hired by fund industry pioneer Walter L. Morgan, founder of Philadelphia's Wellington Fund. He rose quickly through the ranks, and by 1965 was leading the firm. In a move he describes as opportunistic and naïve, Bogle merged Wellington with a Boston investment firm that had achieved spectacular results during the "Go-Go Era" of the mid 1960s. The once-happy marriage was not to last, and in the midst of the 1973-74 bear market, Bogle was fired from the firm that he considered "his." Heartsick but determined, Bogle seized that well-disguised opportunity to create a firm that would embody the idealism of his senor thesis. In founding The Vanguard Group in 1974, he created a unique mutual fund firm: one that was owned, not by an external management company, as was (and is) the industry standard, but one that was owned by its mutual fund shareholders-a truly mutual fund organization. At the outset, Vanguard was responsible for just $1.4 billion of mutual fund assets. Thirty-one years later, assets under management approach $850 billion. Bogle's innovations did not stop with Vanguard's ownership structure, which has allowed the firm to operate at costs that are less than one-fifth the industry average. In 1975, just a year after he founded the firm, Vanguard launched the world's first index mutual fund (today, the 500 Index Fund is the world's largest mutual fund). Two years later, Vanguard created the first multi-series bond fund, whose then-novel structure, comprising separate short-, intermediate-, and long-term funds, quickly became the industry standard. His 1977 decision to eliminate broker distribution and abandon sales loads sharply accelerated the growth of no-load mutual funds. In 1999, exactly a half-century after the magazine had introduced him to the mutual fund industry, Fortune named John C. Bogle one of the financial industry's four "Giants of the Twentieth Century." In 2004, Time magazine named him to the "Time 100," the "World's 100 Most Powerful and Influential People." Former Federal Reserve Chairman Paul A. Volcker has praised Bogle for his "fiduciary responsibility, objectivity of analysis, and willingness to take a stand," and the former Chancellor of the Delaware Court of Chancery, William T. Allen, described him as "a man of high virtue." Bogle dedicated his long career to the notion that the human beings who own mutual fund shares deserve a fair shake. He died on January 16, 2019 in Bryn Mawr, Pennsylvania at the age of 89. | |||