This morning I awoke to front page tributes in the Wall Street Journal and the New York Times commemorating the life of an extraordinary man: Jack Bogle. Like his wife, Eve, and their children, I mourn the loss of a giant.
Strange bedfellows we were. Jack the father of indexing and I an active manager. A company in which my firm had a large stake was comporting itself in ways that were precisely the reasons for which Jack wrote the book, The Battle for the Soul of Capitalism (2007). After reading it, I sent a copy to each of its board members with very specific instructions on what to read.
Our friendship/mentorship grew out of recounting that episode to him. Later, when The Man in the Arena (2013) was published, the author, Knut Rostad, included my tribute to the man I so admired. Even in his passing these words seem fitting to speak again.
Words from Those Who Know Bogle Best
Frank K. Martin, investment adviser; founder, Martin Capital Management; author of A Decade of Delusions
If there’s one word that explains the popularity of Jack Bogle’s books and his iconic status among investors worldwide—including those purveyors of advice in the investment industry who scorn him publicly while admiring him privately—it’s integrity. As a personal friend, as well as a disciple, I have been a first-hand witness as this trait of character manifests itself in all that Bogle says and does. The word integrity is often applied where it doesn’t fit and hasn’t been earned, which makes it all the more fitting in this instance. How is it that integrity has become synonymous with the persona of Jack Bogle? As another remarkable and courageous man, German theologian Dietrich Bonhoeffer, observed, one can often find the significant in the trivial.
“Jack Bogle Does Not Write to His Legions of Followers from a Gilded Cage. He Writes As One of Them.”
In 1974, Bogle made what at the time might have seemed like an inconsequential decision. As founder of the Vanguard Group, he decided that it should be organized as a “mutual” fund, owned by its investors, to whom the fund’s profits would flow through lower costs. While he could not have known at the time the exact opportunity cost of his decision, he surely knew it would be huge. He had seen the handiwork of Edward Johnson II, who founded rival family-owned Fidelity Investments in 1946. His multi-billionaire heirs rank high on the Forbes list of the wealthiest Americans. By contrast, Mr. Bogle says his own wealth is in the “low double-digit millions.” “Most of it is in Vanguard and Wellington mutual funds in which he invested via payroll deduction during his long career,” according to a recent New York Times article.
In a world inclined to measure success in dollar terms, Jack Bogle would not even warrant honorable mention. And yet he has achieved his iconic status among tens of millions of investors while most men of wealth from the financial sector, save, perhaps, for a few like his friend Warren Buffett, have discovered something that money won’t buy.
Because of that crucial decision made years ago, Jack Bogle does not write to his legions of followers from a gilded cage. He writes as one of them, as their equal, as a man who has walked in their shoes. Their fears are his fears, their realities his realities. One, after all, cannot be king and subject at the same time. One must make a choice. Jack Bogle made that decision almost 40 years ago, quoting Justice Harlan Fiske Stone: “Most of the mistakes and major faults of the financial era that has just drawn to a close will be ascribed to the failure to observe the fiduciary principle, the precept as old as holy writ, that `a man cannot serve two masters’.”
Having read all of Jack Bogle’s books, circulating my favorites among friends and family far and wide, it is his priceless integrity and incorruptible motives thus revealed that have long inspired me. As Charlie Munger likes to say, and I paraphrase, tell me a man’s motives and I’ll tell you the outcome. Jack Bogle’s motives are unimpeachably transparent, making his honesty and candor all the more appealing. He says what he means, and means what he says. In the end, Jack Bogle’s books contain a wealth of insights for investors from a man who has always been able to see the forest while most only see the trees. The subliminal message that percolates up through each book is the story of the life of Jack Bogle, the tireless champion of what is right and true, of what it means to live a life of integrity.
His book Clash of Cultures, like The Battle for the Soul of Capitalism and Enough before it, challenges conventional wisdom and offers a tried-and-true way of thinking as an antidote for present-day ills. One reads Jack Bogle’s books much like Bogle himself relishes the biographies of his hero Teddy Roosevelt: there is something quite redeeming in reading the works of great men.
In memory of my friend and mentor,
Frank K. Martin