Was Vanguard’s John Bogle the Colin Kaepernick of His Day?

401k, retirement, Bogle, Vanguard
John C. ‘Jack’ Bogle, 1929 – 2019

Forget Kaepernick—John Bogle was once accused patriotic malfeasance, and was recently called a commie (seriously).

It might be 40th anniversary of the of the launching of the first index mutual fund by Vanguard, but the investment legend and conscience of the industry pulled no punches (as usual) when describing those early years.

“In 1975 and 1976, indexing didn’t really account for much, and some people actually called it un-American,” Bogle told 401(k) Specialist. “In 1995, it was 6 percent of invested assets and today it’s 72 percent of invested assets. Higher-cost funds have reached economies of scale that are still not shared with the average investor. They’re not getting their fair share of the return. If you don’t believe me, ask Bill Sharpe.”

In an odd throwback to Cold War slurs, The Wall Street Journal’s Holman Jenkins pointed to a recent research report from Sanford Bernstein that called passive investing “worse than Marxism.”

Jenkins colleague, the indispensable Jason Zweig, noted that Bogle’s fund was introduced with $11.3 million in assets, far short of the $150 million target that Bogle had planned.

“The investment banks underwriting the fund were so disappointed by the measly amount they had raised that they wanted to give investors their money back,” Zweig wrote.

“Hell no,” was Bogle’s response in typical Jack-style.

Today, Vanguard 500 Index Fund holds more than $252 billion. Index mutual funds and exchange-traded funds invest nearly $5 trillion in combined assets and are considered a staple of long term investing.

Bogle, that unpatriotic Marxist, might be on to something.

John Sullivan
+ posts

With more than 20 years serving financial markets, John Sullivan is the former editor-in-chief of Investment Advisor magazine and retirement editor of ThinkAdvisor.com. Sullivan is also the former editor of Boomer Market Advisor and Bank Advisor magazines, and has a background in the insurance and investment industries in addition to his journalism roots.

2 comments
  1. This was a real stretch and very unfair to John Bogle. Kaepernick is an ignorant ingrate who not only disrespects his country, he disrespects his own mother. If he knew anything about history, he would realize that blacks in this country have a much higher standard of living in the USA than in any other country in the world, including Africa. Kaepernick should be shunned.

Comments are closed.

Related Posts
Total
0
Share