00:01 - Stream more programs like this

00:03 - live and on-demand

00:04 - with the PC enter

00:05 - in hd

00:06 - on your favorite device.

00:08 - Go to PC and TV dot com

00:10 - to start streaming today.

00:16 - John Clifton bogle

00:18 - founder.

00:19 - Former chairman and former

00:20 - ceo of the vanguard group.

00:23 - First question i'm

00:24 - interested in is just.

00:26 - Rolling up your.

00:28 - What.

00:29 - What was your family like.

00:31 - What was the.

00:33 - The country like at

00:34 - the time you grew.

00:36 - Well that's a good question.

00:39 - First of all we had a.

00:42 - Wonderful family.

00:43 - And.

00:45 - My mother and father my two

00:46 - brothers and I

00:46 - have a twin brother

00:47 - who died a few years

00:48 - ago and an older brother.

00:49 - We were brought

00:50 - up pretty much as

00:51 - triplets he was two

00:51 - years old and we were.

00:53 - Are very close which

00:54 - means with three

00:54 - young boys we were

00:55 - fought all the time.

00:57 - But that's what

00:58 - young boys do and I

00:59 - guess will do forever.

01:01 - And we grow up.

01:03 - We we'd actually been born

01:04 - when my family

01:05 - was quite wealthy.

01:06 - And.

01:08 - Somehow during.

01:09 - During the early nineteen

01:10 - thirties all the money vanished

01:12 - and so we were all the kids

01:13 - were very hard

01:14 - working and then I

01:15 - probably spent time working in.

01:18 - The summers and that

01:18 - kind of thing and then

01:19 - something the winters

01:20 - from the time I was

01:21 - probably nine years old hold on

01:22 - you're not killing work

01:23 - in the delicatessen or that

01:25 - kind of thing

01:25 - confectionery stores

01:27 - and

01:28 - but working

01:29 - and we always

01:29 - worked in the summer.

01:30 - Even from a very young age I

01:32 - would guess ten

01:32 - or eleven years old

01:34 - and

01:34 - not punishing work but enough to

01:36 - make money and keep busy and.

01:37 - Stay out of trouble.

01:40 - Did you realize that.

01:41 - The country was going through a

01:43 - depression at the age

01:44 - you were no we didn't

01:45 - realize that we

01:46 - knew I think intuitively

01:48 - that we were going

01:48 - through kind of a depression.

01:50 - Because you know

01:51 - we it was

01:52 - gasoline was

01:53 - expensive when you had

01:54 - a flat tire I was used

01:55 - to wonder whether.

01:56 - There's enough money there

01:57 - to get it fixed

01:58 - that kind of thing

01:59 - but we lived in perfectly

02:00 - nice surroundings.

02:02 - We didn't we had to sell

02:03 - our house but we rent houses.

02:05 - Move around live down

02:05 - the shore for awhile

02:06 - new Jersey shore

02:07 - in the winter it's very

02:08 - cheap down there and

02:09 - those wonderful days.

02:11 - What

02:11 - are your role models

02:12 - growing up.

02:14 - Well I you know the first

02:15 - role model I can think of.

02:18 - Was my father was a flyer

02:19 - for the royal flying corps

02:21 - in world war

02:22 - one

02:22 - he wanted to get into

02:23 - the action he was an

02:25 - American wanted to

02:25 - get into the action early.

02:26 - So I had you know done

02:27 - all these ideas that I wanted to

02:29 - be a flyer to you

02:30 - know like any kid.

02:31 - And so am I the first hero I can

02:33 - remember I named

02:34 - my my boy scout troop.

02:35 - After him and probably in

02:37 - the mid forties early forties

02:38 - was general Billy Mitchell.

02:41 - And he was a guy that

02:42 - took on the establishment.

02:43 - He wanted to prove that bombers

02:45 - could sink battleships

02:46 - and by god he did

02:47 - and got court

02:48 - martialed for his trouble.

02:50 - And.

02:51 - I

02:51 - tenafly with the

02:52 - contrary and I think in history.

02:55 - The guy that gets

02:55 - pushed around and down.

02:58 - The person who's stubborn.

03:00 - And determined.

03:01 - Maybe a contrary

03:02 - and kind of a thing.

03:04 - But he he would

03:04 - be the first one.

03:06 - Do you remember I've

03:08 - read your grandfather

03:09 - founded American brick.

03:10 - Yup

03:11 - do you remember your.

03:12 - Grandfather he actually

03:13 - died before I was born.

03:15 - Grandfather bogle did

03:17 - okay my grandfather hipkins

03:18 - and his wife.

03:19 - I remember very well

03:21 - because said that I

03:22 - was in my twenties

03:23 - by the time they

03:24 - died and they were

03:25 - really wonderful

03:25 - characters you know

03:26 - it's a great thing

03:27 - in this life to have

03:28 - grandparents.

03:29 - And I feel real good

03:30 - about being Grant

03:31 - a grandfather to my

03:32 - own grandchildren.

03:35 - Continuing.

03:36 - On.

03:38 - Coming through the.

03:40 - Depression.

03:41 - And.

03:42 - You ended up going to

03:43 - school Blair academy's that.

03:45 - Can you describe.

03:47 - What that was and

03:48 - how you entered there

03:49 - was sure

03:50 - we had gone through

03:51 - you know we were not

03:52 - in economically great

03:53 - circumstance the ones

03:54 - who always to public

03:55 - school all through.

03:56 - Sophomore year and

03:57 - in in highschool cool

03:59 - and we went to manasquan new

04:01 - Jersey high school

04:02 - small shore high school

04:03 - and I you know I'm

04:04 - not sure but I if I had

04:05 - to guess I'd say maybe

04:06 - five percent of the.

04:07 - Of the seniors went to college.

04:09 - Maybe even less.

04:11 - Wasn't really a college

04:12 - preparatory thing and

04:13 - my mother particular

04:14 - was very ambitious.

04:16 - For her boys

04:17 - to be be able to get out in

04:18 - the world and do good things

04:20 - and so she was able she and

04:21 - my father were able to get US.

04:23 - Scholarships all

04:24 - three of US actually.

04:25 - First my older brother and then

04:26 - the two of US to Blair academy.

04:28 - And tuition

04:30 - wasn't very much

04:31 - but when any money.

04:32 - None.

04:33 - So we worked as.

04:35 - All of US

04:36 - I worked as a waiter there.

04:37 - In the dining hall and then

04:38 - as a head whether your

04:39 - waiter to kind of earn my keep

04:41 - and with scholarship aid.

04:44 - It didn't cost my family

04:45 - hardly anything actually

04:46 - had an uncle who

04:47 - helped paid part of the bills

04:48 - to get US through.

04:49 - That Blair academy

04:51 - and that was like an

04:51 - awakening experience.

04:53 - Because we'd been you know the

04:54 - your mind isn't

04:55 - exposed to the big ideas.

04:57 - The discipline and class

04:59 - even in those days was not.

05:01 - Not as great as it would be the

05:02 - expectations of the

05:03 - teachers was fairly low

05:05 - and then you go

05:06 - off to Blair academy

05:07 - and the expectations

05:08 - are whoa wow.

05:09 - I mean they you know

05:10 - you better shape up

05:12 - and I honestly I think at Blair.

05:15 - Probably I started

05:15 - to be aware of this

05:16 - when I got the

05:17 - Blair for the first time

05:18 - really in my life I'd

05:19 - always be a good

05:19 - student in these schools

05:21 - that wasn't the biggest

05:21 - challenge in the world

05:22 - but I think.

05:23 - That the teachers the masters

05:25 - as we call them all men.

05:26 - At Blair academy was all

05:28 - all boys school

05:29 - up in blairstown new Jersey

05:31 - I think they saw something in me

05:33 - and therefore they

05:34 - wanted to really punish me.

05:36 - Make me work hard

05:36 - make me do my very best

05:38 - and maybe the death every day

05:39 - ID but I kind of felt

05:40 - I was singled out

05:41 - to really.

05:42 - They wanted to pull

05:43 - the very best I had

05:44 - and I think they probably

05:45 - pretty much did.

05:48 - What were you thinking you were

05:49 - going to become are going

05:51 - to do at that

05:51 - point in your life.

05:53 - While my father was

05:54 - a businessman white

05:55 - collar businessman

05:55 - worked in new York city

05:57 - commuted from montclair new

05:58 - Jersey new York when I was

05:59 - a kid and.

06:00 - Came home with the

06:01 - evening paper under his

06:02 - arm

06:03 - and I was always

06:04 - and we were I think brought

06:06 - up to be kind of aware

06:07 - of the world around rand has.

06:09 - Talked about things that were

06:10 - in the papers issues and so on

06:12 - and he was a businessman

06:13 - and I thought I wanted

06:14 - to be a businessman.

06:15 - I was kind of enjoyed numbers.

06:17 - So I kind of thought at some age

06:19 - probably around the

06:20 - time I got to college.

06:21 - That I that I probably

06:22 - want to go into

06:23 - something that was

06:24 - financial or

06:24 - something like banking.

06:25 - The idea of banking

06:26 - seemed pretty good

06:27 - struck me as a very

06:28 - secure business.

06:30 - And

06:31 - so.

06:32 - That that was

06:33 - probably my main focus.

06:36 - When did you

06:36 - start thinking about.

06:39 - Stocks mutual funds but

06:41 - that type of that investments

06:44 - well actually that's a that's a

06:45 - really a great question because.

06:47 - Until I discovered the

06:49 - mutual fund industry

06:50 - I don't think I

06:51 - could have told you

06:52 - what a stock or a bond was I

06:53 - couldn't have given

06:54 - you the definition.

06:55 - We didn't have

06:56 - any money we didn't

06:57 - have any investments

06:58 - in the family

06:58 - it was not.

06:59 - Not something we

07:00 - even thought about.

07:01 - We thought about

07:02 - how the bills were

07:03 - going to get paid

07:04 - and.

07:05 - How the finance

07:06 - company was going to lend

07:07 - US the money to pay

07:08 - the ones that were late

07:09 - but.

07:10 - That was.

07:11 - That was the spending

07:12 - side that that side

07:12 - of the equation so I

07:13 - didn't know anything

07:14 - about stocks and bonds.

07:15 - And then came this happy day.

07:17 - In Princeton in December

07:18 - of nineteen forty the nine.

07:20 - I was made majoring in economics

07:23 - and at that time truth told

07:24 - struggling a bit with my grades.

07:26 - I also had a job.

07:29 - Very lucky.

07:30 - To get into

07:30 - Princeton because of.

07:32 - I done well at Blair academy.

07:33 - Got into Princeton

07:34 - again same story

07:36 - scholarship

07:37 - jobs

07:38 - no money not a penny have

07:40 - a family support

07:41 - and that was all fine I mean I

07:42 - always thought it was wonderful.

07:44 - And you know to be

07:45 - able to work your way

07:45 - through the world

07:46 - at a young age is the.

07:48 - Enormous.

07:49 - Enormous.

07:51 - Advantage.

07:52 - In life.

07:53 - People that don't

07:54 - do that don't realize.

07:56 - They gotta get their

07:56 - acts together to catch up.

07:58 - So.

08:00 - Why do you say

08:01 - that I just want to

08:02 - get your perspective on

08:03 - and how how many jobs

08:05 - do you even know how many

08:06 - jobs you had up

08:06 - until that point.

08:08 - Well I'd probably

08:09 - say I mean I worked

08:10 - in the post office at

08:11 - bay head new Jersey

08:12 - cancelling.

08:13 - Letters and filling

08:14 - the mailboxes and

08:14 - answering general

08:15 - delivery I worked in a toy

08:16 - store down there.

08:18 - I worked in a little

08:19 - ice cream parlor in.

08:21 - In.

08:22 - Sea girt new Jersey

08:23 - during the winter.

08:24 - I worked in a

08:25 - similar place in bay

08:25 - head new Jersey

08:26 - during the summer.

08:29 - As I was growing up and got

08:30 - toward college I worked as a.

08:33 - As a cub reporter

08:34 - for the evening

08:35 - bulletin Philadelphia

08:36 - evening bulletin.

08:37 - I worked in a brokerage

08:38 - firm one summer.

08:41 - Do you take experiences away

08:43 - from each one of those things.

08:45 - Well I mean I do but

08:46 - I'd say not consciously.

08:48 - You know it's.

08:49 - A lot of life.

08:51 - Is.

08:52 - Trying to do the best you can.

08:55 - During the day.

08:56 - That

08:57 - the lord the lord

08:58 - presents to you.

08:59 - In young people ask me

09:01 - what's the seek grid of.

09:02 - Life man I first of

09:03 - all I have no idea

09:05 - but you have to say

09:05 - something and I say.

09:07 - The first rule of life.

09:08 - Is get out of bed

09:09 - in the morning.

09:10 - Because if you don't do that

09:11 - absolutely nothing will happen.

09:13 - And then I I formulated this

09:15 - expression later

09:16 - on in life obviously

09:17 - but I think that's pretty

09:18 - pretty much a good

09:19 - description of the way I live

09:20 - I've lived my own life

09:22 - and that is.

09:23 - After you get up in the morning.

09:24 - You try and get

09:25 - through the day and you

09:26 - try and make yourself

09:27 - a little bit better.

09:28 - You try and help the

09:29 - people around you

09:30 - you

09:30 - try and be friendly.

09:31 - You try and be a good.

09:33 - Family member good father

09:35 - good child whatever it is.

09:37 - And you know if if

09:38 - you have an attitude

09:39 - toward life that when

09:40 - you're out in the world

09:41 - it's your not accustomed to

09:42 - walking down the

09:43 - street or something.

09:44 - If you say something

09:45 - nice to somebody.

09:46 - You know your store

09:47 - looks beautiful or.

09:48 - Something like that I've

09:49 - never seen it look better

09:50 - that's not

09:51 - going to hurt.

09:52 - And if you do just kind

09:53 - of live the day for the day

09:54 - don't worry about tomorrow

09:56 - tomorrow I'll have

09:57 - to take care of itself.

09:58 - And get through the

09:59 - day and try and just be.

10:01 - I think a good huh.

10:03 - But advance

10:03 - yourself I mean I don't.

10:05 - You know sit back

10:06 - and waste a lot

10:07 - of time.

10:09 - And.

10:10 - Then.

10:11 - If you do that

10:11 - in the day I think

10:12 - you can get a

10:12 - good night's sleep.

10:14 - And then you're just

10:15 - repeat that rule the next day.

10:16 - Get out of bed.

10:19 - If you would ask

10:20 - her about one one

10:21 - job you mentioned

10:21 - in particular and that's

10:22 - that's a

10:23 - cub reporter for the

10:24 - Philadelphia board and

10:25 - yeah and

10:26 - why did you want to do that and.

10:29 - What what did you think about it

10:31 - well I always like journalism.

10:34 - I had an idea about

10:35 - banking and

10:36 - finance

10:37 - had an idea about journalism.

10:38 - At a point I had an idea about

10:40 - being an architect

10:40 - or being a lawyer.

10:42 - Not anywhere near as serious

10:44 - but the idea in the summer.

10:47 - Was to get a summer job.

10:49 - That wasn't easy to do.

10:51 - So it just happened

10:52 - that I think I had a

10:53 - friend who knew the

10:53 - map imaging editor of

10:54 - the bulletin

10:55 - and

10:56 - they sent this little

10:57 - kid I mean I had

10:58 - to go go around

10:59 - Philadelphia from

11:00 - bullet was an evening papers

11:01 - he worked during the day

11:02 - except for Saturday it worked

11:04 - Saturday night because

11:05 - the paper came out.

11:06 - Around midnight.

11:07 - So worked till midnight

11:08 - got the stories in

11:09 - for the night then

11:10 - they published Sunday

11:10 - morning edition.

11:11 - I used to travel all

11:12 - over Philadelphia

11:13 - on trolleys

11:15 - and you'd figure out where they

11:16 - intersected to get

11:16 - you'd go to usually

11:17 - most of your work was

11:18 - around police stations.

11:19 - And it was there.

11:22 - That I learned in

11:22 - one of the many lessons I

11:24 - remember this one

11:24 - better than most.

11:26 - But.

11:26 - The lesson about law life.

11:28 - And that it was it was

11:29 - probably eleven thirty at night

11:31 - and the

11:32 - call came in there

11:32 - was a fire at a house.

11:34 - Somewhere and I was supposed

11:35 - to go over and cover a big fire.

11:37 - And.

11:39 - I was tired.

11:40 - And I didn't want to get

11:41 - enough of inconvenient

11:43 - the trolley didn't

11:43 - go to the right place

11:44 - and the day was almost over.

11:46 - So I didn't do what

11:47 - I was told to do.

11:49 - I

11:49 - talked to the firefighters

11:50 - when I got back.

11:52 - And.

11:53 - Called the story in.

11:55 - And the rewrite man at the other

11:56 - end is the way the

11:57 - newspapers work.

11:59 - It's a very wise man.

12:00 - And I got through

12:01 - giving him the story

12:02 - he sensed that I

12:03 - hadn't done what I

12:03 - should have done.

12:04 - And he said.

12:06 - What color was the house bogle.

12:09 - And I said.

12:11 - I'll get over there right away.

12:15 - So.

12:17 - That's a good

12:17 - lesson for everybody.

12:20 - I don't take any shortcuts.

12:23 - What did you mean.

12:25 - When you said

12:26 - people that don't

12:27 - you know

12:27 - work their way through

12:29 - like that have.

12:31 - Allowed to catch up.

12:33 - Well you know life

12:33 - when you get out into

12:35 - the real world people

12:36 - aren't giving you

12:37 - things on a silver platter.

12:39 - You have to earn them.

12:40 - I mean I think you

12:41 - have to earn friendships.

12:42 - I think you after

12:43 - promotions.

12:44 - I think you have to

12:45 - earn respect from people

12:46 - and if it starts at a young age.

12:48 - You know

12:49 - that you're that much ahead of

12:50 - the ball when you get out there.

12:51 - I think people really.

12:53 - Think you feel like

12:54 - life is too easy you

12:55 - don't have to make

12:56 - your full contribution.

12:58 - If everything is given to you.

13:00 - Not everybody is

13:00 - as what you can't

13:01 - make general rules

13:02 - and I understand that

13:03 - but in general.

13:05 - The people I've had

13:05 - to work their way.

13:07 - Up the ladder if you will

13:09 - and I think are pretty well

13:10 - are are better positioned.

13:11 - For for a full.

13:13 - Rewarding.

13:14 - Complete.

13:16 - Life.

13:17 - As a

13:17 - decently random human being.

13:20 - Hell.

13:21 - We were talking about going to

13:23 - Princeton and you

13:24 - went to Princeton you

13:25 - need sat on the scholarship and.

13:27 - What to.

13:29 - What was it like it at

13:31 - Princeton and did you

13:32 - have an adjustment

13:33 - to make from Blair to.

13:34 - Actually a the

13:34 - adjustment from Blair they

13:36 - just from manasquan new Jersey

13:37 - high school to

13:38 - Blair was enormous

13:39 - the intellectual adjustment

13:41 - and the living away from home.

13:42 - Adjustment.

13:43 - So I've done that by

13:44 - the time I got to college

13:45 - so it wasn't that

13:46 - much different but god

13:47 - I thought I was in

13:48 - heaven when I got the

13:49 - Princeton.

13:49 - It was a it was

13:51 - magnificent place

13:52 - not that Blair was not

13:53 - magnificent it was

13:54 - in it's own small way.

13:56 - You know very.

13:57 - Looked like a

13:58 - school for instance

13:59 - god knows looks

13:59 - like a college yeah.

14:01 - But at stemming I still go up

14:02 - there it's up there

14:03 - last weekend.

14:04 - He used to get the nostalgia.

14:08 - And

14:09 - there's.

14:10 - Even I walked past my

14:11 - wife and I walked bad

14:12 - walked down this

14:13 - walk go eat and walk in

14:14 - the university just

14:14 - a few days ago.

14:16 - And as a there's a quote

14:17 - there from sophocles.

14:19 - That says a stranger.

14:21 - You have reached the

14:22 - noblest home on earth.

14:24 - And.

14:25 - That's where I was when

14:26 - I was at Princeton was a

14:27 - a wonderful.

14:28 - Place for me

14:29 - it is curiously enough.

14:32 - I did a lot of looking

14:33 - around with a little

14:33 - extra time on our

14:34 - hands I went to the

14:35 - library where I.

14:36 - Stumbled on

14:37 - the idea of running

14:38 - a mutual fund thesis

14:39 - and I couldn't

14:40 - help observing that.

14:42 - It was almost the same.

14:44 - The room was the

14:45 - same and just just opened

14:46 - the library just

14:46 - open the new library

14:47 - firestone library one is there.

14:49 - And it was.

14:50 - Virtually the same except

14:51 - that the tables that we used to

14:53 - put books and

14:54 - spread out papers on

14:55 - this is in the reading room.

14:59 - Now we had

15:00 - computers everywhere.

15:01 - And then one other difference.

15:03 - All

15:04 - young.

15:05 - White

15:06 - males when I was there.

15:08 - An all male institution

15:09 - no minorities.

15:11 - Pretty spooky

15:13 - and now of course.

15:14 - It's like.

15:16 - Thinking the world has caught up

15:17 - and.

15:18 - They're young men

15:19 - and young women.

15:20 - Or.

15:21 - Blacks and.

15:23 - Asians and.

15:25 - Very

15:25 - very it's okay it's

15:26 - pretty exciting to think of

15:27 - and I kind of stood there.

15:29 - Just a few days ago and.

15:30 - And thought how.

15:32 - Just like life.

15:33 - How much remains the same.

15:36 - But how much changes.

15:37 - It's pretty exciting.

15:40 - I

15:40 - do and ask you.

15:42 - Obviously about the.

15:44 - Mutual funds in your thesis but

15:45 - but before that the time period

15:47 - we were just talking about.

15:49 - Some of that happened

15:50 - during world war two.

15:52 - Do you remember.

15:54 - World war two and

15:54 - did it have any effect on.

15:57 - On you and then

15:58 - the time after it.

15:59 - Yeah oh I remember world

16:00 - war two very much I mean I

16:02 - first of all I was deeply

16:04 - involved in it

16:05 - intellectually if you will.

16:06 - I mean I had maps of the

16:07 - European front and my wall

16:09 - of the map of Europe and I

16:11 - each time the

16:12 - Americans would advance

16:13 - they land and France

16:14 - the beachhead gets big

16:16 - earnings he does red spreading.

16:18 - All the way to the end

16:19 - in in then on may eight that

16:20 - would be my

16:21 - birthday may eighth of

16:22 - nineteen forty five

16:24 - and so I was very much involved

16:26 - but I was more than

16:27 - just intellectually involved.

16:29 - I did not want the war to end

16:31 - till I got into the

16:32 - United States air corps.

16:34 - The army air corps then.

16:36 - And it did end.

16:38 - Ended.

16:39 - June of nineteen.

16:40 - Forty six

16:41 - and.

16:43 - I was.

16:44 - Devastated.

16:46 - Devastated.

16:48 - Because I really wanted

16:49 - to be a flyer in the worst way

16:51 - I didn't know

16:52 - anything about risk

16:53 - I didn't know anything about war

16:54 - just the young kids view.

16:56 - You know I wanted I suppose.

16:58 - Sigmund Freud would say

16:59 - I wanted to be my father.

17:04 - When it

17:05 - when it ended did

17:06 - did you sense that I mean

17:07 - can you tell that.

17:09 - What was the mood in the

17:10 - country like was

17:11 - there a big change

17:12 - or a big oh yeah gosh

17:13 - I can remember the

17:15 - parade we had in bay

17:16 - head new Jersey where

17:17 - we were living

17:18 - and.

17:19 - We were just in

17:20 - I guess just turning seventeen

17:21 - yeah cause a friend of mine.

17:23 - Had a car.

17:25 - Car

17:25 - bogus didn't know

17:26 - any of the cars

17:27 - we had one family

17:28 - car to get in the car

17:29 - and we drove up and

17:30 - down main street and

17:31 - everybody was cheering

17:32 - and the horns were

17:32 - honking this was on vj day.

17:35 - And

17:35 - I guess nineteen forty six

17:37 - and it was really it was

17:38 - an unbelievable experience

17:40 - and of course my mother was.

17:42 - Completely overwhelmed by it.

17:44 - Because

17:45 - my older brother was

17:46 - in the marine corps.

17:47 - And he went in in

17:48 - nineteen forty five

17:50 - and she was of course

17:51 - worried that he was

17:51 - going to get out in

17:52 - the war and killed so

17:53 - the end of the war

17:54 - at a you know deep

17:55 - personal meaning to her I didn't

17:56 - think about life

17:56 - and death in those.

17:58 - In those days too much.

18:01 - At a.

18:02 - At Princeton at the time after.

18:06 - The war ended.

18:07 - And.

18:07 - Optimism about

18:09 - the future

18:09 - in general.

18:10 - Well yeah I mean

18:11 - Nana we were young

18:13 - and we were idealistic

18:16 - and you know kids in their.

18:18 - Seventeenth and

18:18 - eighteenth they go

18:19 - off to college in ninety

18:20 - teens and twenties

18:22 - and exposed to new ideas

18:23 - exposed to the

18:24 - excitement of the.

18:26 - Of the mind.

18:27 - Exposed a history in

18:28 - English and philosophy.

18:31 - Exposed to politics

18:32 - and economics

18:33 - and mathematics

18:34 - and.

18:35 - It's and it's the most exciting

18:36 - time anybody has

18:37 - really in their life

18:39 - and.

18:40 - So yes.

18:41 - You know I was.

18:43 - When we get to talking

18:44 - about my thesis

18:45 - you'll see it's a.

18:46 - Talk about how it's

18:47 - an incredibly idealistic.

18:49 - Document.

18:50 - But I I have no hesitancy in

18:52 - saying not to get

18:53 - ahead of the story

18:54 - but I'm more idealistic.

18:56 - Idealistic now that I wasn't in.

18:58 - All this

18:59 - you know fifty years

19:00 - or something like that of.

19:02 - Life.

19:03 - That's not one me.

19:05 - Not shaken any of

19:05 - that a lot of people

19:06 - lose their idealism

19:07 - as they grow older

19:08 - I think that's a shame

19:10 - and for whatever

19:10 - reason maybe I've just

19:11 - lead not maybe but

19:12 - I've left a blast lived a

19:13 - blessed life

19:14 - and.

19:16 - My idealism is

19:17 - intact and I and maybe even.

19:19 - Greater than it was then.

19:22 - What kinds of

19:23 - you just mentioned a lot

19:25 - of things philosophy history.

19:27 - What kinds of things.

19:29 - Did you get exposed to.

19:32 - At Princeton besides.

19:34 - What you're doing and

19:35 - besides the economics

19:36 - investing in that

19:37 - kind of thing but

19:38 - that stuck with you.

19:40 - Well I mean I I

19:41 - I guess the best

19:42 - example I can give you

19:43 - is I never knew.

19:45 - I didn't really know so

19:46 - much when I went there

19:47 - I never knew there was

19:48 - the study of the history of art.

19:50 - The paintings.

19:52 - Back to.

19:53 - Giotto and Michelangelo though.

19:57 - And

19:57 - I mean I never knew

19:58 - that that subject existed

20:00 - and I took an art

20:00 - course I think in my

20:01 - freshman year maybe

20:02 - my sophomore year

20:04 - and

20:04 - it was just blown away by it.

20:06 - I mean the beauty of it.

20:09 - The history of it.

20:11 - The development of it.

20:13 - Is of art but I'm speaking

20:14 - visual art painting.

20:17 - Or at least by

20:18 - and large painting

20:18 - a little bit of

20:19 - architecture thrown in

20:20 - and I took him I

20:21 - think I think I think I

20:22 - took art courses

20:23 - every year I was there.

20:24 - The whole new.

20:26 - Awakening.

20:28 - But that was true of a

20:29 - lot of other things too.

20:32 - What.

20:33 - At at at this point

20:34 - are you still thinking.

20:36 - Banking or you

20:38 - have banking or finance

20:39 - something like that

20:40 - the idea wasn't clear

20:41 - in my mind and my

20:42 - kind of middle

20:43 - years at Princeton.

20:44 - And I was just that just

20:45 - goes back to what I was

20:46 - saying a little bit

20:47 - before but my attitudes.

20:49 - You know if you.

20:51 - Way to sum up my attitude I

20:52 - think best to live

20:53 - one day at a time

20:54 - and that means you don't think.

20:56 - A lot of people don't

20:57 - think this way at all

20:58 - but I don't think

20:59 - where am I going to be

21:00 - five years from now

21:00 - or ten years from now

21:02 - I think where am I going to be

21:03 - at the close of business today

21:04 - when I go to sleep.

21:06 - And it's

21:07 - it's making the most of the day.

21:08 - That is.

21:10 - Something that suits

21:11 - my personality and

21:12 - temperament don't

21:12 - recommend this kind of

21:13 - stuff to anybody else mean

21:15 - it'd be true for a lot of people

21:16 - but a lotta people can't deal

21:17 - I mean I know people said.

21:19 - I want.

21:21 - So and so elected me

21:23 - elected vice president I want a

21:24 - picture from bach

21:25 - rock and I wanted to

21:26 - it has to happen before i'm

21:27 - thirty five or

21:27 - something I mean I.

21:28 - I never thought that way.

21:31 - How did you get.

21:33 - It

21:33 - to your thesis I.

21:35 - Want to talk about it

21:36 - how did you.

21:37 - Decide to do something on

21:38 - mutual funds and had the.

21:40 - The subject.

21:41 - Ever interested you before you.

21:43 - Know I had I had no I mean I I

21:45 - if I was interested in

21:46 - economics and I wanted to do.

21:48 - My my idea was.

21:50 - To write a senior thesis which

21:51 - you had to write at Princeton.

21:53 - Still do to this day.

21:55 - On a subject that

21:56 - no one had ever

21:57 - written a senior

21:57 - thesis on before.

21:59 - So you know the famous

22:00 - economists like John

22:02 - maynard keynes or

22:03 - Adam Smith or Karl Marx.

22:05 - They weren't going

22:05 - to be when my thesis

22:06 - was going to be on

22:07 - because everybody's

22:07 - written about it.

22:08 - And I didn't know what to

22:09 - write on but I just

22:10 - happened into.

22:11 - In firestone library.

22:12 - One afternoon.

22:14 - Sun pouring in from the south.

22:16 - And open up fortune magazine.

22:18 - And it was in a

22:19 - big big magazine.

22:21 - And I used to

22:21 - read it every month

22:22 - when it came out in the library.

22:24 - And I stumbled on this article

22:25 - page one hundred and sixteen.

22:27 - Called big money in Boston.

22:29 - And.

22:30 - It was about the

22:31 - mutual fund industry and

22:32 - I read the article I

22:33 - was intrigued with it

22:34 - and called the industry tiny.

22:36 - But contentious.

22:38 - And I thought well.

22:39 - Maybe that'd be

22:40 - a good place to be

22:41 - so I wrote my thesis

22:42 - about it I didn't think

22:43 - about it then

22:43 - particularly as a career.

22:45 - But I

22:46 - certainly spent.

22:47 - A huge amount of time

22:48 - over the next two years.

22:51 - Writing.

22:53 - Researching

22:54 - year and a half I guess.

22:56 - Writing researching

22:57 - and trying to

22:58 - understand this business

22:59 - and it was a it was

23:00 - quite an experience

23:02 - and everything in my

23:03 - career that followed.

23:05 - Came from that.

23:06 - Chance opening of a magazine

23:07 - when you think about

23:08 - that I mean if they.

23:09 - If I hadn't opened the magazine.

23:11 - Then if a bar if i'm

23:12 - going to Princeton.

23:14 - There wouldn't be

23:14 - any vanguard today.

23:16 - It's sort of amazing.

23:20 - What did.

23:21 - You

23:22 - do you have to defend.

23:24 - A senior thesis

23:25 - is there a process

23:26 - that no it's not

23:27 - it's not like an

23:28 - oral exam I mean I.

23:29 - I'd worked we have an advisor

23:31 - and my advisor was

23:32 - professor Philip bell

23:33 - and

23:34 - we would I I don't

23:35 - have a great recollection

23:36 - of the process but

23:37 - I'd check in with him

23:38 - and he'd look at my work

23:39 - probably once a month.

23:41 - Or once every two months

23:42 - and.

23:44 - And finally.

23:45 - I got to the end I

23:45 - just hand them the

23:46 - finished thesis he

23:47 - didn't look like a final

23:48 - draft or anything.

23:49 - And he gave me a sterling grade

23:51 - and.

23:52 - It was the best

23:53 - grade I think I ever

23:54 - got at Princeton I

23:54 - didn't get a lot of one

23:55 - pluses that was the

23:56 - highest grade like a plus

23:57 - but that's what I

23:58 - got on the thesis US.

24:00 - When you finished it.

24:03 - Were you still

24:04 - thinking about the.

24:06 - Mutual funds are we

24:08 - well I

24:09 - a

24:09 - well I thought about it and.

24:12 - I typed it all myself.

24:14 - I.

24:15 - Would not a bad typist

24:16 - and so it was I mean

24:17 - it was an involving

24:19 - experience along to

24:20 - takes a long time to do

24:21 - that kind of thing.

24:22 - And then I sent it.

24:23 - Copies of it.

24:25 - Do I'd interviewed a lot

24:26 - of people in the industry

24:27 - and I said it caused some copies

24:28 - of it to people in

24:29 - the industry and.

24:30 - And.

24:32 - Mr Walter Morgan the head of

24:33 - the Wellington fund down here.

24:35 - I.

24:36 - Sought

24:36 - and.

24:38 - He said and he wrote

24:38 - a little memo about

24:39 - it and setting up the

24:40 - organizations that as

24:41 - a result of this thesis we

24:42 - have added mr bogle to our.

24:44 - Wellington organization.

24:45 - So it got me my job he was a

24:47 - wonderful man my mentor for

24:48 - fifty years.

24:50 - He died at age one hundred.

24:52 - Just after his hundredth

24:53 - birthday so he was good

24:54 - it's amazing to meet somebody.

24:56 - When he's fifty.

24:57 - And still no one.

24:58 - Fifty years later

25:00 - and he was

25:00 - just as fun and manage

25:01 - ever want to meet.

25:04 - What it.

25:05 - Was that was your

25:06 - first job then out of

25:07 - Princeton.

25:09 - What was it like.

25:10 - What was kind of fun you know

25:12 - you thought you

25:12 - were a businessman.

25:14 - And.

25:15 - My first day in the

25:15 - office my brother who

25:16 - was a businessman

25:17 - in Philadelphia my older

25:18 - brother called me

25:19 - up and said we have

25:19 - to have lunch on it

25:20 - and had lunch with him

25:21 - and he said you know

25:22 - you have to buy a hat

25:23 - businessmen wear

25:23 - a hat so he went onto

25:24 - stetson hat store or

25:25 - something like that.

25:27 - Got a hat you felt like you

25:28 - were there you were in a suit

25:29 - at work and.

25:30 - I was very very

25:31 - young looking kid

25:32 - everybody must

25:32 - have laughed at me

25:33 - but.

25:35 - It was it was an

25:36 - exciting environment

25:37 - was very small

25:38 - company that maybe.

25:39 - I had to guess forty people

25:40 - in it or something fifty.

25:43 - And a.

25:44 - Large company a

25:45 - mutual fund business but.

25:46 - I busted with.

25:48 - Wellington fund was

25:49 - about one hundred and.

25:50 - Fifty million dollar fund.

25:52 - And today you know vanguard is.

25:55 - Five hundred and fifty billion.

25:57 - It's a big difference.

25:59 - Instead of

26:00 - forty or fifty people.

26:01 - Ten thousand people.

26:03 - They were great days

26:04 - I mean I like small.

26:06 - Again and

26:07 - not sure god.

26:08 - Meant for me to

26:09 - run a large company.

26:11 - What the what was your first

26:13 - job and what did you have to do.

26:16 - Well we used to do things

26:17 - like I'd helped mr Morgan.

26:19 - Respond to letters

26:20 - from shareholders.

26:21 - So shareholder

26:22 - would have a certain.

26:24 - Oh and

26:24 - a complain about the

26:25 - way something has

26:26 - happened let's say or

26:27 - want an answer to some

26:27 - kind of a question I'd do that.

26:29 - And

26:30 - I used to do marketing

26:31 - material for them

26:32 - and in those days

26:33 - someone would say.

26:34 - Well let's see how an

26:35 - investment of ten

26:36 - thousand dollars.

26:37 - Over the last twenty years

26:38 - would have been

26:38 - in Wellington fun.

26:40 - And with all the

26:40 - dividends plaid backs you

26:41 - have to get out a

26:42 - little Monroe calculator

26:43 - and put on all the numbers.

26:45 - Wasn't like it is today

26:46 - and you know you.

26:47 - Reinvested the

26:48 - first quarter then you

26:48 - reinvest the second

26:49 - quarter and reinvest the

26:50 - third quarter all

26:51 - different by then there

26:52 - were there were so

26:52 - much data your one.

26:54 - Year due to the Internet.

26:56 - And I used to

26:57 - help that put costs

26:58 - in the portfolio

26:59 - and in those days.

27:01 - Portfolios be printed

27:01 - every month but

27:02 - they didn't have costs

27:03 - in them so I'd write

27:04 - go calculate the costs.

27:06 - And I think mr

27:06 - Morgan was impressed.

27:07 - Because I realized

27:08 - nobody wanted to

27:09 - know that the cost

27:10 - of a stock was say.

27:11 - Seventeen dollars nine cents.

27:13 - Is one that was

27:13 - seventeen dollars.

27:15 - So I figured instead of

27:16 - using that Monroe calculator.

27:18 - I could use my

27:18 - friend the slide rule.

27:20 - Which gives you you

27:21 - a flawless result

27:23 - it just doesn't give

27:23 - you a decimal points.

27:25 - Seller or at least you can

27:26 - approximate it but I didn't

27:27 - use them because they didn't

27:28 - want to know that so I could.

27:29 - Beat everybody in assembling

27:30 - the cost of that portfolio.

27:33 - And you know I'd do some

27:34 - marketing work I worked in the

27:36 - investment department.

27:37 - Worked on evaluating

27:38 - stocks and bonds both.

27:40 - Side of very broad

27:40 - experience just doing

27:41 - whatever anybody

27:42 - wanted me to do I'd help

27:43 - mister Morgan hang pictures.

27:45 - It was a small kind of

27:46 - fun it was great time.

27:48 - Had you met your

27:49 - wife by this point.

27:50 - Well actually met my wife.

27:53 - She was the sister of a

27:55 - of a friend of mine I met at

27:56 - Princeton class behind me.

27:58 - And so I met her when

27:59 - she was only about thirteen.

28:01 - And.

28:02 - We would take her.

28:04 - My friend j sherrard

28:05 - was his name is his name

28:07 - and.

28:08 - We'd take her

28:09 - along with US to ball

28:10 - games we like to see

28:11 - st Joe's hawks and.

28:13 - Philadelphia

28:13 - the.

28:14 - Warriors in those

28:15 - days and the Phillies

28:17 - and

28:18 - or the a's for that matter

28:19 - the Philadelphia athletics

28:21 - and we go to those

28:21 - kind of games and seats

28:22 - any amount if I bring

28:23 - my sister along fine

28:24 - she was.

28:25 - Kind of fun to be around

28:26 - we never saw

28:26 - each other until she

28:27 - got out of college

28:28 - and that was nineteen.

28:29 - I would have

28:30 - been nineteen fifty.

28:32 - Six

28:33 - I guess.

28:34 - Nineteen fifty five I guess

28:35 - she graduated college

28:36 - and

28:37 - what were you doing

28:38 - at the time we you still.

28:40 - I still

28:41 - I was

28:41 - still it was welling

28:42 - in a long long time.

28:45 - I had two.

28:46 - From that initial.

28:48 - Yeah there's initial candidate.

28:50 - Encounters have you.

28:52 - How did you start

28:52 - dating your life.

28:54 - Well I mean I kind of liked

28:55 - her from the beginning.

28:56 - She hates it when I

28:57 - tell a story but she I

28:59 - knew she shined her

28:59 - brother saddle shoes.

29:01 - And that was a great credential.

29:03 - And but we we

29:04 - got along very well

29:05 - and after she

29:06 - got out of college.

29:07 - Started go out and

29:08 - you know decided very

29:09 - very quickly maybe

29:10 - within a couple of months

29:11 - to get married.

29:14 - I'm not a big ladies'

29:15 - man

29:16 - take

29:16 - a lot of women out.

29:19 - What.

29:21 - It.

29:22 - Was difficult at all to balance.

29:24 - Work

29:24 - and.

29:25 - Family

29:26 - well you know I never thought

29:28 - it was difficult

29:29 - but it obviously is

29:30 - and I probably gave

29:31 - too much time to

29:32 - my work and not

29:33 - enough time to my family.

29:35 - I'd criticize myself

29:36 - somewhat in that regard.

29:38 - In the first year

29:39 - trying to get ahead

29:40 - and everybody understands

29:41 - that and pretty

29:41 - much respects it.

29:42 - But then you you

29:43 - get somewhere and

29:44 - you maybe don't have

29:45 - to work so hard but.

29:46 - Every time I'd get a promotion.

29:49 - I'd work harder.

29:50 - And you know try and.

29:52 - Elevate.

29:54 - My standards.

29:55 - Behavior stay

29:56 - Sanders every standard

29:57 - and I think when you

29:58 - go higher up in the world.

30:00 - You have an obligation

30:01 - to.

30:03 - Be an even

30:04 - an even better role model

30:05 - honestly.

30:06 - And it's.

30:07 - It's one of the

30:08 - tragedies of life that

30:09 - not everybody feels that way and

30:10 - see what happens to.

30:11 - Certain individuals who

30:13 - become president United States.

30:15 - And I don't think.

30:16 - It's elevated maybe it

30:17 - was never elevated but.

30:19 - I just don't quite

30:20 - understand that.

30:21 - Cause I I I've I've always

30:23 - deeply valued my reputation.

30:26 - You know I I could probably

30:27 - be tempted do a lot of things

30:29 - and like any of US

30:30 - but I wouldn't do them because I

30:32 - don't want to

30:32 - wreck my reputation.

30:35 - You know that's not

30:35 - some heroic comment but.

30:37 - The fact of the matter

30:38 - is I value it very highly.

30:41 - Did you think

30:42 - when you're.

30:43 - At Wellington.

30:45 - Did you think you'd be there.

30:47 - Forever I mean

30:49 - absolutely.

30:50 - Absolutely I mean

30:51 - it was the only

30:52 - I'd only been there a few years.

30:53 - In a

30:54 - very small company and

30:55 - a lot of people that

30:56 - have gone to college

30:56 - or starting up and

30:57 - not a lot of people

30:58 - going to college.

30:59 - As a.

31:01 - As a greatest Princeton.

31:03 - And of course mr

31:03 - Morgan gone to Princeton.

31:05 - And I was sort of his

31:06 - boy I guess one would se.

31:08 - And.

31:09 - It was pretty clear within

31:10 - probably five or six years.

31:13 - I was going to be

31:14 - his successor.

31:15 - And.

31:17 - That's what happened.

31:18 - And.

31:20 - It said I think people

31:21 - understood that pretty well

31:23 - and you know I never.

31:25 - Thought I was.

31:28 - I never thought that

31:29 - was something that

31:29 - would happen I could

31:30 - just sit back and watch

31:31 - it happen.

31:32 - But again I I just

31:32 - tried to do my best

31:33 - and if it happened I

31:34 - thought that was fun

31:35 - I suppose in the

31:36 - back of my mind I

31:37 - had an idea that I

31:37 - wanted to do that but.

31:39 - It's basically not

31:39 - getting there all at once

31:40 - but getting there

31:41 - one step at a time and

31:42 - I was taking the steps.

31:44 - So.

31:46 - It finally happened

31:46 - and actually it

31:47 - happened even before it happened

31:48 - if they if you can

31:49 - take that phrase.

31:50 - Because in nineteen

31:51 - sixty five before I

31:52 - came became the

31:53 - president of the company.

31:54 - He came to me and said

31:56 - we had a lot of problems

31:58 - in the company at

31:58 - that time and he said.

31:59 - I want you to do

31:59 - whatever it takes

32:00 - you take charge

32:01 - do whatever it takes.

32:03 - To get them fixed.

32:04 - And so I did and it

32:05 - was then that I made.

32:07 - You know what.

32:08 - A big mistake.

32:10 - I was on my way to

32:11 - becoming president of

32:12 - the company I was

32:12 - executive vice president I

32:13 - think that.

32:14 - Just young you know in

32:15 - nineteen sixty five I was.

32:18 - Thirty six years old.

32:20 - And I am very self confident.

32:22 - Very egotistical

32:24 - and.

32:25 - Very determined.

32:27 - Yeah.

32:28 - And.

32:31 - I.

32:33 - Figured out a way to solve

32:34 - all these problems at once.

32:35 - Involved at which was

32:37 - to get.

32:38 - Better fun for

32:39 - better performance

32:39 - for the Wellington fund

32:41 - to get a new fund we're in the

32:42 - middle what was

32:42 - called the go-go era.

32:44 - Just like this last bubble

32:46 - although you never

32:46 - know it at the time.

32:48 - And to get into the

32:48 - investment advisory business

32:50 - Edward

32:51 - breadth weird only in the

32:52 - mutual fund business that.

32:53 - I was able to accomplish

32:54 - that all at once

32:54 - by doing a merger

32:55 - with another firm very

32:56 - small firm.

32:57 - And.

32:59 - It really worked

33:00 - out quite brilliantly.

33:02 - For a while.

33:04 - And then we had

33:05 - a great big market

33:06 - decline the market

33:06 - went down fifty percent.

33:08 - In nineteen seventy

33:09 - three seventy four.

33:11 - And during that declined.

33:12 - Every buddy got bother

33:13 - with everybody else

33:14 - and you have to cut

33:15 - back and you've got

33:16 - gotta do this I

33:17 - had to fire one of

33:18 - these guys the

33:18 - portfolio manager.

33:20 - And one of the partners

33:22 - and it doesn't didn't

33:23 - add to my popularity

33:24 - and I couldn't get

33:25 - again I was very.

33:26 - Stubborn.

33:27 - Self confident person that.

33:29 - Kind of thing that.

33:30 - Other people don't always like.

33:32 - Even if that my respect that.

33:34 - And

33:35 - these guys ganged

33:36 - up and got me fired.

33:38 - And there was this company

33:39 - that I thought was mine.

33:41 - Stock at a little

33:41 - bit stock in it.

33:43 - And I was out of work.

33:45 - Not fun.

33:47 - And actually I was heartbroken.

33:50 - But that's how

33:51 - vanguard came to be.

33:54 - And then when

33:54 - I got fired.

33:56 - Vanguard wouldn't

33:57 - have happened either.

33:59 - So.

34:00 - It's a little hard

34:01 - to explain but

34:02 - the reality is that the

34:03 - the

34:04 - firm that fired me

34:04 - was Wellington

34:05 - management company which

34:06 - runs the funds.

34:08 - But the funds also

34:09 - have a corporate being

34:10 - Wellington fund

34:11 - and windsor fund.

34:12 - Had their own directors.

34:14 - Some of whom

34:15 - were directors of the

34:16 - management company

34:16 - I ate the people

34:17 - that fired me and me.

34:18 - And some of whom

34:19 - were independent.

34:20 - And I was able to.

34:22 - Persuade.

34:23 - Those directors

34:24 - the other directors.

34:25 - To hire me as a.

34:28 - Full-time fund officer.

34:30 - And protect the funds.

34:32 - Watch out for the

34:33 - fund shareholders.

34:34 - Against what might be

34:35 - the different interests.

34:36 - Of the match manager

34:37 - and the distributor

34:38 - which was Wellington

34:39 - management company

34:40 - and some of the

34:40 - directors did that.

34:41 - And.

34:43 - It was it was a hard thing to.

34:45 - See what would happen.

34:47 - Because it was a job really

34:48 - without precedent

34:49 - in this industry

34:50 - and not really all

34:51 - that interesting one.

34:52 - Because.

34:53 - My former rivals

34:54 - were going to be in

34:55 - charge of all the

34:55 - investment management

34:56 - and all of the distribution.

34:58 - And I would be in

34:59 - charge for the funds

35:00 - just

35:00 - monitoring their activities.

35:02 - And

35:03 - handling the legal

35:03 - and accounting.

35:05 - And shareholder.

35:06 - Relations activities.

35:08 - And that's not the most

35:09 - important part of the job.

35:10 - It's a very

35:10 - important part of the

35:11 - job let me put it

35:12 - a little differently

35:13 - but not what makes

35:14 - or breaks a company.

35:15 - Make or break a company is how

35:17 - the results are

35:17 - delivered to investors

35:19 - and the kind of funds

35:20 - you deliver it to them with.

35:21 - So.

35:23 - The idea I had was to take this.

35:25 - Limited job

35:27 - and turn into.

35:27 - An all encompassing job.

35:29 - And it was only two years maybe.

35:31 - Until I had done that.

35:33 - Yeah.

35:34 - It was it was quite remarkable

35:35 - when looked at in retrospect.

35:37 - That I was able to

35:38 - get into investment

35:38 - management even

35:39 - though I wasn't allowed to.

35:41 - Take over distribution.

35:42 - Even though I wasn't allowed to.

35:44 - And.

35:46 - Take those two things in

35:47 - that component the way we

35:49 - got

35:49 - well I should take a step back

35:50 - and say another lucky break.

35:54 - I didn't know what to

35:55 - call this new company.

35:57 - We needed a company.

35:58 - Because they had the

35:59 - Wellington name my rivals

36:01 - and we needed to name

36:02 - a new company something

36:03 - and a man happened to come

36:05 - into my office

36:05 - selling old prints.

36:06 - Of naval battles.

36:08 - Of the napoleonic war era

36:10 - and of course I was

36:11 - attracted to them because.

36:13 - Wellington the

36:13 - name Wellington is

36:14 - the Duke of

36:14 - Wellington which is like.

36:16 - The.

36:17 - Land battles.

36:18 - The military battles

36:19 - of the napoleonic war

36:21 - so I said sure

36:21 - I'd take a look at

36:22 - his naval prints

36:23 - and I liked them

36:23 - and I bought some

36:25 - and he gave me the book that

36:26 - they came out

36:26 - this is a big book.

36:28 - Of naval prints

36:29 - and.

36:30 - I just

36:31 - went to one of the

36:32 - one of the prints

36:32 - to the principle of

36:33 - the battle of the nile.

36:35 - The great naval battle.

36:36 - Of the last millennium

36:37 - according to the new York times

36:39 - and.

36:40 - It was where lord Nelson.

36:42 - Destroyed Napoleon's fleet when

36:43 - he was in Egypt

36:44 - and abu cure bay.

36:45 - At the battle of the nile

36:47 - and seventeen ninety eight.

36:49 - And so I.

36:50 - Flipping through this book

36:51 - and there's lord

36:52 - Nelson's dispatch

36:53 - to the admiralty killing

36:54 - it as glorious victory

36:56 - and the bravery of his men

36:57 - and how everybody

36:58 - worked together and

36:59 - how they'd accomplished

37:00 - a great mission

37:01 - and beautiful

37:02 - kind of pros.

37:03 - And it's signed.

37:05 - Nelson.

37:06 - Hms vanguard off the nile.

37:09 - Vanguard.

37:11 - There's a name for

37:12 - the new company.

37:13 - So another book another pay.

37:15 - Another page.

37:16 - Or a little piece of.

37:18 - Maybe not very important history

37:19 - but history nonetheless.

37:21 - So without those two books.

37:23 - I don't know where

37:24 - we'd be today.

37:25 - Good fortune.

37:27 - At

37:27 - that point where

37:28 - we're vanguard

37:29 - and Wellington then.

37:30 - Working together.

37:32 - While we were working

37:33 - together but we were sort of.

37:36 - How to put this.

37:37 - We're working arm's length.

37:39 - If they didn't provide

37:40 - good enough performance.

37:42 - I would say.

37:43 - You've got to improve.

37:45 - Or if the distribution.

37:46 - Wasn't working well I could

37:47 - say to them it's got to improve

37:49 - and

37:50 - basically

37:50 - the only way I knew I

37:51 - was ever going to get done.

37:53 - Was if I took

37:54 - over direct control.

37:55 - Of the the investment side

37:56 - or most of the investment side

37:58 - and direct control of

37:58 - the distribution side.

38:00 - And the way we did it

38:01 - on the investment side.

38:02 - Was after we'd been in

38:03 - business only a few months.

38:05 - I recommended the directors

38:06 - that they start an index fund.

38:09 - And.

38:11 - In my senior thesis I had said.

38:13 - Mutual funds can make no claim

38:15 - to superiority over

38:16 - the market averages

38:18 - and whether that's

38:18 - the basis for the first

38:19 - index fund at the

38:20 - end that the industry

38:21 - ever had

38:22 - I dunno

38:22 - but in any event

38:23 - it seemed a great idea

38:25 - because at one

38:25 - magical quality gotten it

38:26 - to two magical

38:27 - qualities one that got me

38:28 - into the investment business.

38:30 - I knew he had to be

38:32 - and to

38:32 - I could say

38:33 - it wasn't getting me

38:34 - into the investment

38:35 - business because

38:36 - the director said.

38:37 - You're not allowed to get into

38:38 - investment management

38:39 - that's the deal

38:40 - and I was able to say

38:41 - this fund has no management.

38:44 - All it does is match the market

38:45 - index and they bought that.

38:47 - So we had an

38:48 - underwriting tiny tiny to the

38:51 - index fun started with

38:52 - eleven million dollars.

38:52 - And it was called Vogel's fault

38:54 - nobody thought it would work.

38:55 - It was a joke

38:56 - in the industry.

38:57 - And here it is the biggest

38:58 - mutual fund in the world.

38:59 - Today.

39:00 - So that was

39:00 - getting into the first

39:01 - step in investment management.

39:03 - Getting into distribution

39:04 - was little bit different.

39:05 - We had been selling our shares

39:06 - through securities

39:07 - brokers and dealers.

39:09 - This is the way the mutual

39:10 - fund in history was build up.

39:11 - You know people

39:12 - if you don't ever

39:13 - heard of a mutual fund.

39:14 - You're going to have to

39:15 - have somebody sell it to you.

39:17 - That's the nature

39:18 - of financial services.

39:20 - And.

39:21 - The industry was growing

39:22 - but I was convinced.

39:24 - That we could eliminate

39:25 - the entire sales force

39:26 - and if people.

39:27 - Come

39:28 - to US to buy

39:29 - with no commissions.

39:31 - It was a value proposition

39:33 - and all I had to do as

39:34 - I've said many times.

39:37 - If we build it they will come.

39:39 - But you gotta build it well.

39:41 - And.

39:42 - If you build a better mousetrap

39:43 - the world will beat a path to

39:45 - your door Ralph Waldo Emerson.

39:47 - And the world did.

39:49 - We took off the sales loads.

39:51 - And again the director said

39:52 - what you can't

39:52 - get into distribution

39:54 - and I said I'm not

39:54 - getting into distribution.

39:56 - I'm eliminating distribution.

39:58 - I think bought that.

39:59 - So within just a

40:00 - couple of years this

40:01 - was February of

40:02 - nineteen seventy seven.

40:04 - And we just started operations

40:06 - in may of nineteen seventy five

40:07 - we were the fully formed.

40:09 - Complex the vanguard is today.

40:11 - And it's.

40:13 - You know it seems like a

40:14 - sort of a miracle to me now

40:16 - but all it happened

40:16 - naturally and I don't.

40:18 - You know we weren't

40:19 - sitting there saying.

40:21 - Isn't this wonderful.

40:22 - Because we weren't working

40:23 - today we were working.

40:24 - I got through the

40:25 - day and got the

40:26 - boat we wanted

40:26 - and would go on to

40:27 - see what happens

40:27 - the next morning

40:28 - when nobody sells

40:29 - one share of anything.

40:31 - And they didn't.

40:35 - He mentions it

40:36 - was called Vogel's

40:37 - folly

40:38 - at first.

40:39 - The.

40:40 - Index fund.

40:42 - When did.

40:43 - It become viewed as.

40:46 - A success.

40:48 - Well I'll.

40:49 - Give you a couple

40:50 - of of guidelines.

40:52 - We started in

40:52 - nineteen seventy five.

40:55 - And I think.

40:56 - The second index fund.

40:58 - Was started.

40:59 - In.

41:00 - Nineteen eighty two.

41:03 - Okay

41:03 - and this is an industry

41:04 - known for copying.

41:06 - Easy enough to copy

41:07 - but.

41:10 - They grew very slowly.

41:13 - And it was really and

41:13 - actually the index didn't

41:15 - have the kind of numbers that

41:16 - one would have expected because

41:17 - the statistics are very funny

41:19 - but didn't do that well in the.

41:20 - As we came out of the.

41:22 - The seventy four seventy

41:24 - five decline and into.

41:26 - Nineteen seventy seven

41:27 - seventy eight the

41:28 - index was not a

41:29 - critically impressive

41:29 - perform was okay.

41:31 - But not

41:32 - not a big leader like

41:33 - it became later on.

41:34 - And I'd say probably nineteen

41:36 - eighty eight nineteen

41:37 - ninety one you.

41:38 - Have been doing it for.

41:39 - Almost fifteen years

41:40 - and then people catch on

41:42 - and

41:43 - other people start index funds

41:45 - and then they became my

41:46 - proceed for what they are

41:49 - and that is

41:49 - there's no.

41:50 - Utterly

41:51 - no.

41:52 - Magic.

41:53 - In an index fund.

41:55 - The magic is in

41:56 - the two things that

41:57 - index funds do and

41:57 - then if they give you a

41:59 - complete diversification.

42:01 - Okay what's investing about.

42:02 - Investing is about buying

42:04 - stocks let's say here

42:05 - when we're talking

42:05 - about the stock market.

42:07 - Well you take.

42:08 - A risk and each stock

42:10 - that you pick.

42:11 - And you take off stock

42:12 - market risk goes to

42:13 - the true risk like

42:13 - all specific stock risk

42:14 - and market risk.

42:16 - The index fund eliminates

42:17 - specific stock risk

42:19 - because you own every stock

42:20 - you own the entire stock market.

42:22 - Every as we now know no more

42:24 - than that never more than today.

42:26 - Market risk white large

42:27 - enough you don't need to add.

42:29 - Stock risk to it.

42:30 - And so the broader

42:31 - diversification

42:32 - and then you deliberate

42:33 - the lowest possible

42:34 - price.

42:35 - And let me just give

42:36 - you a little example.

42:38 - If

42:38 - if

42:39 - the market

42:39 - grows at.

42:41 - Say a return of ten

42:42 - percent over thirty years.

42:44 - A dollar invested in stocks.

42:46 - Will grow to about eighty

42:47 - eighteen dollars and fifty cents

42:49 - in thirty years.

42:50 - The average mutual fund and the

42:51 - average investor

42:52 - won't do that well.

42:54 - Because they will incur costs.

42:57 - The market.

42:57 - People don't get

42:58 - the market return

42:59 - they get the market

43:00 - return after costs.

43:01 - The index funds

43:02 - going to get almost

43:03 - that ten percent return

43:04 - and give you almost

43:05 - that eighteen

43:05 - dollars and fifty cents

43:07 - the average mutual fund cost

43:08 - about two and a

43:08 - half percent a year.

43:10 - So over thirty years

43:11 - they're going to

43:11 - give you about seven

43:12 - and a half percent

43:13 - and this is not just statistics

43:14 - this is what actually happens.

43:16 - And.

43:17 - A dollar invested at

43:18 - seven and a half percent.

43:20 - Gives you about nine

43:21 - dollars and twenty five cents.

43:24 - So think about this.

43:26 - The and the the mutual fund

43:27 - investor in the average fund

43:29 - puts up one hundred

43:30 - percent of the capital.

43:31 - Takes one hundred percent

43:32 - of the risk.

43:33 - And gets

43:34 - fifty percent of the return.

43:36 - And our system of

43:37 - financial intermediation

43:38 - brokers managers and so on.

43:40 - Put up.

43:41 - Zero percent of the capital.

43:43 - Take zero percent of the risk.

43:45 - And also fifty

43:46 - percent of the return.

43:47 - Well as soon as

43:48 - somebody figures that out.

43:51 - It's easy.

43:52 - Takes a little time

43:53 - to get them to figure

43:54 - out I just reading

43:54 - this morning this very

43:55 - morning in fortune

43:56 - magazine of all things.

43:58 - An interview with Warren buffett

43:59 - they said what do

44:00 - you do now he said i'd

44:01 - recommend that you

44:01 - buy an index fund and

44:02 - hang onto it this is

44:03 - Warren buffett the

44:04 - great Warren buffett

44:05 - the greatest investor of

44:06 - the age.

44:09 - What.

44:10 - At

44:10 - at the same time.

44:13 - As you're building.

44:14 - Vanguard.

44:15 - When did

44:16 - I read a lot.

44:17 - About some health

44:18 - problems that you had.

44:20 - Are you battling that.

44:21 - At the same time

44:22 - you're building vanguard.

44:23 - Well I mean I guess

44:24 - so yeah I mean I had.

44:26 - A.

44:27 - Unfortunately

44:28 - a genetic heart disease.

44:31 - That first struck me when I was

44:32 - when I was

44:33 - thirty years old.

44:34 - In nineteen.

44:37 - Actually was I was thirty

44:38 - one it was nineteen sixty

44:40 - and I had a heart

44:41 - attack on the tennis court

44:42 - playing with my.

44:44 - Brother-in-law.

44:45 - And

44:46 - or what they thought

44:47 - was a heart attack.

44:48 - And I.

44:49 - Was really at death's

44:49 - door for quite a few days

44:51 - but no everybody

44:52 - thought it was a regular

44:53 - heart attack but it

44:53 - was really this genetic

44:54 - heart disease

44:55 - that wasn't discovered

44:56 - for another twenty two years.

44:59 - They didn't know what it was

45:00 - and so I had a lot

45:01 - of is the hospital.

45:03 - A lot of.

45:05 - Near misses with.

45:07 - With.

45:08 - Ventricular fibrillation

45:09 - and that kind of thing.

45:11 - And

45:12 - had to go to the

45:13 - hospital haven't stopped

45:14 - god knows how many

45:15 - times maybe thirty forty

45:16 - fifty I mean I lost count

45:17 - but it was a large number.

45:19 - And.

45:20 - By the nineteen sixty

45:21 - seven I didn't know

45:21 - what else to do so

45:22 - they took me out at the

45:23 - Cleveland clinic and

45:24 - stuck in a paste maker.

45:25 - Which

45:26 - with all that

45:26 - cutting and sticking

45:27 - titanium bolts into

45:28 - the failing heart

45:29 - did not help

45:30 - made it worse.

45:31 - So I you know I

45:32 - just kind of struggled

45:33 - on it didn't seem

45:33 - too bad at the time.

45:35 - Continue to play squash

45:36 - which I probably shouldn't have

45:37 - for quite a few more years.

45:39 - And then gradually by then

45:40 - by the time we got into

45:41 - maybe eighty nine or ninety.

45:43 - I'd had quite a few near.

45:45 - Near misses with.

45:47 - The grim reaper.

45:49 - My heart failed.

45:50 - In market street east

45:52 - railroad station.

45:53 - And they had to have

45:55 - somebody bang on my chest.

45:57 - And.

45:58 - It was a I had to

45:59 - I was very lucky I

46:00 - had one.

46:01 - Earlier I'd had one of those

46:02 - squash court and my opponent.

46:04 - Just.

46:05 - Bang on my chest with

46:05 - his fist not got it started.

46:07 - And then I've had him in.

46:09 - In hospitals

46:10 - and they have to put the.

46:12 - The little.

46:13 - Defibrillator things

46:14 - on little paddles.

46:15 - That the shock your heart

46:16 - back into normal rhythm

46:18 - so it's kind of a chequered

46:19 - career but then it doesn't hurt.

46:21 - That nope no

46:21 - pain involved in it.

46:23 - And I'm not much of

46:24 - a worrier as I told you

46:25 - each time I'd get through the

46:26 - day I'd think well that's good

46:27 - but I worry about tomorrow much.

46:29 - But finally the heart just

46:31 - deteriorates and goes

46:32 - and gets huge

46:33 - in size inside you.

46:35 - And finally half but

46:36 - stopped beating.

46:38 - And

46:39 - at that point you know

46:40 - it's not so much fun to be.

46:41 - Around you it's hard

46:42 - to get up the stairs.

46:43 - Can't raise your arms over your

46:44 - head very he can't

46:45 - do even the most.

46:47 - Simple of chores.

46:49 - And so they said

46:50 - you

46:50 - to try and get a

46:51 - heart transplant.

46:52 - So after a little waiting

46:53 - before it got really serious.

46:55 - And.

46:56 - They finally put

46:57 - me on the list and I

46:58 - went into the

46:58 - hospital in October of.

47:00 - October of nineteen

47:02 - sixty five.

47:04 - And they put me

47:04 - on some intravenous

47:05 - tubes to keep my heart beating.

47:08 - Until.

47:09 - February twenty first.

47:11 - Nineteen ninety six.

47:13 - One hundred and

47:13 - twenty eight days later.

47:15 - And in came.

47:16 - A new hard while.

47:18 - And it's been a fantastically

47:20 - successful experience

47:22 - and I'm back playing squash.

47:24 - I get a little bit older

47:25 - but I'm still playing.

47:27 - And.

47:28 - Have a

47:29 - corrupt.

47:31 - Activity schedule.

47:33 - That I think and in business

47:35 - and in my life generally.

47:37 - That I think would exhaust.

47:39 - A younger man.

47:40 - Although.

47:41 - The heart I got was only

47:42 - twenty six years old so in fact

47:44 - I'm only thirty two two.

47:48 - Just going through

47:49 - that experience

47:50 - and

47:51 - change your

47:51 - perspective on things.

47:53 - When you know that's

47:53 - that's a great question.

47:55 - And the reality is.

47:57 - That for any normal person

47:58 - it should really make

47:59 - you a much better person.

48:01 - You should

48:01 - be.

48:03 - Sad to relate.

48:04 - I feared didn't make me

48:05 - a much better PR Austin.

48:07 - And.

48:09 - You know

48:09 - you

48:09 - count your blessings more.

48:11 - You try and be a

48:12 - better human being.

48:13 - But I'm afraid we

48:14 - are who we are.

48:16 - And even that

48:17 - magnificent experience.

48:18 - I you know I think it

48:19 - made me a little bit better

48:20 - but not nearly as

48:21 - much as it should have

48:22 - and I'm still quite

48:23 - clever.

48:25 - Quite a flawed human being.

48:27 - And

48:27 - if

48:28 - it's again that's kind

48:29 - of day to day thing

48:30 - and.

48:31 - It's it's.

48:32 - Light it's very focused

48:33 - on what needs to be done.

48:35 - And doing it rather than

48:36 - thinking maybe about.

48:38 - Being a little

48:39 - kinder to the people

48:39 - around you and all

48:40 - those kind of things.

48:41 - So.

48:43 - It should have but I I

48:44 - think maybe not enough.

48:47 - The vanguard group is you're.

48:50 - Going through this I was reading

48:52 - you know you

48:53 - decided to step down.

48:54 - At one point.

48:56 - And.

48:57 - What was that decision

48:58 - like for you to have to make.

49:00 - While it was actually

49:01 - very easy to make

49:02 - because I think you'd

49:03 - try and make decisions

49:04 - that the this is

49:05 - a little bit bullying

49:06 - my my strategy of

49:07 - looking ahead too far.

49:08 - It's pretty easy to

49:09 - stay in a job too long.

49:11 - And I I had the feeling

49:12 - honestly that I

49:13 - I thought it was.

49:14 - A good idea to get out.

49:16 - You never get out the right time

49:17 - but there

49:17 - to rather be on the early

49:18 - side rather than the light side

49:20 - and in addition.

49:21 - I was faced with

49:22 - a heart transplant.

49:24 - And so I decided in the.

49:26 - I guess in the summer

49:27 - of nineteen ninety five.

49:28 - To

49:29 - step down as

49:30 - as the seat chief executive

49:31 - and remain as chairman.

49:33 - And that was the plan.

49:35 - And.

49:37 - It's an

49:39 - it was a good plant.

49:42 - When you look.

49:43 - Only thing vanguard represents.

49:48 - I'm not sure it's important

49:50 - what I think it represents

49:51 - but I can tell you I talked to.

49:53 - Thousands.

49:55 - Of investors.

49:56 - Thousands of crew members.

49:58 - And.

50:01 - An awful lot scores certainly

50:02 - have people in the industry.

50:06 - People in the press.

50:10 - People in academia.

50:12 - And

50:13 - what vanguard stands for.

50:15 - Is.

50:17 - I think.

50:18 - To use a line I use in my in my

50:21 - speech at our twenty

50:22 - fifth anniversary.

50:23 - A.

50:25 - It's a company that

50:25 - stands for something.

50:27 - And I think that's something

50:28 - stewardship.

50:30 - Of the shareholders assets.

50:32 - Rather than market.

50:33 - For frivolities.

50:35 - It stands for sound

50:36 - investment policies.

50:38 - It stands stands for

50:39 - good human values

50:41 - and.

50:42 - And if

50:43 - what I said in the speech.

50:45 - Was I think it is a company.

50:48 - Of the investor.

50:49 - For the investor.

50:51 - And by the investor.

50:52 - I said in that talk.

50:55 - Quoting from.

50:56 - The great mister Lincoln.

50:59 - Accompany it's name because

51:00 - of the investor body investor.

51:02 - And for the investor

51:03 - as long as it does that it

51:04 - shall not perish from the earth.

51:06 - So I I think people look

51:07 - at it pretty much that way

51:09 - I know I know that people aren't

51:11 - making it up when they tell me.

51:12 - That this company has a

51:13 - huge amount of respect.

51:15 - Not so much the company

51:16 - amount of what a company is

51:17 - but the values we stand for four

51:19 - have a huge amount of respect.

51:21 - And as long as we keep

51:22 - those investment idea is

51:23 - simple investment

51:24 - ideas like indexing.

51:27 - Keep costs low

51:28 - because that's the mix.

51:30 - As an example I gave you shows.

51:32 - It makes a huge difference.

51:34 - And.

51:35 - Keep

51:35 - feeling

51:36 - that everybody in this place

51:38 - is an important human being.

51:40 - Whether he has the humblest job

51:41 - or she has the humblest job here

51:43 - to the highest.

51:44 - And I just hope those values.

51:46 - Will

51:47 - will stay.

51:48 - For as long as I live

51:49 - and a lot beyond that.

51:52 - You've written.

51:54 - Several books.

51:56 - Give a lot of speeches

51:58 - were here.

51:59 - Interviewing you.

52:01 - At.

52:02 - Your office and the vanguard.

52:03 - Complex.

52:07 - What do you enjoy most.

52:09 - Right now.

52:13 - The only honest

52:13 - answer to that is.

52:15 - I enjoy

52:16 - everything.

52:18 - I enjoy seeing my

52:19 - wife in the morning.

52:21 - I enjoy my breakfast

52:22 - particular if I can have

52:23 - eggs and bacon

52:24 - which I do only rarely.

52:26 - I enjoy the give and take during

52:28 - the day I enjoy

52:29 - the phone ringing.

52:30 - I enjoy the pressure

52:31 - of trying to get

52:32 - speech a out while i'm

52:33 - still thinking about speech b.

52:35 - I enjoy working with

52:35 - my little tiny staff.

52:37 - At this unit a

52:37 - vanguard be called

52:38 - bogle financial

52:39 - market research center.

52:41 - I enjoy getting out I was all a

52:42 - whole lot of brass in new York.

52:44 - And

52:45 - and they're fun people some of

52:46 - them are really

52:47 - pretty decent people.

52:49 - And

52:49 - I really enjoy.

52:51 - The two missions and I'm on now

52:53 - at the stage of my life.

52:55 - Want US to make

52:56 - this a better world

52:57 - for mutual fund shareholders.

52:59 - Shape up this industry which has

53:00 - gone so far down the wrong road.

53:04 - And to.

53:05 - To make the American

53:06 - capitalistic system

53:07 - a better system

53:08 - we've gone down the wrong

53:09 - road and corporate governance.

53:12 - Are too many

53:12 - unethical things that

53:13 - are done too many

53:14 - self serving things

53:15 - too much comp

53:16 - compensation for people who

53:18 - makes too small a contribution

53:20 - to the wellbeing of the economy.

53:21 - So.

53:23 - And right now corporate

53:24 - governance that

53:24 - kind of thing is in

53:25 - the forefront and I've

53:26 - been speaking about it for.

53:27 - Probably as long as anybody.

53:30 - For five years I have speeches

53:31 - going back talking about.

53:33 - The problems with the

53:34 - financial markets and

53:35 - how they relate to

53:36 - corporate governance.

53:37 - And.

53:39 - It's it's always been

53:40 - pretty easy for me to

53:41 - think way ahead of

53:41 - where other people are.

53:43 - Now not.

53:44 - Not.

53:45 - Because I have

53:46 - any magical insight.

53:47 - But because it's all.

53:49 - Common

53:50 - sense.

53:51 - If things are being done wrong

53:53 - it's only a matter of

53:55 - time until you get the

53:57 - day of retribution it

53:58 - may be a long time.

53:58 - But the idea of it all as I

53:59 - said in another speech.

54:01 - Bill is.

54:02 - The idea is to be on

54:03 - the right side of history.

54:05 - And.

54:06 - It's pretty easy

54:06 - to be on the right

54:07 - side of history

54:08 - mean do we think.

54:09 - For example that

54:09 - corporate governance is

54:11 - going back to be

54:11 - dictated by his imperial

54:12 - chief executives

54:14 - who are grossly overcompensated.

54:17 - By auditors.

54:18 - Who aren't performing

54:19 - the auditing function

54:20 - we can go back to those days

54:22 - that is not

54:22 - going to happen.

54:24 - And simply not going to happen

54:27 - and it's

54:27 - this focus of.

54:29 - Placing less emphasis which

54:30 - we do on the financial markets.

54:32 - On the momentary

54:33 - but precise.

54:35 - Price of a stock.

54:37 - Compared to the

54:38 - eternal vagueness.

54:39 - Of the value of a corporation.

54:41 - What we're going to

54:42 - have to wean ourselves

54:43 - away from that

54:44 - we've had the boom.

54:45 - And we've had the bust.

54:46 - And that we will learn

54:47 - from that as a society.

54:49 - I'm fond of quoting

54:50 - sir Isaac Newton every

54:51 - action has an equal

54:51 - and opposite reaction.

54:53 - Third law of motion.

54:55 - And.

54:57 - There's a big reaction in the

54:58 - financial markets a big reaction

55:00 - coming in the

55:00 - mutual fund industry

55:02 - and we'll get it right or at

55:03 - least closer to right this time.

55:04 - So it's it's great to be

55:06 - basically on a crusade

55:07 - and I believe every

55:08 - word I'm saying

55:09 - about it too.

55:11 - What two.

55:13 - Awards mean to

55:14 - you you've gotten a lot

55:15 - of boards.

55:17 - For the last several years

55:19 - I know I I can't do much

55:20 - better than this

55:21 - that's very nice.

55:22 - You know I've gotten I think

55:24 - six six honorary degrees.

55:26 - And I guess quite a few awards

55:27 - I certainly don't count them

55:30 - and.

55:31 - I don't need them to survive.

55:34 - But it's.

55:35 - It's nice to get a

55:36 - little recognition.

55:38 - And some of them are really

55:39 - quite remarkable

55:40 - recognition in in.

55:41 - In in areas that I think are.

55:44 - Think maybe there.

55:47 - Greatly overrating.

55:49 - My abilities.

55:50 - And

55:50 - I'm a very average person.

55:53 - I think I have a little

55:54 - bit above average

55:55 - intelligence but I mean

55:55 - I'm sometimes with

55:56 - giants.

55:57 - And I find it a little humbling.

55:59 - But I try and stay

56:00 - toe-to-toe with them.

56:02 - And.

56:03 - I don't push me.

56:05 - Push my luck too far

56:06 - but.

56:07 - It's it's nice and

56:07 - you really can't if

56:08 - if if someone wants to

56:10 - give you an award you

56:11 - can't say no I mean I

56:11 - know how to do that.

56:12 - Your college is big

56:13 - enough for me to

56:14 - accept your honorary degree

56:15 - or something that seems.

56:17 - Not the right thing to do.

56:18 - So.

56:20 - Sometimes I can't do it or

56:21 - doesn't see I'm appropriate I.

56:23 - Know I wouldn't

56:23 - want to get an honored

56:24 - be an honor from an

56:25 - organization I know you

56:26 - can do with for example.

56:28 - But if it's something

56:29 - financial or

56:30 - something like that

56:30 - I'm happy to do it.

56:32 - When you look back.

56:34 - At the thesis that

56:35 - the twenty one year old I

56:36 - guess that wrote the thesis.

56:38 - What did he know.

56:41 - Not much.

56:43 - But a lot of common sense.

56:45 - I mean that thesis says.

56:47 - Mutual funds.

56:48 - Should be.

56:50 - The responsibility of

56:51 - mutual funds is to serve

56:53 - to serve individual

56:54 - investors and

56:54 - institutional investors

56:55 - no one even thought of

56:56 - institutional investors in those

56:57 - days that in itself was dense.

56:59 - And serve them in most

57:00 - honest.

57:01 - Efficient

57:02 - and economical way possible

57:03 - that's an exact

57:04 - quote from the thesis.

57:05 - While you can say that's

57:06 - a design for vanguard.

57:08 - And in a way it is

57:10 - you can also say it's

57:11 - exactly the kind of callow

57:12 - idealism.

57:14 - That college

57:15 - juniors and seniors

57:15 - have been expressing

57:17 - since the beginning of time

57:18 - and that's equally true.

57:19 - So I dunno where the

57:20 - two of them get together

57:22 - but one of the

57:22 - most if not the only

57:24 - really accurate thing

57:25 - I sometimes think.

57:26 - It's ever been said about me.

57:28 - Is

57:29 - he has an extraordinary ability.

57:32 - An uncanny ability is

57:33 - the way this quote went.

57:35 - On uncanny ability.

57:37 - To recognize.

57:39 - The obvious.

57:41 - Think about that.

57:42 - Because the obvious

57:43 - by definition is something

57:45 - that takes no ability

57:45 - at all to recognize.

57:46 - So it's a wonderfully ironic

57:48 - sentence and I think quite true

57:50 - because.

57:50 - You know

57:51 - common sense.

57:52 - Which is the title

57:53 - of one of my books.

57:54 - Is.

57:56 - All about things we know to be

57:57 - true but don't

57:58 - want to recognize.

58:00 - The gross return in the

58:01 - market is not

58:01 - what investors get.

58:03 - They get the net return

58:04 - after cost and from that.

58:05 - And you've compounded

58:06 - over time a multitude.

58:08 - A multitude of economic

58:09 - investment.

58:10 - At truth come out

58:12 - if that's the case.

58:13 - The average manager

58:14 - not won't win.

58:15 - The average manager.

58:17 - Not only

58:17 - can't win.

58:19 - We actually know how much

58:20 - the average

58:20 - manager will lose by.

58:22 - The amount of those costs.

58:23 - There's no

58:24 - way

58:25 - around that it's like

58:26 - the gambling casino.

58:27 - At beating the stock market

58:29 - is a loser's game.

58:30 - Because of the croupiers

58:31 - and the financial system.

58:33 - Beating like

58:34 - the gambling system

58:35 - it'd be in the casino.

58:37 - Is

58:37 - a zero sum game.

58:39 - Until the croupier rake descends

58:42 - and then going to the

58:43 - casino as a loser's game

58:44 - this is not complicated.

58:46 - And and the other side

58:47 - of it is the human values.

58:49 - And that is which

58:49 - can easily be summed

58:50 - up with something

58:51 - that I did not say

58:52 - and the first instance

58:54 - and it's do unto others as you

58:55 - would have them do unto you.

58:57 - Now what could

58:58 - be simpler than that.

58:59 - The investment idea

59:01 - and the human idea.

59:03 - John

59:04 - Clifton bogle

59:05 - founder

59:06 - of the vanguard group

59:07 - on it thank you very

59:08 - much for your time.

59:09 - I've enjoyed it.