1999 Hall of Fame

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Induction Speech for John C. Bogle

Inducted November, 1999

Immediate Past-President Lawrence W.D. Taylor presented FIASI’s Hall of Fame award to John C. Bogle. Mr. Taylor’s introductory remarks follows.

Joe’s discussion of FIASI and the purpose of the Hall of Fame award, which recognizes lifetime achievement relating to the fixed income business, are quite fitting. And the diversity of tonight’s two inductees’ contribution helps to highlight the breadth of what the board has attempted to encompass.

Dick Wilson has been a consummate practitioner, and indeed he is in fact one of the people who deserves credit for helping to invent much of what we all take for granted as fixed income practice today.

At the other end of the spectrum, our first inductee tonight, John C. Bogle, helped define and change the structure and framework of the fixed income investment management business through the development of the mutual fund side of the business.

Jack wrote his senior thesis on the mutual fund industry at Princeton in 1951. He then turned his life’s work into a series of roles as an architect of growth and prosperity at various mutual fund firms, starting with Wellington Management, one of the pioneers of open end mutual funds. In mid-1975, Jack founded Vanguard, with 8 mutual funds. Vanguard has grown to become one of the dominant forces in the mutual fund industry with over $500 billion in assets under management. Vanguard has also been a pioneering firm in terms of low costs, indexing, and governance. Jack’s tireless innovation has helped the mutual fund industry grow to become a major pillar of the money management business.

However, Jack’s connection with fixed income goes far beyond just his contribution to the overall mutual fund industry. Jack has always had a conservative streak. He has been a long-term advocate of balanced funds, balancing both stocks and bonds. And he has used metaphors as colorful as auto accidents at various speeds to describe risk.

In addition, Jack helped to pioneer some of the first bond funds in 1970 at Wellington. At the time, bonds were viewed as old fashioned, and many people did not believe that there was a place for a pure bond fund. An Institutional Investor magazine cover of the era depicted a dinosaur when describing bonds. Back then there were something like 10 bond funds. Luckily for us, Jack persevered. Today there are thousands of bond funds.

In addition, Jack was instrumental in the development of several concepts we take for granted as part of the industry fabric today. In the mid-1970s, Jack helped pioneer the differentiation of bond funds by maturity, a simple, but important concept which connects investor risk and objectives with fund structure today. By segmenting bond funds into long term, short term and intermediate term, Jack helped investors define and measure risk.

Intellectual curiosity, innovation and an independent spirit have all been hallmarks of a long and extremely successful career. And Jack has become one of the most articulate and thoughtful spokesmen for the investment management business today. All of us look forward to many more years of Jack’s ideas and opinions.

It gives me great pleasure on behalf of the FIASI board and membership to induct John C. Bogle into the Fixed Income Analyst Society's Hall of Fame.

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