In a long and storied career, John Bogle upset many titans of Wall Street by his harsh rebuke of investing greed and waste. And yet he emerged as one of the most highly respected voices of finance. He invented the “index fund”, which merely attains the stock market average—an idea for which he was widely ridiculed. But Jack Bogle was undeterred, having realized as a college undergraduate that most mutual fund managers underperform even the average. So with little effort (and therefore low expenses) his method has become the core strategy for most people who wish to grow their savings. Even super-investor Warren Buffett announced that upon his death, almost all of his billions will be deposited in an index fund. Vanguard, the investing firm Bogle founded in 1974, now manages trillions of dollars in assets, primarily through this deceptively simple technique. And in his gentlemanly manner as heard in this episode of Humankind, Bogle offers a devastating critique of high finance. After a long battle with heart disease, John C. Bogle passed away in 2019 at age 89.
We have a misshapen financial system, where the rewards are grotesquely disproportionate to the contribution to their society. So you could argue, and I think probably successfully argue, that much of what goes on—you could even say most of what goes on—in finance is a waste of the nation’s resources. It is a value-consuming, rather than value-adding business.”
—John C. Bogle, Founder of Vanguard