Knut Rostad's New Book Celebrates Bogle

January 31, 2014 Yes, Jack Bogle has had a really good relationship with reporters, hasn’t he?

Rostad: I think he’s had a superb relationship. And it’s based on a huge part of what Jack Bogle represents, and who Jack Bogle is. And that is, in my view, speaking plainly and clearly and honestly and to the best of his ability about the matters at hand. And I think this also goes back to Roosevelt in terms of both his ability and appreciation for speaking clearly and plainly and honestly to the American people. One of the things that I find interesting about Jack Bogle’s interest and admiration for TR is that in some sense, there’s a real similarity between the two of them insofar as they both represented a threat to the way things had been done.

Rostad: Absolutely. Going back to TR, the first episode in terms of politics was when he was in his mid-20s and he went up to Albany; what did he immediately try to do? He tried to reform, he tried to change. That was clearly his gut instinct.

And in the same way, Jack Bogle’s entire being in the mutual fund industry was as a reformer in the sense of bringing to the marketplace a company that was unlike any company before it, in terms of Vanguard, in terms of its operating premise and then his signature product, the index fund. Those at their core were huge changes, and I think are clearly the anchor of his legacy. Yes, I think the parallels there are strong. Obviously, there were dark days at Vanguard. What is your sense about when the corner was turned at Vanguard?

Rostad: Right now, we can look backward and say of course it was obvious what would happen, but I don’t think that’s the case if you put yourself in Vanguard’s place in the first 10 to 15 years. If you just look at the asset flows, it’s only in the more recent years—20 years, plus or minus—where you could actually say that the market was really beginning to move and that there was a certain momentum.

So I think at the outset it wasn’t at all clear that it was going to be the smashing success that it has been, and that it took several years before that sense truly developed, that this was not just an experiment. We smile when we are reminded that at the outset this was called un-American.



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