Mind-Bogle-ing Changes at Vanguard

Memo to Vanguard: Have you lost your minds? You can't kick John Bogle off the board like he's just some sort of old guy that needs to be sent to the mutual fund pasture. Tell me this is all a big practical joke, some sort of publicity stunt ... a surprise for Jack's 70th birthday, maybe?

Bogle's my hero. I have said it to him, I have said it to my dad and I am saying it to you. (We are all from Philadelphia, where Bogle is revered as a sort of Lou Gehrig figure.) Bogle stands for one thing: value for shareholders. He is anti-fee. He is pro-consumer. He is the Diogenes of our business. He is the only person willing to speak freely about how mutual funds routinely overcharge people and don't give you value vs. the index funds.

(Disclosure: A little while back, Bogle's book publisher asked me for a blurb for his new book about the power of index funds, Common Sense on Mutual Funds. I said I had to read it first because I couldn't check off on something I hadn't read.

(I had problems with the draft I saw. I didn't think it was as compelling as it should have been, and I suggested some changes. Jack and his publisher agreed. Bogle didn't want me saying I loved a book if I didn't. The changes were made. I wholeheartedly endorsed the final version, and it is a must-read book for people who are trying to uncover the truth about active vs. index managers.)

This is one of those decisions that can and must be reversed if Vanguard is to maintain the love and affection it has earned over the years from all of its adherents, including my family. (I know that I am going to urge my dad to pull out our money from Vanguard if Jack's not back, pronto.)

Ostensibly, Jack's been given his walking papers because he is 70. But anybody who has worked or talked with him lately knows that, since his successful heart transplant three years ago, this man is fired up and ready, with the sharpest mind in the business. I am sure that the subtext here is that Jack was standing up for the shareholders against other managers who wanted to make more money for themselves.

Someone made a mistake here. Stand up, apologize and let Jack go back to work. It's never too late to admit you were wrong.

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