Acquired
00:05:29 · David Rosenthal, Ben Gilbert
[00:05:29] S1: Oh, alright. Well, we start. In May 1929, on the eve of the great Wall Street crash of October nineteen twenty nine that would throw America and the world into the Great Depression, wipe out millions of family savings, ruin countless lives, forever scar an entire generation. We we don't often talk about the Great Depression on acquired. It was truly horrible. I mean, the financial crisis was quaint compared to this. 9,000 banks failed after the Wall Street crash of nineteen twenty nine. 9,000,000 individual family savings accounts were wiped out. Almost a 100,000 businesses failed. Unemployment reached 25, and it truly did scar an entire generation. I mean, I remember my grandparents still, like, into the nineteen nineties doing absolutely insane things because of their experience during the depression. My my dad's mom never threw out a plastic bag in her entire life. When she [00:06:32] S0: died and we cleaned out her condo, it was, like, full of tens of thousands of plastic bags. My grandpa was magazines and Tums containers. Containers. We We found found just overflowing amounts in his basement. But the crazy thing about this, David, is back then, only one to 2% of Americans owned stocks. Yes. So all of these things were second order effects from the crash, from the banks being deeply intertwined, a lot of leverage on all these equities. It wasn't like, oh, I own a bunch of stocks and those stocks crashed, so my life is over. It is the giant interrelated ripples and no safeguards in the economy at that time.
00:07:10 · David Rosenthal
[00:07:10] S1: Yep. Exactly. It was the bank failures. It was the businesses going under. It was unemployment. It was everything. But on the eve of this great financial calamity, our hero and a financial hero to many is born, John Clifton Jack Bogle. And he's born here in May 1929 as one of two twin boys, along with his twin, David. And together with their older brother, Bud, they form the Bogle Boys, as they would be known throughout the rest of their youth and indeed the rest of their lives. Now, Jack and David, here at the time of their birth, are born into a prominent New Jersey family. Their great grandfather had founded a mutual fire insurance company. Nice foreshadowing there with founding Mutual. Mutually owned company as Vanguard would go on to be. And their grandfather had then founded a company which would go on to become part of the American Can Company, which manufactured tin cans and was one of the largest companies in America for a long time. So it's like a a prosperous, well-to-do, well respected family that they are born into. But during their early childhood here in the depression, the family loses everything. Their dad becomes an alcoholic, divorces their mom, abandons the family, runs off, basically ends up dying alone on a street corner years later. Their mother, as you can imagine, is equally scarred from all this, suffers from severe depression, mental health issues, isn't able to provide for the boys. And so the Boko boys, basically, from the time they're kids, like, before they're teenagers, they're kinda left to fend for themselves in the world. So all three of them work several concurrent jobs while they're growing up and going through school. I mean, we're talking, like, paper routes, food service jobs, restaurants, manual labor, like, anything that they can do to support themselves and their mom. Jack would talk about how the best job that he ever had as a kid was a 3AM paper route that he had because the world was quiet and peaceful in the middle of the night, and he could escape the chaos and strife all around him. As he liked to say, it was a contrast to the rest of my life growing up. And you got all this
00:09:42 · Ben Gilbert, David Rosenthal
[00:09:42] S0: from talking with Jack's kids. Right? [00:09:43] S1: Yeah. Yeah. I spoke to several members of the Bogle family for research, and, I mean, this story is just incredible. [00:09:50] S0: Yeah. It's interesting because kinda through his last name and his great grandfather and his grandfather, they had this sort of family network where they were in high society, and he knew other well-to-do kids. But, personally, their family's wealth and relationships were kinda in shambles.
00:10:10 · David Rosenthal
[00:10:10] S1: They're both insiders and outsiders at the same time. So as the boys get older and they enter high school, again, the family no longer has any money, but they do still have these connections and relatives and friends who have resources. And so they managed to get all of the boys scholarships to go to Blair Academy, one of the sort of prestigious East Coast boarding schools for their junior and senior years of high school. And Jack, especially, just, like, flourishes at Blair. He becomes a fantastic student. He graduates cum laude. He gets voted both best student and most likely to succeed by his classmates at graduation. Obviously, he's going places. Yep. Now there's just one problem, though, as Jack and David are approaching graduation. The boys in the family still have no money even though they've gone to this, you know, prestigious boarding school that they're gonna graduate from. And they all need to keep working both to support themselves and, you know, their mother who's still alive. So the three of them get together and decide that, hey. Because of our situation, only one of us should actually go to college, and the other two need to keep working and providing for the family. And because Jack has been so successful at Blair and is such a good student, he gets chosen as the one of the brothers that's gonna get to go to college. And Jack would say that, like, the weight of that decision just rested on him for the whole rest of his life. Like, he alone was given this chance to do something bigger, and he felt like a tremendous obligation to make good to his family on this opportunity. And the other two never go to college. I mean, all three of them remain close, but David and Bud never go to college.
00:11:57 · Ben Gilbert, David Rosenthal
[00:11:57] S0: And it's funny listeners, David, you're referencing the things that Jack would say. It is incredibly easy to find Jack's words everywhere. There is no shortage of commentary that Jack would give on his own life, on his philosophies. The man gave thousands of speeches. He wrote memoirs. He wrote 12 books, investment advice, reflections back on Vanguard. He would go on TV and talk to journalists and speak in classes anytime anyone would have him. So there is no gaps in the historical record Yeah. Of Jack's life. [00:12:30] S1: Of Jack's memory. Yeah. Jack loved nothing more than to give a speech. So after graduation from Blair, Jack goes on to college at Princeton. Once again, on a work scholarship, he's working in, like, the dining halls. He ends up working in the ticketing office for athletic events and football games. And while he's at Princeton, he becomes fascinated with economics after he takes a intro econ course in the fall of his sophomore year, during which he gets a d plus on the midterm, an inauspicious beginning to his finance career. Yeah. But he loves it. He works hard. He finishes with a c minus in the class. Incredible for, like, you know, the guy who would go on to revolutionize all of finance. Yep. So the next year, during Jack's junior year at Princeton, he's decided that he's gonna major in economics or concentrate in Princeton's, you know, fancy terms. You know, majors. You have concentrations. Really? And yeah. Yeah. Really. [00:13:28] S0: Just every every day, I learn one more quirky little Princeton thing.
00:13:28 · Ben Gilbert, David Rosenthal
[00:13:28] S0: Just every every day, I learn one more quirky little Princeton thing. [00:13:31] S1: I know. I'm sorry. I'm sorry. I, of course, went to Princeton, so I went through all this. And, specifically, I also went through the rite of passage that Jack has to go through, which is he needs to write a senior thesis. So one of the hallmarks of Princeton is that every single undergraduate must write a senior thesis, which must be a unique piece of scholarly research in order to graduate. It's it's like a mini version, a very, very mini version of what you would do as a PhD. Mine, of course, was on the marketing history of champagne, being a French literature major. [00:14:08] S0: Which is so funny for Acquired. Like, it's actually very useful for us in the LVMH episode. [00:14:13] S1: Incredibly useful. There you go. David Rosenthal, Jack Bogle, you know, the connection's bound. [00:14:18] S0: Okay. Continue the story.