Rex Sinquefield
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| Rex Sinquefield | |
 Rex Sinquefield
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| Born | Saint Louis, United States |
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| Alma mater | University of Chicago |
| Occupation | Co-founder, Dimensional Fund Advisors Show-Me Institute |
Rex Sinquefield, 62, was the co-founder of Dimensional Fund Advisors and was its co-chairman until his retirement in 2005. In the 1970s, he did influential research on historical stock market returns and pioneered many of the nation's first index funds. He was the author, with Yale School of Management professor, Roger G. Ibbotson, of Stocks, Bonds, Bills and Inflation, at the time, the most comprehensive empirical study of stock market returns.
Since 2003, he has served as a member of the editorial board of the Financial Analysts Journal. Sinquefield is a director of St. Vincent Orphan's Home in St. Louis, a member of the investment committee of the Archdiocese of St. Louis, and a life trustee of DePaul University. He serves on the boards of the St. Louis Symphony Orchestra, the St. Louis Art Museum, and the Missouri Botanical Garden. He received his MBA from the University of Chicago in 1972 and his B.S. in 1967 from St. Louis University, where he is a member of the board of trustees. He founded and serves as the president of the Show-Me Institute, a public policy research organization based in St. Louis.
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[edit] Raised in Orphanage
Sinquefield’s rags-to-riches life is one of his attractions. Born in St. Louis, he spent six years in St. Vincent’s orphanage — roughly ages 8 to 14 — before reuniting with his widowed mother and older sisters. He graduated from Bishop DuBourg High School near St. Louis Hills. Sinquefield attended Cardinal Glennon Seminary for three years before deciding the religious life was not for him. “I was studying to be a bishop. They said, ‘Wait a minute, you have to be a priest first,’ ” Sinquefield recalled with a chuckle. He transferred to St. Louis University, graduating in 1967 with a business degree. In 1968, at the height of the Vietnam War, Sinquefield was drafted into the Army. But instead of being sent overseas, he was placed in the finance corps based at Fort Riley, Kan. After a two-year military stint, Sinquefield worked for banks in St. Louis and Chicago, the latter while also acquiring an MBA at the University of Chicago. He spent nine years with the American National Bank of Chicago, working his way up to be the head of its investment section and later, the trust department. His love of investing prompted Sinquefield to leave the bank in 1981 to co-found Dimensional Fund Advisors with business partner David Booth. The firm quickly grew, and now employs 330 people worldwide. In 2006, it managed at least $138 billion in funds. A spokeswoman confirmed that the firm’s owners include employees, board members and 28 outside investors, including California Gov. Arnold Schwarzenegger. Long based in Santa Monica, Calif. — which Sinquefield dubs "Soviet Monica" because of its high taxes — the firm now is relocating its headquarters to Austin, Texas. The draw: Texas doesn’t have an income tax. [1]
[edit] Income Tax Battle
Two years ago, Sinquefield retired from the firm to pursue his political and personal passions. His mantra, which he preaches to everyone he meets, is that state income taxes hurt job growth and economic prosperity. He makes the same argument about the earnings taxes levied by the cities of St. Louis and Kansas City and the minimum wage . In the case of state income taxes, Sinquefield points to the rapid growth experienced the nine states — including Florida, New Hampshire and Washington — that don’t impose an income tax. The state income comes from other taxes, such as sales taxes. “The absence of that (income) tax is a powerful magnet,’’ Sinquefield said. He also seeks constitutional restrictions on state spending. But Kottmeyer asserts that eliminating Missouri’s income tax is “a dangerous idea for the state’s economy. It’s a giant tax break for the rich and a giant tax hike for consumers’’ who would be saddled with higher sales taxes. As for St. Louis’ earnings tax, Sinquefield proposes replacing it with a land tax that would be separate from a property tax. He notes that many city officials and corporate executives are looking for alternatives to the earnings tax. On the education front, Sinquefield is among several institute board members who have intervened in court against the 250-plus Missouri public school districts who are suing for changes in the state’s aid-allocation formula. The Show-Me Institute has issued studies that generally agree with Sinquefield’s views. But the experts who conduct the studies say he wielded no undue influence. “I have dealt with people who tried to direct research once they’ve commissioned a report from me,’’ said Joseph Haslag, an economics professor at the University of Missouri-Columbia who has conducted several studies for the institute. “My relationship with the Show-Me Institute and Rex has been the exact opposite.’’ Among Sinquefield’s disappointments was last year’s overwhelming statewide vote in favor of Proposition B, which increased Missouri’s minimum wage to $6.50 an hour, up from $5.15. He agrees with business groups that particularly oppose the measure’s mandate of annual cost-of-living increases, which Sinquefield contends will cost jobs. Kottmeyer advised the groups in favor of Proposition B, and says last fall’s results were evidence that Missouri voters disagree with Sinquefield’s views. “Rex has certainly got an agenda that has been rejected by a majority of Missourians,’’ he said. Sinquefield replied that when it comes to a minimum wage, “Some things have common sense appeal, but they’re just wrong. [1]
[edit] Known for chess, charm
Sinquefield’s passion for government change is softened by what even his critics describe as charm and compassion. Holden, for example, said Sinquefield offered one of the buildings on his estate for a Holden family reunion held when the former governor’s mother was gravely ill. And Sinquefield and his staff emphasize that he’s donating far more money to other personal passions besides politics, such as the symphony, St. Vincent’s and after-school programs for the urban poor. A chess fanatic, Sinquefield is offering to start and bankroll a regionwide chess program for children. He’s also honing his own chess skills to return to the tournament circuit. Sinquefield often plays chess online with other chess experts, in games that can take days for a single move. He appears to be adopting the same methodical, patient approach to state and local government. Sinquefield said he recognizes that it may take years for his vision to take hold. But he also is upfront about his political expectations. Sinquefield acknowledges that he’s willing to pour millions of dollars into the campaigns of like-minded politicians. But he added that he’ll contribute to campaigns only “as long as it advances this agenda.” “If it doesn’t,” Sinquefield said with a smile, “I won’t.” [1]
[edit] References
[edit] External links
- An interview with Rex Sinquefield explaining the investment philosophy he pioneered.
- An article on Sinquefield's receipt of the 1999 Distinguished Entrepreneurial Alumni award from the University of Chicago graduate school of business.
- Fortune article on Sinquefield's investment predictions.
- Home page of the Show-Me Institute, where Sinquefield now serves as president.
- Article on Sinquefield's political activities in Missouri.
