Mr. Price in his seventies was still full of ideas. He enjoyed watching his forecasts of the runaway inflation begin to come true and basked in the resulting good performance of the New Era Fund, the even better results of his own model inflation fund, and the increasing income his conservative portfolio was generating. But he couldn't stay silently on the sidelines. The enjoyment for him was the challenge of new investment concepts. Once a new strategy was proven, it was time to move on.

As his health had returned, there were vexing ideas and advice still to be passed on by the Cheshire Cat. It was impossible for him to stop thinking about the world of investing, which had been his life's fascination and his occupation for more than fifty years. A little more than a year after his official retirement in 1972, he wrote Charlie Shaeffer a letter, with a bulletin attached called “The New Era for Bond Investors.” In it, he pointed out that the accelerating inflation he had forecast would have a profound effect on bonds as well as stocks:

1. It [inflation] significantly reduces the proceeds on both income and principal. A 5 percent inflation rate, for example, would reduce the purchasing power of today's dollar by 39 percent in 10 years and at the end of 30 years, it would be down 77 percent. The money supply (M2) in early 1972 was increasing at an 11% (annual) rate.
2. The United States government was generating a deficit that was increasing. In addition, many states and local governments were near insolvency and heavily dependent on taxes to stay afloat. The tax burden of United States citizens was bound to increase.
3. When the money supply and interest rates are controlled by the government, the old economic laws no longer apply [also very true today]. Normally, interest rates rise and bond prices fall when the economy is booming. On the other hand, when the economy is in the doldrums, interest rates fall as demand for credit declines. In this environment, bond prices rise. This normal fluctuation in the price of bonds allows investors to efficiently manage their bond portfolios. In recent years, however, bond prices continue to decline simply due to the accelerating government‐created inflation, without regard to the economy. Long‐term bonds not only lost money for investors, due to the decline in the purchasing power of the dollar, but also because of their greatly increased supply. Tax‐exempt bonds with a 20‐year maturity dropped 37 percent from August 1, 1968 to May 1970. Corporate long‐term bonds suffered even worse, declining 53 percent over the same time period. Bonds, in other words, were behaving like stocks in this new era. Clearly, bond portfolios could no longer be put away and forgotten as they had in the past. In this new environment bonds must be intensively managed.
4. Bonds and fixed income securities remain an important component of investment portfolios, despite their poor recent performance. Bonds are needed by investors to pay regular income and to pay living expenses. For institutional investors, the yield from bonds is required to pay operating expenses. In 1972, the yield on tax‐free bonds was more than five percent, when the yield on large growth stocks was only one percent. Bonds, therefore, yielded more than five times the yield of stocks. For investors who were in a 50‐percent tax bracket this increased to seven times.

To effectively manage bonds in this new era Mr. Price suggested that much more attention be paid to maturity schedules, with continued trading necessary to keep maturity schedules short and losses to a minimum. In addition, more research was required, particularly in the important tax‐free area, given the declining financial health of states and municipalities. As he said in “The New Era for Bond Investors,” “Investors should place much less emphasis on past and current credit ratings.”

Up until this time, the firm had not actively managed their clients' fixed income portfolios. If such a portfolio was quite large, as it might be for a pension fund, it was typically turned over to a bank trust department to maintain. For most clients, the firm had simply followed the normal path, at the time, of staggering maturities of bonds so that the risk of loss was minimized. (When a bond portfolio is staggered, the portfolio is divided into, perhaps, four parts. Each part is invested in comparable bonds, but with a different maturity – such as two, five, seven, and ten years. This reduces the risk of interest changes and balances the yield between the higher long‐term rate and the lower short‐term rates. Unfortunately, it doesn't work well in the environment of accelerating inflation that the firm and its clients found themselves in during the 1970s.)

After carefully reviewing Mr. Price's memo, Charlie agreed. Mr. Price had once more provided the firm with an important new business opportunity. Carter (Toby) O. Hoffman, who had joined the firm in 1961, was then acting informally as the head of what would become the Fixed Income Department, giving advice on this investment area to the other counselors. He came to the firm with a background in accounting and was able to thoroughly analyze a balance sheet or a report by a municipality to determine whether the bond might be indeed repaid at maturity, the most important consideration in buying any bond. His analysis was considered, in‐house, to be more reliable than the more superficial credit ratings provided by Standard & Poor's Financial Services, Moody's Investors Service, or Fitch Group. Toby, however, was primarily a counselor, with a number of large clients. As bond performance became more important, Toby could not manage both his own clients and the firm's bond portfolios. When approached by Charlie to be the leader of the new Fixed Income Department, he chose to remain as a counselor. The firm went on a search for a bond manager.

The field of fixed income was and is much larger than the equity market. A bond department would have the potential of adding a significant new earnings center for the firm and, at the same time, help existing clients. Active management of client bond portfolios would protect and enhance the return from client's fixed income portfolios, particularly in the current economic environment. Skillful trading could also produce significant additional capital returns.

Because it had provided little real management of client's fixed income accounts, the firm had not charged much in the past for administering and managing them. A reasonable fee for active bond management could easily be justified in this new volatile environment. There was also the opportunity to create specialized bond funds for both individuals and pension funds.

In the stock market, commissions and trading profits by 1970 were razor thin, prices were publicly available, and commission schedules were published. Bond trading, however, took place in a freewheeling over‐the‐counter market where spreads could be relatively wide. Traders often were a bit “careless” in their pricing of bonds, and there was no central market to determine accurate current prices, such as existed for stocks on the New York Stock Exchange. Innocent amateurs were often eaten alive by professional Wall Street bond traders. Even today, there is still no central bond exchange where prices are openly quoted and bids and offers are transparent. Tom Wolfe gives an entertaining portrayal of this market in his 1987 book, The Bonfire of the Vanities. Michael Lewis was hired as a bond salesman at Salomon Brothers, fresh out of Princeton, and his Liar's Poker, published in 1989, is more accurate and gives a lively, nonfictional account of the bond trading market and some of the characters that populated it almost thirty years ago. That market is not as flamboyant today, and profit margins have narrowed significantly, but on occasion, like the recent bust in 2008, it can seem like the Wild West again.

Right in Baltimore, Charlie and Toby found their person, George J. Collins, to run the bond department. He was working for a large local insurance company, the United States Fidelity and Guaranty Company. Thirty years old, he had started his career as a catcher for a semiprofessional baseball team, but left when he decided he had no chance to rise to the major leagues. After a four‐year career in the Air Force and a one‐year stint as an analyst at a small local brokerage firm, he had joined USF&G as a trader in the bond department. He had done very well in that hectic, competitive world. After three years, he was considering more lucrative offers from Wall Street when he was approached by T. Rowe Price Associates. The opportunity to build an entirely new business in fixed income from the ground up won him over, despite the firm's comparatively modest compensation strategy. He joined in 1971.

Mr. Price was involved in the search process. He met George before he was hired and took an instant liking to him. He wrote to Charlie, “I have had several talks with George and think he is an outstanding bond man and is doing an excellent job. I hope his department will be enlarged, so that the firm will become expert in this important field.” He and George subsequently established a very comfortable personal and working relationship, which was rare for Mr. Price – but then maybe he was getting a little older and more relaxed in retirement. Plus, George's knowledge of Mr. Price's personal holdings, relatively obscure bonds, cemented their relationship.

Initially, George's blunt manner and manic pace mystified many in the T. Rowe Price organization. He was isolated with his credit analysts and traders on a different floor with what George claimed were World War I desk chairs and Civil War desks left by Union soldiers when they departed Baltimore. He had a view across a narrow alley to a brick wall.

The bond world is indeed very different from that of equities, but George's success began to win converts. His first major account came at the end of 1972, when he secured the bond portfolio of Northwestern Bell's pension fund. It began as a $25 million account, not to be sneezed at even in those days of larger and larger accounts. The bond portfolio of the Baltimore County pension fund came soon afterward.

That was just the beginning. In 1973, Charlie authorized the creation of the New Income Fund. This was a balanced maturity, fixed‐income fund. Rather than run it in the traditional manner of staggered maturities, George managed it based on the concept of total return. That is, profits could be generated by making money from buying bonds at a good value and then selling them for higher prices, without waiting for them to mature. The bonds could be sold either when the value inherent in the bond was recognized by the market, or when interest rates fell and prices rose in value. The client made money through capital gains from the sale of the bond, as well as from the income generated by the yields on the bonds themselves. The investment program also included preferred stock and a limited amount of common stock.

In order to uncover hidden value in bonds and thoroughly examine their credit risks, a good research department was required, similar to what existed at T. Rowe Price on the equity side. As Mr. Price had discussed in the memo “New Era for Bond Investment,” there would be less emphasis on past credit ratings and more emphasis on detecting opportunities in changing markets through research. Developing superior trading strategies, and often simply being more aggressive, were also key strategies. Most importantly, George and Mr. Price agreed that inflation would dramatically accelerate in the 1970s. As a result, George followed the philosophy of early recapture of capital. He kept all the bond portfolios relatively short‐term, primarily buying short and intermediate bonds, or those close to their maturity dates. He often opportunely sold them early, recapturing his capital as inflation drove interest rates ever higher and bond prices commensurately lower. As the results proved, following this strategy, he performed far better than his competitors, who bought many of the same bonds, but held them longer, even to maturity.

Like two of the three original equity mutual funds, the New Income Fund was a slow starter. When interest rates soared in the mid‐1970s, however, it took off. By 1977, it had reached $284 million in assets and became the third‐largest corporate bond fund in the country. By then, George was clearly winning over the equity side of the firm. Like the Cheshire Cat, Mr. Price just smiled benignly.

The fixed income markets were changing dramatically, and T. Rowe Price's bond department was leading the way. In 1976, Congress passed legislation permitting tax‐free municipal bond funds, and the firm was quick to seize the opportunity. Before this legislation, tax‐free income went through the corporate shell of a mutual fund and became taxable. This was eliminated under the new law. In the first five months of operation, according to George, the new Tax‐Free Fund accumulated $75 million in assets. It had grown to $215 million in assets by 1978 and was again the third‐largest fund of its type.

In 1976, George persuaded the firm to start the Prime Reserve Fund. Though the Federal Reserve System regulated the interest rates that banks and savings and loan associations could pay to their depositors, there was no such limit on mutual funds. On the other hand, the public initially viewed money market funds with considerable suspicion. Unlike bank deposits, money in short‐term money market funds, like the Prime Reserve, was not insured by the U.S. government. The Prime Reserve Fund also had a slow start, chiefly because of this “trust” factor. When interest rates reached double digits, far above the 5.5 percent level that banks were allowed to pay, the Prime Reserve Fund finally took off. Such rates proved to be irresistible to corporations and, eventually, to the public as well, even without insurance.

The Prime Reserve Fund was important to the firm in another way. It provided a handy parking space for investors in the company's equity funds. When some of these investors became nervous about the stock market, they could seamlessly move their money from an equity fund to the Prime Reserve Fund. The firm continued to get a fee from managing the Prime Reserve Fund, although at a lower percentage rate than an equivalent amount in an equity account. Most importantly, when someone sold his or her equity fund, the client did not vanish, perhaps forever, into a bank savings account. He or she could instead easily move money back into the market when the time was right.

Reserve funds, such as the Prime Reserve Fund, also increased investors' interest in the mutual fund industry as a whole. As George mentioned, many shareholders of Prime Reserve had never owned an equity mutual fund before. The fluctuating trendless stock market of the 1970s convinced many investors that their own instincts, and those of their brokers, were not to be trusted. Once they had put their toe into an investment in the Prime Reserve Fund, it was simple to move over into an equity fund managed by professionals, which produced much better results and allowed them to sleep at night.

By 1983, according to George Collins and The History of T. Rowe Price Associates, Inc., only twelve years after Collins had joined T. Rowe Price the Fixed Income Department was managing more than $2.2 billion in private counsel accounts. The tax‐free bond fund had $673 million in assets and the Prime Reserve Fund, despite its slow start, had amassed $2.7 billion. In total, the Fixed Income Division accounted for nearly half of all of the assets under supervision by T. Rowe Price Associates, with a similar percentage of the earnings. This was a remarkable feat in a new business that Mr. Price had initiated and George Collins had executed. There was no surprise when George was made president and CEO of the firm in 1984, at 43 years old.

With 20/20 hindsight, it was fortunate for the firm that it started the Fixed Income Department when it did. The equity environment changed after 1972 – and particularly for T. Rowe Price Associates. One minute it seemed that the world was its oyster, with growth stocks outperforming the market, and both the Growth Stock Fund and the New Horizon Fund leading all competitors for their first ten years. In 1971, the Growth Stock Fund rose 30.4 percent, with the Dow Jones up only up seven percent. But it all changed quickly. As investors might have noted in the annual reports, during the next 10 years the Growth Stock Fund only beat the market in one year. The New Horizons Fund did better, but its record over the next decade fell far short of its first ten years.

Mr. Price and Eleanor continued to avoid the damp, cold Baltimore winters at the Hillsboro Club near Pompano Beach, Florida. Following his retirement, the Prices generally arrived after Christmas and stayed through until April, returning only so as not to miss the lovely Baltimore spring and the rebirth of his roses. A casually elegant club that has been in existence for more than eighty years, the Hillsboro Club catered largely to East Coast families who enjoyed soaking up a week or so of warm southern Florida weather there in the winter. Friendly and comfortable, it was more relaxed than many clubs in the Palm Beach and Naples areas, with wicker furniture in tasteful pastel colors, and a large 1,000‐foot private beach. Tennis was a major sport at the club, which Mr. Price played into his seventies. The club also offered world‐class croquet for the less active members. There was plenty of social activity for the young, and comfortable dining and sitting around for the older members. It was just the kind of place for Mr. Price and Eleanor in their retirement years.

When I visited the club in 2014, a member heard that I was writing a book about Mr. Price. She came over during the cocktail hour and told me about meeting him at the club in the mid‐1970s. She had her nine‐year‐old niece with her, and they were seated near the Price's dinner table. At that time, the club still used finger bowls, with a separate, round doily napkin. Her niece had never seen a finger bowl before. Her husband showed her niece how to transfer the bowl properly to the doily, and then put her fingers into the water. There was a subdued burst of laughter as Mr. Price doubled over at the sight. She suddenly saw his human, nonbusiness side. He had just been another fussy old man, but now he became “Uncle Rowe.”

When he was in Baltimore, Mr. Price regularly visited his office at One Charles Center. He mostly worked on his family portfolios and those of old friends and charities. He also occasionally interacted with the young professionals, as well as members of the New Era Fund, where he still made suggestions on new investments.

Another story about Mr. Price was told by M. David (Dave) Testa in an interview with Steve Norwitz, who was hired in 1971 and later became a director and senior member of management. His office was only two doors down the hall from Mr. Price. Several times a day Mr. Price would walk by on his way to the Quotron machine, a popular electronic device which displayed stock quotes, to obtain quotes for the stocks in his model portfolios. After about a month, Mr. Price stuck his head in the door and then came in and stood there. He asked Dave how he was doing, and Dave said that things were going very well. Mr. Price stood there and looked at Dave for a while. Then he asked if he was learning anything. Dave replied that he was “actually learning quite a bit.” Mr. Price looked at Dave some more and then asked him, “What is a growth stock?” Dave had just been reading all of the marketing material on that subject. He regurgitated all of the various definitions and qualifications for a company to be a growth stock. “You haven't learned a thing,” Mr. Price said, and turned around and left.

For a new employee and a fresh Baker Scholar from Harvard Business School, this put‐down was a cold shock. When Dave got back from lunch later that day, he discovered a brochure in the middle of his desk from 1950, written by Mr. Price. It included a reprint of his 1939 Barron's article in which he first defined the Growth Stock Philosophy. Mr. Price had underlined a passage that stated, “A growth stock is a company whose earnings and dividends grow at a rate faster than the economy and inflation.” And that's it, Dave recalled thinking. Straightforward, to the point, with no wasted words. The best philosophies are often the simplest.

Mr. Price would also occasionally meet with the counseling and research staff to discuss performance, his favorite topic and, he believed, the key to the firm's past success. He would often also talk about the firm's history, the personal attributes that made it tick, and its simple focus on what was best for the client. He taught the young professionals his core belief that the payoff for being honest, straightforward, and loyal to the client would not only produce a continued flow of fees, but it would also build the firm's business over the longer term through references from satisfied clients. As he pointed out, a good relationship with the client would even take you over the rough patches of short‐term weak performance.

In 1975, the firm moved to its current home at 100 East Pratt Street in Baltimore Harbor. Once more, it had outgrown its quarters, with offices on four floors at One Charles Center and the elevator, once more, a major inconvenience. Mr. Price was not included in the move. According to George Roche, this was because someone had not included an office for Marie Walper. Mr. Price, therefore, decided to stay with her at One Charles Center. Based on a number of reports from mutual friends, the oversight hurt him deeply. He was particularly disappointed that the young associates, whom he enjoyed interacting with so much, didn't seem to want him around. It was this slight that probably gave rise to some of Mr. Price's critical comments to the press in the latter 1970s, although, in the opinion of those who knew him, Mr. Price was never a man to carry a grudge.

It is unclear how this seeming oversight occurred. It was certainly not intended as such by the firm. It was probably an unfortunate error caused by all of the thousands of details surrounding the move. After all, Mr. Price had officially retired from the firm in 1971. Someone on the administrative staff must have assumed that he meant it.

T. Rowe Price Associates did continue to pay for his offices at One Charles Center, and Marie kept her office next to his. They had made the full circle in a sense. The firm had begun in 1937, when Mr. Price and Marie opened the door into a two‐room suite at 10 Light Street.

In the early 1970s, Mr. Price noticed that Eleanor was becoming increasingly forgetful. When Mr. Price went with her to see their family doctor, concerned about her loss of memory, his doctor assured them that she was fine. As recounted by Dr. Rabins (see the next paragraph), there was then a dangerous episode at the Hillsboro Club when Eleanor stepped into a steaming hot bath, having forgotten to turn on the cold water. She was badly burned. Mr. Price went to two additional doctors for second and third opinions. They also failed to detect a problem. One weekend, after they were back in Baltimore, he was working outside in his yard at the same time as his neighbor, Dr. Richard S. Ross, Dean of the Johns Hopkins University School of Medicine, was in his adjoining yard. When Mr. Price described Eleanor's condition and his difficulty in convincing any of her physicians that something was wrong, Dr. Ross suggested that they visit Dr. Paul R. McHugh, who was then the director of the Department of Psychiatry and Behavioral Sciences at Johns Hopkins, and an expert in memory loss.

A Dementia Research Clinic had been established there and was sponsoring a geriatric psychiatry program, led by Dr. Peter V. Rabins, MD, the program's founding director, and later the first holder of the Richman Family Professorship of Alzheimer Disease and Related Disorders in the Department of Psychiatry and Behavioral Sciences of the Johns Hopkins University School of Medicine. Eleanor was diagnosed with Alzheimer's. Dr. Rabins's group schooled them in the care that she would need and what to expect as the disease progressed.

Looking back on his experience and the difficulty he had getting a correct diagnosis – even in a sophisticated medical community like Baltimore – Mr. Price recognized that many others might be in a similar situation. According to Dr. Rabins, late in 1979 he decided to gift $250,000 in securities to endow the T. Rowe and Eleanor Price Teaching Service, located in the geriatrics section of the Johns Hopkins Department of Psychiatry and Behavioral Sciences of the Johns Hopkins University School of Medicine. Its mission was “the training of doctors and nurses in the causes and treatment of loss of memory and the associated general dementia,” according to Dr. Rabins.

Mr. Price had always enjoyed working with intelligent young people, and he was impressed by Dr. Rabins. In turn, the doctor found Mr. Price to be polite and never condescending. However, he said that Mr. Price was not one to tolerate suppositions. He insisted that if Dr. Rabins did not know the answer to a question, he say so. As others had discovered, Mr. Price valued honesty and frankness. Mr. Price spoke with Dr. Rabins every three months or so over the course of the several years of Eleanor's treatment. Ultimately Dr. Rabins was named the Director of the T. Rowe and Eleanor Price Teaching Service of the Department of Psychiatry and Behavioral Sciences.

According to Dr. Rabins, Mr. Price's private goals in regard to the service were three‐fold: 1) to ensure that physicians, nurses, and all health care providers were taught about Alzheimer's disease and related dementias, because little was known about them at that time; 2) to provide this information for both the person with dementia and for the family caregiver; and 3) to find a cure.

Dr. Rabins remembers Mr. Price explaining that “before he invested in a stock, he always thoroughly investigated all aspects of the company. He carefully studied its business as well as its finances.” This was the approach that Mr. Price wanted Dr. Rabins to take in his research into Alzheimer's. He wanted the group to thoroughly study all the known science at the time in an effort to better understand the disease.

Nancy L. Mace, MA, a consultant to and member of the board of directors of the Alzheimer's Association and an assistant in psychiatry, was hired as coordinator of the T. Rowe and Eleanor Price Teaching Service. Working with Dr. Rabins and a nurse, Mary Jane Lucas, she set up the Alzheimer's Association Chapter of Greater Baltimore, which held monthly meetings with patients, their families, and caregivers to discuss issues and solutions.

Minutes were kept of these meetings and distributed to the participants and other interested parties. These notes were mimeographed and stapled together. The package of notes grew significantly in size over time. They were finally edited by Dr. Rabins and Nancy Mace and were originally published in 1981 and are still in print in a sixth edition under the title The 36‐Hour Day: A Family Guide to Caring for People Who Have Alzheimer's Disease, Related Dementias, and Memory Loss. According to Dr. Rabins, more than three million copies have been sold, the largest number for a book title ever sold by Johns Hopkins Press. It has become the bible for the care and treatment of Alzheimer's, and has been translated into multiple languages. The book now discusses all the potential treatments that might lead to a cure of the disease.

When Mr. Price died, his gift would be increased to $1 million dollars under his will. Although Alzheimer's research is more substantially funded today, when Mr. Price made his initial and subsequent donations, very little money was being spent in the United States on the study of the disease. This made his contribution even more significant at the time.

As Eleanor's memory loss worsened, it became impractical to continue to live in their beloved Guilford home. They moved late in December 1974 to the Warrington Apartments on North Charles Street in Baltimore, which housed a number of Mr. Price's old friends in large, comfortable apartments.

On May 3, 1981, his wife and lifelong partner died. He and Eleanor had a true and beautiful partnership. In describing their relationship following her death, he alluded to their shared love of gardening, saying, as quoted in her obituary, “I raised the flowers, she put them in beautiful arrangements, and together we won many awards.” This metaphor was quite poetic for a man whose speech was usually concise and businesslike. He rarely spoke of personal issues. His allusion to a garden and her beautiful bouquets suggests that he credited Eleanor for creating a warm, colorful environment for the two of them. Because she so ably tended to the domestic needs of the couple and their boys, Mr. Price was able to focus on building his business and establishing a preeminent reputation in his industry. It was a true partnership of equals and Eleanor was his lifelong love. Thomas Rowe Price IV, Mr. Price's grandson, said his grandfather told him that whenever he was in the hospital, he always had a picture of her looking like the day he married her.

Following Eleanor's death, his younger sister, Gahring, who then lived in Lancaster, Pennsylvania, often came down to take care of him. His older sister, Mildred, who had guided him so often to his new schools, had died some years before. It was still a close family.

Mr. Price continued to write and publish his investment bulletins privately throughout his retirement. These were distributed to key members of the firm. He also remained intensively competitive, publishing the results of his model accounts and comparing them with the performance of the firm's mutual funds. The competition was congenial and the intent was a good one: to keep the firm and the funds focused on performance and always trying to do better.

Mr. Price also retained his long habit of intense concentration and need for privacy. Although his office before the move to 100 East Pratt Street was in the middle of the counsel floor, he always kept his door shut. He was definitely not the open‐door type of leader. Everyone had to have an appointment to see him, with a precise time to begin, and Marie Walper was the strict gatekeeper.

Pete Calhoun tells a story of knocking on Mr. Price's door one day and there was no answer from within. Nevertheless, Pete went in, saw that Mr. Price was deep in study, and sat down in front of his desk. Mr. Price didn't look up. Pete kept sitting there. Finally, Mr. Price said, “You know how irritating I find it when people come in at the wrong time?” Pete said he knew that. Mr. Price asked, “Is your watch working today?” Pete said that it was. Mr. Price said, “Do you know how annoyed I get when people ignore my privacy?” Pete said that he did. After several similar questions and answers, Mr. Price said, “Well then, would you please get out of here!” in a loud voice. Pete got up and went to the door. In leaving, he turned and said, “Mr. Price, you will be the last person in this building, and the building is on fire.” With that, Pete left. Mr. Price looked out of his office and saw that the firemen were indeed occupying the floor.

Mr. Price, as noted, did continue to pay particular attention to his youngest “child,” the New Era Fund. He realized that, though the concept of growth stock investing and his outstanding long‐term record was well‐established and accepted, the New Era Fund's performance, with its unique investment strategy aimed at profiting from inflation, would be significant to his legacy. Even though he attended no more meetings of the Fund's investment committee after 1973, he did regularly contact its chairman, Bob Hall. The committee made all the purchases and sales of stocks in the portfolio, controlling its performance. Often Mr. Price's call to Bob would be on Sunday morning and he would begin teasingly with, “I know you are probably not in church.” Then he would begin a review of the fund's performance, its purchase and sales of stocks, and Mr. Price's general outlook for the economy and the market. All of this could easily take an hour or more. What Bob had expected to be his breakfast time often became brunch. This was how Mr. Price remained an integral part of the New Era Fund, even in absentia.

Often these conversations became a bit contentious when Mr. Price sensed that Bob was not in total agreement. Bob remembers saying (under his breath), that he was always held accountable based on Mr. Price's high standards. Which meant that your standards were always being raised, of course.

Bob also remembers that Mr. Price could be very generous and thoughtful to those with whom he worked closely. “When my father died, “he said, “he called me up and even wrote me a letter. I don't know how he even knew about it. He was retired and vacationing at the time. But he kept track and went out of his way to offer his condolences.”

During the late 1960s and early 1970s, as referenced in Chapters 13 and 14, Mr. Price had begun to significantly build up his position in gold stocks in his model accounts and, through his strong urging, the New Era Fund had followed, although to a lesser degree. He had first established a small initial position in gold in his Model Inflation Fund in 1967. He added to these holdings in 1970 and early 1971. When President Nixon took the country off the gold standard in 1971, Mr. Price aggressively bought gold stocks, which appreciated sharply during the 1973–74 market break. By the first quarter of 1974, gold accounted for over 30 percent of Mr. Price's total model equity portfolio. As was his custom after such an appreciation, he sold enough of his gold holdings to cover 80 percent of his total costs, plus the capital gains taxes. The gold stocks in his account had risen over 700 percent between 1972 and 1974. Gold promptly declined sharply, as inflation ebbed in 1975 and 1976. Mr. Price switched back to the buy side and bought aggressively once again. For the first time since his early thirties, he became an active trader and this time much more successfully. He believed rightly that inflation was far from over and that gold remained the investor's best protection against it. Although an oil or timber company could conceivably be a growth stock for five or 10 years, this was not true of a highly volatile gold company, where earnings were relatively meaningless and management was usually very thin. As he often told Bob Hall, “Gold stocks could not be just bought and held.”

His program of aggressively buying gold again in the mid‐1970s bore fruit as gold hit a record price of $850 in early 1980. Because it was even more heavily invested in gold stocks, Mr. Price's model inflation fund did even better than New Era. Winning this little match between his model fund and the New Era Fund brought Mr. Price great satisfaction.

As Forbes commented in “Why T. Rowe Price Likes Gold” in the October 15, 1975, issue, “Some of his rivals [other money managers] are studying the trees. Others study the forest. But Price tries to take in the whole landscape. With…almost uncanny perspicacity.”

On July 30, 1975, he wrote a final memo on “Better Performance” to the firm's professional staff. At the end he wrote, “Like Mohammed [sic] Ali, I believe in retiring a winner. God knows because of my age and poor health, it is time to stop competing!” He did, however, introduce one more new investment concept, a salvage and recovery fund. At a meeting of the firm's investment professionals in 1969, he had suggested that T. Rowe Price Associates consider a mutual fund based on this idea. No action was taken, and in 1970 he started a small model account of his own to invest in such companies to test out the idea. He quickly determined that one needed intimate knowledge of the securities in question and unlimited patience. In “Fertile Fields in the Eighties,” an article he wrote for the November 9, 1981 issue of Forbes, he suggested putting “25 percent of a new cash account into the building and construction industry,” which had been decimated by the high interest rates and weak economy of the previous decade. Many such companies were indeed selling at well under book value. More than a year later, on December 6, 1982, Forbes reported in the article “Stocks for the Mid‐80s” that this final recommendation by Mr. Price had “raised eyebrows” at the time, as the companies he suggested were “in almost total disfavor on Wall Street. They had, however, made a spectacular recovery, far outperforming the market.”

He explained in an article in the Baltimore Sun that the place to look for investment opportunities for a salvage and recovery fund was in industries that had been declining for a number of years, and that the opportunities were greatest when the country was in a recession. Buying had to be done gradually, with many more shares purchased as the stocks declined under book value. He warned that these investments should be sold quickly when earnings recover.

With rapid inflation, high interest rates, and weak business conditions, the environment indeed seemed to be ripe for such a fund. The firm's Investment Policy Committee made a visit to his apartment, after the article was published, to discuss the concept. Mr. Price discouraged the idea for the firm at that time. He had discovered, with his model salvage and recovery portfolio, that there was just not enough liquidity for big institutional accounts or a mutual fund on the scale of the firm's other funds.

It turned out that the firm actually did adopt a version of this concept a few years later when it entered the field of value investing, which was strongly promoted by James (Jim) S. Riepe who was hired then to direct marketing as well as other important areas within the firm. (This is discussed in detail in the Epilogue.)

In the December 1982 Forbes article, Mr. Price also recommended, for the first time in nearly 20 years, that investors buy bonds. Specific bonds were not named, but a longer maturity was implied. Assuming that the investor bought long‐term Treasuries, then a favorite of Mr. Price's, he would have had a total compound return on his capital of 14 percent over the following decade, far better then the 10.8 percent for the Standard & Poor's 500 Index. Mr. Price recognized that Volcker's strong medicine had stopped the country's inflationary spiral that had so concerned him 15 years before, and that the economy would soon begin to prosper. Forbes reported that his recommended list of “stocks for the' 80s were already up 24 percent versus 14 percent for the market.”

As he might have reminded his audience: “Change is the investor's only certainty.”

In November 1982, he fell ill again and, as his doctor was trying to put him back into the hospital, he reportedly told friends that he had so many ideas – and opportunities – that there weren't enough hours in the day to talk about them all.

Late on a Friday afternoon in April 1983, Henry H. Hopkins, the firm's chief legal counsel, got a call from Mr. Price, who was at the Greater Baltimore Medical Center (GBMC). “Henry,” Mr. Price said, “I would like you to update my obituary and bring it out for me to check over. I need it right now.” As recalled by Henry to me, he was about to leave for his home on Gibson Island, an hour's drive away, but he quickly called a member of the Communications Group. Henry explained that Mr. Price wanted his obituary revised and updated quickly. He said, “I can't. We are going out to dinner. When do I have to have it ready?” Henry said “You and I had better review it and you should take it out to him tonight. Tell your wife you will meet her wherever you are going. You will be late.” “Okay,” he said, reluctantly. “I'll stay.”

Henry read the Sunday paper carefully, but there was no obituary. There wasn't one on Monday either. Monday night, Henry played tennis doubles. One of his tennis partners was a general surgeon at the hospital and Henry asked him, “I heard Mr. Price was dying. He is at your hospital. Have you heard if he did die?” The surgeon replied, “How did you hear that?” When Henry explained it to him, the doctor said, “Friday night, when I went by to see him. I would have bet one million dollars that he was going to die. That he was on his deathbed. He had major stomach issues. His stomach was just disintegrating. I thought I was going to get a call that night, but I didn't. Saturday morning early I went in to do my rounds. I walk into Mr. Price's room and there he is sitting in his chair all dressed in his suit and necktie.” Mr. Price said, “I decided not to die. Check me out. I want to leave now. Right now!” The doctor added, “That was one of the major miracles of my practice.” Henry replied, “Mr. Price, indeed, is known to change his mind on occasion.”

And change was indeed in the air and it remained the only certainty for Mr. Price. In his last bulletin, “Outlook for 1983 and Beyond,” August 1, 1983, he said, “Stocks are statistically cheap. This will be the biggest Christmas in many years. We are on the verge of the biggest bull market in a long time.” He suggested that investors have 70‐plus percent of their portfolio in stocks, which was his position at the time and which, for him, was extremely aggressive. None of the stocks he recommended were resource stocks and the great majority were true growth stocks, both big and small. One could imagine his old partner, Mr. Ramsay, saying “But Rowe!” as he would when Mr. Price abruptly changed his mind.

Bob Hall visited him during this period, at home in his apartment. “He was a very sick man by this point,” Bob recalled. “He was surrounded by nurses and sipping water. He looked at me and laughed that the nurses all thought he was drinking water. Then he cupped his hand and in a loud whisper said, ‘It's really gin.’ Naturally, it wasn't,” Bob continued, “but there was a person with a very sunny, optimistic disposition behind that tough, gruff exterior. Even at the worst of times, when he was at the end of his life, he was able to poke fun at himself.”

When Mr. Price turned bullish on the stock market in his last investment bulletin to clients, the Dow was 1,194. January 2018 it hit a new all time high of 26,617, up more than 21 times.

Mr. Price died at home from a stroke on October 20, 1983. He was 85.