Peter L. Bernstein, the economic historian and consultant who achieved rock-star status in the investment world in his later years, never stopped asking the big questions.
He was “full of ideas,” said Paul A. Samuelson, the Nobel laureate and professor emeritus at the Massachusetts Institute of Technology, Cambridge. Mr. Samuelson, who is 94, said Mr. Bernstein was “a very good friend” and acknowledged referring to him as “a whippersnapper.”
Mr. Bernstein, who died June 5 at the age of 90, leaves a legacy in his books and articles. Some thought he would never stop, despite his advancing age and increasing frailty.
“He was so vibrant,” said Martin Leibowitz, managing director at Morgan Stanley, New York, and himself an icon in the investment world. “You just sort of felt he was immortal.”
“He was a giant in the investing world,” Theodore R. Aronson, principal at Aronson + Johnson + Ortiz, Philadelphia, wrote in an e-mail sent while traveling in Italy.
“To the very end, he was contributing mightily to our thinking about, and appreciation of, economics. He will be sorely missed and can never be replaced,” Mr. Aronson said.
Mr. Bernstein, the author of “Capital Ideas,” which explains the evolution of modern portfolio theory, and “Against the Gods: The Remarkable Story of Risk,” among other works, was known for his curiosity.
“The thing about Peter that always impressed me is that he was always trying to learn new things, new ideas. He wasn't himself a mathematician, but he learned enough to understand portfolio theory,” added Mark Kritzman, president and CEO of Windham Capital Management LLC, Boston, who has written guest columns in Mr. Bernstein's semimonthly client letters for years.
Bruce I. Jacobs, principal, Jacobs Levy Equity Management, Florham Park, N.J., wrote in an e-mail: “Many professional investors today were introduced to the more sophisticated and quantitatively oriented concepts underlying modern portfolio management through the work of Peter Bernstein.
“Whether it was Harry Markowitz's theories of portfolio optimization, or Bill Sharpe's capital asset pricing model, or the option-pricing theory of Fischer Black, Myron Scholes and Robert Merton, Peter seemed able to translate the most abstract, arcane ideas into language that was accessible to those of us not necessarily trained in physics and higher mathematics. And he was able to do so in a lively, informal style while keeping all the main points intact.”
Mr. Leibowitz recalled being interviewed by Mr. Bernstein for “Capital Ideas Evolving,” the sequel to his earlier work on modern finance.
“He would start off with not naive, but not deep questions,” he said. But with every subsequent interview, the questions would probe further. “Toward the end, he was asking me questions about my work that I couldn't answer. He just bored in. He was relentless. He wanted to come and understand things at a level” beyond which most others would have thought 'that's good enough,' and then move on.”
But Mr. Bernstein's curiosity doesn't explain the reverence for the late consultant expressed by many leading investment experts. Many praised him not only as a scholar, but also as a gentleman and a mentor.
Mr. Bernstein was “a tremendous man ... a truly old-world gentleman in a world where it's increasingly (rare),” said Cliff Asness, managing principal, AQR Capital Management, Greenwich, Conn.
Rodney Sullivan, head of publications at the CFA Institute, Charlottesville, Va., regularly met Mr. Bernstein and his wife and business partner, Barbara, when visiting New York. After publishing a couple of articles in the Journal of Portfolio Management — which Mr. Bernstein founded in 1974 — Mr. Sullivan said Mr. Bernstein asked him: “'Where have you been hiding all of those great articles?' That was worth the price of admission to hear that from Peter.”
Mr. Aronson added: “His generosity of spirit and time was legendary; he was many, many folks' 'Jewish uncle.' I vividly recall joking with Peter that, only after reading 'Capital Ideas' had I realized I started in the investing world at square one of the quantitative revolution.”
Mr. Bernstein never set out to be in the money management business, but ended up running his father's money management firm, Bernstein-Macauley Inc.
“When Peter's father died, there was pressure on him to come in and run the family firm, but he didn't want to do it because he had other fish to fry,” MIT's Mr. Samuelson said. “To his amazement, it's what he most enjoyed doing.”
After selling the firm, Mr. Bernstein and his wife ran Peter L. Bernstein Inc., which consulted to endowments and foundations and whose newsletter was widely read in the institutional investment world.
Robert Arnott, chairman of Research Affiliates LLC, Pasadena, Calif., described Mr. Bernstein as “such a wonderful mentor and friend.”
A memorial service is being planned for fall.