Obama, the Wealth Manager

March/14/2015 5:04AM
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No fear, your president wants to look after your finances. He believes financial advisors, money managers, wealth managers, etc. are ripping off the public. They are stealing the scraps still left after he vacuums the vault with his war on the 2% ers. This is the epitome of hypocrisy. He really, really wants anyone who has enough left after his existing and proposed taxes to believe he is the best possible resource to prevent you from being abused from the aforementioned group of fellow thieves. He wants extensive government involvement to insure those folks behave themselves. Of course, to do that he will need to add layer after layer of incompetent, indolent, bureaucratic, union workers. A whole new department of expense. Thousands of government minions to do what you need to do for yourself.

Here’s how to fix the problem yourself, should you have one. Measure your financial advisors against indexes in every investment category. If they don’t meet or exceed those numbers find another advisor. Simple as that. I know you have a great relationship with that fine person you pay a lot of money to do less than you could do by buying the indexes yourself. Statistics show 90% don’t beat the indexes. So, 90% of us are paying for nothing. If you don’t know how you are doing, fix that today. Sit down with your person and demand a scorecard. If you do, and you don’t care, that’s OK too. Your problem, and people like you will be the reason we get ObamaInvest. If you do know and you don’t like it, fix it. It won’t be easy

. You will need to do a lot of research to find one of those financial advisors in that elite 10% who beat the indexes. Many of those only deal with the 10% who have the most money. Everyone you talk to will assure you they are in that group. Like politicians, they all lie. Obama is right, 90% of the public is paying fees for bad performance. There are no scorecards. No bank or other financial institution publishes their performance. For good reason.

Most likely you would need to do two things. Get a pie chart, like every investment professional has, to determine your tolerance for risk. It parcels out your portfolio by investment category. Fixed income, large caps, mid caps, small caps, emerging markets, etc. Then truck on down to your nearest Schwab, Jones, or other discount investment office and open an account. Get the data you need on the mutual funds in each of the categories above (fixed income, large cap, etc.). Research whose index funds did best last year. Fire your guy and have the money transferred to the discount broker of your choice. Now buy the funds from those’ you found that perform best in the percentages that the pie chart told you to buy.  If the stock market goes up, you might consider putting more in the equities index. If the market looks shaky, lighten up that index and move some to fixed income index funds. If the interest rate is headed up, lighten and shorten up that fixed income index group. You, with minimum effort will out-perform what you have now. You can even find a person at most discount offices who will help you do this free. Want some evidence? If you bought the Dow Index in 2014 you would have enjoyed a 20% appreciation. Did your investment person get you that last year?

Or, you can just wait around for the guy who is taking more from you than that incompetent financial advisor takes, Barack Obama, to ride in and fix your problem with ObamaInvest. Good luck.

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