2017 Republican Thread

[Chisoxfn]

That's not really an apt analogy though. Financial professionals and asset managers don't hold themselves out as salesmen. They hold themselves out as professionals who will take care of and invest your money.

 

Financial professionals are closer to lawyers in my mind. I'm a professional providing services to my clients and I have a duty of care that goes along with that - a standard that I have to be held to. I'm selling a service in that I'm billed an hourly rate and paid accordingly, but if I don't fulfill my duty, I can be sued.

 

If you want financial planners, asset managers, and other financial professionals to be held to the same standard as a car salesman, they should probably just be called salesmen.

They are still held to a suitability rule...it just is a lower bar then "fiduciary". I've seen a lot of stuff misrepresented by the media / radio talk shows regarding what is and isn't being impacted by the DOL rule. I do agree with you that they are not the equivalent of a car salesman and I think the quotes from the official white house people were awful regarding why they were doing what they were doing (and missed the point on the real reason there should be stay in the requirements around the DOL rule). Please note, that I am not lumping Dodd Frank into this, even though I have heard a lot of people who seem to think Dodd Frank has anything to do with the DOL Fiduciary rule.

[Chisoxfn]

Even if we instantly implemented a "financial education" course and requirement today, though, you've still got tens of millions of people in this country who are already out of high school and may not have enough financial literacy to be aware of these issues and that their "adviser" they're trusting their life savings with may not have their best interests in mind. It's a common enough issue that some financial services firms even have commercials where people ask someone "how does your adviser get paid?" and the person sits there with a blank look on their face.

 

There are already people that are held to the fiduciary standard, so I guess I'm struggling to see why this couldn't be implemented to people who now only have to meet a "suitable" standard.

Does it make sense to you that only 401K money should be part of the fiduciary standard? The wrong party is driving this thing and ultimately it should be more in the hands of the SEC, imo, and applied consistently to those giving financial advice on registered products. By the way, sometimes a commission is a better strategy...for example, i might do something that I hold for a long long time and paying a commission vs. an asset based fee could actually save me significant money in the long run. The regulation of what was currently written was beyond onerous, that said, the intent of what the regulation wanted to do absolutely makes sense.

[Chicago White Sox]

Dumber than thinking a 'gun free zone' sign will protect you? if you prohibit people from protecting themselves legally, then you should be required to do so.

Who's forcing you to shop in a gun free zone? If you're so afraid to go to Best Buy without your gun, then do your shopping on Amazon. Businesses should have the right to decide if customers are allowed to carry guns, just like you should have the right to not enter those businesses if you don't feel safe for some reason.

Edited February 8, 2017 by Chicago White Sox

[caulfield12]

I don't think you understand the role of the fed at all. They are the banking system's regulatory body. The federal reserve bank isn't a PR firm. They are responsible for the safety and stability of the entire banking system. The fact that all of these financial products have relationships to the overall system alone is reason enough for them all to be done under one roof. While there has been a role of a cheerleader at times of trouble, that isn't the systems primary role at all. Not even close.

 

The fun part is bolded is exactly the rule that Congress enacted for grading of securities. They were pissed off at the ratings agencies, so they rewrote the rules to remove all mentions of the ratings and that system. Guess who is deciding credit worthiness of bonds now?

 

 

There's theory and then there's reality (like running low inflation for a decade with interest rates at zero.)

 

Greenspan stopped regulating when things were going great and then it was too late to put the genie back in the bottle. Unless you call his "irrational exuberance" comments a brake on the gas pedal.

 

Other than the KC Reserve Bank, what governors were even skeptical a decade ago?

 

There's been more consolidation and too big to fail is just as true today as a decade ago. Probably moreso.

 

 

[southsider2k5]

There's theory and then there's reality (like running low inflation for a decade with interest rates at zero.)

 

Greenspan stopped regulating when things were going great and then it was too late to put the genie back in the bottle. Unless you call his "irrational exuberance" comments a brake on the gas pedal.

 

Other than the KC Reserve Bank, what governors were even skeptical a decade ago?

 

There's been more consolidation and too big to fail is just as true today as a decade ago. Probably moreso.

 

I am curious which part of the Federal Reserve bank charter deals with Anti-Trust issues?

[caulfield12]

I am curious which part of the Federal Reserve bank charter deals with Anti-Trust issues?

 

I'm assuming the FTC or SEC.

 

 

The horror story could have easily been prevented had there been intelligent life at the Federal Reserve Board in the years when the housing bubble was growing to ever more dangerous proportions (2002-2006). But the Fed did nothing to curb the bubble. Arguably, it even acted to foster its growth with Greenspan cheering the development of exotic mortgages and completely ignoring its regulatory responsibilities.

 

Most people who had this incredible infamy attached to their name would have the decency to find a large rock to hide behind; but not Alan Greenspan. He apparently believes that he has not punished us enough. Greenspan has a new book which he is now hawking on radio and television shows everywhere.

 

The book, which I have not read, is ostensibly Greenspan's wisdom about the economy and economics. But he also tells us that his problem as Fed chair was that he just didn't know about the flood of junk mortgages that was fueling the unprecedented rise in house prices during the bubble years. He has used this ignorance to explain his lack of action – or even concern – about the risks posed by the bubble.

 

 

https://www.theguardian.com/commentisfree/2...g-market-crisis

 

Once again, how is someone so cozy with the financial press (such as his wife Andrea Mitchell and Maria Bartiromo) and the investment banks expected to objectively or fairly regulate them?

 

Edited February 8, 2017 by caulfield12

[NorthSideSox72]

That's not really an apt analogy though. Financial professionals and asset managers don't hold themselves out as salesmen. They hold themselves out as professionals who will take care of and invest your money.

 

Financial professionals are closer to lawyers in my mind. I'm a professional providing services to my clients and I have a duty of care that goes along with that - a standard that I have to be held to. I'm selling a service in that I'm billed an hourly rate and paid accordingly, but if I don't fulfill my duty, I can be sued.

 

If you want financial planners, asset managers, and other financial professionals to be held to the same standard as a car salesman, they should probably just be called salesmen.

 

Kind of answered here...

 

They are still held to a suitability rule...it just is a lower bar then "fiduciary". I've seen a lot of stuff misrepresented by the media / radio talk shows regarding what is and isn't being impacted by the DOL rule. I do agree with you that they are not the equivalent of a car salesman and I think the quotes from the official white house people were awful regarding why they were doing what they were doing (and missed the point on the real reason there should be stay in the requirements around the DOL rule). Please note, that I am not lumping Dodd Frank into this, even though I have heard a lot of people who seem to think Dodd Frank has anything to do with the DOL Fiduciary rule.

 

My analogy was a little sloppy, but the key point really is that there are already standards in place.

 

Even if we instantly implemented a "financial education" course and requirement today, though, you've still got tens of millions of people in this country who are already out of high school and may not have enough financial literacy to be aware of these issues and that their "adviser" they're trusting their life savings with may not have their best interests in mind. It's a common enough issue that some financial services firms even have commercials where people ask someone "how does your adviser get paid?" and the person sits there with a blank look on their face.

 

There are already people that are held to the fiduciary standard, so I guess I'm struggling to see why this couldn't be implemented to people who now only have to meet a "suitable" standard.

 

I wasn't suggesting that financial education was a sole fix of course. But I do think it would go a long way as time went on if it were done.

 

There are a few things going on here, and the change in bar for standard to be fiduciary causes multiple issues. For one thing, the advisors aren't custodians - they don't hold the accounts. Those are held by prime brokers or clearing firms. So you've already created a major disconnect where you are expecting that reporting and oversight to go with the role aren't actually possible. And what can be reported of course adds substantial costs, will inevitably be transferred to the customer. But it's not just the level of the bar here, it's the legislation setting an expectation for every interaction meet a standard that goes beyond even fiduciary duty and into something more like power of attorney. You can't force people's decisions, otherwise you aren't an advisor at all. By saying every interaction has to be demonstrably the best decision available for the client is not a reasonable standard for the role.

 

 

[southsider2k5]

I'm assuming the FTC or SEC.

 

 

The horror story could have easily been prevented had there been intelligent life at the Federal Reserve Board in the years when the housing bubble was growing to ever more dangerous proportions (2002-2006). But the Fed did nothing to curb the bubble. Arguably, it even acted to foster its growth with Greenspan cheering the development of exotic mortgages and completely ignoring its regulatory responsibilities.

 

Most people who had this incredible infamy attached to their name would have the decency to find a large rock to hide behind; but not Alan Greenspan. He apparently believes that he has not punished us enough. Greenspan has a new book which he is now hawking on radio and television shows everywhere.

 

The book, which I have not read, is ostensibly Greenspan's wisdom about the economy and economics. But he also tells us that his problem as Fed chair was that he just didn't know about the flood of junk mortgages that was fueling the unprecedented rise in house prices during the bubble years. He has used this ignorance to explain his lack of action – or even concern – about the risks posed by the bubble.

 

 

https://www.theguardian.com/commentisfree/2...g-market-crisis

 

Once again, how is someone so cozy with the financial press (such as his wife Andrea Mitchell and Maria Bartiromo) and the investment banks expected to objectively or fairly regulate them?

 

You do know that the Federal Reserve bank doesn't regulate MBS's right? That falls to the SEC. The only responsibility the Fed would have is as it relates to how an MBS would affect the balance sheet of a member bank, and not for the regulatory worries of the MBS's themselves.

 

Then you have the pseudo-governmental agencies who were buying the damned things without knowing what they were or understanding them in Fannie and Freddie, giving them governmental legitimacy and thus a false price discovery to hold the whole system up for an artificially long time.

 

And without knowing it, you are hitting on my exact point of one agency not knowing or understanding what another agency is doing, even though all of these things are eventually tied together and interwoven throughout our financial system.

 

EDIT, and the answer is very clear, the Fed Bank has zero ability to do anything about anti-trust issues from a legal standpoint.

[caulfield12]

You do know that the Federal Reserve bank doesn't regulate MBS's right? That falls to the SEC. The only responsibility the Fed would have is as it relates to how an MBS would affect the balance sheet of a member bank, and not for the regulatory worries of the MBS's themselves.

 

Then you have the pseudo-governmental agencies who were buying the damned things without knowing what they were or understanding them in Fannie and Freddie, giving them governmental legitimacy and thus a false price discovery to hold the whole system up for an artificially long time.

 

And without knowing it, you are hitting on my exact point of one agency not knowing or understanding what another agency is doing, even though all of these things are eventually tied together and interwoven throughout our financial system.

 

EDIT, and the answer is very clear, the Fed Bank has zero ability to do anything about anti-trust issues from a legal standpoint.

 

http://www.oecd.org/finance/financial-markets/44260382.pdf

How are you going to prevent the insurance industry from being involved as well (creating more "too big to fail" scenarios), like AIG?

 

Anyone who watches movies or t.v. shows can understand the conflicts between CIA, FBI, DEA, ATF, NSA, Homeland Security, local law enforcement...there's usually less communication and sharing due to everyone protecting their own turf/budgets. So if there's a completely non-partisan way to regulate the financial/monetary system which can be completely depoliticized. I would love to see it. Just not sure it's possible in the current environment. Someone jokingly said that Twitter should have a panel of one Democrat, one Republican and one true independent to vote on whether Trump's tweets should be released in order to prevent a possible nuclear war...but how can that supposed independent not lean one way or the other?

 

 

 

 

[southsider2k5]

http://www.oecd.org/finance/financial-markets/44260382.pdf

How are you going to prevent the insurance industry from being involved as well (creating more "too big to fail" scenarios), like AIG?

 

Anyone who watches movies or t.v. shows can understand the conflicts between CIA, FBI, DEA, ATF, NSA, Homeland Security, local law enforcement...there's usually less communication and sharing due to everyone protecting their own turf/budgets. So if there's a completely non-partisan way to regulate the financial/monetary system which can be completely depoliticized. I would love to see it. Just not sure it's possible in the current environment. Someone jokingly said that Twitter should have a panel of one Democrat, one Republican and one true independent to vote on whether Trump's tweets should be released in order to prevent a possible nuclear war...but how can that supposed independent not lean one way or the other?

 

A system where everyone is independent and fighting to keep their own budgets at the expense of everyone else is exactly how we got the system we have now.

The best chance of it happening is to have it insulated outside of politically managed governmental organizations.

 

Let me put it this way, how is the system we have now going to fix those problems? How are they preventing the next too big to fail? The answer is they can't. They are quite literally not able to because those agencies do not possess the powers to do anything about things like too big to fail. This system is only geared towards stopping the last bad thing, and not the next one, because that is how they get a budget.

[Balta1701]

A system where everyone is independent and fighting to keep their own budgets at the expense of everyone else is exactly how we got the system we have now.

The best chance of it happening is to have it insulated outside of politically managed governmental organizations.

 

Let me put it this way, how is the system we have now going to fix those problems? How are they preventing the next too big to fail? The answer is they can't. They are quite literally not able to because those agencies do not possess the powers to do anything about things like too big to fail. This system is only geared towards stopping the last bad thing, and not the next one, because that is how they get a budget.

And because preventing the next collapse will cost people money in advance of the collapse, so the more fragmented the regulatory apparatus is, the more easily it is beaten to make money during that time.

[southsider2k5]

And because preventing the next collapse will cost people money in advance of the collapse, so the more fragmented the regulatory apparatus is, the more easily it is beaten to make money during that time.

 

Eh. Then again, today you have to have staff and resources to satisfy requests from dozens of agencies, instead of just one.

[illinilaw08]

Eh. Then again, today you have to have staff and resources to satisfy requests from dozens of agencies, instead of just one.

 

SSK, NSS, and other investment guys, this is on topic with all the discussion about "suitability" and "fiduciary" standards with respect to retirement, as well as the financial system generally.

 

Unless you work for the State in some capacity, companies that offer pensions are very difficult to find. Thus, more people need to rely on the market to save for retirement. Most IRAs are index funds in some capacity. Because of that societal reliance on the market for retirement, and the positive societal benefit to having people retire eventually, should the feds carry a greater burden in regulating investment behavior? Should investment professionals managing money specifically designated for retirement (ie, can't touch it without penalty until 59.5) be subject to stricter scrutiny?

 

Curious to hear your thoughts.

[southsider2k5]

SSK, NSS, and other investment guys, this is on topic with all the discussion about "suitability" and "fiduciary" standards with respect to retirement, as well as the financial system generally.

 

Unless you work for the State in some capacity, companies that offer pensions are very difficult to find. Thus, more people need to rely on the market to save for retirement. Most IRAs are index funds in some capacity. Because of that societal reliance on the market for retirement, and the positive societal benefit to having people retire eventually, should the feds carry a greater burden in regulating investment behavior? Should investment professionals managing money specifically designated for retirement (ie, can't touch it without penalty until 59.5) be subject to stricter scrutiny?

 

Curious to hear your thoughts.

 

To some extent, I think this is the idea behind the fiduciary rule. The vast majority of people who have money in the market only have retirement money there, so a rule like this by its very nature is aimed at retirement funds. To a large extent I also think the rules that govern specific retirement tax havens (such as a 401K or IRA) have rules that reflect that nature. For example, you can't trade shorts in an IRA. They are designed and created to be lower risk, and by their nature, lower cost to the investors.

[NorthSideSox72]

SSK, NSS, and other investment guys, this is on topic with all the discussion about "suitability" and "fiduciary" standards with respect to retirement, as well as the financial system generally.

 

Unless you work for the State in some capacity, companies that offer pensions are very difficult to find. Thus, more people need to rely on the market to save for retirement. Most IRAs are index funds in some capacity. Because of that societal reliance on the market for retirement, and the positive societal benefit to having people retire eventually, should the feds carry a greater burden in regulating investment behavior? Should investment professionals managing money specifically designated for retirement (ie, can't touch it without penalty until 59.5) be subject to stricter scrutiny?

 

Curious to hear your thoughts.

I would break your target audience into a few categories...

 

1. A scarily large portion of people aren't investing at all, or at least not meaningfully. This can be due to income levels, or just ignorance or bad choices. For this swath of people, the best bet all around is education.

 

2. Then there's the crowd who invest in 401k's, IRA's, classic brokerage accounts and other investment vehicles at the consumer level. The great majority of those are not using an advisor - for them, the answer is providing information. The providers of those instruments actually provide a LOT of this info now. It can be a little intimidating at times because it's a lot to take in, but many of those firms offer free seminars and the like too. Not sure how you can regulate those who don't use advisors, and it's again more about education. What you CAN do is make sure the information provided is not fraudulent - and this is already highly regulated.

 

3. Now there is the crowd who uses a financial advisor, but is not in #4 below, and are investing for general financial improvement and/or retirement. While education is also key here, you do have the folks who are relying heavily on the advice of these advisors. This is the target crowd for your points, really. How far do regulations go on advisors, where they protect investors but don't make the advisor's job unmanageably expensive? Part of this is covered by existing regulations to make sure certain data is always available, and that the published data is not untrue or misleading. But what about the soft advice? Financial advisors are already overseen by certification groups, much as say, psychologists are. But how can you regulate what is best for the consumer? The answer is that you can't do it in detail - that's the key. The cheapest load fund is not always the best one. Each investor is unique in their precise needs and wants. What you should focus on is profit-related fraud by the advisor. That means, stick to how the advisor gets paid, not their every interaction. I don't pretend to know in great detail exactly what to be done around that, as I am not an advisor and don't use one. But I do know that already, in many cases, advisors make money as a percentage of invested assets. For non-insurance instruments, that means it is in the best interest of the advisor to have the customer make money anyway. Insurance has it's own regulations that are labyrinthine. I would need to know more about pay structures for advisors, is what I am saying - but I feel confident that dialing into each interaction and trying to harden what is by nature subjective isn't the right approach.

 

4. Finally, the "rich" sophisticated investor who does things with a wealth management firm, or hedge funds, etc. These folks by nature, you just need to protect against per se fraud.

 

[caulfield12]

http://www.cnn.com/2017/02/22/europe/europ...licy/index.html

 

Can Europe really take the high moral ground on the refugee crisis?

[southsider2k5]

The topic of Obama's war on the whistleblower came up the other day, and I just happened to run across this today.

 

https://www.longislandpress.com/2017/01/14/...whistleblowers/

[DrunkBomber]

Obama wiretapping an incoming president adds to his legacy as the most criminal and disgraceful piece of garbage president in our countries history. Anyone who supports the s*** he has done over the last calendar year is an absolute dumpster person. The democratic party is a hypocritical laughing stock.

[Quin]

Obama wiretapping an incoming president adds to his legacy as the most criminal and disgraceful piece of garbage president in our countries history. Anyone who supports the s*** he has done over the last calendar year is an absolute dumpster person. The democratic party is a hypocritical laughing stock.

 

So ..Proof?

[DrunkBomber]

https://www.washingtonpost.com/world/indian...m=.b4540968e3f2

 

Thanks Chuck

[pettie4sox]

https://www.washingtonpost.com/world/indian...m=.b4540968e3f2

 

Thanks Chuck

 

I think you posted the incorrect link.

[CrimsonWeltall]

Obama wiretapping an incoming president adds to his legacy as the most criminal and disgraceful piece of garbage president in our countries history. Anyone who supports the s*** he has done over the last calendar year is an absolute dumpster person. The democratic party is a hypocritical laughing stock.

 

Not to mention that he's a secret Muslim born in Kenya who wasn't a legitimate President to begin with.

 

Source: Paragon of honesty Donald Trump

[NorthSideSox72]

Obama wiretapping an incoming president adds to his legacy as the most criminal and disgraceful piece of garbage president in our countries history. Anyone who supports the s*** he has done over the last calendar year is an absolute dumpster person. The democratic party is a hypocritical laughing stock.

 

Trump wiretapping Hillary Clinton adds to his legacy as the most criminal and disgraceful piece of garbage president in our countries history. Anyone who supports the s*** he has done over the last calendar year is an absolute dumpster person. The republican party is a hypocritical laughing stock.

 

 

 

Now show me even a shred of evidence that either thing happened.

 

[pettie4sox]

He vanished. Maybe he was trolling?

[Jenksismyhero]

My favorite response to the nonsensical Trump claim:

 

Jon Favreau‏Verified account @jonfavs Mar 4

 

 

Barack Obama's master plan:

1) Wiretap the opposition

2) Gather damaging info

3) Say nothing

4) Let him win

5) Ride off into the sunset