financial services

/Tag:financial services

Wall Street Executives Belong in Watchdog’s Ethics Doghouse

Morgan Stanley CEO James Gorman had the partial fortitude to admit his firm belongs in the doghouse. Unfortunately, he also used two forms of standard Wall Street spin to dilute the impact of his comment when Bloomberg News quoted him saying, “Wall Street’s reputation will remain “in the doghouse” as long as trading scandals continue to plague the industry.” He went on to blame UBS for the latest scandal when he said, “The good works of the industry are ignored when some trader does some stupid thing like this guy at UBS did and goes to jail”.

Gorman is right about the doghouse. According to a Gallup poll last Summer, Americans’ confidence in U.S. banks fell to a record low of 21 percent; about half of what it was in 2007 before the Wall Street initiated crash in 2008. This was supported by Edelman Public Relations survey in January of this year that showed Financial Services & Banking were the least-trusted industries in America. […]

Financial Advisors Minimize Damage of Fiscal Cliff

By now you probably have a pretty good understanding of the Fiscal Cliff and how it may impact you. In essence, it is a combination of expiring tax cuts and proposed budget cuts that if implemented as is, could tip the U.S. economy back into recession. The Fiscal Cliff also has a lot of implications for investors who are impacted by increased taxes on dividends, interest, capital gains, and estates. Virtually every personal tax reduction since 2001 will be rolled back to previous, higher rates.

Can you afford to wait for politicians to legislate some type of compromise or should you be taking a more proactive approach?  […]

Who Are the Real Financial Advisors?

Stockbrokers, who sell investment products for commissions, tell investors they are financial advisors because it reduces sales resistance and improves their odds of making sales. They are breaking an industry regulation when they call themselves advisors, but the claim is verbal in a sales pitch. Investors have no record of what was said to them so the sales reps get away with it.

It is easy to recognize stockbrokers and other types of sales reps. They have two distinguishing characteristics that are difficult to hide. You just have to know the right questions to ask. First, “What licenses and registrations do you hold?” And second, “How are you compensated for your advice and services?” The advisor is a sales rep if the answer to the first question is a Series 6 or 7 license and the answer to the second question is commissions. […]

Trust in U.S. Financial System Drops to a New Low!

The Chicago Booth/Kellogg School Financial Trust Index’s most recent quarterly report showed only 21% of Americans trust the financial system in the U.S. This is the lowest point since the financial crisis started in 2007. And, this study was conducted before the Libor scandal and JPMorgan’s latest acknowledgement of billion dollar trading losses. The combined impact of these two events will reduce this trust percentage even more.

According to Luigi Zingales, a professor at the University of Chicago’s Booth School of Business and co-author of the index, “This suggests that the national banks may be ‘too big to trust”. I could not agree more. The major banks are out of control. […]

5 Signs You Selected the Wrong Financial Advisor

Most investors are not aware there are financial advisors and sales representatives (reps) who have very different services, agendas, and business practices. You can blame sales representatives for the confusion. Most of them refer to themselves as financial planners or financial advisors because they know investors do not want sales reps investing their assets. If they disclosed their real status, they would lose sales.

Following are five tips that will help you quickly and easily determine who are the real financial advisors and who are the sales representatives who are masquerading as advisors. Make sure you select a real advisor by requiring documentation for the following information. […]