Risk sellers have deservedly seen their wealth manglement arms lose billions under management in the past 5 years as clients realized that their “advisers” were actually looking out for their own profits and self-interests ahead of the client and capital preservation.
This revelation has not been forgotten despite unprecedented central bank efforts to try and convince us all that thinly participated, largely unregulated, hugely leveraged, soaring stock markets are stable, safe and prudent places for investment. The past 14 years of this secular bear have served to hurt the revenues of financial firms that charge much higher fees on client capital in stock markets than capital in bonds or cash. And so as US stock prices have moved back to cycle peaks, and the last financial crash has moved into the rear view mirror, fee desperate firms are literally pounding the table to get cash back into stocks. Trouble is this time, their twice bitten, thrice shy, most lucrative “high net worth” customers, just aren’t taking the bait: multimillionaires are now holding a record 30% of their net worth in cash (along with a further record 2 trillion in cash being parked in corporate bank accounts).
Shake shinny lures all they want, the only thing that will attract savvy cash piles into risk markets from here, will be much lower, investment worthy prices. This clip is a beauty, see: Credit Suisse to ultra rich: Shed that cash! Here is a direct link.