Some recent mail from blog readers has reminded me of an important topic always worth repeating.
Many financial sales firms recommend that their customers/clients borrow money either against their real estate (HELCOs or mortgages) or against their security portfolios (margin debt) as a way of increasing the firm’s fees.
This is predictably devastating for their customers once down cycles arrive and asset prices start falling while the debt does not. Such self-serving ‘advice’ should be illegal.
If you or someone you know has borrowed funds to buy securities, it’s not too late to get a second opinion.
See my post here: Investors Group tightens the leverage noose on the gullible as well as Financial trainwreck assured: borrowing to ‘invest’ at record highs.
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