Juggling Dynamite

This clip is a must watch for everyone using an investment “advisor” to manage their savings. One of the most complex questions that must be confronted is why so many intelligent, hard working people continue to place their trust, hope and capital in the hands of sell-side firms even after they have suffered through cycles of repeated loss.

Hard as it is to accept, I have come to realize that many people do not wish to see the truth. Many prefer to rationalize that they have suffered from one bad apple rather than a whole orchard that is rotten. It is irrational to move on to a new investment firm with the same approach and philosophy as the last and look for different results. Whether the motivation be desperation, naivete or willful blindness, financial suicide is a sad thing to witness.

“Many of those who work on Wall Street go through a process in which they gradually learn that what is perceived as “smart investing” is often unbelievably dumb.

Specifically, they learn that many of the recommendations that Wall Street makes–and the transactions that Wall Street gets paid to facilitate–are not in their clients’ best interests.

And once they learn that, they face a choice:

Continue to make the same bad recommendations and trades.

Or change the way they do business, often in exchange for a lower initial salary.

Here is a direct link.

Good discussion here on the continued deterioration in Chinese earnings and equity markets which typically have led North American equity cycles by 3-4 months. The hosts grasp at the usual straws of “but won’t more central bank intervention reverse all this?” Sean Darby, Global Head of Equity Strategy, Jefferies says first-half earnings for Chinese firms are set to be one of the most disappointing on record. (Accent alert: Sean talks at the start about a build up in “inventory” being a negative but he pronounces it “infantry”. LOL)

Here is a direct link.

Also see WSJ:  No shelter from China’s export storm.

“Former Pennsylvania Governor Ed Rendell has a message for the Republican and Democratic parties and their leaders this political season: Don’t wuss out.

The two-term Democratic governor — and a former Democratic National Party chairman — is also the author of the book, “A Nation of Wusses: How America’s Leaders Lost the Guts to Make us Great.”

According to Rendell, politicians change positions too often, refuse to admit mistakes or credit their rivals and won’t say “no” their base. Underlying these and other signs of “wussiness,” says Rendell, is a lack of backbone.” Here is a direct link.

Ps. true leaders lead, they don’t cower and pander to the status quo