Investment Advice in Ads

 

                       

Ads give only the advantages, and not the downsides of investments being suggested. Why take the advice? Yet, so many investors learn about what they buy solely from ads and salesmen.

               

I have now researched over 1,600 investment strategies that are occasionally or frequently used. I have also looked into the pros and cons of each. And I have not found one that has an exclusive advantage, without at least one disadvantage.

                       

An example: Sellers of gold investments may be selling one type without discussing various other forms, or whether everyone ought to be buying gold, despite looming inflation. The public never gets full information.

                       

Furthermore, investor age, family status, personal psychology, finances and risk, have lots to do with investment choice. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole tweets.)

   

Government Deficits Are Worse Than Too Many Think

                       

Too many American voters appear to think differently but you can be certain that government deficits will spell disaster. For taxpayers and even for those who don’t pay taxes, nor anyone who worries about the cost of living.

                       

Government spending debts can easily be borrowed away. That debt of today, however, is being financed at very low interest cost. Those costs will easily double and triple. Long term rates can conceivably reach 18% or so from under 3% right now,

                       

So we are looking at astronomical debt, with poor prospects of an economy expanding where it can accommodate that debt.

                       

The public will eventually see that today’s spending is only a down payment on future costs, to be paid by heavy taxes and a more worthless dollar. Yes, if taxes don’t foot the bill, a worthless, inflated dollar will.(See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole tweets.)

Big Investors' Fees

                       

Even pros are feeling those adviser fees. Huge institutional investors should be able to get better terms as investors than do smaller investors. Mutual funds do reduce expenses to clients who keep larger fund balances. This is perfectly logical and it’s legal.

                   

But the U.S.government  has not been happy about fee discounts if done in unison by organized major investors. They include; endowments, foundations and pension funds, as part of groups, Institutional Limited Partners Association (ILPA), The group’s members have more than one trillion dollars at work.

                       

They would all like to negotiate lower terms than they have been getting. But it would be against the “anti-trust” law. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole tweets.)

Treasury Department Gold

 

                       

There’s been lots of talk about how Treasury Department gold can be used, or whether it ought to be kept as it is.

                       

At its present price, the gold’s value totals about $400 billion. One suggestion has been to use it to reduce U.S. debt. I would rather not sell gold for this purpose, I feel it will not reduce or affect government spending habits,

                       

I believe the gold holding ought to instead be used to back the U.S. dollar. The stability would be an economic boon. That would also accompany reduction of government spending and debt.(See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole tweets.)

Over-Paid Financial Advisers

                       

As you probably know from my reports, I find professional advisers extraordinarily expensive for most ordinary investors. They take as much as 20% and more of earnings when their cut is 11⁄2% or more of assets managed. Only investors who require estate and tax advice need additional expert consultation.

                       

To make themselves appear necessary, advisers will make up portfolios with as much as ten and more individual funds when just a few, low cost funds will do. The assortment is supposed to be the result of more selective investment thought. But the end result is meaningless, apart from marketing the adviser’s service.

                       

I have written volumes about the subject, but to sum up, let me repeat a simple lesson: Once you learn investment basics, you can manage your own investments with low-cost index mutual funds, (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole tweets.)

                       

U.S Debt Problems

  

                                                         

Most Americans may not yet be too concerned about heavy government financing by enormous borrowing, the equivalent of printing money, and enormous outstanding debt that has to be constantly financed.

                       

Funds for financing business and government are in a Zero Sum game. Funds needed by government to finance huge debt have to displace funds needed by industry. Economists of every stripe concede that. This problem will get worse when government has to raise its cost of borrowing from currently very low to more realistic, higher levels.

                       

Governments can only overcome the accommodation for extraordinary spending and the potential problems they will entail, by expanding the economy. But if the government is heavily taxing while borrowing and literally printing money, it will be curtailing that necessary economic expansion.

                       

To sum up: You cannot borrow forever without hurting expansion because you crowd out funds required for private business to operate normally. There will be business stagnation and inflation. Proof has been shown over and over for centuries. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole tweets.)

Insider Financial Information

                       

No matter how many investors see as government attempts to even the playing field by convicting those who attempt to use inside securities information, too many investors are still missing the facts.

                       

What is illegal is the sale or divulging of information you are contractually not permitted to divulge, as part of your employment.

                       

What you can divulge about your special securities knowledge is vague. Many individuals are convicted of merely lying to government investigators, as in the Martha Stewart case.

                       

Yes, there is an advantage of being an ‘inside player” in the securities field; that has to do with the job or work you may have in the securities industry. But this is not illegal. It does cause a disadvantage to investors who choose to engage such inside players when it’s often unnecessary.

                       

I always suggest investors avoid dealing with inside players. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole tweets.)