We would love to hear from you. Click on the ‘Contact Us’ link to the right and choose your favorite way to reach-out!

wscdsdc

media/speaking contact

Jamie Johnson

business contact

Victoria Peterson

Contact Us

855.ask.wink

Close [x]
pattern

Industry News

Categories

  • Industry Articles (21,155)
  • Industry Conferences (2)
  • Industry Job Openings (35)
  • Moore on the Market (414)
  • Negative Media (144)
  • Positive Media (73)
  • Sheryl's Articles (800)
  • Wink's Articles (353)
  • Wink's Inside Story (274)
  • Wink's Press Releases (123)
  • Blog Archives

  • March 2024
  • February 2024
  • January 2024
  • December 2023
  • November 2023
  • October 2023
  • September 2023
  • August 2023
  • July 2023
  • June 2023
  • May 2023
  • April 2023
  • March 2023
  • February 2023
  • January 2023
  • December 2022
  • November 2022
  • October 2022
  • September 2022
  • August 2022
  • July 2022
  • June 2022
  • May 2022
  • April 2022
  • March 2022
  • February 2022
  • January 2022
  • December 2021
  • November 2021
  • October 2021
  • September 2021
  • August 2021
  • July 2021
  • June 2021
  • May 2021
  • April 2021
  • March 2021
  • February 2021
  • January 2021
  • December 2020
  • November 2020
  • October 2020
  • September 2020
  • August 2020
  • July 2020
  • June 2020
  • May 2020
  • April 2020
  • March 2020
  • February 2020
  • January 2020
  • December 2019
  • November 2019
  • October 2019
  • September 2019
  • August 2019
  • July 2019
  • June 2019
  • May 2019
  • April 2019
  • March 2019
  • February 2019
  • January 2019
  • December 2018
  • November 2018
  • October 2018
  • September 2018
  • August 2018
  • July 2018
  • June 2018
  • May 2018
  • April 2018
  • March 2018
  • February 2018
  • January 2018
  • December 2017
  • November 2017
  • October 2017
  • September 2017
  • August 2017
  • July 2017
  • June 2017
  • May 2017
  • April 2017
  • March 2017
  • February 2017
  • January 2017
  • December 2016
  • November 2016
  • October 2016
  • September 2016
  • August 2016
  • July 2016
  • June 2016
  • May 2016
  • April 2016
  • March 2016
  • February 2016
  • January 2016
  • December 2015
  • November 2015
  • October 2015
  • September 2015
  • August 2015
  • July 2015
  • June 2015
  • May 2015
  • April 2015
  • March 2015
  • February 2015
  • January 2015
  • December 2014
  • November 2014
  • October 2014
  • September 2014
  • August 2014
  • July 2014
  • June 2014
  • May 2014
  • April 2014
  • March 2014
  • February 2014
  • January 2014
  • December 2013
  • November 2013
  • October 2013
  • September 2013
  • August 2013
  • July 2013
  • June 2013
  • May 2013
  • April 2013
  • March 2013
  • February 2013
  • January 2013
  • December 2012
  • November 2012
  • October 2012
  • September 2012
  • August 2012
  • July 2012
  • June 2012
  • May 2012
  • April 2012
  • March 2012
  • February 2012
  • January 2012
  • December 2011
  • November 2011
  • October 2011
  • September 2011
  • August 2011
  • July 2011
  • June 2011
  • May 2011
  • April 2011
  • March 2011
  • February 2011
  • January 2011
  • December 2010
  • November 2010
  • October 2010
  • September 2010
  • August 2010
  • July 2010
  • June 2010
  • May 2010
  • April 2010
  • March 2010
  • February 2010
  • January 2010
  • December 2009
  • November 2009
  • October 2009
  • August 2009
  • June 2009
  • May 2009
  • April 2009
  • March 2009
  • November 2008
  • September 2008
  • May 2008
  • February 2008
  • August 2006
  • Advisor Worries: A Top 10 List

    April 2, 2013 by Bob Veres

    When I asked the readers of my newsletter recently to articulate their biggest professional fears, I received more than 300 messages covering a range of concerns. Here are some of the most common themes I heard.

    1. ERODING CONFIDENCE

    Investor confidence in the fairness of the investment system and in the stability of the global economy has been eroding steadily, scorched by the global economic meltdown, the Madoff and Stanford Ponzi scandals – and, more recently, billions of dollars of political commercials telling everyone how bad things are in America.

    Add to that the blogs from professional doomsayers, news reports leading up to the fiscal cliff and all the rest: Clients are being driven toward a belief that investing (and, indeed, the entire economy) is rigged, the future is dark and the smartest move to make is to dig a hole and hide from whatever is coming next.

    Advisors know the opposite to be true: that the markets are driven by the daily efforts of millions of business owners and workers, and by billions of great choices, creative ideas and hard work contributed to business enterprises and the economy as a whole. But that message is apparently much harder to convey now than it was a decade ago, and many advisors say they are getting overwhelmed by the constant effort to keep clients from losing faith in the economic system.

    2. ANOTHER MELTDOWN

    Advisors worry about the possibility of another self-inflicted global economic meltdown triggered byWall Street and the players in the derivatives markets, along with crony capitalist scammers and Ponzi schemers too tight with regulators to be properly regulated.

    The advisors I talk with, and those who responded to my survey, are not totally confident (to put it mildly) that the investment banks have been definitively prevented from engineering another economic meltdown. Indeed, the same greedy incentives seem to be in place now that existed leading up to 2008.

    Advisors point out that, in the public’s mind, financial planner is approximately equal to money manager, money manager is equal toWall Street, andWall Street in full scandal mode is roughly equal to evil. When brokers and Ponzi schemers masquerading as advisors make headlines, the overall level of client trust sinks. Even worse, that happens at exactly the time when you want to reassure clients that it’s never a good idea to make a long-term bet against the growth and returns of the investment markets.

    3. POLITICAL IRRESPONSIBILITY

    I’m sure you expected this one, although it was only cited by about a third of my poll respondents. Advisors complained that they see no meaningful effort in Washington to seriously address the long-term fiscal health of the country – and the national debt in particular. Many also feel that Congress is far too addicted to special interest money and short-term thinking to make the difficult, statesmanlike choices that we need.

    4. BOND BUBBLE EXPLOSION

    Someday, the Fed is going to take its foot off the brake on interest rates. When that happens, will millions of retirees who invest in bonds open their statements and see an 8% decline in one month? And will those same retirees be hit by a resurgence of inflation just when the bubble bursts?

    It gets worse. Many advisors say that we (you and I, the government, the regulators) have no idea what kinds of bets have been made on bond rates in the shadowy world of derivatives, but that trillions of dollars are probably involved. This could bring down another major firm or a high-profile hedge fund, raising once again the specter of counterparty risk.

    5. FINRA REGULATION

    This is perhaps the least surprising item on the list. If FINRA ultimately succeeds in hijacking supervision of financial advisors, and manages to blur the distinction between fiduciary advisors and salespeople, consumers will be misled about who actually serves their best interests. At the same time, the ensuing blizzard of harassing regulation could drive many smaller advisors out of business. Despite FINRA’s recent statement that it was backing off, few advisors believe it has truly ended its push to become the regulator of the RIA world.

    6. CONSTANT TAX CHANGES

    The big tax package passed right after the new year supposedly made the tax laws permanent – but for how long? As we’ve already seen, the next round of partisan squabbling has already raised the specter of tax law changes.

    This constantly shifting landscape causes people to lose confidence in one of the most basic services offered by financial planners: the ability to model and forecast the future. When the rules of game constantly change, it calls into question the value of long-term planning.

    7. GEOPOLITICAL ISSUES

    Are you worried about a war in theMiddle East? Or what would happen if the theocratic regime inIran decides to plant some mines in theStrait of Hormuz? What about a eurozone breakup or sovereign debt default? Or a destabilizing social collapse inEgypt?

    Any of these could whack trillions off the investment markets. Advisors worry about another terrorist attack, too. Planning for so-called black swan events is especially difficult, which adds to the worry.

    8. POSITIVE SURPRISES

    Even a positive black swan event can have an unexpected impact on the markets. And the world is changing so rapidly that client portfolios could get blindsided from any direction.

    Consider a truly positive development: Researchers find a treatment or cure for Alzheimer’s. This would be hugely beneficial for humankind, but it could bring about a collapse in the nursing home industry.

    What if biotechnology advances manage to greatly extended the human life span? If people lived 25 years longer, it would crippleSocial Security andMedicare, destabilize retirement plans and dramatically raise counterparty risk for insurance companies that sell annuities.

    Or think about the potential for unlimited energy from new fusion technology. A fairly quick shift from a petroleum-based economy would change geopolitical dynamics, boost the economy, decimate the oil industry and foster a dramatic worldwide retooling of everything from cars to power plants. How do you shape client portfolios to plan for something like that?

    9. PROFESSION SHAKE-UPS

    The planning profession itself could go through major changes. One advisor envisions the availability of quality financial advice from online bots and smart calculators; others note that the profession is not remotely ready to shift to the more collaborative work that the next generation of clients will demand.

    Will investment advice become commoditized? Will new software tools force us to re-learn our office technology? What new services will become part of the planning engagement in the future? Those answers could prove critical.

    10. ACCENTUATING THE NEGATIVE

    One final big risk: Advisors may focus on all the negatives, and spend their time on all the factors to worry about, and forget that the positives almost always vastly outnumber the negatives in our society and our investment markets.

    This concern might be described as the antidote for everything you’ve read so far. Advisors talk about the danger of dwelling on all the things to worry about. They don’t want to develop the habit (subconscious or otherwise) of giving advice from the perspective of fear rather than abundance.

    With so many negative headlines swirling around our awareness, how many of us stop and give equal time to the potential upside surprises that the world may offer?

    Originally Posted at InsuranceNewsNet on April 1, 2013 by Bob Veres.

    Categories: Industry Articles
    currency