Posts Tagged ‘financial industry’
Posted by Larry Doyle on January 20th, 2011 7:06 AM |
Screw me once, shame on you!! Screw me twice, ….
You know how that works. Yes, indeed, we do know how that works. In fact, Americans know all too well that they were badly screwed by many within the financial industry. In the spirit of fairness, there were also many consumers who screwed the system by knowingly falsifying info on mortgages and loans. From both ends, the biggest loser over the course of the last decade has been our virtues of truth, transparency, and integrity. Rest assured, though, that pursuit goes on and it is having ripple effects across Wall Street specifically and the financial industry as a whole.
I see clear evidence of this dynamic in a recent commentary at The Center for Public Integrity. Why are banks very concerned and scrambling to protect their franchise value? (more…)
Tags: abusive lending practices, Bank of America, can I trust Wall Street, Center For Public Integrity, Christine Acosta, credit freeze for small business, customer franchises, Customers Close Accounts to Protest Wall Street, financial industry, hidden bank fees, hidden credit card charges, integrity on Wall Street, JP Morgan Chase, JPM, Larry Doyle, Michael Dalrymple, screw me once, screw me twice, Sense on Cents, transparency on Wall Street, trust on wall street, truth in lending, Wall Street 2011, Wall Street bailout, Wall Street franchises, Wall Street screwing customers
Posted in General | 1 Comment »
Posted by Larry Doyle on March 15th, 2010 12:51 PM |
Pricing power is everything.
What businessman wouldn’t like greater control and influence over the pricing of his goods and services? How are prices determined? In a capitalist system, prices are a function of the competitive forces of supply and demand. What happens when competition dwindles? Pricing power for the suppliers increases. How does competition dwindle? When barriers to entry are so high, or competitors go out of business. This economic reality is also known as an oligopoly and it defines the current state of our financial industry known as Wall Street.
Is Wall Street taking advantage of the lessened competition and flexing its muscle to drive revenue? Is the Pope Catholic? (more…)
Tags: capitalism, CNBC media appearance, crony capitalism, financial industry, financial lobby, FINRA, Goldman Sachs, Goldman Sachs Demands Collateral It Won't Dish Out, JP Morgan, oligopoly, over the counter derivatives, pricing power, Richard Lindsey, Street Signs, to the victors go the spoils, TRACE, Wall Street, Wall Street collusion, Wall Street lobby, Wall Street oligopoly
Posted in General, Goldman Sachs, JP Morgan, oligopoly, Wall Street | 2 Comments »
Posted by Larry Doyle on October 16th, 2009 9:05 AM |
The American public is becoming increasingly wise to the ways of Wall Street and Washington.
Many Americans were duped by financial practices and products emanating from Wall Street. Where was Washington? I would assess Washington’s involvement and responses in the following fashion:
1. At worst, Washington was complicit given a wide array of failed public policy programs, especially in housing. These public policies were largely ‘greased’ by lobbying dollars and campaign contributions.
2. To a large extent, Washington was negligent in terms of oversight, especially on the financial regulatory front.
3. At best, Washington was naive given a general lack of understanding of markets and finance.
The American public is now responding in appropriate fashion. How so? In increasing numbers, they are choosing not to play the Wall Street game. What game is that? Active trading and investing. While the numbers of pure day traders may have increased, the American population at large is focused elsewhere. Where is that focus? On the economy at large and on their individual pocket books.
Washington’s focus on Wall Street and its selling of the market rebound as reflective of a return towards prosperity is a product that will not fly . . . try as they might. Why?
It’s the economy, stupid! Reports this morning indicate that wages will likely show the greatest decline since 1991. Even in the face of declining wages, consumers’ purchasing power is being further eroded by the continuing decline in the value of the dollar. That decline is inflationary which hurts consumers but it continues to present a very cheap funding vehicle for those who want to use the greenback to employ leverage in the markets. Who has the advantage in that process? The large banks. Do they spread that wealth in terms of increased credit and higher savings rates? Now why would they do that?
The American saver and consumer shouldered the cost of the bank bailouts in 2008. They are now shouldering the cost of the wealth transfer to the banks in 2009. While Washington would like to sell this dynamic differently, the American public gets it.
Washington will continue to sell this dynamic at its peril.
LD
Tags: American public, banks, credit, day traders, decline in value of dollar, declining wages, dollar devaluation, financial campaign contributions, financial industry, financial lobby, financial practices, focus of American public, housing, Inflation, investing, leverage, Main Street, markets, public policy, purchasing power, regulatory oversight, savings rates, trading, wages, Wall Street, Washington, wealth, wealth redistribution to banks from public
Posted in Economy, General, markets | 1 Comment »
Posted by Larry Doyle on October 15th, 2009 3:56 PM |
Have you given up on the market? Do you not trust the financial industry? Have you stuffed your money under the mattress? To an ever increasing extent, more and more Americans have become more risk averse when it comes to investing.
Alix Partners, a consulting firm, produced Half of Americans Have Stopped or Reduced Investing and a Quarter Don’t Intend To Invest for at Least Three Years:
Americans will be investing significantly less in the future, according to a new survey released today by AlixPartners LLP, the global business advisory firm, indicating that the financial crisis is likely to have a significant impact on investor behavior over the next several years.
While the U.S. financial services industry is slowly recovering from its biggest losses in decades, investor confidence appears to be recuperating tepidly at best. A staggering 49% of people surveyed who identified themselves as “previous investors” reported either having stopped or reduced investing in stocks or mutual funds and 26% said they had no intention of investing in these bedrock financial vehicles in the next three years. The survey also found that among higher-income households, those earning more than $75,000 per annum, 21% of previous investors reported having stopped investing altogether in stocks or mutual funds. These results could point to a significant structural contraction in the market for financial services firms and financial advisors, while also suggesting that financial companies should be thinking about how to better focus their marketing dollars in today’s uncertain market.
“Investors who had placed their trust in the investment industry are cross, cautious and confused,” observed Clarence Hahn, AlixPartners’ Financial Services Improvement practice co-lead. “And while the collective loss of wealth in the past year has had a deep impact psychologically as well as financially, the irony is that the lost wealth can only be rebuilt through participation in the markets. Financial-advisory firms therefore have two key challenges: to figure out who really is going to start investing again; and to win back trust by building into their offerings a level of oversight, due diligence and risk management that will eradicate the possibility of similar meltdowns in the future.”
While brokers and financial planners will need to figure out how to reengage with a client base that was often ill-served, I strongly believe individuals will need to assume a greater degree of the burden to truly understand the art of investing. What does that art entail? Let’s start with the following:
1. Learn about risk: how to measure risk, how to identify risk, what are the risks in different investments.
2. Learn about the values of diversity across asset classes and regions.
3. Learn about the impact of policy implemented in Washington and the influence it has on Wall Street specifically and finance and investing in general.
4. Learn about the differences in fundamentals and technicals.
How do you start to undertake the above four steps?
5. Read Sense on Cents.
Don’t necessarily give up on investing. Get started on educating yourself.
LD
Tags: Alix Partners, Alix Partners survey, Americans investing less, brokers, Clarence Hahn, diversity, due diligence, Economy, financial industry, financial planners, financial services industry, fundamentals and technicals, Half of Americans Have Stopped or Reduced Investing, identifying risk, investing, investing in stocks and mutual funds, investor behavior, investor confidence, market, markets, measuring risk, money, public policy, Risk, Sense on Cents, structural changes in investing, trust, Wall Street, wealth
Posted in General, investments | 3 Comments »
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