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The Trustworthy Financial Advisor

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March 25, 2008 – Comments (6)

 

I have but one thing to say about the financial advisor who advised this guy...  - and since the profanity filter won't let me say it, it rhymes with dick.

6 Comments – Post Your Own

#1) On March 25, 2008 at 7:02 PM, dwot (45.58) wrote:

Looking at this picture off CR I couldn't help but see the higher they go, the harder they fall...

I think that will be true for the market as a whole, so we are just past the peak... 

 

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#2) On March 25, 2008 at 7:20 PM, dwot (45.58) wrote:

Medicare will spend more than it receives starting this year...

 

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#3) On March 25, 2008 at 7:23 PM, ATWDLimited (< 20) wrote:

Oh wowo, I have been warning you guys about the 53 trillion in debt in america and our retarded commitment to expand government and have social security and medicare/medicade, and additional 60 trillion dollars. Visit my blog about americas love affair with debt.

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#4) On March 25, 2008 at 7:27 PM, dwot (45.58) wrote:

ATWDL Canada has a lot of off balance sheet type of debt obligations like that as well, but I think ours is relatively less, something like $1 trillion, which correcting for population means about 1/5th.

Thanks for everyone who's been giving "This is too funny" a recommend. 

I am up to page 2 on Floridabuilder's most popular blog pages.  If you've ever looked there un the "top tens" you'll understand what I mean by calling it Floridabuilder's pages. 

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#5) On March 25, 2008 at 9:14 PM, XMFSinchiruna (27.09) wrote:

Ouch... that's some rough advice... but there's plenty of that going around.  My Mom's been with the same guy for 20 years, and I recently asked her about how he's doing.... she didn't know, so I asked her to ask him for some documentation of past performance.  Turns out he's averaged 4% over 20 years!  Oh the money she's been losing to inflation all these years!

Also, when i first got started investing some years back I let the bank's investment advisor convince me to put a huge portion of my portfolio into bond funds, saying they were every bit as good as Treasuries.  Not only did she not warn me about the macroeconomic factors affecting treasuries going forward, but her claim that they were the same was totally false, and cost me thousands of dollars.  Thank god I took the reigns and found gold and silver early enough in this bull market!

Dwot and ATWD... did you guys see my post about the shortage in physical silver. There is a very real disruption in supply of physical silver right now, which is one reason that this correction will be so short-lived.

Dwot.. I think I read somehwere that your real-world assets are on the sidelines right now.... I sure hope at least some is in an asset class that's harder than paper.  :)

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#6) On March 26, 2008 at 1:45 AM, dwot (45.58) wrote:

My goodness on your mother's advisor...  Some of those year bank deposit rates were better than 4%...

When I first started my retirement plan I think I was getting something like 8.5% per year, which I locked in for 5 years.

Then I got my first of three adviser who ranged from losing 1/3rd of my portfolio to being 3-4% under the market.  I've done well enough to make up for these "expert's" mistakes and to just sit out and watch. 

Your comment about being in the gold and silver market early is why I am not rushing to have assets in gold or silver.  It is no longer early anymore.  

I feel a lot more confidence in the Canadian financial system.  We don't have as much debt, although it has been rising.

I'm looking at this study about Canadians,  http://www.cmhc-schl.gc.ca/odpub/pdf/65704.pdf.

I haven't found Canadian debt yet.  Average weath per household is $383k, but median is $166k, which is a major inequity in distribution of wealth. The top 1/5th of families hold 70% of total net worth.  The median net worth grew more slowly than average net worth, which fits in with my rants about increasing gap between those who make ends meet and those who don't.  Hmmm, in 2005 owners of household's had median net worth of $327k versus $14k for renters.  The wealth gap changed from 18 times wealthier in 99 to 24 times in 2005.

So, in 2005 55% of homeowners had mortgages.  Some where I was reading that 40% of Americans are mortgage-free.  It looks like Canada beats the US here with 45% mortgage-free.  Median net worth with mortgages was $219k versus $525k without mortgages. 

Canadians have different attitudes towards debt.  Most want to pay their mortgage off as quickly as possible.  Half say that when possible they put extra money on their mortgages.

Average mortgage debt to average after-tax income reached 83% in 2006, un from 80% in 2005. 

Dang, prices go up and idiot lenders start giving 100% mortgages, 40 year mortgages, products for near-prime and sub-prime and mixed products. 

Here's a good one, contrasting Canada and US, "Unlike Canada, the majority of mortgages in the US are not funded through deposits held by the lending institutions, but through the secondary market -- 55-60% of US mortgages are routinely securitized."  Canada has a vertically integrated model and there is less incentive to underwrite increasingly risky loans in order to maintain volumes.

In 2006 1 in 400 households fell 3 or more months behind.

This is a dumb report, it then talks about increasing securitization of mortgages in Canada... Dumb, dumb, dumb...  $36 billion in 2006, an increase of 19% over 2005.

More crap...  We had a solid 2.5% mortgage insurance to Canada Mortgage and Housing, and now there are all these competitors.  I couldn't see how CMHC would run into a problems with the appropriate fee for mortgages insurance, but I bet that's no more with the magic of American entering our markets...  AIG, PMI, Triad, MGIC... 

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