Each year, I look forward to attending the prestigious Securities Industry and Financial Markets Association (SIFMA) Annual Meeting in New York City to hear directly from the country's premier industry speakers on the very topics most on our hearts and minds: the state of the market and our economy.
Attending these sessions allows me to bypass the media hype on behalf of my clients and get to the heart of what's happening.
Last year, I reported that senior level professionals were working behind the scenes to fix the unfolding economic crisis.
I advised my clients to hold onto their confidence for the future while managing their financial affairs according to their 'rainy-day' plans.
This year's event struck me quite differently.
As the day progressed, I felt that too many politicians and regulators used it as a platform to congratulate themselves for all that they felt they had accomplished.
I was conflicted as I heard key speakers avoid providing clear answers to what caused last year's meltdown.
As they described new regulations that did not address last year's issues, I wondered if the supervisory lapses that provided the environment for the meltdown to occur were in danger of being perpetuated.
Mary L.
Shapiro, Chairman of the Securities and Exchange Commission (SEC) was our breakfast speaker and went into detail about how the SEC had changed regulations and were taking additional enforcement actions.
However, most of the regulations and enforcement actions she discussed were about controlling the interaction between retail investment advisors/brokers and their clients.
I walked away from that session with the realization that controlling the end-investor relationship was not the regulatory answer that last year's meltdown needed.
My questions about what was being done to implement the proper supervisions to prevent another meltdown went unanswered.
At the end of the day, U.
S.
Treasury Secretary, Timothy Geithner's one and a half hour interview with Charlie Rose was imprecise and evasive, not providing us with any clear sense of direction or perspective.
Although Geithner was bright and cheerful, he did everything in his power to avoid answering a single question with clarity.
When speaking of Troubled Asset Relief Program (TARP) monies, he told us that he expects more financial institutions to return the money they received.
He said, "It will depend on the institution, but for major banks in the country I think that money will come back relatively quickly.
" When Charlie Rose asked him, "How soon, three years? five years?" Geithner would only reply with, "Soon.
" During the mid-morning panel session, Ronald J.
Kruszewski, Chairman & Chief Executive Officer of Stifel Nicolaus & Company, Inc.
, pointed to the real reasons for last year's economic meltdown: unregulated derivatives, reduction in lending standards enabled by Fannie Mae and Freddie Mac, the efforts of Congress to increase national home ownership by encouraging banks to lend to those folks who were not creditworthy, and industry regulators ignoring their supervisory responsibilities by becoming too 'clubby' with the folks they were regulating.
He further asserted that the regulatory and political focuses described during this event were doing nothing to prevent or correct what happened last year.
When he said aloud, "The Emperor has no clothes on," the message of the day was clear for me.
It was clear from other discussions that I heard that the unspoken directive was to rely on the individual investor to circumspectly manage their own affairs rather than depend on the elected politicians and appointed regulators to watch out for them.
Because of this shift in focus from last year, here is the advice I will be bringing to my clients in the months ahead: 1.
Continue to have a well-funded 'rainy day' plan in place.
Don't be caught unawares again.
Depending on politicians and regulators to take care of your financial future is a mistake that can jeopardize all your retirement plans.
Be proactive about taking care of yourself and your family for the future.
2.
Work with a qualified professional.
Planning your financial future with a qualified financial professional you can trust is more important than ever before.
I'm not talking about chasing hot stocks and searching for rates of return.
I'm talking about making good decisions about how you are handling down-side risk in your investments, implementing practical asset protection, reducing taxes, and planning your estate.
The current financial media sweetheart is not your best choice to provide you with the advice you need.
3.
Review and revise your financial plan regularly.
Your plan needs to be reviewed and revised on a much more frequent basis now.
It needs to be flexible, adapting to the changes in the market, regulations, and taxes.
In the past, a family could design a financial plan that would guide their financial decisions for years, if not decades.
Working with a qualified professional can help your plan stay abreast of how each of these arenas affects the whole of your future plans.
Get a planner and get a plan; then learn how to work that plan together.
4.
Only excellence will succeed.
Competition for business in the global economic environment is going to get fiercely competitive.
Its effects on small businesses and job security are just beginning to be felt.
Being average will not be enough to guarantee a strong financial future.
You will need to position yourself and your small business to pursue excellence and efficiency on every front.
I am still optimistic about the future of America.
I am optimistic about what you and I can do to take personal responsibility for our individual futures and how that can positively affect the years ahead.
Working closely with a qualified professional can help you take charge of your personal economic recovery with confidence.
Attending these sessions allows me to bypass the media hype on behalf of my clients and get to the heart of what's happening.
Last year, I reported that senior level professionals were working behind the scenes to fix the unfolding economic crisis.
I advised my clients to hold onto their confidence for the future while managing their financial affairs according to their 'rainy-day' plans.
This year's event struck me quite differently.
As the day progressed, I felt that too many politicians and regulators used it as a platform to congratulate themselves for all that they felt they had accomplished.
I was conflicted as I heard key speakers avoid providing clear answers to what caused last year's meltdown.
As they described new regulations that did not address last year's issues, I wondered if the supervisory lapses that provided the environment for the meltdown to occur were in danger of being perpetuated.
Mary L.
Shapiro, Chairman of the Securities and Exchange Commission (SEC) was our breakfast speaker and went into detail about how the SEC had changed regulations and were taking additional enforcement actions.
However, most of the regulations and enforcement actions she discussed were about controlling the interaction between retail investment advisors/brokers and their clients.
I walked away from that session with the realization that controlling the end-investor relationship was not the regulatory answer that last year's meltdown needed.
My questions about what was being done to implement the proper supervisions to prevent another meltdown went unanswered.
At the end of the day, U.
S.
Treasury Secretary, Timothy Geithner's one and a half hour interview with Charlie Rose was imprecise and evasive, not providing us with any clear sense of direction or perspective.
Although Geithner was bright and cheerful, he did everything in his power to avoid answering a single question with clarity.
When speaking of Troubled Asset Relief Program (TARP) monies, he told us that he expects more financial institutions to return the money they received.
He said, "It will depend on the institution, but for major banks in the country I think that money will come back relatively quickly.
" When Charlie Rose asked him, "How soon, three years? five years?" Geithner would only reply with, "Soon.
" During the mid-morning panel session, Ronald J.
Kruszewski, Chairman & Chief Executive Officer of Stifel Nicolaus & Company, Inc.
, pointed to the real reasons for last year's economic meltdown: unregulated derivatives, reduction in lending standards enabled by Fannie Mae and Freddie Mac, the efforts of Congress to increase national home ownership by encouraging banks to lend to those folks who were not creditworthy, and industry regulators ignoring their supervisory responsibilities by becoming too 'clubby' with the folks they were regulating.
He further asserted that the regulatory and political focuses described during this event were doing nothing to prevent or correct what happened last year.
When he said aloud, "The Emperor has no clothes on," the message of the day was clear for me.
It was clear from other discussions that I heard that the unspoken directive was to rely on the individual investor to circumspectly manage their own affairs rather than depend on the elected politicians and appointed regulators to watch out for them.
Because of this shift in focus from last year, here is the advice I will be bringing to my clients in the months ahead: 1.
Continue to have a well-funded 'rainy day' plan in place.
Don't be caught unawares again.
Depending on politicians and regulators to take care of your financial future is a mistake that can jeopardize all your retirement plans.
Be proactive about taking care of yourself and your family for the future.
2.
Work with a qualified professional.
Planning your financial future with a qualified financial professional you can trust is more important than ever before.
I'm not talking about chasing hot stocks and searching for rates of return.
I'm talking about making good decisions about how you are handling down-side risk in your investments, implementing practical asset protection, reducing taxes, and planning your estate.
The current financial media sweetheart is not your best choice to provide you with the advice you need.
3.
Review and revise your financial plan regularly.
Your plan needs to be reviewed and revised on a much more frequent basis now.
It needs to be flexible, adapting to the changes in the market, regulations, and taxes.
In the past, a family could design a financial plan that would guide their financial decisions for years, if not decades.
Working with a qualified professional can help your plan stay abreast of how each of these arenas affects the whole of your future plans.
Get a planner and get a plan; then learn how to work that plan together.
4.
Only excellence will succeed.
Competition for business in the global economic environment is going to get fiercely competitive.
Its effects on small businesses and job security are just beginning to be felt.
Being average will not be enough to guarantee a strong financial future.
You will need to position yourself and your small business to pursue excellence and efficiency on every front.
I am still optimistic about the future of America.
I am optimistic about what you and I can do to take personal responsibility for our individual futures and how that can positively affect the years ahead.
Working closely with a qualified professional can help you take charge of your personal economic recovery with confidence.
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