A look at market performance for last week might suggest that we had a least some good news. The S & P rose over 4% and is well off it’s lows from late November. Benchmark SPY ( index) hit a low tic of 75.45 on the close and Friday closed the day at 88.99. Not bad considering the fact that on the economic front news has been getting worse and not better. I continue to think we are in a bear market as so does my friend over at BARRONS, Alan Abelson.
I just cannot stop reading about this Madoff scandal…. How could this have possibly have happened? How do you keep a scam going that long? How is it possible so many ‘smart’ people got pulled in? It is mind blowing and I am sorry for the people who lost money and I think this has BIG implications for the (diminishing) wealth management business as a whole.
Six years ago I started to invest a significant amount of my time learning about this business. Although I would have called myself financially sophisticated, when I embarked on the journey to manage our own money I realized I had a lot to learn. And learn I did. With my partners at Circle Financial Group we have talked to hundreds of managers, advisors, lawyers, accountants you name it. My biggest take away is this: you have to be actively involved. Have to. Sad to say but it is hard to find people who care as much about you and your family as much as you do. Those people are out there, but they are hard to find. The industry is built to sell product and the more complicated it is the higher the fees. Right at this moment it is clear that the general model is BROKEN. Why do I say that? Because the bond of trust has been broken. People have lost way too much money and I am not talking just hedge funds, but everything. I am going to dedicate an upcoming newsletter to this topic so stay tuned.
A friend sent me this detailed view on what is going on in our economy right now and it is a very thoughtful read. Written by Jim Quinn it is on a site I have not visited before but I found it very useful, especially the chart that highlights how much our administration has committed so far to the various bailouts. Take a look and let me know what YOU think.
On a positive note – I have so much HOPE. Yes so much has failed and is broken but we have an opportunity to reshape the world we live in in to a better world. Let’s all do more, right now, and ask others to do more as well. This weekend I spent two hours with my children serving patients at an elder care facility, most of which have severe memory loss. I left there so full, so fed. Giving, serving, helping others, living a life based on a premise of abundancy is the what can and will heal the world. Blessings………..