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Investing Scandals & Scams: Tell The Truth And Don't Steal From Investors!


We humans are as inventive on the "Dark Side" of economic activity as we are in developing useful new goods and services. In the face of substantial economic rewards, however, several corporate executives cannot resist taking an additional dessert even before their shareholders have finished dinner.

Below are a few candidates for upcoming "Blockbuster Scandal Awards" (B S Awards, if you will): Variable Life Insurance Coverage & Annuities, Wrap Accounts, Portfolio Window Dressing, Asset Allocation Mutual Funds, as well as Obscene Executive Compensation.

1) Variable Insurance & Annuities: Variable products are a relatively new thing within the insurance industry, circa 1980 or so. Prior to that, the conventional wisdom named the Shock Market too risky for Life Insurance Policy as well as Annuity Contract guaranteed benefits.

In reality, these advantages had been "guaranteed" for such a long time that it became a generic expectation of any individual in the market for either. Why then did the State Insurance departments collapse during the Variable Product lobby?

2) Wrap Fee Investment Accounts: From the very start of riches, the very affluent employed Investment Managers to protect and to improve their portfolios.

The majority of Investment Managers had just a number of major clients that they tended to as the rest of the fledgling financial industry focused entirely on property protection and estate development through life insurance.

Nearly all investors today will employ many Investment Managers and never really speak to any of them. If this describes what you're dealing with, contact a nz fsp from any of the new zealand offshore banks by simply searching: fsp new zealand.

3) Portfolio Window Dressing: Every quarter, each year, we hear about the corrections that portfolio managers make as they make an effort to look smart to their major clients.

Today in a discipline (Investing) that they all basically recognize as a long-term commitment to some precise strategy or plan, why do the Experts of the Universe spend so much time adjusting their short-term performance numbers?

Why is this viewed as business as usual rather than common theft?

4)Asset Allocation Mutual Funds: I view Asset Allocation a bit differently than a lot of professionals seem to and I manage and monitor a portfolio's structure utilizing the cost basis of securities rather than their Market Value.

But how, realistically, can a one-size-fits-all Mutual Fund be the appropriate mix for all investors?

5) Corporate Executive Compensation: I passionately believe that all of us have the right to get filthy rich, legally of course. I respect anybody who gets there legitimately because their success brings about jobs, opportunities, wealth, and a higher quality of life for everybody.

But, whenever they sell shares of their successful businesses to the public, they have an obligation to share future profits and growth. Obscene executive suite compensation (all the down to the chauffeured limousines) is actually stealing from investors.

Four of the 5 candidates for this year's Blockbuster Scandal (B S) Awards have been created on Wall Street. The 5th is ignored by it. Which one affects you most?

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