About 140 years ago, a retailer named John Wanamaker figured his customers and salesmen had better things to do than spend hours haggling. His invention: Assigning one price, “plainly marked,” to every product.
The price tag caught on nearly everywhere with one major exception: financial services. Investors still have a surprisingly difficult time figuring out what they’ll pay for financial advice, for mutual funds and especially for their retirement plans.
From The Big Picture:
Jim McTague explains why this is the unhappy anniversary of the flash crash:
From Jan. 1 through April 30, 2010, investors put $668 million into stock funds, says the Investment Company Institute, the mutual-fund trade group. By the end of 2010, they had withdrawn about $96 billion. In 2011, there were $135 billion in outflows. This year, there have been more than $15 billion in outflows.
The hazards posed [...]
All of Wall Street’s wildly bullish calls on stocks may be having just the opposite effect, driving wary mom-and-pop investors out of the market despite the long-standing rally.
After all, they’ve been down this road before: One big-name analyst after another advocates a buy, buy and buy some more strategy, only to see a bubble burst that ends up trapping late-to-the-game individual investors.
True to form, Wall Street’s biggest investment houses have [...]
By Andrea Coombes, MarketWatch
SAN FRANCISCO — You’d think a legislative bill to fund the nation’s highways and mass-transit systems would have no connection to your retirement savings. But that didn’t stop lawmakers from proposing an amendment to the bill that would have trimmed a valuable retirement-plan benefit.
The proposal would have raised about $4.7 billion over 10 years by changing the rules governing how people who inherit an [...]
The total value of Americans’ retirement assets stood at $17 trillion at the end of September –a drop of 7.5%from the record high of $18.4 trillion recorded on June 30, 2011.
That’saccording to a reportby the Investment Company Institute, a national association of asset managers. The $1.4 trillion decline can be attributed in part to the troubles of the stock market: The S&P 500 lost 13.9% during the third quarter. [...]
So the little guy sold low and bought high. Sounds about right. When the market crashes again (soon), they will lose what little they had left last time. After I lost half my 401(k) in 2008, I left it right where it was, and started contributing more so I could buy low. I’m not rolling in money, or anything, but I’m willing [...]
Why Investor Optimism May Be a Red Flag
By PAUL J. LIM, New York Times
NOW that the market has risen, investors are becoming optimistic again about stocks.
There are many signs of this. The American Association of Individual Investors, for example, reports that most investors now describe themselves as bullish, versus just 20 percent in July.
And the flood of money that was pouring into bond funds largely out of [...]
“I believe that Harrisburg, Pennsylvaniaâ€™s actions represent the very tip of the iceberg municipal bond missed payments and/or defaults. Remember, the muni bond market is $2-3 trillion in size, so weâ€™re not talking about a minor issue here.
Worst of all, individual investors are the ones most likely to end up getting creamed.
Indeed, ever since the 2008 Crash, investors have been generally pulling money from stocks and putting them into bond [...]
“March 8 (Bloomberg) — Equity mutual funds are burning through cash at the fastest rate in 18 years, leaving them with the smallest reserves since 2007 in a sign that gains for the Standard & PoorÃ¢â‚¬â„¢s 500 Index may slow.
Cash dropped to 3.6 percent of assets from 5.7 percent in January 2009, leaving managers with $172 billion in the quickest decrease since 1991, Investment Company Institute data show. The last [...]