Why A Large Proportion Of Investment Specialists Aren't Reliable 25213

Last month a big story that made the rounds in the financial media was Jim Cramers (of the Street.com) statement that some hedge-fund managers spread false rumors about an organization to large trading desks and the media to drive a stock price lower. He said this practice is illegal, but easy to do 'because the SEC [Securities Exchange Commission, the U.S. regulatory body] does not understand it.' More over, since the truth is indeed against your view, the exceptionally rich former hedge fund manager boasted, Whats essential when you're in hedge fund mode, says Cramer, will be to not do such a thing remotely truthful.

For anyone of you that remain skeptical about the deceitful techniques of organizations and investment professionals, probably a partners entrance may finally tell you. Why these stories even make big statements is beyond me. As a former industry insider myself, Ive been saying for many years that the investment industry is saturated in investment experts, everybody else from financial consultants to private wealth managers to professional money managers, hard at work weaving the emperors new clothes. But, only once a large mouth like Cramer speaks of the dishonesty that netted him great wealth does it attract attention.

For those of you unfamiliar with the fantasy The Emperors New Clothes I want to summarize it for you. Long ago in a kingdom, there lived an emperor whose vanity was famous. Two swindlers, Luigi Farabutto and Guido, knew they could capitalize on this emperors character defect to produce a huge pro-fit. This lovely linkemperor site has some witty cautions for the purpose of it. They approached the emperor and told him that they would sew him the best possible suits of a really high priced special fabric that would be invisible to anybody that was stupid or of low character. The emperor, fearing that he wouldn't be able to see the clothes, sent two of his men to go see the matches. The men came back, and afraid to tell the emperor they couldn't start to see the garments, told the emperor the suits were one of the most beautiful suits they had ever seen.

Once the emperor went along to see the Farabuttos, knowing that his servants were in a position to see the clothes, he didn't want to acknowledge that he couldn't see the clothes for fear of being considered stupid and of low character. So he proceeded allowing herself to be dressed in non-existent clothes to get a parade through town and proceeded to go through town in his underwear. When he came upon a new child that pointed at him and said, But he's no garments, only then did the emperor realized that he'd been swindled.

It is wonderful to me that many people, even those with millions at investment businesses, really think that their consultant or their firm has their needs at heart. In reality, within my set of 101 Reasons Why Managing Your Personal Money is the Only Way to Build Wealth at http://www.smartknowledgeu.com, Ive given viewers 101 reasons why this really is very, very seldom the case. Of-course, everyone else thinks that their counselor or financial expert may be the one guy or gal at their organization that actually cares about their financial security. If only they could spend only one-day in the trenches making use of their consultant, they'd 999 times out of 1000, experience a completely different story. Ill exchange another method I learned about a top economic expert in a top Wall Street firm that should get your attention.

That prime economic guide maintained several million dollar accounts. Just how he'd get wealthy investors to trust him was to demonstrate for them his ability to choose stocks that performed phenomenally well. To accomplish this, he would find a very thinly traded stock that historically had been very unstable. He would pay for a list of high net worth clients, phone twenty people o-n that list and let them know he was a premier financial consultant at his firm. Of-course, this may not get the attention of these wealthy individuals since they did not know him from Adam. Knowing they'd be unwilling to hand their income to him and start a relationship with him, he would know their concerns. He'd then check out keep these things publish the name of this stock that he'd investigated over a piece of paper. He'd then tell these 1-0 people that his stock selecting system was so good that he was 100% certain that if they committed to this stock, they would create a healthy profit in a short period of time.

Then he'd just take the next 10 people on the number, repeat this fraud, but instead, inform these 10 people that he was 100% certain if they bought put options on this stock that they'd make lots of money from this stock. Before stock moved 2500-3000 approximately he then would wait many weeks. When the stock gained, he'd call the 10 people who he told he was a large number of certain they would make a lot of money from purchasing the stock. He'd ignore the 10 rich individuals he promised would call the 10 people he told to short the stock and make plenty of cash by purchasing this stock, if the stock lost 25% roughly. When he called these individuals they were surprised that he was right regarding an investment that they'd never heard about, and many decided to provide plenty of cash to him.

I tell you this story because schemes like this, designed to make it look as if these investment experts, and I use this term very carefully, really understand what they're doing, when in reality, they're selling simply emperors clothes to you. In fact if you have been reading my sites for some time now, you realize that the methods of diversification, asset allocation, and low volatility are all only emperors clothes as-well. Although they might sound great for you, thats precisely what the very best of most income methods accomplish. They are designed therefore well that they make you feel comfortable and in control. The very best emperors clothes sell customers with no customers also recognizing that they have been highly selected goals. Only search our Down the Rabbit Hole and Educational methods articles at http://www.theundergroundinvestor.com to find why every one of the best-known investment strategies to-day are only emperors clothes.

My estimate of the per cent of professionals that weave emperor clothes every-day to hand to investors is 99%. So that upon presentation to you, they appear to be the finest economic strategies made especially for you, their finest consumers they weave systems, marketing strategies, and sales strategies in complex ways. Only in the end, these methods keep you financially naked, so much so, that even children with no financial level of sophistication, could comment upon seeing these investors that so willingly let themselves be used for a ride, But he has no money. To explore more, please check-out: link emperor.

The truth is, just a week ago, I read this report with claims from the CEO of the firm that handles the records of some of the people in The Usa about what it requires to seriously build success. Many of his statements, though emperors clothes reasons that most of the people accept as fact, were so foolish that I laughed out loud, knowing that he'd been able to place emperors clothes for your top tier of wealthiest clients in The Usa. Do not misunderstand me, it's not that in my opinion that everyone available is out to scam you out of your wages. There are some truly good, honest people available.

But, as a result of how firms compensate their economic consultants, this much is expected. There will come a time, and probably repeatedly, when a expert will have to make a decision between you and himself/herself. Which means the guide will need to choose between doing absolutely the best thing for you and doing something not as good for you but better for his / her income. And having been in the business enterprise, I know plenty of instructors that chose the latter often and rarely any at all that chose the latter sometimes.

Bear in mind Jim Cramer, some-one that developed an estimated fortune of $100 million by adjusting rich clients, stated, Whats important when you are in hedge-fund function, is never to do such a thing remotely sincere, since the fact is really against your view. And when you read Cramers record again, understand that this mentality predominates among virtually all investment market specialists, not merely Jim Cramer..