News From the Control Tower - 4/26/2023
If you’ve been watching the new season of Succession, the power games that the characters play can make you dizzy. So can some of the numbers they throw out. The Financial Times this week breaks down some of the economics behind the story. I love a good story about the perils of using a robo-advisor. (Unfortunately there are way too many of them.) In this one, clients lost money because of material misstatements made by Betterment. The SEC settled for $9 Million, but what did the clients get, other than bad advice? Where is the accountability? We advocate hiring a fiduciary for a reason, if for nothing else than you can hold them personally accountable if they mess something up. Meanwhile, First Republic was undone by kowtowing to wealthy clients, and car dealers wanted to get in on the inflation action by marking up cars even more. Finally, homebuilders are cutting so many corners that no one wants to buy a house built post-2010.