-=PCTechTalk=- Re: offtopic,mutual fund questions

  • From: "cristy" <poppy0206@xxxxxxxxxxxxx>
  • To: <pctechtalk@xxxxxxxxxxxxx>
  • Date: Sun, 1 Feb 2009 23:19:06 -0500

HI Gman,

Whew!  hee hee...read it twice to absorb it all.  I thnk I will just shoot 
him an email with a question about the guided portfolio.  Thing is, I know I 
asked him about it last time we met in person but honestly was still 
confused, it was just 50 bucks a year I thought I did not really need to 
spend but did it anyway and have for the past year and a half or so.  But I 
have had net losses pretty consistently for the past year and one half 
(coincidence? I dont know).  I hate feeling dumb asking him questions but I 
did not graduate financial investing 101. lol.
christy



----- Original Message ----- 
From: "Gman" <gman.pctt@xxxxxxxxx>
To: <pctechtalk@xxxxxxxxxxxxx>
Sent: Sunday, February 01, 2009 7:53 PM
Subject: -=PCTechTalk=- Re: offtopic,mutual fund questions


> Cristy,
>    Using email, I don't have the means to pour over your investments to
> help you determine the answers you're seeking here.  However, I'm a little
> confused myself as to why you have both a financial advisor AND a 
> portfolio
> guide service.  Since you initially asked about mutual funds, you ALSO 
> have
> the already paid-for services of the mutual fund's managers, which is a
> group of advisors who's job security depends on how well they can predict
> the market and make money for you.
>
>    If you really think about it, the only folks who's own financial future
> is truly linked with yours is with the mutual fund management team.  They
> also have more insider insight into what's going on behind the scenes 
> before
> they make changes to their portfolio.  You can pull out of the agreements 
> if
> you're not happy with the performance/advice you get from your advisor 
> &/or
> the portfolio guide service, but that doesn't threaten their business.
> They'll still have plenty of other clients and they'll lose very little.
> However, it's VERY much in a mutual fund manager's favor to always stay on
> top of everything in their area of expertise in order to keep their job. 
> If
> they fail the fund, they're fired and lose everything.  For this reason, 
> the
> safest bet is always going to be on a well managed mutual fund.  Just keep 
> i
> mind that there are different types of funds with some focusing primarily 
> on
> stocks and quick turnarounds, others that divest between stocks and bonds
> (both tend to move in different directions depending on the overall
> finanical climate), some that focus on divident producing investments, 
> some
> that focus more on overseas opportunities, etc..  To that end, not all 
> funds
> are right for all investors, so be sure you're comfortable with the type 
> of
> fund approach that you're money is going to.  Also, compare different 
> funds
> of the type you wish to use to make sure the one(s) you use have been well
> managed over a long period of time.  Some will obviously have better
> performance than others.
>
>    Having said that, several other thoughts still come into play here.
> Some are universal and some apply specifically to your situation.
>
>    Universally, those who are in control of the overall financial picture
> of the world have made some mighty huge long-term errors (it can be traced
> back at least to the US government's establishment of the Federal Reserve
> Bank, but I'll argue that it goes back quite a bit further than that) and
> brought about the present worldwide financial crisis.  As a result, even
> large businesses are losing tons of money.  Some have already gone under 
> and
> some others won't be around much longer.  It's during times like these 
> that
> we'll see more and more consolidation as some better off businesses will 
> do
> all they can to buy up their not-so-financially-healthy competition.  As
> competition lessens, prices go up and that just makes things worse for
> regular folks like you and me.  As folks like us have less to spend, we 
> buy
> less and that affects ALL businesses, but especially those who specialize 
> in
> non-essential services such as home improvement contractors (heat is more
> important than home improvement), restarants (folks eat at home more 
> often),
> entertainment (who has money for going to the movies of theater these
> days?), etc..  Since small businesses are the true economy movers (much 
> more
> overall money trades hands through small businesses than through large
> corporations), THIS situation is what's going to force the various world
> governments' hands more than anything into forcing the money controllers 
> to
> turn things around again.  If many more of our small businesses go under 
> due
> to lack of customers, some countries (including the US) could collapse in 
> on
> themselves and we'll all lose much more than our money.  I appologize if 
> any
> of this is making you more nervous that you already were.
>
> My apologies to anyone following this thread who is not a US citizen, but
> I'm going to focus specifically on the US for the next couple of 
> paragraphs.
>
>    As I see it, the US government is WAY too big, spends WAY too much on
> nearly worthless endeavors where they don't belong in the first place and
> they don't even have any of their OWN money (they don't produce anything, 
> so
> how can they earn money?).  It's the taxpayer's money that they're 
> spending
> on so many things we, the people, simply don't need.  They need to start
> spending our money on things that will create new jobs and put those in 
> need
> back to work.  Individual states try to brag about how they were able to
> create 12,000 new jobs last year, but they fail to mention that 130,000 
> old
> jobs were 'repositioned' overseas.  Of course, that's great news for the
> other countries that received the jobs, but the losses here are a rather
> significant part of what's hurting our economy, and that's on top of the
> already straining financial market caused by the gov't printing too much
> money to fund their various wars and skirmishes around the world in the 
> name
> of "democracy".
>
>    The reason why I bring all of this up is not to frighten you.  It's to
> try and explain that there's a lot more to the financial health of your
> portfolio than just how well some guy picks out stocks, bonds, etc.. 
> Until
> the world's government leadership makes most of the changes needed to turn
> things around (here in the US that responsibility falls on Congress, not 
> the
> president), our collective portfolios will not be able to fully rebound 
> from
> the damage already caused by so many dumb laws, ignorant (but usually
> intentional) loopholes and money wasted on things that aren't in the best
> interest of the people providing that money.  So far, Obama appears to be
> doing all he can to lead the charge towards turning things around, but 
> he's
> going to need a lot more firepower than just his presidency to get things
> done in a hurry.  He's not the one with any real power to make changes to
> the laws that have allowed lenders to pillage us for years.  Again, that
> responsibility falls to the lawmakers and they are not hearing enough
> warnings from the people who pay their salaries and elect them into
> positions within the Senate and House of Representatives.  In fact, most
> folks seem to think that the responsibility falls on the presiding
> president.  Since they tend to take their frustrations out on the 
> president,
> Congress doesn't even get to hear them.  If everyone would direct their
> displeasure at their own representatives in Congress, we'd see a LOT more
> things 'fixed' in a really short amount of time.  It would also give Obama
> plenty of fuel & momentum to really push them into taking things off the
> books that have been hurting the country (such as the laws that currently
> allow credit card issuers to continue gouging us with ridiculous rates, 
> fees
> and penalties for the next 17 months or so).  If you want to help the
> country get back on track, research the issues and get in touch with the
> folks who make the laws we all have to follow.  It's the only way to make
> sure the laws actually work FOR us instead of AGAINST us.  If we don't do 
> it
> ourselves, the only voices the lawmakers will continue to hear are those 
> of
> the lobbyists, and they only care about the folks who hired them.
>
> Ok, that should be enough of the world/US news to give you a wider view of
> why things aren't going so well right now.  So let's talk about your own
> situation some more.
>
>    If your personal financial advisor has never given you any reason to
> doubt his/her advice (never intentionally stung you), I would suggest
> spending a little time with that person discussing your options.  In order
> to sell that kind of service, they must pass a relatively long test to 
> show
> that they understand each of the options available to their customers.
> While it's definitely not the same thing as going to law school for 4 
> years,
> it still ensures that they are up to date on what's available to their
> clients and that's more than I can say for myself, having been out of that
> business for nearly 20 years (things change every year).  I tend to agree
> with the advice to stay away from portfilio guide services unless you plan
> to use them as your primary financial advisor.  You don't need two of them
> unless you're rich and want to split up your investments among several
> services.  But if you're rich, you'd hire one to only work for YOU and
> forget all of that.  Unlike a service, his/her job would then depend on
> their ability to keep your money growing.      lol
>
>    Take along a small tape recorder and ask them for permission to tape 
> the
> session before you begin.  That way, you'll be able to relisten to the
> conversation, research any items or topics that need to be clarified, look
> up and compare specific investment ideas they mention and finally make an
> informed choice about how you'll weather out the remainder of this 
> financial
> storm.  It's great to have faith in someone else making educated 
> suggestions
> (like you have with me), but nothing beats knowing what's going on when it
> comes to that kind of a relationship.  I know this appears to be the
> opposite of what I said yesterday, but the difference is that you're 
> putting
> your faith in a single person who doesn't need to perform at peak
> performance in order to stay in business as opposed to a more diversified
> fund management team who MUST get the best returns on the investment money
> they handle.  Of course, if they're investing your money in mutual funds,
> you're hopefully getting the best of both worlds.
>
> Peace,
> Gman
>
> http://www.bornagainamerican.org
> "The only dumb questions are the ones we fail to ask"
>
> ----- Original Message ----- 
> From: "cristy" <poppy0206@xxxxxxxxxxxxx>
> To: <pctechtalk@xxxxxxxxxxxxx>
> Sent: Sunday, February 01, 2009 5:46 PM
> Subject: -=PCTechTalk=- Re: offtopic,mutual fund questions
>
>
>> HI Gman,
>>
>> I must admit I am a bit uneducated in all of this but have put faith in 
>> my
>> financial advisor.  Under normal circumstances, I would know I will be
>> working for at least ten more years so would make sense to leave it in.
>> But, there is a possibility I could become disabled before then possibly
>> to
>> the point of not being able to work, so this part is a little risky for
>> me.
>>
>> I also am somewhat confused about this portfolio guide service they
>> offered
>> that I went ahead and signed up for again on my advisor's advise.  I pay
>> about $50.00 bucks a year and the powers to be decide best where to put 
>> my
>> money.  It also gives you projections or something too.  I had noticed my
>> money in the +gain side before I went to this service, coincidence, I
>> don't
>> know.  But for the past year and one half have seen all -loss signs in my
>> total amount of my funds.  I did do one withdrawal a few years back but
>> was
>> for a good reason and this was agreed that it was with my advisor.  To 
>> buy
>> back service credit at a very good rate at the time.
>>
>> I have steadily increased my monthly amounts going in also.  I am
>> wondering
>> how did they determine where to put the money before the guided portfolio
>> service and was it doing better then since I was seeing more gains than
>> losses.
>>
>> christy
>
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