Monday, April 10, 2017

Tribes, Collegiality & The Systemic Death of Professionalism - Part III "Personal" Financial Planning

                                  Tribes, Collegiality &
The Systemic Death of Professionalism - Part III
"Personal" Financial Planning

If you are kind when you should be cruel;
you’ll be cruel when you should be kind
Judaic thought

Tribe – clan, ancestral
Tribal - clannish
Profession – occupation, vocation
Professional – proficient, certified, licensed, authority, specialized

            The concept of a profession assumes:

·         An assured level of competency
·         Substitute reliance (from the client, patient to the ‘professional’ beyond that of caveat emptor ((buyer beware)) standard of the ‘trades’ and ‘businesses’). Reliance on the another's statement or ability is a, claim or promise then the person upon whom one relied is entitled to expect performance. Substitute is  a surrogate, stand in, deputy.
·         Self accepted & imposed (though rarely disposed) Ethical Obligations

Thesis: the assertion of a profession and professionalism is primarily a self absorbed trade declaration wrapped in claims of self imposed ethics masking the reality of being but a trade association for self protection of  the clan/tribe’s economic benefit even if it means sacrificing & at the expense of  assured level of competency and substitute reliance. Furthermore, systemically, professional collegiality amongst the clan/the tribe (regardless of haughty self absorbed declarations for the good of the client’) also supersedes assured level of competency and substitute reliance. And the ‘few bad apples’ defense (let alone the chunk up – of context – ‘millions satisfied and these are isolated incidents’) is  just retort, deflection, and spin to avoid responsibility

Stipulated Qualification: ‘Client Amnesia©’ is a real but not offsetting defense of the professions examined though not limited to below. Clients suffer – all too often – from client amnesia – selective & convenient loss of memory of their own responsibility looking to blame everyone but themselves for their own actions.. This client amnesia is a strain – enhanced & geometrically perfected by ‘takers’ (Leftist Collectivist Progressives and Liberals) - to play the victim – be offended – rather than accept one’s own responsibility – while seeking recourse at others’ expense

Collegiality: Personal Financial Planners,
Their Trade Associations, & Their Irregulators

Unfortunately the above story is not limited to irregulators in insurance arena. Today there is a legislative argument over what is called The Fiduciary Rule for financial planners, advisors etc. The intent is to create a higher standard of care. And what is the purpose of this higher standard of care: hopefully to prevent or minimize fraud and abuse.
Now even according to hitch hiker of virtue Consumer Federation of America’s Roper in the ‘90’s, ‘all fraud and abuse is a question of compensation.’ Twice defeated in the Colorado legislature,  I was the catalyst and co author (Colorado legislators carried the bill) of bills in the ‘90’s that would have created a deterrent (treble damages) and legal fees under existing law (Colorado Consumer Protection Act) without creating a bureaucracy (with no stay out to prevent revolving doors). The bill required an estimate of all compensation upfront (not just method) and actual amounts quarterly reported to the client. Democrat State Insecurities Commission Phil Feigin fought the bills – worked to defeat them and then represented in private practice an insurance/agent planner who, had the bill Feigin not fought to defeat been enacted and while though the schmuck would still be probably be in Canon City –  fewer clients would have been fleeced. Feigin after his Colorado State Insecurities Commissioner stint but before reentering private practice again became head of the State Securities Commissioner Association (NASSA).
Collegiality trumps incompetency.

The tax exempt (alleged) not for profit tax exempt College for Financial Planning, certified financial planner trainer, owned the CFP (Certified Financial Planner) trademark. The CFP Board, the self regulator of CFP’s, had a committee to oversee CFP Trainers. The College – a trainer – was on the committee overseeing itself and other trainers (sort of like Dracula guarding the Bloodbank).
The College incorrectly and knowingly continued to train then 40,000+ CFP’s (not including all that were not granted the mark) in wrong math methodology to determine a client’s retirement needs. And the College continued despite this being brought to it’s attention, despite Forbes’ expose ‘Bad Math, Bad Advice,’ despite the likes of world class mathematician like John Allen Paulus (I hope I have his name correctly spelled) seconding my contention. The impact of this wrong math methodology – would be to save too much, save too little – etc etc for retirement– effectively and conceivably harming clients in the multi multi millions or  billions
I was the one to start and continue the fight – no thanks to the rest of the pusillanimous lily-livered  spineless coward financial planning association officers and officials – the same one’s who pontificated the virtues of ‘the profession.’
Concurrently then, with the College controlling the CFP mark and the certification of CFP trainers, though a trainer itself, it was able to amass as a not for profit tax exempt over $120 million. How? Effectively through structural barriers to trade, the College was a monopoly constructively keeping out other institutions from offering the CFP designation. (Alleged clever tricks like sending the materials to a competing higher education institution offering the courses – after their quarter began – was not beneath The College).

NAPFA, the National Association of Personal Financial Advisers, the association of fee only personal financial planners which I cofounded – not only stood on the sidelines forgetting ‘assured level of competency’ relative to the College, but its President sat then on committees of the CFP Board which effectively the College controlled – a major conflict of interest. Worst, the NAPFA President wrote to the membership calling me ‘a terrorist.’
Collegiality by NAPFA as well as the CFP Board!
The upshot: I resigned from the weenie gutless yellow belly NAPFA organization. Subsequently, but without any finger pointing at then past conflicted President, NAPFA outlawed its officers and officials from concurrently sitting on another financial planning organization board. As for the College, most likely fearing an anti-trust suit for its monopolistic structural barrier to trade as a not for profit – disgorged the CFP mark and sold itself to the people of Phoenix University.
Cowardly collegiality (NAPFA) turning tail against one of its founders (who was proven to be right) was essentially a co-conspirator in attempts to cover up ‘bad math bad advice’ failing ‘assured level of competency and substitute reliance. The former President involved in trying to quash the uncovering of the College’s bad math, bad advice – to this day goes unscathed.

Monday, January 30, 2017

"SACRIFICING" Jewish Personal Financial Planning

 Satisficing – Jewish Personal Financial Planning

Is there an inherent bias against ‘enough’ in our language?

“It’s so satisfying”
paraphrasingMars’ Snickers Commercial Jingle
(same Mars that owns Banfield Vet Hospitals that aren’t so satisfying)

            The root word ‘satis’ is Latin means ‘satisfactory, adequate, enough.’ As such, colloquially in American culture (and others) enough is merely adequate a ‘C’ whereas ‘more’ is the preference – assumed to be ‘better, good and worthy’ as per Rockefeller when asked what was enough – he replied ‘a little more’ and yet as  e.e. cummings wrote, ‘more, more, more – what are we all morticians.’ The irony in personal finances ‘more, better, now’ has a habit of becoming ‘less, worse, later.’
            Back to ‘satis’ and it’s implications:
            American Nobel-laureate Herbert Simon coined the word ‘satisfice’ to mean aiming for a satisfactory – adequate result rather than the maximum or even optimal result in negotiations – and decisions. Per satisficing ‘good enough’ is enough.
            I would counter – in personal financial planning with the filter of ‘managing goals rather than managing assets’ good enough – is making the goal. If the goal after tax and inflation risk adjust requires 4% and the Dow Jones even after tax and inflation is 14% - who cares under the assumption of managing goals. But under the ‘more, better, now’ comparative assets under management heuristic – the financial advisor/asset manager in personal financial planner masquerade – the advisor failed.
            Why because the masquerading planning – the planner pretentious – was in the ‘more’ business – the assets under management business – managing assets not goals – NOT in the personal financial planning business regardless how one particular writer who also works for an asset under management firm tries to white wash the situation.
            Good Enough – making the goal – is not Enough for the asset under management personal financial planning pretenders – and this hoax is reinforced by the compensation method of a percentage of assets under management – rather than compensation that reinforces the model of ‘managing goals.’
            Asset Under Management compensation holding themselves out as Personal Financial Planners – ain’t so satisfying nor satisficing.
            The so-called titling personal financial planning firm compensated by assets under management – is something to ‘snicker at’ and in reality from ‘mars.’


            Still, how could Yaakov give so much to Esau (though some might argument in appeasement)? Because as Yaakov/Israel said ‘I have plenty’ as in Shaddai (Hashem) – the ultimate ‘enough’ beyond the current currency – of the ultimate currency – faith that Shaddai ("God, God Almighty, God All Sufficient, Enough") is Enough to ‘more’ than ‘suffice.’ )
            Obviously, Yaakov would not engage an ‘assets under management’ faux personal financial planner – though Esau probably would.

Monday, December 19, 2016

Unemployment & Inflation Statistical Fairy Tales:

Unemployment & Inflation Statistical Fairy Tales:
"Lullabys, Legends, & Lies"
(per Bobbie Bare song)

When Bush had good unemployment numbers, the refrain from the Democrats was 'look at the quality of jobs - people are having to have 2 and 3 jobs - the rate doesn't take into account 'underemployment'"

The same Democrats now herald their 4.6% unemployment rate - though
1) the average income is down in the past 8 years from $52K to $50K and worse when
        a) one looks at real inflation (not BS inflation) to lower which effectively reduces the income further in terms of goods and services that can be bought

        b) the quality of the jobs (selective memory)
        c) the amount of goods and services that can be bought given the fallacy of Obama care which increased costs rather than 'if you like you doctor, you can keep your doctor, if you like your insurance plan, you can keep your insurance plan, and you'll save per family $2500.'

2)So if anything, adjusted the $52,000 in terms of goods and services adjusting for inflation and Obama night mare - is what $45,000 or less a 13% decline in average standard of living - due to Obama --- SO DAMN MUCH FOR THE VERACITY OF THE 4.6% UNEMPLOYMENT - WHICH IS UNDEREMPLOYMENT RATE AS WELL....

Yet, 10,000 boomers a day are leaving the workforce - but that is way more - way more than offset by those who have just given up - such that the denominator (?) in calculating the rate without adjustment is complete fabrication UNDERSTATING the rate.. thus the quality of the unemployment rate is a figment of the administration's imagination Obama's & The Egalitarian Totalitarian Progressives' Economics Professors with Tenure (Scholar Barrens) who have never made a payroll -Lullabies, Legends and Lies

PS one further note - look at for example a Triscit(?) box or the like selling at the 'same price' - (I used Triscit not knowing or knowing they do this but have seen this with other products) so the price looks the same but the goods are less - hiding the inflation from the IYI (intellectual but idiots) on the inflation rate etc...(Talk about the violation of Torah relative to weights and measures!)

Remember all money is is goods and services (stored or consummed). Therefore the same price per box and less Triscits - less goods and services and the money is worth less - though the inflation rate may not (probably does not) reflect this game at all.

Personal Financial Planning: Managing Goals or Managing Money?

((sent to Investment News - of course, no response - oh their revelation question (no, there is gambling at Rick's Cafe??) is personal financial planning about managing money (now that the compensation from assets under management is being compressed by robo advisers?))).....

Personal Financial Planning is about managing goals NOT managing assets. Period.

Otherwise personal financial planning is merely a Trojan Horse for being an unnamed Asset Manager. Furthermore, with the emphasis on managing assets not goals being  1) if that is how one is compensation (managing assets aum) then as Maslow stated 'if all you know is a hammer everything looks like a nail' 2) the personal financial goals and their alignment to life mission/significance becomes a second rate citizen relative to attention of the asset manager masquerading as a personal financial planner.

Personal financial planning was born as a marketing ruse for the sale of product. The movement to AUM - worse  if managing asset selection directly - is just a another pretense and disguise. It's wrong headed enough (in my opinion) that asset under management compensation is inherently conflicted with managing goals - making other than asset accumulation goals (for which 'the planner' is compensated) the orphan second class citizen child. Add picking stocks and bonds - that doubles down the focus on the asset accumulation area - at the expense of other goals and led the conflict of so called planners telling clients to mortgage up to their ying yang - so there could be more monies to manage. (Real smart - playing hedge fund with the client's shelter ??)

There are always conflicts which gets to the question of full NOT fool disclosure - yet picking stocks and being compensated on this basis is in my opinion - mutually exclusive with the personal financial planning process as it is held out to be.

Final note there is a huge difference between process consulting (which is what personal financial planning is supposed to be and is held out to be) and resource consulting (an expertise on a subject or area - i.e. a product etc.). It is difficult enough to do process consulting let alone at the same time be the resource consultant on which one, what kind of particular this or that.

The great Rabbi Hillel was asked to explain Judaism while standing on 1 foot. He replied don't do unto others that which is unpleasant to you.... The rest is commentary, go study.'

Personal financial planning is managing goals (for prioritized alignment and realization relative one's values). The rest is commentary or just an imposter rationalization for resource consulting for asset management.

Wednesday, December 14, 2016

The MOREon Cascade of Cain: Fear, Acquisition Self Interest, Selfishness

As a child, I remember my mother calling me ‘selfish’ – and not a few times. (Of course, my retort was, ‘you’re a mean Mommy.’
Nevertheless, in cogitating on ‘selfish,’ selfish is a derivative of the following cascade:

Fear of Extinction (sense of self identified as the body)

            Desire for Permanence, Continuity, Certainty (immortality of body
                        -Everybody wants to go to heaven- nooobody wants to die – T. Rogers)

                        Fear: Lack of permanence, continuity, certainty

                                    Strategy: Buy It (Acquisition – Cain in Hebrew –
yes, as In Cain & Abel)

                                                Substrategy of Acquisition: More
                                                            (as there is Never Enough)

                                                                        Self interest & selfishness
                                                                        Palliation to cope, deny & deflect

            NOTE: Shaddai (meaning Enough – as in God, God Almighty, God All Sufficient, Enough – is not in this cascade. Thus, herein lies the test of faith – as Shaddai – as the ultimate Enough.

Do better, Cain

Sunday, December 11, 2016

More, MOREons & Peggy Lee

More, MOREons & Peggy Lee

Is that all there is, is that all there is
If that's all there is my friends, then let's keep dancing
Let's break out the booze and have a ball
If that's all there is
Is That All There Is sung by Peggy Lee

            When the MORE explanations, rationalizations, and justifications are scratched & scrapped off the surface ‘it that all there is,’ underneath  – the Yatzer MORE inclination – the MOREon co-dependency a derivative of acquisition. Whether genetic and or acculturated, More is a temporary palliative (usually requiring higher and higher ‘hits’ aka dosages) to deflect from, and deny ‘is that all there is,’ unless one has come to meaning IN their life.
            And even ‘Enough’ is deflected and recycled to More per the Rockefeller answer to the question of ‘what is enough?’ –‘a little More.’
            The More imperative (The Yatzer More) is but a derivative of man’s primary strategy seeking immortality via acquisition though immortality is masked in the futile pursuit of permanence, continuity, certainty (PCC before PC???). Regardless of verbal assertions to the contrary as well declarations of belief and faith in ‘the soul,’ we identity with our bodies as ‘I’ and fear it’s extinction – as ‘that’s all there is.’ (1950’s comedian Timmie Rogers made an identifying slogan to this day with his line proving the above, ‘Everybody wants to go to heaven. But noooooooobody wants to die.’
When More isn’t forthcoming or not enough (which is a little more) palliation is the typical respite of the MOREon and Yatzer More to cope –requiring higher and higher dosages. This palliatory coping mechanisms include psychiatrists (who teach what they typically have to learn themselves), psychologists (in reaction formation constantly trying to prove they are as good as shrinks), and other anesthetize with the Oprahs etc.
            (Okay I have dog – God’s emissary – chaver ((friend)) of the soul)
            More is a default cope which deflects reflective anxiety substituting action which nevertheless covers up (the hole in the soul) and ironically defers (‘is that all there is’ confrontation) but in the end increases the anxiety and the need for a fix and higher dosage of More (since there is ‘never enough.’). Thus, there is a co-dependency relationship with More: MORE, Yatzer MORE & MOREons. (The Moreonic Trinity).

            There will always – yes always be an addiction to More which is never Enough unless there is meaning IN one’s life – such that the requirement is just Enough – enough to live on enough to live for.
            Otherwise – ‘is that all there is, my friend’ then lets keep dancing’ with More.

Sunday, December 4, 2016

Yoda The Goldsmith: Financial Planning’s Lamp Lighting Failure to Ignite”

 Yoda The Goldsmith:  
Financial Planning’s Lamp Lighting Failure to Ignite

            “A goldsmith had an apprentice. When he finished teaching him the craft, he wrote down for his student all the steps in the process. However, he did not write down that he had to ignite the coals before he started, because that was the main thing, and unnecessary to mention. However, the student forgot (and unable to produce results – jds)
            This parable is easily understood. The main thing (in serving G-d - & in the profane in serving the client-jds) is that there be a spark of fire that can be (or is to be aligned to  jds)  ignited.”
Ben Poras Yosef, p119b (with apologies from jds)

            Given the compounding failure to ignite effect of the MOREon acculturated personal financial planning heuristic (*) without alignment to meaning IN one’s life,  efficiency will prevail over effectiveness thus carrying ‘coals to New Castle.’  Result: the wrong thing (ineffective), at best, will be done well (efficiently).
            Things not worth doing are not worth doing well or as Burlesque Queen Gypsy Rose Lee said, things worth doing are worth doing slowly.

            And so while the MOREon personal financial planner pitches alchemy what is produced is dross (which douses rather than ignites).

(*) MOREon personal financial planning heuristic: more, better, now –ironically has a habit of becoming less, worse, later – metaphorically resulting in ‘coal in the stock-ings & bonds’).