There are many areas of concern and conflict between the banking business and government these days. Debtor nations have fallen into bed with their bankers and now find themselves perilously tied in co-dependent positions they would not otherwise have chosen.

A large number of bank/brokerage bosses have gone into government after they have cashed out on Wall Street. The nepotism is blinding. But just as this sorted tale seems most insipid the Obama administration tossed in a hand grenade last week with a proposal for financial regularoty reform that includes an elevation of bank owned brokers to the standard of fiduciary duty when advising clients.

I write about the importance of legislating a fiduciary duty for financial advisory firms in Juggling Dynamite.

Up until now most investment sales people in the world have only answered to a “suitability” standard meaning they need only show that they had reasonable grounds for thinking that an investment product may meet a client’s needs. In other words if a product increases in value, the broker/dealer/advisors will take credit for the brilliance of the increase, but if a product loses value, they are in no way responsible for the losses. But fiduciary duty goes a whole lot further than this...   more »

Just finished reading Barry Ritholtz's new book Bailout Nation: How Greed and Easy Money Corrupted Wall Street and Shook The World Economy:



Barry is one of the rare, refreshingly candid, financial commentators. He also has a law degree which helps him to easily recognize the glaring conflicts of interest in the finance world. Barry calls 'bullshit' with clarity, humour and style. While entertaining, the book delivers detailed perspective on past financial crisis, bailouts, and classically human mistakes, aided and abetted by government through the past 100 years.

Ritholtz uses his education and real life experience as a stool to stand on in order to see over the clouds of minutiae to big picture clarity. Available in fine stores everywhere or on line here. You can also read his daily blog here: The Big Picture.   more »