More On Legal & Compliancefrom The Advisor's Professional Library
- Updating Form ADV and Form U4 When it comes to disclosure on Form ADV, RIAs should assume information would be material to investors. When in doubt, RIAs should disclose information rather than arguing later with securities regulators that it was not material.
- Disaster Recovery Plans and Succession Planning RIAs owe a fiduciary duty to clients to prepare for disasters and other contingencies. If an RIA does not have a disaster recovery plan, clients financial well-being may be jeopardized. RIAs should also engage in succession planning, ensuring a smooth transaction if an owner or principal leaves.
I enjoyed reading the May edition of Research Magazine. I particularly enjoyed Jane Wollman Rusoff's piece ("What Do Prospects Find When They Google You?") about online marketing.
As much as I agree, I was however somewhat amused by your cover story. Coming from the wirehouse world (10 years, recovering) anything even written is frowned upon, if not explicitly banned, in the name of liability control and under the guise of compliance.
Voice mail gives the average branch manager nightmares, and e-mail likewise is similarly censored out of existence. Wall Street e-mail servers must be the modern day equivalent of the Maytag repairman, lonely to say the least.
The thought of having any kind of creative, thought-provoking online media presence of any sort is laughable and would be considered heresy. I suspect this is the case throughout the mainstream financial advice machine.
Sean M. O'Brien, President, Andover Equity Investment Group LLC
The Real Learning Curve
Regarding Ken Fisher's piece "Obama's Learning Curve" in the June issue, the article points out many truths about the Democrat vs. Republican debate over who is better for the stock market. I strongly agree that any new president will try to implement his policy goals within the first two years and President Obama is no different. However, the article wants to make him out to be no different than Clinton, Kennedy or FDR regarding spending and his socialistic agenda.
President Obama's majority interest in several banks, insurance companies and automakers, along with stated goals for a national health care system, followed by government control over carbon/pollution/energy --- how is this not central planning at a minimum and a shake-down of American business to conform to President Obama's wishes for state control over production and lifestyle?
Mr. Fisher would like us to believe that President Obama's stimulus plan and proposed budget is no big deal. He only compares the current year debt as a percentage of GDP around 40 percent as normal and sustainable. If you look at the Congressional Budget Office (CBO) estimates for the next 10 years released March 20, we should all be very concerned. The CBO estimates the cumulative deficit would include $9.3 trillion in additional debt from 2010 to 2019.
This would more than double the national debt held by the public from $6.7 trillion to $17 trillion. The interest alone would reach nearly $1 trillion per year or 35 percent of GDP!
The CBO estimates do not show the annual budget deficits ever coming down and they can not possibly reflect additional debt for national health care, wars or other unforeseen national issues. The only way to pay for any of this will be much higher taxes for individuals, businesses and embedded (pass through to consumer) taxes.
It is sad to say, as the article points out, that most presidents play to the middle for the sole goal of being re-elected. The American people deserve better out of our politicians. We need someone who promotes capitalism and individualism, someone who will take fiduciary responsibility with the national debt and annual budget and someone who doesn't care about re-election.
John M. Lugauer, Kalamazoo, Mich.
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