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June 06, 2012 at 04:00 AM
Like most folks my age, I find much of today’s “totally awesome” language just as brain-dead as the “happenin’-groovy-far out” expressions we used to think were “cool” when we were kids. There are some exceptions, though, and one of them is the response “Really?” Possibly the best term to come out of pop culture in 50 years, “Really?” pretty much says it all when one is trying to express their disbelief that whatever they just heard is really the best that someone could come up with.
Which, of course, makes it pretty darn useful in today’s culture. For instance, take the comment by “daveinphoenix” to my May 30 blog, about publicly disclosing conflicts of interest, in which “dave” (if I may be so informal) expresses his outrage at the “huge” 1% AUM fees that some advisors charge. Truth to tell, my response should be “Really?” and just leave it at that. But since that doesn’t fill up a whole blog, I’ll elaborate.
Dave seems to hang his outraged hat on data he says was released by the Attorney General of New York a few years back, showing that “over a 10-year period, a 1% asset management fee = a 9% front-end load if a mutual fund has no increase in market value,” which he writes is “1% to the 10th power.”
Really? Sorry, couldn’t help myself. Let’s tackle the math first.
Now, I was no math major myself, but at my liberal arts college, they did make us take some basic arithmetic (lest we miscount the number of credit hours we needed to graduate), and by my calculations, 1% to the power of 10 would be .01 x .01 x .01 x .01 x .01 x .01 x .01 x .01 x .01 x .01, which my calculator tells me equals .00000000000000000001 or .000000000000000001%. Since that’s a pretty darn reasonable AUM fee, even for say, Donald Trump, I think we can conclude that’s not what Dave meant, and that Dave wasn’t a math major either.
