What a person finds humorous can be quite revealing. Former President Ronald Reagan always got big laughs when he said, tongue not quite in cheek, “The nine most terrifying words in the English language are ‘I’m from the government, and I’m here to help.’”
Such a non-ha-ha funny statement reflects Americans’ lack of trust in (big) government and our mixed, suspicious feelings about our leaders in general. When I speak to advisors at industry gatherings, I know I’ll always get a big laugh when I preface some profound statement about advisors by saying, “Don’t worry, you can trust me: I’m a journalist!”
Since the financial crisis of 2008-2009, the issue of trust has become a big worry among thoughtful people in the financial services world. The thousands of bank failures during the Depression led many Americans to deeply distrust banks.
After the crisis, many Americans have come to distrust the big Wall Street institutions, and my personal belief is that independent advisors have been the beneficiaries of that distrust.
Maybe that’s because investors are more aware of risk. The fourth “Rebuilding Investor Trust” study, released Jan. 21 by branding firm Sullivan and Northstar Research Partners, delivered its own mixed messages about investors and trust. While 80% of the 1,800 affluent investors (at least $100,000 in investable assets) surveyed said they now strongly trust their financial firms (up from 46% in 2011 and 65% in 2012), 44% fear health care or serious illness more than they do market declines.