July 30, 2010
I think the "fiduciary standard" held forth as an enforceable concept to protect consumers more effectively than in the past, is ill concieved and more window dressing than substantive. I am a Series 7 rep and advisor and my conduct relative to my clients, exclusive of additional paperwork and added levels of suppossed oversight, has remained the same throughout my career. I have met reps and agents that can be slightly incompetent, but that is rare and I have come across the fiduciary fool as well. Whether I was a young agent working with a young couple, or an older advisor working with a transitioning soon to be retired couple, I have always made every effort to best ascertain my clients situation and goals and make the recommendation I would take were I in that situation. To imply the fiduciary standard will sure ills cost effectively or not, is to exclude a huge segment of agents from assisting middle class families save carefully for education, retirement and other goals. This part of the population will then only be served by large impersonal brokerage houses giving cookie cutter advice that proves acceptable, but inappropriate or they will not be served at all and that is quite dangerous in an economic environment where we want to encourage people to assume responsiblity.
Be careful on this one.