Recall my piece from awhile back: ASPPA Disclosure. As well as Michael Kitces piece – The Public Deserves A Choice, But It’s Not Fiduciary Vs Suitability. If you think the brokerage world has your best interest at heart…think again.
Supporters of the DOL’s efforts scoffed at Reilly’s note.
“This is as Orwellian as it gets,” says Barbara Roper, director of investor protection with the Consumer Federation of America in Washington, D.C. “They will serve their clients best by defeating a regulation that would require them to do what’s best for their clients?”
“If it is not in the best interests of customers, it’s not advice, it’s a sales pitch,” Roper continues. “That’s what they are fighting for here, to portray themselves as advisors while they are being regulated as salespeople.”
Scott Dauenhauer CFP, MPAS, AIF
In May of 2013 (and ever since) it has been a fait accompli that interest rates MUST rise. I wrote in “Do Interest Rates Have To Rise Soon” on May 6th, 2013 the following:
I’ve listened to the prognosticators predict higher rates now for almost four years…and rates instead went lower. Are interest rates going to turn around and go up anytime soon? I doubt it.
Turns out that rates did in fact rise soon after I penned this.
My statement wasn’t meant to be a prediction of where rates were going to go, simply an acknowledgment that there was nothing requiring higher rates and in fact there was precedent for lower rates for longer. The ten year sat at about 1.80% when I wrote that post and by then end of 2013 it had risen to just a tad over 3%, quite a big rise in a short period (though not unheard of). Since that time rates have steadily come back down and the ten year now sits about where was back in May 2013. While rates might rise again and the Fed may even raise short-term rates in the near future, there is nothing keeping rates from staying essentially flat or within a small trading range for the foreseeable future. I’m not saying they will or making bets that rates will stay the same or fall, simply repeating my statement from nearly two years ago that there is precedent for these low rates for a longer period then we might expect and saying that “rates must rise” is not supported by history.
Rates might rise, they also might fall – I certainly don’t know where they are going (nor evidently do economists who get paid to make such predictions), but I do know that basing my client’s investment strategy on the “fact” that rates must rise is ignoring the facts.