The competitors moved up their game. With market share momentum behind them and legions of wholesalers distributing fund products, they made a bold move that affected the distribution channels for mutual funds. They ripped out the wire harnesses single funds needed to get their message to spark in the minds of retail sales representatives. The age of financial planning was born!
“There are changes happening in the mutual fund marketplace,” Bob beseeched David. “More outfits are offering this family of funds concept with switch privileges to money market funds. Investors can switch between all sorts of funds depending upon how they feel about the markets. They are introducing bond funds, junk bond funds, country funds, specialty funds, hot area funds, topical funds. You name it and they’re marketing it.”
“Yeah, so what?” David seemed distant. “Why are you bringing this up?”
“I’m bringing this up because we’re up against it. There’s already a battle for shelf space in the big brokerage firms and in the regional firms. To get shelf space, the big fund groups are pouring tons of commissions onto these dealers’ trading desks and we’re getting moved down shelf and off shelf. Big dealers are also bringing out proprietary product funds. Between the reciprocal kickback commissions for sales headwinds and house products, we’re getting marginalized with our fully managed fund concept. And that’s not all. Recently I’ve been to branches where the branch manager will not even allow me into the office to talk to the sales reps. I’ve been told in a couple of places that the firm doesn’t want me mixing up their reps’ heads. They’ve got them trained to sell a certain way, the family of funds way, and they don’t want the client to have a choice because they want to keep those residual 12B-1 commissions. They’ve been told by their top management that our sale will make their brokers think too much. They’re afraid they’ll lose sales if their brokers start to think, so we’re now banned from the shelf in some places.”
“Well, the big firms never sold much anyway. They’ve always programmed their reps to sell proprietary garbage, so what’s new here?” David seemed nonplussed by Bob’s anxiety over the distribution landscape. His time on earth was growing shorter and his thoughts had turned more toward retirement.
“The point is even insurance firms are buying this concept. They’re becoming financial planning firms using multiple fund products. They’re building their sales pitches around it. The public is getting accustomed to hearing this sales genre and its becoming mainstream financial lexicon. If we don’t make changes in the corporate business model, we risk getting marginalized.” Bob’s anxiety was palpable.
David erupted in an uncharacteristic display of anger, like a latent volcano that unexpectedly blew the top off its mountain. “I don’t give one flying fuck what these financial planning firms are doing,” he began, like a roar from an angry lion. If a financial planner had been present, David would have punched him in the nose. His teeth clenched as he snarled. “These financial planners are the insects of the investment world. None of them know jack shit about how to analyze a company or understand their asses about the markets. They’re just retreaded insurance salesmen, ass-kissers and dog walkers.
“Their fucked-up business models are based upon the false assumptions that the Fed will always be there to inflate markets for them so their phony financial plans will never be found out and there will never be another serious downturn, never again another depression. They’re a lot like retail real estate brokers. They show Mr. and Mrs. Dumb Shit some beautiful retirement brochures with pretty photographs of idiots sitting on a beach hugging each other. It’s all a lot of infantile idiotic, pie-in-the-sky, wet dreams horse shit! All these fucking financial planning maggots will ever succeed in doing is destroying the entire capital base of a once great nation.”
“I’m just telling you we’re getting our ass kicked in the marketplace for sales. I’m telling you it’s something you need to seriously consider.”
“Just one minute.” David wasn’t finished erupting. “I want you to think this one through.” He pounded his fist onto his desk and held it there, pinning down the desk by his force of will. “What happens to a money manager in one of these la-di-da fund groups, huh? What happens to this growth fund manager? He’s supposed to get growth, right? Let’s say there’s a market break, a flash crash, some hedge fund or bank or government throws up someplace. Let’s say an odd Black Swan event happens. A big bank fails somewhere in the derivative laden world. You get a big sigma event, three to ten standard deviations from the norms. The multi-sigma events repeat themselves. This isn’t supposed to happen! But it’s going to happen. Not once every five hundred million years like the programmers’ guaranteed, but once every five seconds. Every five fucking seconds! There’s a financial earthquake. A tsunami crash crushes stock and bond prices. The hungry bear escapes his cage. People panic. They always panic because the idiots never knew what they owned in the first place. Their fund manager stayed on the momentum wave all the way up to the top of the market before it crashed, because if his performance numbers fell behind some goofy stock market index he’d get fired by the marketing guys who run the casino.
“Investors demand to switch to the money market fund. Suddenly the genius portfolio manager with the red-hot track record, the one the financial planner touted to sell his plan, his pie-in-the-sky ‘dream plan,’ suddenly—and I mean real suddenly, man—gets a phone call. Is this the call from his hot trophy wife asking him if he’d like pork chops for dinner? Hell fucking no!” David screamed and pounded his fist again and again on his desk.
“It’s the phone call every one of these prima donnas dreads. Suddenly he realizes he’s no genius at all, just a poster boy for financial plan sales, because the wave he rode was the one that worked at the time. He’s a momentum junkie, and the momentum stopped taking him up! He’s like the guy at the craps table trying not to roll snake eyes, but the marketing guys make him keep rolling! ‘The phone call is from the fund services desk,’ his secretary tells him.
“‘Oh my God,’ he screams. He browns his pants! It’s craps! Game is over! Fund services got their calls from their dealers’ margin clerks. The cashiers want their cash, baby. They want cash and they want it now! It’s good-bye pretty beach pictures for all the gullible schmucks! Now they’re just trying to save their asses so they can afford bologna sandwiches.
“Hell, they always knew in their heart of hearts, in those tiny corners of their tiny minds, that the whole sale, the whole financial plan, was all bullshit anyway, but hey! It made the wife happy and it gave the poor bastard a few years peace! He never believed in the investment. It never made sense. There was no one responsible for management of the investment, but he went along with it because it stroked his wife’s security button and she stopped nagging him. The whole sale was just insurance run in reverse for the benefit of the insurance salesmen, so those insects could sell something. Instead of backing up the hearse to the kitchen table and telling the wife her poor bastard is going to die, so let’s make him get insurance to cover your ugly ass. instead they tell her the poor bastard is going to live, so let’s take some of his money and put it in a plan for you. It all assumes there’s no such thing as a market, or the need to understand risks. It’s an implied guarantee of eight percent per year, just like insurance is guaranteed to pay at death, but it’s complete bullshit!
“So now we have the prima donna getting his cash call. What can he do? The time for showing pretty marketing pictures is over!” David was shouting even louder.
“It’s time to sell something. What to do? What? He’s got to sell right now, not ten minutes from now. The markets are falling and they are falling fast, baby. We’re going downhill on a toboggan ride, but this ride doesn’t stop on a nice level valley floor. No, baby. Oh no! This toboggan ride goes right off the cliff and everybody’s money dies! Investors’ dreams die because their money dies! Whee! It was fun while it lasted, but now we can’t get off! But we gotta get off! Momma wants her cash,
and she wants it right now!
“What can the prima donna do? He can only do what he must do. He can only sell those stocks that are liquid enough to have any market at all. Nothing else is trading. The dealers are ducking bids. Some firms put up order gates. The high frequency traders and the house account trades beat Momma to the exit doors. Momma can’t get her money out of the corral!
“Momma’s fucked, big time! But she isn’t on the beach getting fucked. Oh no! She’s getting fucked while making bologna sandwiches. The cash calls keep coming. Momma wants her ass saved now! Get the lady her cash! ‘Oh my God!’ she screams to her husband. ‘Get our money back!’ He calls his planner. The planner’s secretary puts him on hold. There’re other calls ahead of his. ‘What’s wrong with that fucking asshole?’ screams Momma’s husband. ‘The market’s going down!’ She’s screaming in one ear and he’s hearing telephone elevator music in the other.
“Poppa wishes he could be off at a bar someplace, or at a hunting lodge, but he can’t get away from his wife or the fucking phone with its fucking elevator music. He’s trapped. Their money is trapped. Prima donna gets more calls. He sells his most liquid stocks and gets half what they were selling for yesterday. Other prima donnas are getting their cash calls too. Now what? The market is going down more. Dealers will not bid for anything, so the prima donna goes off board to Instinet or Third market. He’s got to take three cents on the dollar for stocks that were a beach house dream yesterday! The beach house just got sold for three cents! Three fucking cents!
“‘What about the bank?’ screams Momma Ruth. ‘We still have our money in the bank, right?’
“‘I don’t know!’ yells Poppa Bill. ‘On TV, they’re showing lines of people outside of the banks.’
“‘That’s just someplace in Europe, isn’t it?’ screams Ruth.
“‘No. It’s here!’ yells Bill. ‘There’s Mrs. Keegan standing in line. She’s waving her fist in the air and screaming something.’
“‘What’s she saying?’
“‘I don’t know. It sounds like, “fucking bastards this” or “dirty cocksuckers,” some things like that.’
“‘Are you sure it’s her. That’s not like her. Are you sure? How do you know it’s her?’ Bill and Ruth start shouting from their distress. Calm rational thought is long gone.
“‘It’s her, I tell you!’ insists Bill. ‘I’m sure of it. I’d recognize her anywhere. I used to fuck her!’
“‘What!’ Ruth reaches for something to throw at her bone-headed husband. It could be a shoe or a lamp; it doesn’t matter at this point. Ruth gets a momentary grip and holds off throwing her shoe. Money matters concern her right now. She’ll deal with her husband later.
“‘But what about our financial plan,’ Ruth screams. ‘Didn’t that nice man tell us there was this plan we were in? Didn’t he tell us he would rebalance our assets, our funds, whatever, so we couldn’t get hurt in a downturn? I know I heard him say that. They were advertising that on the TV! All we had to do was follow what he said and we’d have the house on the beach! We’d have money for the grandkids, remember? We’d be secure! We are going to be secure, aren’t we?’ The look of panic spreads across Ruth’s face. ‘Bill, remember he showed us a copy of that speech Alan Greenspan made where he said America would invent everything in technology, the economy would grow and grow, and the rest of the world would do all the work? We’re safe, aren’t we, Bill? Bill. Answer me! We’re safe, aren’t we? Bill, tell me we’re going to be safe! The rest of the world was supposed to do all the work and all we had to do was invest in this stuff and sit on the beach and drink mai tais. He told us we’d make eight percent per year and we had these nice colored pictures on a pie chart and we had that picture of the cottage on the beach and—’
‘”Shut the fuck up, Ruth. We were nuts to listen to that huckster. How in the hell is he going to get us eight percent per year when interest at the banks is zero? Huh? I knew it was all bullshit when I heard it. The Chinese People’s Liberation Army hacked into all our tech companies and stole all their source codes. Everything our companies can do the Chinese can do cheaper, plus they fucked our companies with their spyware and viruses. All that shit he sold us was a pipe dream. All this shit we own is worth less than dirt. I knew that cute fart didn’t know shit from cannolis, but you were all gaga over the fucking plan, and I suspended common sense and—’
‘”But he said we needed to follow the plan. He said he’d adjust the plan….’
“Bill doesn’t answer, just looks at Ruth like she’s stupid as a stump. He walks to the hall closet.
“‘Where are you going, Bill?’ Ruth takes a deep breath. She’s alarmed.
“‘I’m going out!’
“‘What are you doing, Bill? You have your shotgun! Where are you going with your shotgun?’
“‘I’m going to see that silver-tongued cocksucker who sold us this shit!’ he yells, holding up some glossy brochures. ‘That dickhead sold us a box full of dog shit and convinced us it was candy bars. I’m done, Ruth.”
“‘Bill, stop! Stop! What are you going to do with your shotgun?’ His wife is sobbing hysterically.
“‘Ruth, you stay out of this! We are not going to follow some idiotic plan like a robot running off a cliff with a herd of other robot lemmings! We’re done with soaking up the bullshit!’ Bill opens the closet, looking for his coat.
“‘Bill, you answer me! Why the shotgun?’ Ruth screams.
“‘Because the rules ain’t fair, Ruth. The rules are just there so big guys can screw us little guys.’
“‘Oh my God, don’t do something foolish. Bill, don’t! You’re all I have, Bill. Come back here. Don’t!’
“‘Never mind, Ruth. It’s time to handle things my way!’ Bill shouts as he puts his coat on and leaves through the garage door.
“‘Don’t go, Bill! You’ll get into trouble. Don’t go,’ Ruth pleads, but it’s too late. Bill no longer gives a shit about getting into trouble.
“He tears out of the driveway in the family sedan and Ruth sits on the floor and cries to herself. ‘Oh my God! What’s going to happen to us? Oh my God. No, dear God, no. Please tell me this isn’t happening. Somebody tell me this is just a bad dream. I want to wake up now.’ Ruth’s cries turn to whimpers. She pulls her hair out, and then she holds her face in her hands. It is happening, and she knows it.
“This is what happens when it’s all over, when cats start sleeping with dogs, when dreams and fantasies die, when families fly apart and men must eat their pasta off the grass on the front lawn. This is when women throw frying pans at their men and men kick their dogs and throw their beer cans at the TV. This is when grown men have to stop watching the NFL and go around begging for odd jobs to get money to eat. This is when America has to dine at the banquet of bad consequences, when we of the later generations get to eat the shit stick meal, when we suffer the consequences of the folly of Wilson putting a privately owned Federal Reserve Bank in private control of our economy and an Internal Revenue Service to feed the monster blob.
“This is the beginning of a depression. This is what it’s like when nobody has any money. The banks close their doors, the ATM machines say they are out of order, the grocery stores have no food, and the credit card doesn’t swipe at the gas pump. This is when Bill can’t get beer, dog food, or gas. This is when people stop trusting fiat dollars and their elected government. This is when all the worthless retired teachers who dummied down innocent kids for a living and those useless union goons lose their pensions, which they never should have had in the first place except they voted like a block for the progressives who promised them a cushy ride and a free lunch for their votes. This is when people buy gold and silver if they can get still it. This is when morality creeps back into society and people learn to love one another and be good friends and neighbors again. This is when money leaves and religion returns. It’s ‘come to Jesus’ time!
“That’s just the beginning of the ‘Hell for Dummi
es’ times. Bill and Ruth have a beautiful, intelligent, well-educated daughter with a nice high-paying office or professional job. She’s a nurse or project manager or corporate secretary, and she’s engaged to another professional, a nice young lawyer or stockbroker or marketing brand manager. Suddenly the dollars they earn aren’t enough to buy groceries. The dollar was mathematically worthless for years before, but it took a market break for dummy Americans to lose their confidence in it. The young hopefuls leave their jobs to get work in the mine fields digging for gold to sell on the black market. Their hands grow calluses, they get ruptured back discs, but they must dig dirt to buy groceries.
“It doesn’t get better for them. The pits where they crack rock have mosquitoes. Mercury fumes from cyanide reduction stoves eat into their nervous systems. He shakes, then contracts malaria and can’t work. She becomes a camp whore to make money, hoping to keep their dreams alive. Things get worse, never better. He succumbs. As death draws near, she asks him, ‘What happened to us?’ He tells her, ‘We believed the socialist lies. We voted for the liar who the complicit media failed to vet, who the irresponsible political party that nominated the bastard demigod refused to vet. We voted for the Trojan Horse because we thought the country had such riches we could take a chance on being nice, good-hearted, stupid people, and we voted for our own destruction.’
“She buries him and it gets worse. She contracts syphilis. She loses her looks, teeth, hair, nervous system, and womb. She lives a miserable painful life and dies a painful death. Hope and change turn into hell and death. The Grim Reaper collects his final payment from the believers in stupidity. Bill, Ruth, and their daughter pay a horrible price for voting for the delusional ideological dreams of a deceitful liar’s father. But hey, they just went along with the crowd! They’re not responsible for their decisions! Who thinks about the importance of being smart with your vote, anyway? They were only drinking the same kumbaya Kool-Aid everyone else was drinking. The crowd can’t be flat-ass dead wrong, can it?
When The Butterflies Come Page 23