The FPA lawsuit against the SEC has finally won out. This is huge as it overturns the exeption to the broker-dealer exception to the 1940 Investment Advisor Act.
The impact of this is that consumers will have an opportunity to tell the difference between an adviser that has their best interest in mind and an adviser that is a salesmen in sheeps clothing.
This is GOOD news for everyone except brokers.
The stock market has only droped like this a couple of times, and it’s the biggest drop in almost 5 years. I think this is like the four or fifth largest point decline in the dow history. I wouldn’t be surprised if it’s headline news in tomorrows papers as it’s the lead story in the NY Times and Washington Post online right now. Indifference here is a risky strategy for advisers, unless you can afford to lose a few clients. Today is the test of client relationships.
There is a great need for educating workers on the concept of a 401K. But the problem is that it’s really difficult to get paid for that education. Adults are situational learners and they care less about preventative measures that current problem solving. The 401K company often does some things, but usually not enough because the money is in setting up more companies, not in educating the ones they already have.