RIABiz takes on Occupy Wall Street in New York and finds investors wanting answers

This is a fine article, but the larger question is whether or not you can actually blame any institution for the failing of the markets. The ice berg effect is prevalent here. The people are unaware of the many players that lead to the crushing of the markets. These “people” are also their neighbors, the homeowner that decided to get loans that leveraged them to the tilt with false documentation (and as a former investment banker selling whole loans and securitizing, we saw how many homeowners had bad mortgages). You have to understand., Wall Street is a product and transaction culture. We take the underlying collateral and then pass it through in a derivative of its former self to another buyer. It was the erosion of the collateral that forced its hands of multiple defaults that was systemic. People say they want better, but really, it seems to me every case study you’ve brought here suggests they desire free and easy money (easy credit and lending) to be prevalent once again. Are you going to blame Goldman Sachs? Merrill Lynch? They’ve been in this business for hundreds of years, and did no different from their model as a transaction firm. The man who says he is a capitalist, well great for him. But the erosion due to buying and churning doesn’t happen overnight. You don’t see 40% of your wealth drop overnight because of buying and selling of securities. That’s the reality. Complacency to terminate your financial adviser is a greater crime. What I don’t see is a great sense of accountability, and perhaps that is most telling from this group of occupy wall street folks. To hear the “Stock market is corrupt” is not only disenchanting, but it is more reflective of the lack of education people have. Remember the commercial paper market and how that almost froze? Well the “people” should have been aware that without the markets being ..well…the markets exists to add liquidity to the system. Or did we forget about the interbank rates rising for Europe because people are no longer adding more assets into that system. When you take the money out, everyone loses. But in this case, it seems unlike 1960, 1970, 1987, and 2000, people are focused on the political aspect, and commingling politics with free markets.

Wall Street does/did provide a necessary service to our market based economy. When Wall Street deviated from this business model “offering” complex derivative structures that Wall Street understood but their clients did not is where we went off the rails. In my opinion Wall Street is to blame for this deception. Not sure OWS understands this but CDO/CLO groups did!

I have been involved in Wall Street first as a broker for 17 years and then as an independant RIA. Along the way I have been an investment banker and insitutional sales person. I am furious that no one has gone to jail or that serious reforms have not been made ( witness MF Global) part of the blame for this mess is that it is easy for Congress to pass laws saying do this or don’t do that but it is less sexy and popular to pass bills to pay for the supervision. The ratio of examiners to bank assets declined every year from 1980 to 2008, and the number of referrals for prosecution for financial crimes declined to all time lows during the current administration. If you do not enforce laws you breed contempt for the law.

OWS represents a movement that might gain some sympathy if it got better control over itself and began to administer some from of discipline over members and associates. There is no place for the anit Semite, Communist, racist, and violent in any movement seeking real change.

While I am sympathic to the plight of those with student debt no one forced them to take it on and no one forced them to take it to study soft science and humanities. Thousands of students took on debt and studied engineering are finding wide acceptance in the job markets, if you studied the wrong thing and took on debt don’t ask the rest of us to forgive your debt use it as a learning experience.

As an RIA I deal every day with those effected by the financial mess and I have lots of associates from the past who lost it all with Bear Stearns and are now at 60 years old starting over. I have some sympathy with the OWS but not with any movement that does not recognize that people had freedom of choice and made bad choices and that allowed the banks and investment banks to engage in activities that were shady.

While I am ranting this living microphone thing where everything is repeated is just plain creepy and weird, look at the movie 1984 for an similar example.

The current financial system has been around for at least 70 years it recieved its death sentence in September of 2008 but the death will be slow and painful for all. There will be a new system none of us have any idea what it will be but it will not what we saw in the past. If you want to control the excess of Wall Street you need to control compensation, it is compensation that drives it all. Not that bright people should be paid slave wages just that compensation should not be immediate and should be tied to performance. The other element that needs to be in place is a renewed comittment to a sense of morality and the laws that grow out of moral teaching. The passage of laws and regulations do not reduce the chance of violation they increase it, only a moral compass reduces the motivation toward violations. Moral compass start with accepting you own responsibility.

Every economy is market based. Socialism doesn’t win at all, subsidizing losses just gets you more losses and a leverage problem (Sounds like USA and EURO). For deception, its hard to say its deception., because whether not the groups knew it was bad, they had an commitment to transaction. But to say all of Wall Street is like that based out of a few unique sampling of the population (magnified by politics and press), is being dishonest to the rest of the hard working folks at Wall Street. How about M&A? You can say at the % of failed mergers and divestitures of merged entities that there is no real value for investment bankers. But then there is the few % that say there is,....it really is up to the circumstances.

My concern with Occupy Wall Street is that the free enterprise capitalist system against which they protest (forgive mortgage obligations, forgive student loans, etc) has fostered the most egalitarian economy and the highest standard of living known to man.

Nothing is free. For those of us who work 80 hours a week, we earn it the hard way.

In my humble opinion, unless they have a better solution rather than working very hard, they might consider reindirecting their energies to more productive endeavors as no one is going to give these people anything—they have to earn it like the trest of us.

This is why everyone wants to come here, there is nothing holding them back in the pursuit of happiness—race, color, creed—just their personal initiative. It’s the American way. It’s the uniquely American freedom to suceed or fail. Europe has tried socialism and we are about to witness economic armagaddon in southern Europe—hopefully not to be repeated here in the US.

To say Occupy Wall Street actually has something constructive to say is a streach, they simply are complaining when everything is not given to them when the 53% of us who actually pay taxes are pulling 80 hour weeks.

No sympathy here for the Occupy Wall Street crowd who prefer anarchy to personal initialive and responsibility upon which our country was built.

SCW

SCW – well put and completely hitting this topic on the nail.

My family grew up with poverty and my father built a business from scratch in the 90s before being acquired by Thomson Financial. I saw capitalism and hard work before my eyes. As an employer today, I see resume’s from generation of employees that does not wish to work, but demands all the benefits.

Now as an employer, THAT is depressing,

Thank you everybody for all your thoughtful and heartfelt comments. They all hit a mark.

I think Occupy Wall Street is easy to criticize as a bunch of laid-off embittered, lazy and ignorant crybabies. They often don’t get their facts straight. As a group, they are not organized or clearly purposeful. There are some people who truly see the movement as a way of saying the government should take care of them.

I haven’t studied OWS enough for a last-word view but I am erring on the side of support for this movement. I spend my days on the phone with people who have worked on Wall Street and studied Wall Street. These are insiders who tell you that there are things desperately wrong with some of these institutions. These are defectors who couldn’t stand to be part of it anymore. These are hard core capitalists.

These breakaway executives, brokers or admins are knowledgeable in their criticism of the inner working of Wall Street and a Congress that sanctions it. These are people seeking a real fiduciary standard.

The fact that OWS protestors are inarticulate in their criticism or just plain all over the place is notable. But it doesn’t mean that there’s anything wrong with their nostils. There is something rotten in the state of Denmark and I believe they can smell it.

Keep the comments coming…even, or particularly, if you disagree with my views.

Brooke

Anybody who thinks Occupy Wall Street is aligned with the interests of anybody in the investment community is just plain wrong, and this article and its obvious bias makes me extremely hesitant to trust anything from this publication going forward. These protests are against capitalism and free markets!!! The fact they have socialists as key organizers and speakers testifies to this. If the occupy movement got its way, we as financial advisers would not exist!!! The detachment from reality demonstrated in this article is shocking, but unfortunately no longer surprising.

Demonizing others is just a cheap, but very pop(ular) rhetorical trick. All problems are complex. All problems are poorly described, let alone, understood, let alone remediated. All problems are “we” and “us” problems, not problems of “them.”

But angry and fear-based emotional venting is the favorite of editors and producers. Ho hum.

Sometimes people need to be demonized because they are the bad guys. The Occupy movement deserves to be demonized.

There is no research or data to support that claim. Bad actors are very rare. Most bad actions come from innocent, normal human mistakes.

How is OWS any different from Tea Baggers?

Really, you can go to youtube and see video of occupy protests where people advocate violent overthrow of the government, use children as human shields, incite and commit violence against police, and the list goes on. At the very least, they are wasting taxpayer resources at a time when budgets are already under strain, which will result in social services to those most in need not getting those services and additional layoffs of police and firefighters. If that doesn’t make you a bad actor, what does?

Tea Baggers have been crying for the same for longer, along with the Repub candidates (the installation of a christian theocracy), Rick Perry demiizing social security as a “crininal enterprise”. Tea Baggers carried guns to rallies. Individuals spouting Tea Bagger sentiments committed multiple murder-suicides at beginning of Obama admin. 20% believe Obama is a Mulsim, etc. Crackpot ideas are all over the media. At both extremes.

Brooke, I would agree with you that Wall Street and the finanical system in general have the smell of rot about them and there is a desperate need for reform. That being said I believe the source of the rot is deeper in the society and starts with misalined cultural goals and cult of narcassim that is rooted in a consumer culture focused on achieving all with no work or sacrifice.

Our financial system is riddled with conflicts of interest and revolving doors that allow the well funded and connected to work to different rules than the rest of us. In that I agree with what seems to be smell detected by OWS.

All that aside, the idea of sitting in a tent and stopping subways and tresspassing in banks ( all of which are breaking the law and harming working people) is immoral and following immoral means to moral ends defeats the morality of the end.

As Alan “Ace” Greenberg, a great man who founded AIG once said – All I want in life is an unfair advantage.

But well put Dennis,

Correction: – Maurice “Hank” Greenberg, not Alan Greenberg. Alan was the idiot who lost bear stearns.

Brooke,

The Occupy Wall Street crowd has specifically been, anti-semitic, anti-capitalism, anarchist suggesting we abandon the rule of law, violent, lethal (several deaths), unsanitary, anti-women (several rapes), but definitely has had absolutely nothing to say about advisory services and fiduciary standing.

They do not know the abuses they complain about are better directed at investment banking and the Barney Frank faction that relaxed lending standards to the point of failure. They do not know mortgage backed securities and associated derrivatives have indeed almost taken down the Global economy, and have fostered millions of job losses which was the result of the very public policies they advocate (free housing, free college, free health care, free everything).

Unless we turn socialist, someone has to pay for this stuff and there is not remotely enough money to pay for it even assuming a 100% tax rate over $250,000. The only way there can be a safety net, is if we are fortunate enough to have a robust economy. We are clearily at the point where it is indisputable we can not afford the social welfare regimen which has alone increased by 25% in just the last three years. That conscious expansion of government could in hindsight have permanently crippled our economy as if the private sector continues to erode, the scales of socialism may have been tipped against free enterprise—long our saving economic grace.

Government is never concerned about cost or program effacacy required in the free markets and Occupy Wall Street has every increasing demands (free housing, education, healthcare, etc., etc.) as they pay for nothing.

If Occupy Wall Street wants job creation then the present course can not continue as at some point we will run out of money and credit—and increasing interest on the debt will eventually consume the entire federal budget leaving no money for either defense and social welfare programs. The answer is live within our federal means, cut and streamline federal programs against objective self sufficiency metrics which must be achieved or the program is cut. Effectiveness determines which programs survive.

Every day we read of established firms making across the board cuts to maintain commercial viability—the government needs to do the same. Any and every form of the welfare safety is only possible with a strong free enterprise capitalistic system that raises all boats. Occupy Wall Street wants to lower all boats—they just do not understand how fragile the free enterprise system is which they are about to destroy. This country is on the brink of failure. The very things they advocate are the cause of this economic failure and unemployment and will further widen income disparity.

Occupy Wall Street doesn’t get it as they are advocating against their best interest if jobs and economic vitality are their objectives.

SCW

Ace did not lose Bear- he was the victim of a coup by the real idiot Jimmy Cayne who lost hte firm because bridge was more important than risk control.

Ahh, yes you are right. But Maurice Greenberg is still the best. He was wrongfully accused by an attorney general that then got indicted for a high class escort. Now that is irony.

The peer-reviewed research we’ve seen suggests:

- Wealth inequality in US is historically extreme and getting more so

- It may correlate with higher risk for the economy, lower quality of life for all, compared to other OCED countries and anti-democratic effects

- The causes of extreme wealth disparity appear to be random or factors we cannot identify yet. They likely have nothing to do with individual behaviors.

- Purposeful, wider social diversification of wealth across the society may lead to greater growth and strength in the economy and society — maybe not. “The future is unknowlable.”

Whatever moralizing/spin ideology wants to put on the data is rhetoric and marketing not evidence-based.

We don’t know any of this for sure but it’s what’s some of the data we’ve seen suggests.

Who was the one with pot addiction and a bridge champion?

As a tea party supporter or “tea bagger”, I find it interesting that people have to resort to calling us names rather than deal with the facts and debate the issues. The facts are: tea party rallies were significantly larger than any of the occupations, yet there was no violence, all permits were applied for, paid for, and received. Facilities used were left cleaner than before. Guns were legally carried at some tea party events, whereas guns were illegally concealed and subsequently used to murder people at multiple occupy events. Nobody was raped or assaulted at a tea party event, and there was no cover ups at tea party events. Their was no tea party at the start of the Obama administration, and blaming murder-suicides on tea party sympathies is baseless, and frankly beneath anyone trying to have a real debate on issues. One thing is true, the original protesters of the too big to fail, government mass bail outs of politically connected entities like banks, car companies, and unions was and is the tea party based on the premise they not only are not fair, but they don’t work. The current economic environment provides plenty of evidence to support that position.

Wealth inequality I would argue is created by the crony capitalism where your political connections count more than your abilities. As evidence, all the CEO’s of the big banks who had to be bailed out kept their jobs, while the CEO’s of banks who smartly avoided the crisis were rewarded with higher FDIC fees and additional regulations. Poorly run big banks got bigger at the expense of the taxpayer, while smaller, better run banks were forced to curtail lending and raise fees to customers.

The biggest myth is that we should raise taxes on the rich to provide equity. Raising taxes on the wealthy does nothing to bring up the lower class because the money doesn’t go to them, nor should it. Reality is that it is easy for the wealthy to argue for more taxes because they won’t end up paying them. Just look at GE. However, for the small business owner who can’t dodge taxes through stock options and other perfectly legal accounting gimmicks, higher income taxes makes it more difficult for them to become wealthy because they have less to invest after taxes and less ability to create jobs.

Where is the peer-reviewed evidence? “Without data, you’re just another person with an opinion.”

“Opinions are like elbows, everyone has a few.”

We don’t personally happen to subscribe to any political or ideological views, but the perception of unfairness is rampant. Rightly or wrongly. The question being asked is how much is fair for everyone to contribute of the society they benefit from? Doubt anyone supports a “winner takes it all” society.

Bringing guns to a political or media event is a clear threat of mortal force, why pretend otherwise? We like and own guns. Using them to intimidate political opponents ande as a political symbol is deeply dishonest, for a democratic society and just creepy.

Elmer, Larry- really guys this is what the current problems are all about. The two of you have strong opinions and are not respecting each other’s point of view. Elmer you can start by not using the pronographic term Tea Bagger and not understanding that to some people in this country carrying a gun is a cherished right and by the way is protected by the Constitution. I was at a number of Tea Party functions and I saw guns legally carried with respect and discretion and no one was intimidated. In fact at one rally one of the cops said to me that if someone was going to carry guns he was glad it was the Tea Party they knew how to use them properly. I have also been to a number of Occupy events and was openly threatened with both guns and knives simply for asking questions.

Larry, elmer is right you indicated peer reviewed research but gave no link to it. By the way Elmer saying you do not subscribe to any politcal point of view is a silly statement it is obvious from your writing you do.

There is no doubt that income inequality is high now the GINI index of income inequality places the US at .469 which is lower than Mexico! Meaning our income is less equal than Mexico! There is no doubt that there has been a meaningful negative movement in income distribution in the US. The causes can be debated all day long but it is real. However the idea that government at all levels should tax the inequality away is failed economics. Look for example at the alternative minimum tax. Originally aimed at like 160 families it has done nothing to damage them but now ensnares 33% of all Americans. Taxes do not work as social policy.

How many times do we have to go down the failed socialistic, keynesian economic model with poor results before we accept that it does not work except to enslave people in a morass of government programs. As someone once said if you tax Peter to pay Paul you will always have the support of Paul.

Ayn Rand probably said it best …...Who is John Galt?

The world is quickly turning into Atlas Shrugged.

The world is quickly turning into Atlas Shrugged.

The more extremist voices rise and the media touts them the better things likely are. We’re going leveraged long the US. Hope everyone else buys the media hype for Tea Party of OWS about the world coming an end — again. It’s all just silly.

But it’s a slow news season.

No, bringing guns to a political event or rally and brandishing them is against all principals of civilized societies.

I am happy to be called an extremist voice. Moderates don’t have principles they stand for, they just change their positions with the wind. As for tea partiers packing heat, love saying that, it is a constitutional right and statistically you are far safer being near a law abiding citizen with a gun than not. If that somehow makes me uncivilized, so be it.

Anyone who even suggests advocating the threat of shooting political opponents is unbalanced.

I agree that suggesting shooting political opponents is unbalanced, but nobody in the tea party has ever done that or they would have been kicked out. I have seen a democrat suggest shooting political opponents in the head while holding them against a wall, and then after the Giffords incident a few months later decry violent political speech.

Larry you just did!

how?

We have been gun owners since a small child. Guns are designed solely to kill — not drive nails or change a tire.

Originally they were designed to kill food. Now they are mainly designed to kill people. Shotguns kill effectively at short distances. Rifles at long distances. Pistols at very short distances.

Pistols are not designed to kill game or food or hunt but kill people — quickly with as much damage as possibler at very short distances. Of course, some people do use pistols to hunt, but very few.

Gun owners do not pick up a gun unless it is to use it. Of course, target practice is mainly to help make the killing function more effective.

So someone “packing” has picked up and is carrying a gun to kill a person. They are not “pacing” because they like the weight or it enhances theri appearence. It is only becuase in theri minds they are imagining they will use it — to kill a person that day. They may not kill a person that day but they want the ability to kill a person each day they carry it.

We could then ask — who do they imagine killing as they go about their day?

So making s public comment on a profesional website, bragging, for the world too see about:

- Being a political extremist

- Not likeing moderates

- Liking to be with people “packing” pistols, so they can shoot a person if needed, that day

That’s simply unbalanced, very threatening and scary.

But this is the kind of highly unbalanced, threatening behavior the Tea Bag folks revel in. As a gun owner, we object strongly to using guns for extremist political marketing and media agendas.

Guns aren’t unbalanced — Tea Bag folks waving them are.

Elmer, that is just nonsensical. People are allowed to carry a gun in the Constitution. It is a means of self protection. People that carry guns do not dream of killing people. They don’t want to be killed, robbed, or injured themselves. To insinuate that tea party members are unbalanced after not once has their been one act of tea party related gun violence is ridiculous. Where is your evidence? You can’t put thoughts into other people’s minds just because you don’t like their political and economic views. In fact, the cities, Chicago included, that have the most extreme gun control laws also have the worst records of violent crime, including gun crime.

Elmer,

Do you see the character and behavior of the Tea Party being even remotely equalivant to the Occupy Wall Street crowd? I don’t recall murders, rapes, sanitary problems, anti-semetic language, unlawful behavior, violence and amorial and irresponsible behavior. What more do you need to know to draw a conclusion?

I am very familiar with peer reviewed research, the empiracle data is so obvious as to not even require more than just a cursory review to draw a conclusion with high confidence. Thus, our political and economic views could not be more different. It is like shooting yourself and wondering if it will hurt.

Economically, you are only correct if the rest of the world economy is terrible, which is not to say the US affords great economic promise. Like China and India, where there is an aversion to fiat currency and paper securities, a thousand year perspective might prove gold, silver, lithium, etc far more stable particularly when governments loose all economic discipline and become irrational as the Occupy Wall Street crowd would prefer. The ravages of the absence of demand or deflation raises the question of intrinsic value that a thousand year perspective so clearly sees.

We are at an economic precipice, be careful what you and the occupiers pray for as you might get it as well as its unintended consequences.

Keep your eyes open, be vigilant, be prepared for the unexpected as black swan events are more likely than not. Witness the cowardly behavior of Congress trying to spend our way to prosperity.

As for the question of fairness, the investing public has every reason to loose faith and condidence in the brokerage industry, brokers are neither accountable for their recommendations nor are allowed to acknowledge their ongoing fiduciary responsibilities to act in the consumers best interest as it is a violation of the internal compliance protocol of every brokerage firm. The preagreed upon arbitration proceedings to manage client disputes starts with the premise that brokers do not render advice—thus absolving the broker from and accountability for recommendations precluding professional expert fiduciary criteria for any ongoing advisory duties, as no advice is provided. Not of these things accrue to the consumer’s best interest—and are patently unfair from a consumer’s perspective.

So, I disagree with everything you have said concerning the occupiers, but defend your fairness observation to the end. The occupiers just do not have a clue about what specifically they are complaining about. If they did it would make a difference. What they are complaining about is having to be accountable and responsible, they very problem they should have with Wall Street. In the absence of a rational arguement, the unaccountable and irresponsible Occupiers want everyone to be accountable and responsible to their needs but themselves—which simply makes no sense.

God help us if the political class believes the Occupiers are what will make us great in the future.

SCW

Whew!

There are some very interesting viewpoints here. I found out that not everyone agrees with me. That’s fine, even though I don’t love being called a socialist. I hope everyone will continue to make thoughtful remarks, backed by real thinking, and not escalate the cable-show-style mudslinging. There’s been both quality thoughts and slinging. Let’s keep to the former.

One of the things I like about the RIA business is that whether or not to use accountable, quality financial advice doesn’t seem to break down along political lines. Maybe we should stick to unifying subjects as Thanksgiving approaches.

Brooke

Controversy is always the best traffic builder. lol

The Constitutions does not give anyone the right to threaten or intimidate, even implicitly, political opponenets, your neighbors or our government with the threat of dying from a gun.

Let’s look at some past events:

- Multiple murder suicides attacking government facilities and right wing claims of government oppression and misdeeds by deranged individuals after Obama was elected

- A liberal serving Congress woman almost dying and permanently crippled by an auto-pistol attack in the most open gun carrying state

- The placing of rifle-scope targets on elected officals by a nationally recognized political candidate on her website

- The open brandishing of rifles and handguns (designed only to kill people) at political rallies and media events.

The core of Tea Bag politics is shouting opponents down and physical intimidation and the use of the gun as a political symbol for “freedom” — actually just intimidation of others.

That’s unbalanced and directly counter to democratic principals of free and open speech, sharing and pluralism. But it’s great theater and a media darling — which is why the Tea Bag marketers push it.

We don’t even have to mention the aggressive campaigning by every Republican pres candidate to establish a Christian evangelical theoracy in our government directly counter to the seperation of anyone’s church and out state.

OWS seems pretty tame compared. But their extreme demonization is just as anti-factual and silly.

Proof Elmer I deal in proof not conjecture. There is no connection between Loughner and any read that again any political or idealogical organization or group. This was just a loon who should have been locked up years ago. Also I would love to have you cite for me the place in the Constitution where it says that there will be seperation of church and state, not that we will have freedom of religion put that church and state will be seperate. No conjecture or vagueness here Elmer- give me the cite you know Article something clause something.

Define Brandishing. There is a legal definition and I suspect there is yours and I bet they are far apart.

The language of the murder-suicide government building attackers and the Tea Bag party are the same. Maybe language and words don’t matter.

Regardless of what a person exercising their rights to bear arms says when killing people, the fact is it is only “liberal” elected representatives being attacked.

Good, so another vote for a (white) Christian evangelical government and shutting down courts that disagree. We agree, these are common political goals for the “loudest voices” today.

Waving firearms around and raising them up in public and social/political settings is strictly threatening mortal harm. That’s why police shoot to kill when they encounter it.

Elmer, through this whole discussion I have tried to treat you with respect and kindness with an attempt to understand your point of view but frankly this discussion has to end becuase there is no reciprocity. I asked you a question and you who demands facts do not respond which is a typical response of the unprepared who deal in emotions and not facts. Your assumption that I am and evangelical becuase I ask you to back up your statement on seperation of church and state is pranoid and unworthy of a thinking person. By the way it is not in the Constitution the so call doctrine comes from a single line in a letter by Thomas Jefferson and it is honored more in the breech than in the observance.

I was brought up to beleive the all people should be treated with dignity until they prove themselves fools. This discussion needs to need I have more valuable uses of my time.

There are 3 responses to fear: – Fight — Blame and attack the messenger and other people – Freeze — Clam up and shrink into a corner, don’t speak, or repeat the same attacks – Flee — Run away

If it’s getting to hot in the kitchen, by all means flee.

you have proven that in a battle of wits you are unarmed. I will put my distinguished flying cross, two bronze stars with V, purple heart, 25 air medals, 5 Army Commendations with V and my Cross of Gallantry against anything you have ever done. I run from fools because they are the most dangerous of all. Don’t respond it is useless.

“Description of Appeal to Authority

An Appeal to Authority is a fallacy with the following form:

Person A is (claimed to be) an authority on subject S.
Person A makes claim C about subject S.
Therefore, C is true.

This fallacy is committed when the person in question is not a legitimate authority on the subject. More formally, if person A is not qualified to make reliable claims in subject S, then the argument will be fallacious.

This sort of reasoning is fallacious when the person in question is not an expert. In such cases the reasoning is flawed because the fact that an unqualified person makes a claim does not provide any justification for the claim. The claim could be true, but the fact that an unqualified person made the claim does not provide any rational reason to accept the claim as true.

When a person falls prey to this fallacy, they are accepting a claim as true without there being adequate evidence to do so. More specifically, the person is accepting the claim because they erroneously believe that the person making the claim is a legitimate expert and hence that the claim is reasonable to accept. Since people have a tendency to believe authorities (and there are, in fact, good reasons to accept some claims made by authorities) this fallacy is a fairly common one.”

Elmer, you are absolutely right that the “Constitutions does not give anyone the right to threaten or intimidate, even implicitly, political opponenets, your neighbors or our government with the threat of dying from a gun.” I would add not from any other means, too. Their is no evidence that is what the tea party is trying to do. The message that is being relayed is against gun control. To take it any farther than that is just demagoguery.

However, the occupy wall street movement is explicitly trying to threaten and intimidate government, their political opponents, and ordinary citizens including children just trying to get to school or work. They not only advocate violence, they incite and cause it, their leadership desperately hoping to create a “Kent State Moment”. Police have been spit on, had human waste thrown at them, had their motorcycles pulled out from under them, rocks and bottles hurtled at them, and the list goes on.

I also have to point out that in the Giffords attack, the attacker was a far left, Bush hating liberal that was upset that the Congresswoman didn’t faun over him and if Arizona’s gun laws been followed by the local sheriff who was negligent in not having him put on the federal no gun list (just like the case with the VA Tech shooter), the tragedy could likely have been avoided.

In addition, putting politicians on their target list with a rifle scope is done by political groups on both sides, and dailykos had Giffords on their target list with imagery of a rifle scope because she was not liberal enough for them.

Lastly, for decades we have seen far left groups like PETA and Code Pink showing up at events shouting down their opponents. The tea party has only resorted to such tactics when they are denied the right to speak at public events where they should have been allowed to speak. Criticism of the tea party for shouting rings so amazingly hollow when it has been a core tactics of the left for nearly half a century is beyond the pale.

To be honest, these types of ad hominem, baseless attacks may play to the small minority of kool aid drinking liberals, but they are off putting to people that want to really debate the issues and completely inconsistent with your own views on subjects as defined contribution plans. If the occupiers get their way, taxes are raised, all debt is forgiven, capitalism is restrained, health care, education, and housing is free, and wall street shut down, exactly what are all of us in the investment business going to do because their will be no money or role for us in society.

Dennis, thank you very much for your service to our country. Thank everyone for participating in this discussion. I won’t be on the computer for a couple days, so I would like to wish everyone a very Happy Thanksgiving. Cheers:)

There appears to be no fact basis for any extremist political and media venting, either by Tea Party, alien abduction believers, etc or OWS. for example:

“In general, accounting for taxes considerably reduces the rise in income inequality since 1963, while accounting for noncash benefits has only a small effect on changes in income inequality. Consumption inequality is less pronounced than income inequality, particularly for the bottom half of the distribution. Both income and
consumption inequality rise in the early 1980s and remain somewhat flat in the 1990s,
but in the 2000s overall consumption inequality shows little change while overall
income inequality rises somewhat.”

http://harrisschool.uchicago.edu/faculty/web-pages/Inequality60s.pdf

Of course, we know these facts will get zero media attention since thye would effectively put everyone to sleep. lol

Good discussion, generally. There is clearly a lot to be unhappy about, and major change is needed. Unfortunately OWS is an extremist movement and probably did more harm than good. I would add that “The Big Short” might be the best book on the subject of how we created the financial meltdown based on the US mortgage market, although Europe is another matter altogether. Mikhael Lewis does a good job with that as well.

As the big short and other books make clear, congress, particularly Barney Frank and his crew but also many others, had a huge role in creating this mess. But Elmer disparaging him based on his sexual practices like tea bagging is not helpful. Let’s keep it clean guys.

Happy thanksgiving!

See that’s the thing. Whether you’re a Tea Party government/immigrant/science/etc-hater or OWS financial services/1%-hater, there is little evidence for “...a lot to be unhappy about…”.

Perhaps other people have data.

We also run a Linked In group for family offices and the 1% and the OWS matter hasn’t even been referred to.

Where did we mention sexual anything?!

???

Evidence of a lot to be unhappy about? Are you kidding me? No data on the mortgage fiasco? No data? You lost me, there is a mountain of data. What are you talking about?

As for sexual matters, you were referring to tea-baggers. if you really don’t know, look it up. Not necessary to go there, Barney Frank ought to be criticized on the merits.

Elmer, part of the problem is stating things that are just not true. The tea party doesn’t hate the government, we believe in limited, more effective government. The tea party doesn’t hate immigrants, most are opposed to illegal immigration, while believing in expanded leagl immigration. The tea party doesn’t hate science, many believe, like I do, that some areas of science, like climate change, have been manipulated for political and monetary reasons.

As for mentioning something sexual, you used a sexual term for the tea party. You may not have realized you did, but you did.

The economy was in a down stage because of over-heated lending. Big deal. It’s cyclical. Yes, unemployment is high, but the global financial system is resetting, there is going to be disruptions. So?

Extremists always use the Chicken Little Tactic – “The sky is falling!!, the sky is falling!!” It’s not. America is the richest country in the history of the world and the richest country in the world — by far. Where and how is the sky falling?

America is doing just fine —thank you very much.

What OWS is gripping about may also be a non-issue. We found this yesterday. Do some research folks, it’s not hard:

“In general, accounting for taxes considerably reduces the rise in income inequality since 1963, while accounting for noncash benefits has only a small effect on changes in income inequality.

Consumption inequality is less pronounced than income inequality, particularly for the bottom half of the distribution. Both income and consumption inequality rise in the early 1980s and remain somewhat flat in the 1990s, but in the 2000s overall consumption inequality shows little change while overall income inequality rises somewhat.”

http://harrisschool.uchicago.edu/faculty/web-pages/Inequality60s.pdf

Of course, we know these facts will get zero media attention since they would effectively put everyone to sleep. lol

BTW, RH we don’t respond to personally insulting folks online so have a nice life.

What sexual term? This is a joke right?

More facts:

The TP folks hate anything that encroaches on their indivudal freedom at any time, they call Social Security a “criminal conspiracy” which also means the government officals are criminals, they place rifle scope targets one the names of government officals. They don’t want to pay any taxes to fund any government. They want to defund pretty much every government program. Ergo vehementlay anti-government.

Well they do want our government to protect their rights to conceal carry and wave guns at political events. So not anti-government there.

They are adamently against the scientific evidence for climate change and evolution because they conflict with religious ideologies and business interests,e.g., the Koch’s funding.

Here’s a quote from the leader of the Values Voter conference: “America needs a president who will “reject the morally and scientifically bankrupt theory of evolution.” Most Republican presidential candidates endorse this view.

Here’s a recent example:

“BBC television episode reporting climate change won’t be shown in the U.S.

November 25, 2011 – 2:50 am
Okay, this is from the Daily Mail, but let’s assume it’s reliable. Backed by BBC One, David Attenborough wrote and presented Frozen Planet, a seven-part television series on the natural history of the polar regions. The last episode, “On Thin Ice,” is about how humans are wrecking this environment via anthropogenic global warming.

Guess what? Although the Discovery Channel is showing the show in the United States, they bought only the first six episodes, omitting the one on global warming. The reason is obvious, even to the Daily Mail:

'A poll earlier this year found that the majority of Americans believe that if climate change does exist, it is not caused by humans.

Fifty-three per cent of Republicans say there is no evidence of climate change, while the number is far higher among Tea Party supporters, with 70 per cent saying the theory is ‘junk science’ pushed by groups with a vested interest.’”

http://whyevolutionistrue.wordpress.com/2011/11/25/bbc-television-episode-reporting-climate-change-wont-be-shown-in-the-u-s/

The BBC has a “vested interest?” lol

We’re not saying any of these attitudes and behaviors are right or wrong, but let’s be honest they exist and drive the true believers and the Republican party now..

Elmer, you can trust cherry picked, biased media sources, or you can trust an actual tea party member (me,) about what the tea party stands for. As for polls, we all know most are designed and manipulated to come up with desired results. Outside of Rasmussen, history shows most predicted election returns outside of their own margin of error.

Lastly, it is no joke, “tea bagging” is a sexual act. I will not describe it, but it has been around for decades. I have personally known the term since I was in college in the 1980’s.

What? So when given evidence it is either “cherry picked” or not trusted!? Is that what an advisor says to a client?

Think the head of the Value Voters Conference and the Repub presidential candidates are pretty trusted and main stream for TP. The Discovery Channel censorship is a fact.

We would never make reference to anything sexual in a professional forum. Can’t be responsible for what other bring to it and say.

My evidence is pretty clear. As a tea party member, I have first hand experience, while the reports are second hand at best. In addition, the Value Voters Conference is not the tea party, and only two POTUS candidates have legit tea party credentials, Bachman and Cain. While neither are the most eloquent, if you want tea party positions, you have to look to them and only to them. Lastly, whether intentional or not, you were the one who introduced sex into this thread by using a derogatory term for tea party members that is a sex act. I agree it is not appropriate, but you can’t blame it on others.

Where the heck did we mention sexual anything?

Bachman made the silly and irresponsible comments about HPV vaccines and Cain has a lot to answer for. Wouldn’t be bragging on those folks. The Value Voters are TP allied as is Perry, etc.

Elmer, you used the term “tea bagger” for members of the tea party. “Tea Bagging” is a sexual act. That is how sex got into this discussion. I take you ate your word you didn’t realize it was a sexual term, but regardless of your intent, you brought sex into this thread. I am not advocating Bachman for POTUS, but her position on HPV vaccines is way down the list of important issues. I am advocating Cain, and while he is not perfect, I am not sure what he has to answer for, except being a successful CEO. I don’t put much weight in questionable allegations.

Lastly, value voters and Perry are not tea party aligned. More like they are trying to glom on and usurp the tea party, which is why after vetting Perry has failed to gain support among the tea party voter.

You guys keep bring up “sexual acts” have no idea what you’re talking about.

Having a Presidential candidate who makes false inflammatory comments about a basic medical procedure is crackpot. Now if TP folks want to back a crackpot someone woefully ignorant, that’s fine. But let’s be honest and not dismiss or deny the truth.

After all this time you have not simply googled the term to see for yourself? That is also odd.

Dude, we don’t do that stuff at our house! Kids and Safe Search rules. Pleease!

The Tea Bag party was a name we remember and still use also Tea Baggers is easier to write out than the awkward Tea Partiers. Other folks dirty minds ain’t our concern.

(correction for Blackcrown) It was James Cayne who was at the helm and who toppled Bear Stearns.

Yes, while having a serious pot and bridge addiction.

And another thing — democracy is just messy and drives most people a bit nuts. But societies have tried kings, tyrants and fascism (that was a big failure), nobles-warlords, hunter-gather societies and communes. Great ideas — bad on execution.

“All ideas are good ideas, not all good ideas work.” The country, getting a lot more diverse and just bigger. The global economy seems to be changing at a exponential rate. All of this is impossible to even describe, let alone comprehend, let alone effect.

The most vulnerable and emotionally “sensitive” are going to reactive with fear and aggressiveness first — whether Tea Party or OWS.

No need to let the “loudest voices” have any say in anything. The world is not coming to an end — again. We’ll survive. Actually we predict America will thrive.

For example, OWS cries for bankers to be arrested — what about the folks who lied on mortgage applications. Half the country would be in jail. lol

Elmer,

I concur about Mr. Cayne. I wrote an article about the demise of the company “I grew up in” after the collapse http://www.marketingwithintegrity.com/?p=276

It’s not a matter of concurring but the evidence. Addictive brain disorders seem common in many folks accumulating vast sums. The drive is for more, more, more and there is never enough.

It would be likely be preferable if they did not rise to positions of power.

His addictions made him simply unable to even be conscious of what was happening to the firm and the lives in his charge. Tragic, for him as well.

BTW, pot has serious effects on memory. He likely simply forgot what was going on.

The question also remains, was he to blame but what about all the other people who failed to act on their knowledge of his severe impairments? It gets complicated.

Elmer, this is the weakest justification I have ever hard, “The Tea Bag party was a name we remember and still use also Tea Baggers is easier to write out than the awkward Tea Partiers”. The reason the people who are against the tea party use the term is specifically because not just because it is a sex act, but because of the nature of the act itself!!!

Here’s what we are up against as well — human nature. (well actually animal nature.)

Neither side can or wants to hear reason or facts. Of course, every advisor knows this is what clients do as well. So apparently our minds “off-load” difficult subjects to our government and likely advisors as well. Detaching from the exact problems they should be most engaged with. Big problem.

“Ignorance Is Bliss When It Comes To Challenging Social Issues
According to new research published by the American Psychological Association
• The less people know about important complex issues such as the economy, energy consumption and the environment, the more they want to avoid becoming well-informed
• the more urgent the issue, the more people want to remain unaware

“These studies were designed to help understand the so-called 'ignorance is bliss’ approach to social issues.”

In one study, participants who felt most affected by the economic recession avoided information challenging the government’s ability to manage the economy. However, they did not avoid positive information

To test the links among dependence, trust and avoidance, researchers provided either a complex or simple description of the economy to a group. The participants who received the complex description indicated:

• Higher levels of perceived helplessness in getting through the economic downturn
• More dependence on and trust in the government to manage the economy
• Less desire to learn more about the issue.

“This is despite the fact that, all else equal, one should have less trust in someone to effectively manage something that is more complex. Instead, people tend to respond by psychologically 'outsourcing’ the issue to the government, which in turn causes them to trust and feel more dependent on the government. Ultimately, they avoid learning about the issue because that could shatter their faith in the government.”

Participants who felt unknowledgeable about oil supplies not only avoided negative information about the issue, they became even more reluctant to know more when the issue was urgent, as in an imminent oil shortage in the United States, according the authors.

“Beyond just downplaying the catastrophic, doomsday aspects to their messages, educators may want to consider explaining issues in ways that make them easily digestible and understandable, with a clear emphasis on local, individual-level causes”

Another two studies found that participants who received complex information about energy sources trusted the government more than those who received simple information. “

“What’s next? That’s the question being asked as cities close down Occupy encampments and winter approaches.

The answer is simple. Just as the Tea Party gained power, the Occupy Movement can. The Occupy movement has raised awareness of a great many of America’s real issues and has organized supporters across the country. Next comes electoral power. Wall Street exerts its force through the money that buys elections and elected officials. But ultimately, the outcome of elections depends on people willing to take to the streets — registering voters, knocking on doors, distributing information, speaking in local venues. The way to change the nation is to occupy elections.”

http://www.huffingtonpost.com/george-lakoff/occupy-elections-with-a-s_b_1120243.html

“We are easily convinced by data.” There are interesting articles attached to this original post: http://reason.com/blog/2011/12/12/biggest-handouts-to-1-percent-are-social

“Biggest Handouts to 1 Percent Are Social Security and Medicare
Nick Gillespie | December 12, 2011

John Merline of Investors Business Daily has published a fascinating analysis of $10 billion the government annually gives to the dreaded 1 percent:

Using IRS data, IBD found that the top 1% of income earners claimed approximately $7 billion in Social Security benefits in 2009. That year, the program paid super-rich seniors — those with adjusted gross incomes exceeding $10 million — an average of $33,000 each.

Medicare, meanwhile, paid roughly $2.6 billion in health care subsidies for the richest 1% of enrollees, based on calculations using Medicare enrollment, overall Medicare spending and premium data. (Medicare does not track spending by enrollee income.) And if you consider that 5% of Medicare enrollees have more than $1 million in savings, the amount taxpayers spend to subsidize retiree health benefits skyrockets.

It gets worse from almost any conceivable perspective short of a French aristocrat before the Revolution:

The richest 1%, for example, claimed a total of about $400 million in jobless benefits in 2009. The reason for these billions in payments to the wealthy is that many federal transfer programs don’t have income limits on benefits.

“This is not an accidental loophole in the law,” Sen. Tom Coburn, R-Okla., noted. “To the contrary, this reverse Robin Hood-style of wealth distribution is an intentional effort to get all Americans bought into a system where everyone appears to benefit.” In November, Coburn issued a report focused on federal subsidies going to millionaires.

In addition to direct payments, the top 1% claimed about $31 million in tax credits for buying electric cars, $469 million in home energy credits, and $111 million in child care credits, according to IBD’s analysis of IRS tax return data….

“Shifts in the distribution of government transfer payments (since 1979) contributed to the increase in after-tax income inequality,” according to a recent study by the Congressional Budget Office. The rapid growth in Medicare, for example, “tended to shift more transfer income to middle- and upper-income households.”

The CBO also found that while the poorest fifth of households got 54% of federal transfer payments in 1979, they received just 36% in 2007. Several political leaders and policy groups have proposed changes to reduce federal payments to the super rich.

As you begin pondering the coming generational war and think about ways to create a safety net that isn’t just one entitlement program to folks who should be paying their own freight more fully, read the whole thing here.

And read this whole post from a month ago to get your Irish up on a chilly (in D.C. anyway) December Monday morn:

For centuries, wealth flowed from the old and relatively rich to the young and relatively poor. Nowadays, the direction has been reversed. Via FICA taxes, the young and relatively poor give money to the old and relatively wealthy (you not only make more money when you’re older, you’re sitting on all sorts of assets accrued over time). Every study of Medicare and other entitlements that are not particularly means-tested shows that we can’t have both a safety net and an entitlement system that sucks in huge amounts of cash and then gives it to people regardless of need. I think it would be a better world and a fairer world – and a richer world – if the government took in enough money to help the poor and indigent (whatever their age) and let the rest of us keep more of our money and make more of our choices for our futures.”

Elmer,

You will not find me defending poorily conceived federal welfare programs which are even more poorly managed. Everything has a cost, yet Congress has to this point never considered cost or effectiveness of the cumulative proliferation of Federal programs—some of which overlap with no positive impact.

The management skill missing in Congress is fiscal disipline. There is just not enough money to go around.

The genius of free market capitalism is you can achieve anything you want—you just have to work for it. In the USA the sky is the limit, regardless of race color or creed—the egalitarian pen-ultimate, but you have to work for it.

The federal government operates as if there are unlimited tax resources, cost is not a consideration nor is the effectiveness of programs—as if the US had unlimited tax revenue and were a third party solution to all lifes ills—which of course is absurd. There is no such thing as free housing, free medical care, free education—which the occupiers demand. We are still a free enterprise system. You advocate redistribution of wealth which has never worked because it eventually runs out of other peoples money to redistribute.

No one advocates against helping out the less fortunate. America is by far the most generous country on the face of the earth in large part becaue we are the most productive. By disincenting free enterprise productivity for the false choice of socialism—we end up with the worst of all choices.

Witness the economic collapse of South Europe which could result in economic activity in those country’s being cut in half by the absence of reliable credit markets. This is the path you are advocating. Yes you can point out all lifes ills, but so what? Can we fix everything wrong wrong in the world? Life’s ills are motivating. Witness emmigrants who come to the US not speaking the language, whose children become doctors or lawyers or captains on industry.

We simply can not fix all life’s ills. There is not enough money in the world to create Nirvanna nor could I disagree more with your solution of the redistribution of wealth which disincents both the productive and the unproductive and destroys wealth and the prospects of wealth accumulation in the future. That is called socialism.

Hugo Chavez in Venezuela shares your enthusiasm for popularist wealth distribution. You are certainly entitled to voice that sentiment, but understand in doing so you have killed the single most successful economic system ever created—free market capitalism.

SCW

We have no qualifications to make global pronouncements, nor do we find misportraying views different from ours to be productive. We do not engage in ideologically based philosophizing.

The article(s) posted pinpoints specific items that may be worth exploring. That’s all. Not sure what South America has to do with anything.

Statements like this are quite bizarre – “...you have killed the single most successful economic system ever created—free market capitalism.”