Trust Company of America

Hesiod wrote a few years ago- A spirit of competition, of good conflict that tends to reduce the problems of scarcity. (Hesiod was in favor of the rule of law and the dispensation of justice to provide stability and order within society. He spoke out against corrupt methods of wealth acquisition and denounced robbery.700BC) A very telling tale with eerie significance to current events.

There are challenges aplenty in the world of the breakaway broker. From the obvious considerations of the market over the last decade, to the constant bombardment of the 24 hours news cycle keeping your clients informed of all the potential and peril that exists in the financial arena. With ongoing regulatory changes that create a virtual minefield of violations, and let us not forget the do it yourself marketing that is pummeling the investor to think that they dont need professional guidance.

I saw this quote recently while researching another topic. I found it to be appropriate to capture the challenge that professional money managers have in finding investments appropriate for the current domestic economic and geopolitical environment. The rules (that apply to what makes an investment good or bad) that have been established over the previous 40 years of investing are no longer relevant, and those investments that typically would struggle during a massive global recession have been successful in achieving a rising valuation.

Debt as a percentage of GDP is the standard barometer in which most the worlds economies judge the health of a countrys economy. How much you produce vs. how much you owe. The US as of 12/30/2011 had a total debt of $15.69 trillion. That takes into consideration both publicly-held debt and intergovernmental holdings. Currently, total debt as a percentage of the production of the United States is a staggering 100.4%. Clearly there is no precedent for this kind of fiscal malfeasance. Or is there?