Category Archives: Money Advice

Home / Money Advice
1 Post

In the Huffington Post, Dan Solin recently make an excellent point about the prevalence of useless investment advice in media, using as an example the leading Canadian newspaper The Globe and Mail. Solin argues that the whole media culture of giving exciting stock tips is simply a money-making strategy. The financial media needs this type of advice to guarantee immediate consumption of their product and securities firms make more money from day-traders than from long-term investors.

Bad Investment Advice Knows No Boundaries

One of the big problems with all of this in Solin’s view is that this type of advice is not only limited to sketchy web sites, but much of this type of advice appears in highly respectable publications. He believes that good financial advice is woefully rare and that there is little chance that the state of affairs will change.

Bad advice is a persistent problem, not because of those who give general advice in the media, but also for those who give professional advice as financial advisors. One example is the embattled firm Laidlaw & Co. Despite being chartered in Britain, the firm has been allowed to operate in the United States from its headquarters in New York. Laidlaw and its principals Matthew Eitner and James Ahern have been the subject of numerous complaints and a cease and desist order, which was filed by a biotech company due to their repeated acts of malfeasance.

The problem is that companies such as Laidlaw continue to operate because regulators such as the SEC are far too timid when they encounter reports of wrongdoing. The Madoff case was an excellent example. Despite the criminal activity being painfully obvious, the SEC and New York authorities did nothing until they had no choice.