');} ');} ');} ');} ');} ');} ');} ');} ');} ');} ');} ');} ');} ');} ');} ');}

The theft of a house the size of Colorado (including your money)

It seems like everytime I turn around lately there is some wall street mongrel being arrested for fraud.  Sound familiar? Bernie Madoff stole 50 billion from investors.  To put that in perspective, in the cost per sq foot it cost to build my house you could build a house the size of colorado.  No kidding, the entire state.

Colorado house

Sorry Kansis, NM, and Utah we borrowed 20 extra bill to build on you too, since the government gives out billion bills like candy these days.

Whats the moral? Well we have a few of them for you:

The experts know nothing more than you do
Have you ever wondered why the so called expert’s estimates can be wrong so often yet investors hang on their every upgrade or downgrade, moving the price of a stock each time they revise their opinion. I won’t even start on my Jim Cramer rants, since you all know what I think of him.  They use really complicated mathematical models to come with these estimates and generally, only after much schooling. It’s a given that most if not all of them are extremely bright. Then again a lot of them are not.  Of those that are extremely bright, how many actually know what is coming?  Zero.

Your broker recommends what makes them the most money
I can hear honest, hard-working stockbrokers screaming and tearing their hair out as they read this. How could any law abiding, honest individual forego every shred of decency in the name of larger commissions? Easy, just like you and I, they need to put food on the table or in a lot of their cases, a yacht in their marina. A bang on explanation comes courtesy a scene in the movie Wall Street where Charlie Sheen explains to his dad why he’s always broke. The overhead just overwhelms. They have necessities such as cars, dinners, suits, boats, expensive cigars, golf games, crown XR,  et al that somebody has to pay and it isn’t going to be your friendly broker, it’s going to be you.

The overwhelming point is this: there is no magic formula for investing to get amazing returns year after year and any broker that tells you there is is a liar and a thief.
Brokers are looking out for themselves, and any that promise returns that seem too good to be true I can promise you actually IS too good to be true.  Don’t allow yourself to get swindled.

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