I Guess So Called Financial Experts Are Not

[Aerides]

Jim Cramer is a carnival barker, and anyone who takes him seriously after 2008...I can't even. And that holds true for most any pundit, they are there for entertainment and viewer ratings, not accuracy.

 

[Koolau]

If the experts were as good as they say, they'd be billionaires multiple times over. Invest in index funds and DCA. Boring.

In financial terms, "boring" is good. Or maybe "Goldie Locks" would w*rk. Not too hot, not too cold but just right.

 

[audreyh1]

Jim Cramer is a carnival barker, and anyone who takes him seriously after 2008...I can't even. And that holds true for most any pundit, they are there for entertainment and viewer ratings, not accuracy.

Ha ha 2008(2007) was when Cramer was right and the Fed etc. was clueless. Cramer’s famous “They Know Nothing!” rant was right on.

But in general he’s all over the map and very short-term focused for stock picks and not very useful.

 

[Koolau]

With so much incompetence in the financial industry, why do so many people hand over their money to a fund?

Yeah, at some point you almost have to blame the folks who get suckered. Again.

Fool me once, shame on you. Fool me twice, shame on me. Cramer has a long track record of iffy-at-best-during-stable-times predictions. Why do people listen to him (other than the entertainment value)

I do very little with my portfolio because I got fooled too many times (so my fault.) Now, I just let the market do its thing and hope it comes through for me eventually. As always, YMMV.

 

[luckydude]

Re: Current Banking news: When I first read about the Theranos debacle, my main takeaway was how many experts were wrong in not seeing, or rather refusing to see, the house of cards foundation. Now, we have a few banks failing or on the verge because they did not protect themselves from market changes. I am 100% convinced that had these institutions hired one of us, on this site, to assess their financial stability they would not be in trouble now.
[as a related aside, special shout-out to Jim Cramer for his assessment on both Theranos and SVB).
From my, ahem, non-expert perspective I'm amazed at the stupidity of experts not being able to do what they supposedly know so much about.

There's a huge difference between Theranos and SVB. Theranos was out and out fraud with Holmes selling a technology that simply doesn't exist. SVB's downfall, on the other hand, was due to mis-management of interest rate risks, but SVB was not engaged in any kind of fraud or cover-up.

Also, a lot of the fraud or management incompetence are usually behind company walls and not transparent to outsiders, whether financial experts or the general public. So, unless an "expert" has credible insider information or insider sources, it's hard to really know what's going on within a company.

Finally, I wouldn't call Jim Cramer a financial expert. He's a shrill talking head on TV, good for screaming and shouting and nothing else. As for his calls on Theranos and SVB, all I can say is that a broken clock is still right twice a day.

 

[NW-Bound]

Remember Bernie Madoff. A guy named Markopolis had the numbers that showed his “earnings” could not be right. Despite the math, he was ignored. The gravy train was picking up speed as it went down steeper and steeper slopes. What fun! What an exciting ride? What could possibly go wrong?

IIRC he called her "a visionary", and "another Steve Jobs".

People like to believe in fairy tales.

Being a pessimist, I never believe in idolizing anyone, let alone businessmen, and politicians too.

However, the world is full of people who want to totally believe in something or someone, because they then don't have to think too hard. They just march along like lemmings.

 

[RobbieB]

I have no idea who Jim Cramer is.

 

[jazz4cash]

Finally, I wouldn't call Jim Cramer a financial expert. He's a shrill talking head on TV, good for screaming and shouting and nothing else. As for his calls on Theranos and SVB, all I can say is that a broken clock is still right twice a day.

Jim Cramer worked at Goldman Sachs, ran a hedge fund and now runs a charitable trust. I get the shrill talking head opinion but there is some financial expertise there also.

 

[audreyh1]

I have no idea who Jim Cramer is.

Well you have truly been sheltered!

I take it you don’t watch CNBC either. Good move!

Jim Cramer worked at Goldman Sachs, ran a hedge fund and now runs a charitable trust. I get the shrill talking head opinion but there is some financial expertise there also.

Yes, he knows a great deal. Just way too short-term focused for me.

 

[Car-Guy]

I have no idea who Jim Cramer is.

Well you haven't missed much. I can't believe he's still on the air. He's sort of like Joe Buck is as sportscaster. Worthless, annoying and clueless and I'm being kind.

 

[sengsational]

I have no idea who Jim Cramer is.

Me neither.

 

[luckydude]

Jim Cramer worked at Goldman Sachs, ran a hedge fund and now runs a charitable trust. I get the shrill talking head opinion but there is some financial expertise there also.

I am sure Jim possesses some level of financial knowledge, but as the 2008 financial crisis showed, working at an investment bank or running a hedge fund is unfortunately not a guarantee of high level of financial acumen. I personally know a couple of hedge fund and investment banker types whom I wouldn't trust to invest $10.

 

[RobbieB]

Don't know Joe Buck.

But I do know Juan Merde -

 

[FlaGator]

Back to SVB....

Asset/Liability mis-match, unhedged. Concentration of risk in the loan portfolio. Concentration of risk in depositor characteristics. Unhedged long term interest rate risk. At least one executive focused on social issues rather than their risk management responsibilities. All factors to one degree or another. Some of those look far more consequential to me than others.

So, sh!tty banking, and incompetent regulators for allowing it to happen. The rescue of depositors above the statutory FDIC limit in the name of "stability" or "systemic risk" are political questions best not adjudicated here. So, staying away from that.

Bad set up of the bank, bad monitoring, and an outcome which will produce consequences that won't be known for several years, IMHO.

 

[RobbieB]

And back to people.

So today my wife suggests that maybe we just cash her fathers IRA check and put the benji's in the safe?

I say what?

You know because the banks are failing...

 

[audreyh1]

And back to people.

So today my wife suggests that maybe we just cash her fathers IRA check and put the benji's in the safe?

I say what?

You know because the banks are failing...

Oh boy! People are going to cash?

 

[RobbieB]

That's what a "run on the bank" is eh?

 

[audreyh1]

That's what a "run on the bank" is eh?

Yes, it’s definitely a bank run, but those folks pulling money from SVB weren’t carrying home truckloads of cash.

 

[Koolau]

Yes, it’s definitely a bank run, but those folks pulling money from SVB weren’t carrying home truckloads of cash.

DW wants to pull cash out of our bank. But a truck would only be needed if we took all pennies.

 

[marko]

Jim Cramer worked at Goldman Sachs, ran a hedge fund and now runs a charitable trust. I get the shrill talking head opinion but there is some financial expertise there also.

Agree. I watch him every night, not for stock information as I'm not a trader, but every few days he offers up some general market insights that I've learned from. I only need his first 6 minutes of market monologue and then I'm done.

He kept me sane during the '08 debacle. He's also worth about $100MM so he's done something right.

 

[target2019]

Why didn't financial experts see this coming? Methinks it is always coming. "It" morphs into a new version of greed from time to time. Look at previous tricksters and you see the makings of the most recent mess.

There are elements of greed, politics, mis-management, and other sins too long to list. Now it's not normal business to allow financial experts to examine your dealings. We rely on State and Federal regulation to hopefully keep financial institutions on the up and up.

Of course, that gets to the heart of the matter, and can be quite contentious. Talking-head stew is more palatable.

 

[Gumby]

These things happen when the drive for profit overwhelms morality, ethics, respect for the law, caution and even basic common sense. It is an old problem.....

"For the love of money is the root of all of evil: which while some coveted after, they have erred from the faith, and pierced themselves through with many sorrows."

-- Timothy 6:10 (KJV)

 

[target2019]

These things happen when the drive for profit overwhelms morality, ethics, respect for the law, caution and even basic common sense. It is an old problem.....

"For the love of money is the root of all of evil: which while some coveted after, they have erred from the faith, and pierced themselves through with many sorrows."

-- Timothy 6:10 (KJV)

I agree, money is the root of all evil.

But I prefer my shortened version--Everybody Lies. Better for a hashtag #EverybodyLies

I know there are a few straight-shooters out there, but I personally make the assumption that on the other side of the transaction is someone who would take from my pocket if they could get away with it.

So I trust you (wink-wink) but not really.

 

[Gumby]

I agree, money is the root of all evil.

But I prefer my shortened version--Everybody Lies. Better for a hashtag #EverybodyLies

I know there are a few straight-shooters out there, but I personally make the assumption that on the other side of the transaction is someone who would take from my pocket if they could get away with it.

So I trust you (wink-wink) but not really.

Not money in and of itself (which is a morally neutral tool), but the LOVE of money is the root of all evil. It's an important distinction. Even if we had no such thing as money, man's grasping nature would lead him to do evil.

 

[target2019]

Not money in and of itself (which is a morally neutral tool), but the LOVE of money is the root of all evil. It's an important distinction. Even if we had no such thing as money, man's grasping nature would lead him to do evil.

You lost me on that one. Man's grasping nature?