Beware The Schmucks Of The Financial World

Saturday, December 27, 2008, 6:00 AM | Leave Comment

Forbes magazine online ran a story about “biggest bums of 2008” by Robert Lenzner. English not being my first language, I always thought a ‘bum’ is someone who does not work, is alcoholic and sits on park bench all day long and probably a good part of the night as well. But someone who lives in New York city in a $7 million apartment and others like him, I don’t think, are bums, not in our street talk any way.

Further in the story, the author calls them scoundrels. That I agree with. What’s wrong with calling them, straight out, ‘sons of bitches.’

How about calling them ‘schmucks‘ of the world, of the worst kind.

Moral of the story
The author suggests to do the following and I agree with him – do your own risk management. Take control of your money:

  • Do not keep all your investment eggs in the same basket

  • Do not keep all your investment eggs in one investment technique, as it is far too risky

  • Diversify your investment managers

  • Diversify the investment techniques managers use and strategies they pursue

  • Make sure your assets are held in your name by a fully insured custodian

  • Make sure you get immediate transaction notices from your custodian, instead of the monthly reports that Madoff sent, which everyone believes are fiction

What other tips would you add to this list? Share your thoughts in the comments below!

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