SEC Commissioner Says We're Wasting Money Trying To Protect Millionaires

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SEC Chief: We’re Wasting Money Trying To Protect Millionaires (Think Advisor) 

Right now the SEC is examining possible changes to the accredited investor definition. SEC chairwoman Mary Jo White wants to make sure that the SEC is properly identifying the investors who fit that definition. 

But SEC commissioner Daniel Gallagher doesn’t think this is necessary because “millionaires can fend for themselves,” reports Melanie Waddell.

“Why should we spend limited commission resources ‘protecting’ the wealthiest 2% to 3% of investors in the country? This obsession with ‘protecting’ millionaires — potentially at the cost of hindering the wildly successful and critically important private markets — strains logic and reason,” Gallagher said.

Foreign Central Banks Offer Up A Glimmer Of Hope (Charles Schwab) 

Although Europe’s third-quarter GDP was slightly better than expected, things aren’t looking good. The 18 euro-using economies haven’t posted quarterly growth numbers greater than 0.3% since Q2 2013. “Europe’s economy has remained frozen in place well beyond the past few quarters: real GDP is in-line with where it was four years ago,” write Liz Ann Sonders, Brad Sorensen, and Jeffrey Kleintop.

However, the European Central Bank is starting to act more aggressively. It’s unveiled a negative deposit rate, long-term loans to banks, and purchases of assets. “Global economies remain weak, but we are seeing a glimmer of hope from stepped up responses from foreign central banks,” they add.

Two Advisers Worth $US2.1 Billion Quit Merrill Lynch (Investment News)

“Two advisers who formerly managed around $US2.1 billion departed for rival firms in California, according to representatives at the recruiting firms. Both had ties to Merrill Lynch’s elite private banking and investment group, which comprises 150 adviser teams serving ultra-wealthy clients,” reports Mason Braswell.

James Hulburd, who managed $US1.5 billion, moved to UBS, while John Van Donge, who managed $US600 million, moved to Stifel Nicolaus & Co.

Merrill Lynch has had a string of advisers leave. And the firm’s brokerage chief, John Thiel, was questioned by executives over recent attrition, Braswell reports.

An Adviser Was Expelled From The Industry After He Caused Elderly Investors To Lose $US340,000 (Financial Planning) 

Former CUSO Financial Services adviser Patrick Richard Harrison was banned from the industry after he reportedly was involved in securities transactions that caused two elderly investors to lose greater than $US340,000, according to Margarida Correia.

Harrison “introduced the investors to an individual who purported to sell them discounted shares in a publicly traded regional bank. Harrison participated in phone calls with the investors and the securities seller about the investment opportunity, and assisted in having funds deposited with the seller and entities he controlled,” reports Correia.

And while the investors lost money, Harrison made $US14,000.

Japan’s QE Program Is Great For Global Risk Assets, But Terrible For The Yen (Advisor Perspectives) 

The Bank of Japan recently announced an expansion in asset purchases similar to the Fed’s QE, which should fund massive government indebtedness and facilitates pension fund reform. This could provide a boost to Japanese asset prices and give support to Japanese Prime Minster Abe.

“Pumping money into the economy and changing the asset allocation mix of a trillion-dollar pension scheme has had an impact on Japan’s domestic asset prices. Globally, it’s also very supportive, in our view, because money is fungible. Money that is printed in Japan doesn’t just stay in Japan; it flows into other markets. So we think Japan’s QE program is very positive for global risk assets but will be unambiguously negative for the yen,” wrote Mark Mobius and Michael Hasenstab.

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