My Boss's financial adviser said we are headed toward the worst situation since Great Depression

[Quixote1818]

I was visiting my boss last week and his financial adviser from Merrill Lynch was there. He suggested we were in one hell of a situation and on the brink of real disaster. I wonder if they are all talking like this among themselves?

Anyone hearing from their Financial Advisers lately?

[flvegan]

1. Merrill Lynch?

:eyes:

The big houses will profit either way. Grain of salt.

[Quixote1818]

2. I have heard ML is in bad shape lately.

But I am no expert on the markets etc.

[flvegan]

7. Context is key.

If it was off-record, like "hey, we're headed for a huge downturn...big problems, hope we'll be okay because I'm scared" that's one thing. It's another if it was "hey, guy, we're headed for a huge downturn...big problems, hope we'll be okay because I'm scared which is why I'm putting all my accounts into overseas growth funds" it's a pitch.

[Quixote1818]

12. "...putting all my accounts into overseas growth funds"

Interesting, because it seems like that was one of the things he was suggesting.

[Gman]

24. Because it's good advice

a step better than your mattress and coffee cans in the backyard.

[unblock]

29. you mean like bear stearns? lehman brothers?

i wouldn't trust financial advisors either -- they're not paid to tell the truth, they're paid to make sales.

but investment banks and brokerages can easily lose tons of money in the wrong financial environment, and the situation right now is NOT GOOD for making profits.

[GrpCaptMandrake]

3. I figure they're all talking among themselves

about how to make the rest of us carry their useless butts, a la BearSterns. That was a NICE little piece of welfare!

[high density]

4. Most financial advisers are nothing more than glorified salesmen

Those at Merrill Lynch definitely fall under that category.

[Quixote1818]

6. Good point. And each one will tell you something completely different.

You get 10 in one room and they would all be arguing.

[Rosa Luxemburg]

5. yes I think this has been predicted for some time

[bbinacan]

8. I was a Financial Adviser for

18 years. Nine with Morgan Stanley as an AVP. No great depression coming. In the short term, things are not good. But if your investment horizon is 10+ years out, buy stocks. I'm 44 years old and have a new 401(k) plan in my new career. Every 2 weeks, I'm buying more shares at lower prices. For the record I hold the following Licenses. Series 7, 63, 65, 31, 24 and Life/Health. I also have a degree in Economics from UNC-Chapel Hill.

Take my thoughts with a grain of salt if you want. I just gave you my background so you know I'm not talking out of my ass.

[elehhhhna]

9. Congrats on your new career (and the 401/k). So what do you do now?

ifya don't mind the question

[bbinacan]

13. I don't mind the question at all

I now do land acquisition (right of way easements) for infrastructure such as oil and gas pipelines, electric transmission lines, highways and roads, etc. I'm currently on a liquefied natural gas line project in Texas.

[elehhhhna]

26. cool. sounds recession proof to boot! Please try to avoid working on

the TransTexasPorkBoondoggle...er, oops..."corridor". IMO its' dangerous.

People down here WILL go all Ruby Ridge or something before they get off the family's land...even for big money. This is soooo the wrong state for the Fed to make a massive landgrab attempt. People are goofy about their property here.

[bbinacan]

33. Believe me

I know how Texans are about their property. That highway project is one that I will not do.

[Bobcat]

10. Re: Advisor

I too am a financial advisor. The political point is that the Bush policy is to bail out the "big boys" and leave the rest to "twist in the wind". And it is a precarious wind. On the economic side, if you have a long- term investment horizon and purchase assets monthly as most do, you will be fine. You make a salient point about buying on the cheap. But for those close to retirement this is a disaster. Many plans will have to change. Indeed, many of those 55+ are royally screwed. They have taken a big hit. Retirement will have to wait - until ????

[bbinacan]

16. If you structure the account

to address the needs of the client, you can still have market participation. Case in point. Before I left the business, I structured my Dad's account in such a way that he would have safe and liquid assets to cover 5-6 years of emergency funds and a source of income if needed. He had just retired. The rest we put in a managed account that he wouldn't need to touch for some time in the case of a bear market, like we're in now. Historically, once a bear has been declared, the upswing begins. The same is true of the economy. My Dad unexpectedly passed away in May and my Mom is in good shape due to this strategy.

What firm are you with?

[Mojorabbit]

25. I am 52 and moved what little I have

four years ago into energy funds which are doing well. I did this against the advice of my financial advisor.

[UndertheOcean]

11. oh noes

Its good I'm already poor then , nothing to lose

[lynettebro440]

19. Exactly how I feel

I hear people all day on the phones (customer service) about losing all their money. I'm thankful I haven't had any to lose.

[elocs]

23. Amen to that. When you ain't got nothing, you've got nothing to lose.

Yep, I've got plenty of nothin'.

[The Gunslinger]

14. Tell him to stop whining

It's all in his mind. :sarcasm:

[underpants]

15. Gramm is full of crap-people aren't talking DOWN the economy

all the suits are talking it UP

BIG TROUBLE is coming

BIG

[SmileyRose]

17. I think the Merrill Lynch guy MAY be an idiot.

why would a financial services advisor tell his client that the cheese is about to hit the shredder (implying "get all your crap out of investments while you still have it to get"). Or is that the new tactic of scoring a commission, get um to sell and take the cut.

but yes, I too think we are in for lots and lots things hitting the fan.

[Wcross]

18. No shit?

If you can't see this coming perhaps you are distracted?

[Hekate]

20. I know one (1) rich guy, a developer. He says the US is "about to crater" financially...

He's an old friend going back to elementary school, and we don't meet up too often. Usually he is a bundle of cheerful and optimistic energy. Not this time. He was downright grim.

It wasn't a fun conversation -- but strangely enough we actually had come to the same conclusions, just for entirely different reasons. He looks at the situation through a financial lens, and I look at it through a civil liberties/politics lens.

He's trying to build a lifeboat for friends and family (those who can afford to invest in his latest scheme, that is, and I can't) and I think he thinks I'm sticking with the Titanic.

Well, I have looked at my own situation and have decided to ride it out where I am -- Mr H and I have our own paid off little house with a little yard in a benign coastal climate, and if the seas don't lap at our doorstep and the fires in the chaparral don't actually come into the town, I think we can make it where we are, given our age.

But it was a very dark and interesting conversation and I offer it for whatever it is worth.

Hekate

[Bobbie Jo]

21. Financial Advisor? LOL

Sorry...that just stuck me funny. :rofl:

[PerfectSage]

22. I've seen this coming since 2005, Inflation of the 70's and liquidity crisis of thr 30's

2 more years of bear market loeft. The next for 4 cycle low is due in 2010 problably oct 2010. The 4 cycle goes back to the 40's and every 4 years it's the bottom of a bear market or a major correction in a bull market.

The next 9 month cycle low is due ic oct/nov this year and I expect a lot of bad earnings news and a major decline and panic selling. Before the next decent rally in this bear market.

[Fly by night]

27. The only stock I own is what I can count in the pasture every evening.

The way things are looking, I might have to act to protect them also.

My neighbors and I are thankful for our gardens and our ability to feed ourselves (at least for a while).

A country boy (and girl) will survive.

Our country (and its corpulent way of life), not so much.

[malaise]

28. Guess he knows more about this mess than most people

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x3604631

[unblock]

30. that's probably true. but it doesn't mean another depression.

"just" an ugly, extended recession.

the fed can fairly easily prevent things from getting dramatically worse, and they're already doing it.
it will just take some time to work out the current ugliness. once all the mortgage product losses have been recognized and the financial sector stops reporting losses, confidence will return and we'll get back on the right track.

it's just that it may take another year for this process to play out.

[conscious evolution]

31. My sister the MBA,CFA, says the same thing.

She thinks we are going to have 5-10 years of major financial instability.
She also thinks that it is a deliberate takedown,though she will not go into details on who and why.

[upi402]

34. My MBA step-daughter says similar n/t

[Medusa]

32. So can anyone tell me what I should be investing in?

I have a 401(k). I have a Roth IRA too (which invests in foreign stocks). How much of my money should be in bonds? What type of mutual funds should i invest in? ANY advice would be much appreciated. I'm an idiot when it comes to these kinds of decisions.

[roamer65]

37. TIPS funds for bond funds.

TIPS = Treasury Inflation Protected Securities. The Treasury pays an inflation premium on the bonds based on CPI. While the CPI is grossly inaccurate, I have still been gaining value in the past few weeks, not losing it on my TIPS funds. Look to see if your company offers a TIPS fund as part of their 401k mix of funds.

You also should own some physical gold, just in case.

[DailyGrind51]

35. Oh well, look on the bright side!

Do you think the American people will fall for that "free-market" deregulation crap any time again soon?

[roamer65]

36. John Williams at shadowstats.com is predicting a hyperinflationary depression...

by 2010. As the Federal Reserve shoves M3 money supply ever higher to cover the crisis, the US dollar will head the way of the Zimbabwe dollar.

http://www.shadowstats.com