1.

Stock market risk is at a level I’ve never seen before. Is all the risk baked into current prices? I would find that hard to believe. But I could be wrong. Is that why many advisors aren’t moving big chunks of nest eggs to safety now? I’m always wrong, but if a client can presently get 50% of the long-term market average with the smallest risk, I would recommend it. Think about 4.55% for 4 years with an A+, 96 Comdex insurer.

2.

Margin calls triggered by spiking interest rates are forcing banks, insurers & pension funds globally to liquidate portfolio derivatives. “The bodies are about to start floating to the surface.”

3.

September of 2008 was a very surreal time for marketing insurance products. Do you remember how close we were to a financial melt down? AIG was on the brink and some non-NY insurers were taken over. No matter how dark 2008 was, it doesn’t compare to our current situation–insurers requiring useless paperwork and silly financial data being judge and jury on annuity purchases. Clients worth $5 mil+ who want to own 50%+ of their assets in guarantees are told to take their funds elsewhere. Companies are now run by over-zealous compliance departments assisted by moronic underwriting robots. It’s a very sad time in our business my friends…

4.

As always, seniors need to take less risk moving forward. The 60/40 portfolio should be dead and buried by now. Clients could move some assets “off-statement” and go to a fixed annuity with partial withdrawals. Their nest eggs are distributed right to their heirs at their passing. “Off-statement” asset is a term we’ve used with advisory account clients. Feel free to use it anytime…