401k Salesman Coming into Work

[osoab]

I need some GSUS help here.

We have a new broker for our 401k accounts that is coming in to give his spiel how we should be investing more in the stock market. The boss told me that was what the meeting was for. He is trying to get suckers into the stock market into fixed investments.

Apparently the last broker (Merrill) never called to talk to our companies administrator (the boss) in the 5 yrs we were with them. So the new broker is coming in to talk to the whole crew. I already told the boss I was going to hit him with some tough questions.

I want to avoid any gold/silver talk. I am only looking for reasons why I should not invest in the 401k through work.

I am shooting for 5 questions at the minimum. I have 4 so far.

1. Why would we invest in a 401k when the likely hood of government seizure is looking more certain everyday. I would use as backup the hearings with Harkin and Sanders.

2. Why would why put my money in the stock market when if you use the index values (DOW, S&P500, NASDAQ) from 2000-2010 you would have lost money.

3. The US dollar index has fallen from 100 to 77 in the 10 years. Anything dollar denominated that is gaining in price is for the most part a reflection of the devaluation of the dollar not a reflection of the good times rolling along.

http://www.chartingstocks.net/wp-content/uploads/2009/09/US_dollar.png

Our plan is really crappy. I mean bad. Very few picks and all of them are funds of some sort. Maybe only 20 choices. One is a money market.

4. Why would I want to put more money into a bad 401k package, when I can just as easily open a brokerage account to trade the specific stocks/sectors of my choosing?

5. :dunno


I want to see this guy sweat. So what else can you guys come up with?

[Horn]

I feel sorry for the guy already, he will most likely evade the dollar questions with some good answers, so you may want to stay away from them.

The only thing I might add is, "I thought Obama just invested the next 2 years GDP in the stock market for me?" :)

[ShortJohnSilver]

I would ask about the fees the fund charges. They are called management or service fees. see http://thismatter.com/money/mutual-funds/mutual-fund-fees-expenses.htm

I would ask him if it is the case that high frequency trading (HFT) doesn't mean that any trades they make are gotten in front of. See zerohedge.com for more explanation on that if you need it.

Ask him what happens if inflation reaches 9% a year - how do he expect the stocks to outperform that? (accurate measures of inflation are about 8% recently, I think).

Then again, if he is anything like my local friendly but clueless bank manager, the issue will be that he will be a nice person but 100% clueless and you will end up looking like a jerk.

[osoab]

I would ask about the fees the fund charges. They are called management or service fees. see http://thismatter.com/money/mutual-funds/mutual-fund-fees-expenses.htm

I would ask him if it is the case that high frequency trading (HFT) doesn't mean that any trades they make are gotten in front of. See zerohedge.com for more explanation on that if you need it.

Ask him what happens if inflation reaches 9% a year - how do he expect the stocks to outperform that? (accurate measures of inflation are about 8% recently, I think).

Then again, if he is anything like my local friendly but clueless bank manager, the issue will be that he will be a nice person but 100% clueless and you will end up looking like a jerk.


I forgot about the HFT's. I'll add that in. Granted our options suck so bad that I don't think Goldman would be front running these.

He would probably use the .gov official cpi index for inflation.
Inflation? What Inflation?

[ShortJohnSilver]

I forgot about the HFT's. I'll add that in. Granted our options suck so bad that I don't think Goldman would be front running these.

He would probably use the .gov official cpi index for inflation.
Inflation? What Inflation?


In that case, go to shadowstats.com before hand and print out a couple of the charts.

[osoab]

In that case, go to shadowstats.com before hand and print out a couple of the charts.


I don't want to overwhelm the guy. I highly doubt he has ever heard of Mr. Williams.

I need something that he can relate to easily.

Could use Jim Cramer's buy BS call.

[Quixote2]

Ask him if the additional 5% mandatory payroll tax into the government confiscated 401k (Government Retirement Account, GRA) comes from the employer or employee (make sure your management hears the question).

http://www.humanevents.com/article.php?id=39336

snipped: "In a nutshell, under the GRA system government would seize private 401(k) accounts, setting up an additional 5% mandatory payroll tax to dole out a "fair" pension to everyone using that confiscated money coupled with the mandated contributions. This would, of course, be a sister government ponzi scheme working in tandem with Social Security, the primary purpose being to give big government politicians additional taxpayer funds to raid to pay for their out-of-control spending."

[osoab]

Ask him if the additional 5% mandatory payroll tax into the government confiscated 401k (Government Retirement Account, GRA) comes from the employer or employee (make sure your management hears the question).

http://www.humanevents.com/article.php?id=39336

snipped: "In a nutshell, under the GRA system government would seize private 401(k) accounts, setting up an additional 5% mandatory payroll tax to dole out a "fair" pension to everyone using that confiscated money coupled with the mandated contributions. This would, of course, be a sister government ponzi scheme working in tandem with Social Security, the primary purpose being to give big government politicians additional taxpayer funds to raid to pay for their out-of-control spending."




In my first question.

I have talked to my boss a little bit about the issue, when the tinfoil was still a rumor. I brought the subject back up after I read KD's ticker this morning.

He thinks it is a good/valid question.

[ShortJohnSilver]

I would ask about the fees the fund charges. They are called management or service fees. see http://thismatter.com/money/mutual-funds/mutual-fund-fees-expenses.htm

I would ask him if it is the case that high frequency trading (HFT) doesn't mean that any trades they make are gotten in front of. See zerohedge.com for more explanation on that if you need it.

Ask him what happens if inflation reaches 9% a year - how do he expect the stocks to outperform that? (accurate measures of inflation are about 8% recently, I think).

Then again, if he is anything like my local friendly but clueless bank manager, the issue will be that he will be a nice person but 100% clueless and you will end up looking like a jerk.


I forgot about the HFT's. I'll add that in. Granted our options suck so bad that I don't think Goldman would be front running these.

He would probably use the .gov official cpi index for inflation.
Inflation? What Inflation?


I forgot to add, if the HFTs are the ones responsible for all the volume, then how do we know that if they stop the HFT systems, there will still be enough volume of stock trading to ensure that even publicly traded stocks can be easily sold? Large funds don't buy 100 shares at a time of a stock, they buy 100,000s or millions...

[Sparky]

What's your objective? I'd be focusing on getting more choices, rather than breaking this guy's back about the stock market. He's just doing his job. Ask about commodities funds, particularly energy, materials, and precious metals. Make sure they have a cash reserve fund or a true money market fund, and not just a "stable value fund", which they will tell you is the same as a cash fund. These are the types of things you should challenge him on, because they reflect the quality of their offerings and service, and he could actually do something about it.

Does you company match 401K contributions? That's a good reason to participate.

If the world doesn't come to an end, the scenario is likely to be: a harsh stock market beating, followed by inflation where owning stocks will be an excellent hedge. You're going to want to be back in stocks someday, first as an inflation hedge, and then to take advantage of the next bull run in stocks.

[Silver Shield]

I double dog dare you to show this video to all of your workers before they go and see this 401k guy...

http://www.youtube.com/watch?v=MjVCdPwE7XA

[osoab]

What's your objective? I'd be focusing on getting more choices, rather than breaking this guy's back about the stock market. He's just doing his job. Ask about commodities funds, particularly energy, materials, and precious metals. Make sure they have a cash reserve fund or a true money market fund, and not just a "stable value fund", which they will tell you is the same as a cash fund. These are the types of things you should challenge him on, because they reflect the quality of their offerings and service, and he could actually do something about it.

Does you company match 401K contributions? That's a good reason to participate.

If the world doesn't come to an end, the scenario is likely to be: a harsh stock market beating, followed by inflation where owning stocks will be an excellent hedge. You're going to want to be back in stocks someday, first as an inflation hedge, and then to take advantage of the next bull run in stocks.


My overall goal is to figure out what he is selling. His fricking name is Jimmy Stewart not James. Snake oil salesman?

This guy is not in any control over our accounts as far as I know. He is just drumming up business. The boss said that he is coming in to talk about why we should contribute more or start contributing to the 401k plan.

He is not coming in at the request of our company.

The change into a different plan is at a level that he is not involved with. We are a small company and it has to do with the administrative fees they are throwing at us. This is the cheapest plan. The boss is looking into other options.

Company Match....Considerate it zero.

But this current plan is worthless. The only overseas exposure is a Euro/Pacific Fund (not Schiff). If I remember right one of the largest holdings of this fund was JPM. ???

[osoab]

I double dog dare you to show this video to all of your workers before they go and see this 401k guy...

http://www.youtube.com/watch?v=MjVCdPwE7XA


That thing is funny. I watched it a day or two ago.

Was that a French version of "Geraldo".

[Glass]

What about the FED POMO. Permanent Open Market Operations. Someone here tagged them for pushing Apple to the 2nd highest market capitalisation which was announced....... last week I think

[Olmstein]

Then again, if he is anything like my local friendly but clueless bank manager, the issue will be that he will be a nice person but 100% clueless and you will end up looking like a jerk.


This. ^^^^^^^^^

The best you could hope for is some better investment options. Pointing out what a scam Wall Street has become will just make you look like a crank. Not worth it at work.

[bellevuebully]

Anything you say on how crappy the dollar is or how uncertain the market is will be countered by scripted blather containing the hidden wisdoms about buying when things are low, or some other sales mantra.

I say you lay right in, or forget it. One way you may help someone wake up, the other way...your just burning up energy for nadda. If you choose to lay it all out, you'll only be speaking the truth.

[osoab]

Well, the 4 questions in the OP were reviewed by the boss. He had no issues with them.

Does anyone have anymore quick and concise questions?

[chad]

Well, the 4 questions in the OP were reviewed by the boss. He had no issues with them.

Does anyone have anymore quick and concise questions?


"does it bother you when you fuck old people out of their life savings for a commission?"

[osoab]

Well, the 4 questions in the OP were reviewed by the boss. He had no issues with them.

Does anyone have anymore quick and concise questions?


"does it bother you when you f*ck old people out of their life savings for a commission?"


:ROFL: :ROFL: :ROFL: :ROFL:

I have to use some tact chad.

[Twisted Titan]

What is the process for liquidating the fund??

How long is this process. (aproximately) why do you not bring paperwork outlinging what your companies protocol is?

Are there additional fees associated with final exit? ( do have a copy for review? why not??)

If they ask why you are so "negative" just say every REAL INVESTOR knows what their entry and more important their EXIT POINT is.Not to be aware of them is the very height of stupidity and it only a matter a time before you get skinned alive.





I agree with others DO NOT TALK ABOUT GUBBERMINT SEIZURE you will look like a crank but even worse be a marked man when the hammer falls on the neck of the unprepared.


T

[osoab]

What is process for liquidating fund??

How long is this process. (aproximately) why do you not have outlinging what your companies protocal is?

Are there additional fees associated with final exit? ( do have a copy for review? why not??)


If they ask why you are so "negative" just say every REAL INVESTOR knows what is entry and more important his EXIT POINT is.Not to be aware of them is the very height of stupidity.


I agree with others DO NOT TALK ABOUT GUBBERMINT SEIZURE you will look like a crank but even worse be a marked man when the hammer falls on the neck of the unprepared.


T


The boss likes the gov seizure part. It stays. I have to bolt in a couple minutes to get back to work for our meet and greet.

This guy has nothing to do with the plan other than being a broker for the plan to go through.

He really has no other use other than being a middle man.

The boss said he didn't mind me to ask what his commission is for getting more 401k participation.

[chad]

oh, do post details of what happens. :CS

[madfranks]

I wish I could be there to see his face go pale as he mumbles his way through those questions.

[osoab]

Ok, I have had so time to digest just what the dipsmack said.

I was wrong that he is a broker. He is a just Certified Financial Adviser. He is there as a "tool" (pun intended) for plan members to talk with about our financial situation and financial plans.

I started off at number 4. Crappy Plan, why invest. Why not your own brokerage account?
His response.

Even though the options are limited, you should still come in and talk to me in my office. I don't have the greatest plan through my employer, but there are options that can be looked at that will fit your investment strategy.
You also have to deal with the tax obligations that occur with a brokerage account. You are using pretax money for your investments in the 401k.


Which is horse crap. They had the funds performance through end of Q2 in his little booklet. They were all negative. Half were double digit negative. This wasn't passed out until the 20 minute meet and greet was over.

I brought up the Euro/Pacific fund and he said that it was an old fund from the 50's (I don't think so, but will check) and that they had changed their exposure to more international companies/exposure not just in the Euro/Pacific region. I told him that a 11% weighting into JPM (what sticks in my mind, could be wrong) was not much of overseas exposure, besides the fact that the Euro area and the Pacific rim are 2 completely different plays that shouldn't be combined. I also added that exposure to banks has downside risk since issues with the banking industry are far from being resolved. He countered
that JPM is a large international company. And that listening to CNBC with all the negative news could be counterproductive to a good investing strategy

During the early part of his spiel he kept saying that we were getting free money with the company match.
I had to speak up and say that it wasn't free money. It's either given out to employees because of our labor/effort, or that it comes directly out of the boss's pocket out of his own generosity. I told him it was flippant for him to keep spouting that it was "free money". He didn't give much of a response to that.

Next was question 1. Confiscation.
His response.

Well, you can't listen to what the politicians are saying. They say a lot of stuff that never happens.
They will probably grandfather it in.

I couldn't gauge from his expressions if he had even heard of it.

Then on to question 2. Indexes 2000-2010.

His response.

If you look at the S&P, I think it is a good time to invest. Historically when the index is down for 10 yrs, the next ten years will see a nice return on the index.

I will have to look @ the charts on this one.

Finally on to question 3. Dollar Value.

I tied this into the indexes. I added that even if you took small losses on the indexes, that the loss of the value of the dollar over the ten years compounded your losses in real terms. With a 25% loss in dollar over the same 10 year period.

His response.

You need to come sit with me at my office. I have 1000's (that's what I think he said) that have made money in the market by choosing from funds like those featured in our current 401k

I wish I would have recorded it. Unfortunately, it would have been a felony to do this in ILL without consent of all present.

Only one other question was asked. It was before, I even started. One guy asked if we were still able to access our 401k account online. The damn adviser didn't even know we had total access to change allocation online.

Overall it was a waste of effort and my time. I didn't have a chance to talk to the boss afterwords. Our adviser was still in his office.

[General of Darkness]

Shit I wasn't paying attention to this thread or I would have chimed in.

I would have asked, "When you guys loose money, you get a bailout, what happens when you loose MY money?"

Then walked out.

NEVER TRUST ANYONE WITH YOUR MONEY, NEVER. NOT IN THIS DAY AND AGE. THEY IS NO HONOR, THERE IS NO KULTURA. NOTHING. FUCK THEM, AND IF YOU TRUST SOMEONE ELSE WITH YOUR MONEY YOUR AN IDIOT. I'm not saying that to you Osoab, just in general.

[k-os]

Thanks for the report, osoab.

[1970 silver art]

Ok, I have had so time to digest just what the dipsmack said.

I was wrong that he is a broker. He is a just Certified Financial Adviser. He is there as a "tool" (pun intended) for plan members to talk with about our financial situation and financial plans.

I started off at number 4. Crappy Plan, why invest. Why not your own brokerage account?
His response.

Even though the options are limited, you should still come in and talk to me in my office. I don't have the greatest plan through my employer, but there are options that can be looked at that will fit your investment strategy.
You also have to deal with the tax obligations that occur with a brokerage account. You are using pretax money for your investments in the 401k.


Which is horse crap. They had the funds performance through end of Q2 in his little booklet. They were all negative. Half were double digit negative. This wasn't passed out until the 20 minute meet and greet was over.

I brought up the Euro/Pacific fund and he said that it was an old fund from the 50's (I don't think so, but will check) and that they had changed their exposure to more international companies/exposure not just in the Euro/Pacific region. I told him that a 11% weighting into JPM (what sticks in my mind, could be wrong) was not much of overseas exposure, besides the fact that the Euro area and the Pacific rim are 2 completely different plays that shouldn't be combined. I also added that exposure to banks has downside risk since issues with the banking industry are far from being resolved. He countered
that JPM is a large international company. And that listening to CNBC with all the negative news could be counterproductive to a good investing strategy

During the early part of his spiel he kept saying that we were getting free money with the company match.
I had to speak up and say that it wasn't free money. It's either given out to employees because of our labor/effort, or that it comes directly out of the boss's pocket out of his own generosity. I told him it was flippant for him to keep spouting that it was "free money". He didn't give much of a response to that.

Next was question 1. Confiscation.
His response.

Well, you can't listen to what the politicians are saying. They say a lot of stuff that never happens.
They will probably grandfather it in.

I couldn't gauge from his expressions if he had even heard of it.

Then on to question 2. Indexes 2000-2010.

His response.

If you look at the S&P, I think it is a good time to invest. Historically when the index is down for 10 yrs, the next ten years will see a nice return on the index.

I will have to look @ the charts on this one.

Finally on to question 3. Dollar Value.

I tied this into the indexes. I added that even if you took small losses on the indexes, that the loss of the value of the dollar over the ten years compounded your losses in real terms. With a 25% loss in dollar over the same 10 year period.

His response.

You need to come sit with me at my office. I have 1000's (that's what I think he said) that have made money in the market by choosing from funds like those featured in our current 401k

I wish I would have recorded it. Unfortunately, it would have been a felony to do this in ILL without consent of all present.

Only one other question was asked. It was before, I even started. One guy asked if we were still able to access our 401k account online. The damn adviser didn't even know we had total access to change allocation online.

Overall it was a waste of effort and my time. I didn't have a chance to talk to the boss afterwords. Our adviser was still in his office.






He does not know the answers to the questions that you gave him and he does not care that he does not know because he will always get paid a commission and/or fee regardless of how your investments in your 401-K do. Of course he is going to push stocks even if another 10 years go by and the stock market is still flat or declining because stocks seem to be the only paper game in town.

[osoab]

I forgot to add that his 1000's of clients line had to be b.s. I swear he said 1000's

I will ask tomorrow if anyone else remembers if he said 100's or 1000's of clients.

Lets take about 220 working days a year after weekends, holidays, and vacations. I'll give him 7 hours a day at work to talk to clients 1 hour at a time. 7 people a day. That is 1540 people in a year. There is no way this twerp has 1000's of clients.

Either that or I should go into the adviser business. Tell people where to put their money while they pay me with their money. ;D

[Half Sense]

You need to come sit with him in his office...where others can't hear your embarrassing questions or his evasive answers.

[Olmstein]

If you look at the S&P, I think it is a good time to invest. Historically when the index is down for 10 yrs, the next ten years will see a nice return on the index.

It's also a great time to buy real estate, if you were to ask a RE agent. Probably a great time to buy a car, too, according to the car salesman.

At least you won't have to pay taxes on the money that will be confiscated in the future. :)

[Twisted Titan]

I wish I would have recorded it. Unfortunately, it would have been a felony to do this in ILL without consent of all present.

Screw that bullshit.

RECORD EVERYTHING.


In times like these the only ones who are playing by "The rules" are The loosers or people who dont know they lost yet.

If the Hammer falls ( which it will) that recording may be the only leg you have to stand on and everybody who would have been upset will be kissing your @$$ calling you The Mad Genius.


Rule number one is quite simple: PROTECT YOURSELF AND YOUR INTERESTS......ANY WAY YOU KNOW HOW.

[Sparky]

If you look at the S&P, I think it is a good time to invest. Historically when the index is down for 10 yrs, the next ten years will see a nice return on the index.

I will have to look @ the charts on this one.

Wow. This is demonstrably false. It's a good time to invest when the index is down for 15 years, not 10. If we're not living in caves by then, we'll want to re-enter the stock market in 2015.