Drawbacks of Freedom of Choice in Modern Society
Doctor Thomas:
The private equity trust fund is at least temporarily in the red, andmay be permanently. Macquarie's earlier PET fund returned about 30%paover four years.Private Equity is not supposed to mean "stealing the investors money" -it wouldn't do the Bank's reputation if they did it too often, but I'llwager they won't be spending money on advertising the results of theirlatest effort. Furthermore, the bank gets paid their massive "managementfees" irrespective of how well the fund does. When McBank is called the "millionaire factory" they are referring to senior executives, not investors!
Patrick Henry:
Correctamundo.
We need to do something about the fee structures, like do a Virginisation - offer a good product at a fair price...
Doctor Thomas:
My immediate response is, yes but....
Customers are sufficiently qualified to evaluate the quality of anairline service (though not, admittedly, its safety risk). But (small)investors are not sufficiently qualified to evaluate the difference between a savvy investment bank and dodgy/lucky outfit. In today's complex economic world, investment is a professional skill on par with engineering and medicine (with a corresponding ethical obligation to theclient, in my opinion.)
The private equity trust fund is at least temporarily in the red, andmay be permanently. Macquarie's earlier PET fund returned about 30%paover four years.Private Equity is not supposed to mean "stealing the investors money" -it wouldn't do the Bank's reputation if they did it too often, but I'llwager they won't be spending money on advertising the results of theirlatest effort. Furthermore, the bank gets paid their massive "managementfees" irrespective of how well the fund does. When McBank is called the "millionaire factory" they are referring to senior executives, not investors!
Patrick Henry:
Correctamundo.
We need to do something about the fee structures, like do a Virginisation - offer a good product at a fair price...
Doctor Thomas:
My immediate response is, yes but....
Customers are sufficiently qualified to evaluate the quality of anairline service (though not, admittedly, its safety risk). But (small)investors are not sufficiently qualified to evaluate the difference between a savvy investment bank and dodgy/lucky outfit. In today's complex economic world, investment is a professional skill on par with engineering and medicine (with a corresponding ethical obligation to theclient, in my opinion.)
posted by Patrick Henry at 10:51 PM
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