Financial Secrets (Part 1)

To me, the phrase “financial secrets” immediately connotes fraud. I would invite you to read some of my previous posts to find out why. Somewhat ironic is the observation that financial details are held with such secrecy in our society today.

Dr. Sarah Newcomb, author of Loaded: Money, Psychology, and How to Get Ahead Without Leaving Your Values Behind (2016) wrote an interesting article on this subject in the Sep 2016 AAII Journal. I will post some excerpts and [minimal] commentary:

     > We don’t talk about money.
     >
     > According to “Emily Post’s Etiquette,” money is
     > a third-tier topic of conversation, putting it
     > a full class above sex and religion in terms of
     > inappropriateness to discuss in mixed or casual
     > company. Especially among those with wealth, the

More taboo a topic than sex?! This is shocking to me.

     > unspoken laws of society dictate that we maintain
     > a dignified silence on this important, but often
     > divisive, topic…
     >
     > …the purpose of etiquette is to avoid any cause
     > for pain, embarrassment or offense. Yet our
     > reticence on financial matters is so pervasive
     > that it extends to those who would often greatly
     > benefit from open communication. In many cases,

Those of you who have been reading for a while know I’m fairly convinced that options are better than stock. I therefore feel like I walk around with a huge secret about what I do—a secret that suggests most of the financial industry is wrong and does a disservice to its clients by not employing options as an investment vehicle. Because we are so hush-hush about money, this is not something I feel comfortable coming right out to say.

     > well-intentioned civility leads directly to the
     > financial harm, or even ruin, of those we care for
     > most.

Namely my parents. For years they have invested with a money manager who I believe has failed them. The upside to keeping silent and letting them do their own thing is that I avoid the burden of losses that could result from the market turning ugly. The downside is watching them throw away money year after year to generate subpar returns.

I will finish this discussion in the next post.