Less Than Nothing

clipped from baselinescenario.com Robert Shiller, he of the Case-Shiller Index (and therefore a reasonable symbolic candidate for 2008 Man of the Year, were it not for a certain presidential election), has an op-ed in The New York Times advocating a government program to subsidize financial advice for anyone, particularly low-income people. There is a lot to like about this idea. In Shiller’s proposal, the subsidy would only apply to advisors who charge by the hour and do not take commissions or fund management fees, so they would have no incentive to steer clients into particular investments or into unnecessary transactions. It seems reasonable that, if they had access to impartial advice, some people might not have taken on mortgages they had no hope of paying back or, more prosaically, some people might do a better job of budgeting and take on less credit card debt. But I have one major reservation, In my opinion, most financial advice floating around is worth less than nothing.