Warren Buffett, chairman and chief executive officer of Berkshire Hathaway.
Andrew Harrer/Bloomberg
Berkshire Hathaway CEO Warren Buffett had some choice words for financial advisors and asset managers at this year’s company shareholder meeting, likening the investing world to a “gambling parlor” and suggesting that monkeys could do a better job investing than the professionals. That didn’t sit well with some advisors, who said the comments were reflective of a narrow view of the industry and outright dismissive of fiduciary advisors and financial planners.
In other most-read wealth management articles this week:
Discrimination claim. Gwen Campbell was a plum hire when she joined JPMorgan Chase in 2020, jumping from Merrill Lynch and bringing a $1 billion book of business with her. But the relationship is not going well. Campbell, who already was engaged in an arbitration case against the company, has filed a discrimination claim with the U.S. Equal Employment Opportunity Commission. She claims J.P. Morgan tried to destroy her career and alleges the company has a workplace culture of “unchecked greed, avarice, and misogyny and retaliation.”
Is the Fed doing enough? If the Federal Reserve is resorting to “shock therapy” to temper inflation, will it still be able to avert a recession, and what could it have done differently? We asked several seasoned advisors about the Fed’s interest-rate-hike plans. They suggested the central bank could have started earlier on its rate-hike campaign and dropped the descriptor “transitory” when referring to inflation. They are wondering whether policy makers are underestimating how much they will need to boost rates to bring the economy back into balance.
Fee cuts at American Funds. Capital Group has announced that its American Funds subsidiary is cutting fees on funds with less than $15 billion in assets, potentially netting fee savings of more than $20 million for investors over the next year. The cuts, which mainly affect bond funds, come as that asset class has been hammered in the markets, with one key fund down more than 8% this year. Yet rising yields and lower fees make them more attractive.
$1.6B team jumps from UBS. An advisor team managing $1.6 billion in assets has left UBS to join the independent wealth management firm NewEdge Wealth. That firm’s president said that the decision of a veteran team to join the firm “reflects our company’s ability to serve their clients in a unique way.”
Family matters. Multigenerational financial planning carries some unique challenges, not least the concern that wealth stays in the family—and that younger-generation clients stick with their parents’ advisor. In this week’s podcast, Valerie Newell of Mariner Wealth Advisors shares her advice on how firms can ensure that clients have an age-appropriate advisor, why wealthy clients are reluctant to spend their money, and what matters most to parents.
Also this week, we caught up with one of the most influential women in finance, Penny Pennington, for the Barron’s Advisor Q&A. As managing partner of Edward Jones, Pennington leads a brokerage known for its legions of advisors operating as solo practitioners in communities across North America. But changes are afoot at the firm, she tells us. It’s experimenting with shared office space and advisor teams, and may even be considering an RIA channel.
Have a great weekend.
