Each week, Advice Wars highlights the best and worst events in the financial advice industry.
The Good
Mergers and acquisition activity continues to be the name of the game in the financial industry this year with two big acquisitions announced this week – Franklin Resources buying Legg Mason and Morgan Stanley buying E*Trade. The $4.5 billion deal combines Franklin Resources, the parent company of Franklin Templeton Investments, with Legg Mason to create a $1.5 trillion asset manager – a top 10 firm.
Morgan Stanley’s acquisition of E*Trade is a continuation a great migration downmarket from Wall Street to Main Street. In the past year or so, we’ve seen Goldman Sachs launch its Marcus brand and acquire United Capital.
If you've ever thought "I don't have enough money to work with a financial advice" the massive investment world-leading firms are making in America's Middle Class should tell you otherwise.
The Bad
Boeing’s woes connected to the 737 Max continued this week as a new investigation showed company mechanics had left behind debris in the fuel tanks of several planes. This latest bad news is another disappoint for a plane that could have (or should have) been one of the most revolutionary in history – taking passengers further on less fuel.
However, the company’s poor management of multiple disasters and now its own quality control process shows they just weren’t ready to take us there.
Michael Bloomberg joined the street fight that is the 2020 Democratic Primary process in real-life this week and the knives were out in full force. (Read Full Debate Transcript) Whatever your thoughts on Mr. Bloomberg’s candidacy, you have to be disappointed in his ability to respond well to criticism. He looked unrehearsed, unprepared and unable to show why he should be the nominee. Not a great a start.
The Ugly
Decades worth of unscrupulous sales practices is costing Wells Fargo $3 billion to settle charges against the company with the U.S. Department of Justice. This may settle the current dispute but the trickle of bad news continues to leak from the San Francisco-based bank. Unfortunately for its customers, I think this story is long from over.
Put this one in the “potentially ugly” camp but a growing number of market forecasters are starting to share concern that a market downturn is coming. The only thing that is known these days is that there is no way to tell. The market’s run over the past decade or so has behaved differently than the past, so guessing the date of its demise is a fool’s errand.
Full Links
Franklin Resources to Buy Legg Mason for $4.5 Billion
Morgan Stanley Is Buying E*Trade, Betting on Smaller Customers
Boeing finds debris in wing fuel tanks of undelivered 737 MAXs, orders inspections
Full transcript: Ninth Democratic debate in Las Vegas
Wells Fargo pays $3B, avoids prosecution for sales abuses
Goldman Sachs warns of imminent risk for stocks due to complacency on coronavirus
Here’s how to tell a bear market is coming
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