Brokers take a lead of clients
Published in the Geelong Advertiser, March 2013
Last week I talked about changes to the financial planning industry and how the Government proposes to stop conflicted remuneration.
I think this is a step in the right direction, but I do question the Government's seemingly narrow focus on the financial planning industry.
For example, why is the regulation spotlight not also pointed towards the building or mortgage brokering industries?
Both are largely left to their own devices and as a result the consumer is often getting fleeced and not for small amounts.
As anyone who has bunt a house whether for investment or as their home will attest, builders are in a world of their own with little or no recourse should any major faults arise.
Worse still, the channels to gain suitable compensation are generally very expensive and protracted for the average consumer.
When it comes to financing, mortgage brokers are required to give a choice of a loan that best suits your needs.
However, many recommend a loan that makes them the most commission just like financial planners have been able to do.
As always the question remains who is looking after the consumer?
So what do we expect in the market?
Last week I was interviewed on television about my thoughts on the Australian market as my view was contrary to quite a few analysts.
I was saying the market would fall and others were saying the opposite, and after 17 straight weeks rising our market has now started to fall.
The interesting thing to me is that the price range of the current week down is larger than any of the previous 17.
This again proves markets travel down in elevators: the All Ordinaries Index is now trading at the level it was six weeks ago.
Given I expect the current downward move to last another one to three weeks, my target for the All Ordinaries is between 4850 and 4750 points before it finds support.
That said, I am still expecting our market to have one more rise in the next six months to make its four year high before falling into the next long-term low.
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