Let’s file this one under You Invest They Win shall we?
Unprecedented monetary policy intervention by the Fed has done what all unprecedented interventions by the government do, create winners and losers. In this case, the winner is BlackRock. The Fed picked the firm to handle its corporate bond buying program.
Of course, BlackRock’s share of the corporate bond market grew, and the big got bigger. As one investment professional told the Wall Street Journal “The unprecedented actions taken by the Fed during Covid-19 just accelerated the trend where the biggest products get bigger.”
When government steps in, the big get bigger. And individual investors like you? They get the scraps.
When it comes to bonds, the mutual fund/ETF game is no longer a match for the individual investor interested in securing a steady stream of income and safety.
The big guys like Blackrock have other ideas, mainly, gathering institutional money from bankrupt pensions and sidling up with the connected high priests of the Fed. You do not want to be caught in the vortex of this here-today-gone-tomorrow crew who will sell out of poisonous positions while you sleep only to satisfy their ESG pipe dream.
Today like never before you must rely on yourself to make the correct decisions on the safety of your money and not depend on big institutions to look out for your best interests. To begin with, if they are not talking with you regularly, why would they care about you?
Ask yourself, no ask them, if they’re a fiduciary by law and get it in writing (good luck with that). The race to gather assets will always be their goal, making you just a number.
You deserve more.
Action Line: Check out the rest of my You Invest, They Win series here and decide for yourself who’s winning. Stay up to date on this atrocity by staying in touch with me by signing up for my weekly alert by clicking here.
E.J. Smith - Your Survival Guy
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