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Pastimes : CNBC -- critique. -- Ignore unavailable to you. Want to Upgrade?

To: Jim S who wrote (2276)	2/19/1999 2:13:00 AM
From: Gary M. Reed	Read Replies (2) \| Respond to of 17683

Indeed. I feel as though I can speak on this subject with some authority, having spent 10 years in the brokerage biz, including time at a wirehouse. When I hear someone like Merrill's CEO saying that online trading is dangerous for individuals, or that individuals taking the initiative to "do it yourself" is lethal to one's personal wealth, I have to laugh. Does anyone think that this guy is genuinely concerned about the well-being of the individual investor? Or has it ever occured to the reporters who cover this stuff that there might be an alternative agenda, i.e. "this online trading/discount brokerage stuff is starting to take a bite out of our business, so let's get the media riled up and say that individuals aren't qualified to invest on their own." Let's face it, these wirehouse guys feel their "protected turf" is being invaded and so now they're going to lobby, using the media, against online trading and individuals who wish to daytrade. It's kind of like your apartment landlord telling you why you shouldn't buy a house, telling you about the pitfalls of home-ownership. Instead of re-inventing themselves into competitive, service added-value organizations, they think the answer is to discourage people from trading online. Yes, there are going to be people who blow themselves up daytrading and yeah, it is pretty funny hearing about the stories of people buying the wrong stock like that Mannetech deal the other day ago. But is that any different than someone buying a limited partnership or a proprietary mutual fund or heavily-loaded UIT? When all the limited partnerships blew up in the early '90s, I don't remember seeing any journalists doing stories saying that Prudential or Merrill should be banned from selling investments to individuals. The only difference between online chat board touts and some of the proprietary garbage that Merrill pushes is that some of the chatboard stocks actually work. I'm not just picking on Merrill Lynch; I just think it's hilarious to hear a wirehouse exec bash online trading and then 2 minutes later see an E-trade commercial where the guy says, "My client just made $2,000 and he owed it all to me--in commissions." I too would like to see more unbiased stories on daytrading. I am sick of just hearing about the poor soul who blew his nestegg trading AMZN. There are obviously a helluva lot of people daytrading--99% of whom I'm sure watch CNBC. For every story of someone blowing themselves up, I would like to see a story where a guy is making a great living trading with a disciplined trading strategy. Furthermore, these guests who come on CNBC and thumb their noses at day- and online trading as if it were some fad are wishful thinkers. Two months ago I saw the writing on the wall and dramatically reinvented the way I do business to compete with the onslaught of online services; in fact, even Jim Cramer wrote a piece in TheStreet.com saying brokerages needed to completely reinvent themselves if they wanted to be around in five years. The guys who come on CNBC poo-pooing the online traders, hoping and wishing that it's just a fad are going to hope and wish their way out of business in the next ten years.