Hillary Clinton
In reply to the discussion: Holy shit - Paul Ryan sneaks Wall Street attempt to hurt your retirement into GOP anti-poverty plan [View all]Yupster
(14,308 posts)The bill was to stop the rule his administration put in so if he believed in his rule of course he vetoed it.
The real question is why he supports and in fact ordered the creation of the rule?
That's much more complicated and it's anyone's guess. Is it worth it to even try to figure out motivation?
One place I looked first was President Obama's own individual portfolio.
From that I learned two things.
1. He is very responsible financially. This is hardly surprising as if you had to think of one word to describe President Obama, "responsible" would likely be high on the list. He has large college funds set up for his daughters and his investment mix is just as conservative as can be. His largest holdings by far are US treasuries paying from 0.5 % to maybe 2.5 %. He has very, very little stock exposure and that little bit is in a S+P 500 index fund. No debt at all.
2. He's never been very interested in his own investments. Most president-elects put their investments in a blind trust run by some local Series 7 broker. They talk about what types of investments the president-elect likes and dislikes and then the guy wheels and deals for him until he leaves office. I don't think President Obama did this. He has huge amounts of money in a checking account and even more in money market accounts. It looks like he's pretty much ignored his investments on autopilot.
I just don't think investments have ever been an interest of his. There are more important things in life to him. That's hardly a bad thing. Kind of the type of person you'd like to be president.
So how does that get to a 2,800 page rule that throws the whole industry into confusion?
First I would guess the President had very little to do with it.
Second Secretary Perez has a horrible relationship with the industry. His job before this was Assistant Attorney General for Civil Rights. It's unusual that he's had no experience n the industry he's regulating. The early rule versions came back with biting criticisms, even from the firms which typically try to stay ahead of the regulators by doing more than required. Each time the rule would come back and more criticism followed. The final role did reflect many of the criticisms though.
Third - there really are problems. There are many people selling investment products who are only licensed to sell a very limited number of products. No surprise that everyone therefore needs those products. If your only tool is a hammer, don't be surprised if every problem looks like a nail.
Fourth - I think the government would be happier if retirement accounts were more like the federal government retirement program. Not very confusing. You can invest in the G fund (govt bonds) or the F Fund (bonds) or the C Fund (stocks) or the S Fund (small cap stocks) or the I Fund (foreign stocks). Nice and simple. Easy for the regulators. No weird questionable investments.
I see this rule as a move toward that end. Companies will be moving people to pre-packaged managed money programs. Easy for the regulators to watch over, no weird stuff. But the downside is for people who just have old fashioned simple investments like 100 shares of Walmart or a corporate bond, or even a mutual fund, their costs will generally go up, sometimes a lot. Small investors will find their accounts are below the minimums and may be assigned an 800 number to call. These two trends were happening anyway. These changes will just speed them up.
One other thing is that there is currently a real shortage of financial advisers. The average age is much older than most professions. Companies are aggressively hiring, but the hiring process for the major companies is very difficult and the test is just plain really, really hard to get someone through. These changes I believe will speed up retirements.
Just my own personal opinions of course.