99% of fund managers demonstrate no evidence of skill whatsoever.
MF Global used to be known as Man Financial, and it had a reasonably good reputation. It did a humdrum business placing commodities trades for fund managers as well as farmers, grain dealers and others whose livelihoods depend on the vagaries of commodity prices.
Mutual fund managers are trapped in this rather deadly vicious circle: the more successful they are, the more money flows into their mutual fund. Then, it is more difficult for them to beat the market averages or even to match their own past performance.
Investors tend to discover 'hot' mutual fund managers just after a successful run and just before the inescapable force of mean reversion is about to kick in.
The stock market's handling of new technology is kind of a joke. We have seen CNBC, CNNfn, Bloomberg, and the like turn into home-shopping networks for stocks. Fund managers and analysts go on TV and sell what's shiny and easy to sell.
Mutual fund managers want your money in their funds. They get paid based on assets under management.
It's the company itself, but most of these mutual fund companies, the guy who runs the company is just a fact totem and the guy who runs the money is the power. But we really don't know who they are.
There are a lot of idiot fund managers out there who add no value to the process at all.
Among my greatest disappointments about the mutual fund industry - in addition to excessive costs and excessive focus on the short-term - is that fund managers have been passive participants in corporate governance.
We need to reorganize our entire system of retirement plan investing and to develop federal standards of fiduciary duty for pension trustees and fund managers. These require "top down" intervention. But we also need investors to look after their own economic interests, a bottom up approach to our problems that is well within our individual power to undertake.
