Cardinals, Orioles, and Indigo Buntings

We were watching To the Manor Born this morning and something Audrey fforbes-Hamiliton said made me think of something a manager once told me.

The manager was a strict conservative, meaning he was all in favor of rights, as long as they were for people who looked and thought like himself. It also meant he was very interested in money. How to get it. How to keep it. And how to avoid having to spend it and still reap the benefits of wealth.

He wasn't wealthy when I knew him, but I expect he is now. He strikes me as the type.

He also very much wanted me to be like him, and while we did have a lot in common, I think it was a great disappointment to him to realize I can never side solely with the Conservative point of view any more than I can ever side solely with the Liberal. Both viewpoints have things that appeal to me and both have things I find offensive. And having never been one to believe I have to 'belong' to one side or the other, I don't belong to either. Which is probably why neither the ultra liberals or the ultra conservatives are much impressed with me. (But then is anyone? [smiles])

Anyway, during one his hopeful indoctrination sessions he showed me an advertisement he had received in the mail. It was from some investment firm bragging that for the past 18 months all of their financial predictions had come true. He asked me if I ever got anything like that. It was all I could do not to laugh in his face. Money and I have always maintained a very casual relationship. It shows up in small quantities and then disappears quickly. I've never been any good at investments. Hence my current status.

But RC (I've got to call him something, so I chose RC - Real Conservative) was being indoctrinated by someone who was well-established in the investment world, and that someone told him a trade secret.

The way these investment firms work is this:

• They set up a mailing list of 500,000 names (or whatever the number).
• They mail out flyers to 250,000 names advising investment in something, and different flyers to the other 250,000 warning against the same investment
• Time proves one or the other correct
• Now they mail 125,000 flyers to the 250,000 who got the good advice, reminding them how they were 1-for-1 and advise for something else. They send the other 125,000 the opposite advice, but with the same reminder of their success.
• Time proves one or the other correct
• They keep repeating this process of only sending repeat mailings to those who got the good advice, but splitting them into two groups: advise to do and warn against doing.
  

And this is how they are able to honestly tell recipients that they haven't been wrong in 18 months. As their 'track record' extends they look more and more credible to their mail recipients who, in turn, begin using their company to make investments.

At some point in time their mailing list becomes too small to generate the kind of income they want and they start all over again.

And people wonder why I'm so mistrustful of the financial world.

Who can you believe?