Absurdities

I was watching CNBC this morning (shut up), and I caught part of the interview with Bank of America's head honcho. In it, he revealed that 2009 will stabilize our economy, that by the end of 2010 we'll be headed upward, and that their acquisition of Countrywide will (over time) prove to be a really, really great investment. Oh, and that he's glad everyone in government is slowing down the "emotional" spending, that cooler heads are finally emerging, and ... oh, yeah, the government shouldn't overregulate all the banking stuff.

All his opinion, of course. Of course. What's he going to say? "The economy sucks, it will continue to suck, and it's our fault as much as it was AIG's fault. And we shouldn't have taken a cent of TARP money because of the strings that are suddenly appearing."

Then I heard the usual bull pen of "experts" who spoke of the "burying" of mark to market as a bad thing - the same talking heads who just last fall were yelling about the fact that the President (Bush) could change the accounting system to remove the mark to market system, which, of course, would save the banks from sliding into the abyss of red ink. Of course, that's just their opinions. This month.

Then there are the politicians. The Republicans, at first hollering at the Democrats for running up the deficit, then admitting hints of mea culpa, and finally, this morning (in the same hour as the rest of this) actually saying, in words, that yes, they started this huge overspending by billions and they deeply regret it ... but that the Democrats should stop compounding it and just slow down. Of course, that's just his opinion - which I'm sure he'll tell you, if anyone calls him out about it.

What's this have to do with my quest? With my hunt for treasure? Everything.

Here's the thing: finding old coins and gemstones, writing the Great American Novel (or at least the Wildly Popular American Novel), putting in granite countertops, freeing the world of ugly landscapes forever - all these are great for reaching my goal of $5 mil by 2021. But none come close to the safer, surer, and (for me anyway) faster growth that can and should happen in the stock and bond markets. And I'm not the only one. Everyone in this country has at least some of his or her wealth in a savings or money market account, a mutual fund, a 401K, a retirement plan (that's probably not funded in the success of only his or her company), and/or a home and a bit of land. So, my question is - do you know where your money's really sitting? With which companies? And are any of those companies currently the target of your outrage?

Go ahead. Look up your mutual fund online. See where your money actually goes. I'll wait.

... Muzak version of Dude Looks Like a Lady plays ...

Okay, so, now that you know you own a piece of that company - probably just a tiny piece because the retirement plan into which you put $200 a month puts 25% of that into a mutual fund that owns about two hundred thousand shares of that company (roughly a half-percent of your $200), and so the question is, will you pursue this? Are you outraged enough to use those two-and-a-half shares to start a vote to oust the idiots who made the greedy/improvident/stupid products/plans that we're all so outraged about?

Yes, you are! You want that entire board gone, hung up by their - their thumbs in the town square with no bonuses, no house, no boat, no diamonds, all of it back to the people they shafted, dammit!

But can you? Seriously, can you at least vote the rats out?

I thought I knew, but I wasn't sure so I Googled. Then I read for several hours. And then, when I still didn't find an answer of any kind (even after Yahooing and Asking), I called my own mutual fund company to find out who, if anyone, votes my shares of the individual company.

I was told pretty quickly that, technically, I bought shares in my mutual fund and they own the shares, not me. I can vote their board in or out (and so the managers and employees who came with them). Okay, I knew that. I have no problem with that. But that's not what I wanted to know. Who votes those half-million shares of AT&T (or GE or whatever) that my company owns? My board of directors? The fund manager they hired? Anyone? Bueller?

That answer wasn't as quick to come. The very helpful, very pleasant (and just as curious as I) man to whom I was routed, asked around (as I sat patiently - really - on "hold" and watched The Running Man - very cathartic). Ultimately, however, when he returned, I was diappointed. It didn't look like my guys do anything but buy and sell the shares.

How anticlimactic. And how odd.

I heard a statistic once that 40% of stocks and bonds are owned by mutual funds and managed retirement accounts. Every day companies like AIG and Johnson & Johnson make decisions (bad and good, respectively), choices they make because they're accountable to their stockholders. At least that's why they do it in my idealistic little bubble world - they don't want to disappoint me, Investor Bunny, in fact are a bit frightened of me, quivering in their shoes with the thought I might vote them out of their really profitable jobs if they screw up.
They're not. Not at all. And here's the problem - I get why.

First of all, shareholders aren't going to look too closely or vote anyone out of office if the greedy butchers are making money for them. Second, as I found out, a huge chunk of those shares are (probably) going unvoted anyway (not even proxied in!). Third, who the hell knows not only how to read that prospectus but how to use the information he would find to cause even a mild ripple. (Let's face it, even if John B Public found out something untoward was going on - by accidentally overhearing in the men's room from the machiavellian horse's mouths in, you know, actual English - would he want to wade into the complex and piranha-infested waters that is corporate America today?

I'm not sure I would. I'm embarassed to admit it, but I thought that's why I hired my elves. I thought I could trust them to be smarter than I am, to be my magical wunderkinds, to be my watchdogs and guardians, maybe even my teachers. How absurd that I should think I could simply vote someone into office and then trust them to always have only my well-being, my success, my honor - my best interests - at heart.

We're angry because we're certain that someone let the economy fail - the government because they're supposed to regulate and police (and pull us out of) the incredibly complex system, or the news outlets (especially those who specialize in business) because they are supposed to understand this gobbletygook and at least explain it to us, or even the companies themselves because they're directly responsible to us, after all.

But, it turns out, they're not. Truth be told, in all the voting that's going on (politics, boards, fund managers) it appears that no one fears us, that maybe no one is directly responsible to us, and, worst of all, that no one's going to change it, not in the system, anyway.

Of course they won't. Because - and here's the truly idiotic thing - although it's our billions of dollars in taxes and investments and Nielsen ratings (that translate to ad dollars) we don't seem to care enough to make it change.

Now that's absurd.

And incorrect.

I care.