A Capitalist's Lament: How Wall Street Is Fleecing You and Ruining America

by: Leland Faust (0)

Leland Faust unmasks Wall Street’s unsavory tactics in powerful detail by giving readers a high-level view of how the financial services industry misleads them, overcharges them, and exposes them to needless risk. He documents the financial industry’s alluring come-ons, airbrushed risks, high-stakes gambling, half-truths, misleading statements, outlandish predictions, tricks to overcharge customers, bad deals, and outright fraud by the most prominent and renowned of Wall Street’s players.

A Capitalist’s Lament is about what happens when financial firms and their employees forget whose interest they are supposed to protect. It shows how making foolish or wrong predictions is of no consequence to those who make them and how Wall Street luminaries with poor track records still garner celebrity status. Most of all, it spotlights how Wall Street manipulates the system and furthers its own interests at its customers’ expense and puts us all at great risk. Here is what you need to know to protect yourself from “business as usual” and get ahead—instead of getting taken.

The Reviews

If you think you already know all of Wall Street’s dirty tricks you’ll be amazed at how much more you will learn by reading Leland Faust’s A Capitalist’s Lament, a book that will grow in importance as America faces a new administration and uncertain prospects for the regulation of financial services. Faust’s meticulously researched book goes well beyond the moral corruption and manipulation exposed following the Great Recession to show the decades-long pattern of criminal behavior and a “heads I win, tails you lose” mindset that cheats investors big and small, destroying America in the process.Brokerage firms play fast and loose with the math in their sales literature or hide fees in the products they sell. For example, Faust shows how these brokerages institutionalize the process of confusing investors into overpaying. They push no-load mutual funds that are commission-free but instead carry an underplayed management fee that effectively is higher than a commission would have been. They take advantage of unsophisticated investors by pushing high commission, tax-deferred annuities onto clients who don’t need them. Faust knows all the tricks and does the math for us as he exposes the fine print in this ultimate con job.No part of this ecosystem is innocent. Investment bankers gamble with investors’ money without carrying much of the risk. Hedge fund managers – even the legit ones - earn billions when their funds underperform. Rating agencies, industry analysts and the huckster-prone financial media all play their part, not scrutinized amid blatant conflicts of interest.Among the most surprising things about A Capitalist’s Lament is that it was not written by an earnest and angry radical but by an earnest and angry and extremely knowledgeable industry insider who solidly believes in capitalism but is horrified by its shadowy side. Faust researched this book over his four decades in the business, even sharing anecdotes about opportunities he was offered to participate in questionable deals.So everybody knows that Wall Street is run by crooks but everybody also needs to know where to invest their money. Fortunately, Faust does not leave readers hanging. In addition to warning of the hazards of short selling, derivatives, options and over-leveraging, he offers a thoughtful 20-question checklist for choosing an advisor or investment firm and pages of reasoned, wise advice. Now more than ever, we need such financial sanity.

This book is a must read for anyone who wants to invest money securely, wisely, and for long term appreciation. Leland Faust describes many of the risks that should be avoided and the traps that can ensnare unwary investors on Wall Street. He also has much sage advice about how investors should invest their funds with a true fiduciary in order to achieve their investment objectives.This book is also an outstanding review of the conflicts of interest that divide Wall Street from the investing public. Leland Faust, as a long time and successful investment advisor, has a unique perspective and experience with these conflicts, and his book illustrates these conflicts with many anecdotes that are based on his personal experience and/or news accounts of the actual events.The ordinary investor wants to conserve and grow his/her investment funds in a prudent manner, but much of Wall Street is more concerned with its own short term profitability. This creates the temptation for Wall Street to profit at the expense of its clients and the investing public.The risk to the investing public is compounded by the conflict of interest that exists between corporate managers and their stockholders. The stockholders and the investing public have a long term goal of preserving and growing their invested capital. Corporate management, unfortunately, is often more concerned with short term gains and management compensation rather than with growing the value of the capital that is invested in their companies.The risk to the investing public is compounded further when government policy is captured and corrupted by large investment firms that are "too big to fail." Public funds were, for example, used to save the owners and managers of private investment firms like Goldman Sachs, Citi Bank, and AIG from the consequences of their risky and disastrous investment decisions in the "Great Recession."In addition to the previously mentioned advice for the individual investor, Leland has some interesting and constructive public policy suggestions for protecting the investing public from the damaging effects of these conflicts of interest.

A Capitalist's Lament: How Wall Street Is Fleecing You and Ruining America
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