I don't know what to make of this. some say it's against the middle class

[Mac1958]

These rule changes are a long time in the making. The industry has no one to blame but itself, yet the industry will ensure that the investors pay the price for their own lack of ethics and all the while blaming it on the government.

Edward Jones Agrees to Settle Host of Charges
Revenue sharing, called "pay to play" by critics, isn't illegal, but regulators are taking the position that failing to disclose such arrangements violates the law. California's suit alleges that by keeping the payments secret, Edward D. Jones broke a state law requiring brokers to disclose all the facts investors need in order to make informed decisions.

The suit alleges that Edward D. Jones received payments primarily in cash, but also from brokerage commissions stemming from securities trades that fund companies steer to brokers that market more of their fund shares. The arrangements, known as "directed brokerage," were banned by the SEC this year. As money managers, fund companies have an obligation to fund shareholders to seek the best prices in buying and selling stocks, and they aren't supposed to base such decisions on their own financial gain. The agreements were generally oral, the suit alleges.

The suit alleges Edward D. Jones had an incentive to favor funds that paid it, and that individual broker bonuses depended in part on how many preferred funds they sold. According to an internal e-mail enclosed as an exhibit to the suit, revenue sharing was a factor in drawing up "profit and loss," or P&L, statements for brokers, which in turn determine bonus size.

Indeed, the financial services industry has committed many sins. I could give you a pretty long list of highly questionable things I've seen people in the industry have done, first hand. I've seen some pretty nasty stuff.

Careful, efficient, effective regulation is absolutely necessary, there are simply no two ways about it. Those who kneejerk against all regulation are simply wrong.

Probably the single biggest individual problem right now is the fact that people who push Equity Indexed Annuities need nothing more than a life insurance license to sell them. No securities licensing or training. So they cram every last dollar seniors have into them. Yet securities people are being blamed by a populace that is ignorant about the industry.

What politicians and partisans constantly do is confuse MORE regulation with BETTER regulation, and that's precisely what we have here.
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