Last week the Federal Reserve scaled back its view of prospects for the U.S. economy and labor market.  Reuters discusses the timing of when interest rates will go higher.  Many of our clients have been burned by the brokerage industry.  The CFA Institute advocates for Department of Labor proposals to broaden the sweep of individuals and firms required to put the interests of clients first. Thinking about a new wave of graduates considering their future, it is worth pondering the difference between ‘normal success’ and ‘extreme success,’ the latter which comes at the cost of many other things.

Fed’s downgrade of economic outlook signals longer rate hike wait.  The Federal Reserve scaled back its view of prospects for the U.S. economy and labor market and said it would have to see more encouraging data before it considers raising interest rates.  The Fed made it clear that it sees some of the downward influences on growth as temporary, amid weather-related disruptions and a West Coast ports strike.  Meanwhile, the Commerce Department said economic expansion dropped to 0.2% in the first quarter from 2.2% in the fourth quarter of 2014.  The growth figure was a fraction of the 1 percent annual rate of expansion predicted by Wall Street economists.  The central bank probably won’t raise rates before the third quarter of 2015, analysts said.

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Fiduciary face-off.  In the view of The CFA Institute, brokers are salespeople.  Too often they pretend to be trusted financial and investment advisers.  Simply put, if they wish to call themselves advisers and provide advice, then they must be bound by the higher, fiduciary standard of care.  No problem if you want to be salespersons, but stop leading customers and clients into believing you are their trusted personal investment adviser putting their interests first.  What is needed is a clear and consistent fiduciary duty to anyone providing personalized investment advice to clients.  The CFA Institute comments are in response to proposals by the Department of Labor to broaden the sweep of individuals and firms required to put the interests of clients first.

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The anatomy of extreme business success.  How can you be a phenomenal business success—like Bill Gates of Microsoft, Steve Jobs of Apple, or Elon Musk of Tesla?  In one of the best explanations of success I have ever read, Justine Musk, former spouse of Elon Musk, sums it up—you can’t.  Extreme success results from an extreme personality and comes at the cost of many other things.  According to her, success comes in two types:  normal success—involving hard work, talent, etc.—and extreme success—as enjoyed by her ex. Your odds for happiness are better with ‘normal success.’  The extreme version is only available to people who are born that way.  “They are dyslexic, they are autistic, they have ADD, they are square pegs in round holes, they tick people off, get into arguments, rock the boat.”  Working insanely hard is their way of coping. Extreme success comes complete with “family drama, issues with the Significant Other you rarely see, dark nights of the soul…little sleep, less sleep than that.”

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J. Mark Nickell & Co.

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