Bring Back the “Customer’s Man”
By Gene Marbach, SVP, Makovsky+Co.
The news of late is replete with stories about how investors are fleeing the stock market. In his inimitable fashion, William H. Gross, Managing Director, Pimco, wrote recently:
The cult of equity is dying. Like a once bright green aspen turning to subtle shades of yellow then red in the Colorado fall, investors’ impressions of “stocks for the long run” or any run have mellowed as well. I “tweeted” last month that the souring attitude might be a generational thing: “Boomers can’t take risk. Gen X and Y believe in Facebook but not its stock. Gen Z has no money.”
The infamous Flash Crash of 2010, Facebook’s problem-plagued IPO, and, more recently, Knight Capital’s trading malfunction are cited as reasons for why investors are shunning equities; what’s interesting to note is that computers seem to be at the heart of these matters. In the aftermath of the Knight Capital situation, SEC chairwoman Mary Schapiro issued a statement which, in part, read:
Reliance on computers is a fact of life not only in markets everywhere, but in virtually every facet of business. That doesn’t mean we should not endeavor to reduce the likelihood of technology errors and limit their impact when they occur.
Much has been written about the disintermediation taking place within our markets, in essence, the elimination of the middleman, the “storyteller,” if you will… Has the middleman been replaced by machines? Machines that talk to other machines?
Some years back, I looked at the titles on a bunch of business cards I’d collected over the years from various denizens of the financial world. I found “Stockbroker,” “Financial Advisor,” “Wealth Advisor,” “144 Specialist,” “Investment Strategist,” “Registered Representative,” to name but a few. Of course, there were the more mundane titles such as “Vice President” and “Managing Director.”
One title that was conspicuously absent was “Customer’s Man.” Whatever happened to the “Customer’s Man?” For many in the industry this old-fashioned term for brokers, sexist as it may be, described a broker who worked for his customer – not for his firm. The term, I suspect, came from simpler time with fewer products and far less pressure. Also, a time when there was greater human interaction as opposed to machine-driven transactions…
I say, let’s bring back the “Customer’s Man” and, as a nod to current times, the “Customer’s Woman.”