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The Daily Brief: Check Your Credentials

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If you're reading this, odds are you aren't the problem, but there are plenty of folks out there posing to be financial advisors and using a wide variety of defunct, outdated or nonexistent credentials to get their hands on other people's money. According to research by Paladin Registry, there are 259 different financial designations or certifications, 35 percent of which are defunct or have no prerequisites or requirements. Be sure your clients know you're real and also know how to spot a fake. 

The Newest Committee Man

Sherrod Brown (right) is replacing Charles Schumer on the Senate Banking Committee | Copyright Brendan Smialowski, Getty Images

Sen. Chuck Schumer (D-N.Y.) officially announced Friday that he would not serve as the top Democrat on the Senate Banking Committee. The post will fall to Sen. Sherrod Brown (D-OH), an outspoken critic of Wall Street who passed tougher funding rules, scrutinized banks’ involvement in commodity markets, and voted against Obama’s nomination of Mary Jo White as SEC chairwoman due to her past as an industry lawyer. Brown says he is not an enemy of the financial services industry and supports regional and community banks, but opponents say his legislation is designed to break up the largest Wall Street institutions. 

Back to School Blues

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Lily Fang, a visiting professor at the MIT Sloan School of Management, suggests that school vacations may be the reason September is a terrible month for stocks. Her research found an “after holiday effect” where market returns are 1 percent lower on average following major school holidays. The effect is exacerbated in September because of the long break (or in August for companies based in states where schools start earlier). Traders spend time with their families instead of with the markets, so bad news gets incorporated into prices more slowly. “The main lesson here is that attention is a limited resource,” says Fang. “We make the unrealistic assumption that since traders are professional investors, they are super machines with infinite attention spans. But the fact is: human beings are human beings.”

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