April Fools Q1 Update

A little Fraud, A little Music, A little Hope

Three things on my mind right now:

The Industry Trust Problem.

I wrote a long piece on the state of the ETF industry and key trends from Buffers to Tokenization over at ETF.com, and of course, I’d love you to read it.

But I also wanted to dig into what I think is the most important chart, which really isn’t even about ETFs, it’s about trust.

I actually think the current set of rules the ETF market is operating under here in the US is as good as they’ve been in my lifetime. After the passage of the ETF Rule in 2019, we’ve got efficiently pipes for getting all kinds of exposures into the ETF wrapper, and that’s a good thing. We’ve got massive flows and huge liquidity. Those are good things. And the SEC is at least holding the line on derivatives (leverage) use, continuing to reject all the attempts to get over the 200% Value-at-Risk test. Good thing.

But I’m still extremely anxious.

I’ll get on my high horse about the GPB-David Gentile commutation. Gentile (who I have never met) was sentenced to 7 years in prison for bilking investors out of nearly $1 Billion in the most classic of classic ponzis: using new money to pretend your fund is generating income by funneling their purchases out to the old investors. I followed this case closely back when. I talked to advisors (independant BDs) who got swindled.

Laws don’t matter if cronies get to ignore them. Well-connected Gentile walks, while his business partner remains in jail for the next 6 years for the same crime while investors are still trying to get their money back in lawsuits.

It’s not over. Amid the blatant insider trading happening through administration leaks, the very folks who’d have to investigate have been fired: There are, literally, only two lawyers left in the United States with the job of investigating public officials for stuff like this. And if you think those two (out of the 36 that used to have jobs) are the bulldogs who are going to take on the White House, you’re delusional.

It doesnt’ matter whether you or your firm is involved in any of this. This is the new background radiation for wealth management: the law will not protect you or your clients. Just ask the advisors looking for their GPB restitution.

People. Individual humans that you’ve met, talked to, and shaken hands with. That’s the only thing deserving of your trust right now.

Music is Magic

The ETF.com crew set up our own little lounge at FutureProof Citywide in Miami a few weeks ago, and it was a big hit. Most of that success came from a great team doing all the hard work to create a chill, comfortable physical space to hang out and have conversations. But I think a secret key to the success of the event was the Vibe. And Vibe’s are built of tunes.

Over a few weeks, we kicked playlists around for a chill hang on the beach, and here’s what we came up with (for your listening pleasure).

ETF Jazz Lounge:

Here’s an art-deco era playlist for sipping martinis by the pool:

ETF Indie Lounge:

Of course, as much as I love Jazz, my core-genre is Indie music, so we made an alternate version featuring mostly new music. I have had this chill mix on repeat for a month at this point:

ETF PostModern Jukebox Lounge

And mostly because folks kept suggesting songs from Scott Bradlee’s Post-Modern Jukebox, I spent the plane ride down currating what I think are the very best of his and his incredible musicians work. (And if you don’t know PMJ, I’m so jealous, because you’re in for a treat).

A Zine Playlist

And last, the most recent issue of #85bb65, my short-run physical only Zine had a run of new music I just have to share. Here’s the link, but also, the Zine page:

Finding Hope in Local

There’s lots going on all over the place that’s not great or encouraging or inspiring. It would be easy to slip into despair and cynicism, and indeed, I see that all around me and I feel the pull.

But at the same time, I feel better armed for this than at any point in my life. Not because the world is better, but because, perhaps, I’ve gotten a little better at shutting down the thought-loops and the worry.

Some of it’s meditation, of course. Yesterday I spent 15 hours travelling from one spot of woods on one coast to another spot of woods on the opposite coast, through airports and screaming babies and angry travellers (like usual). But honestly, I just sat in place doing concentration practices for nearly 8 hours of it. That felt like a real gift.

Another part of it is intentional. Some time ago I decided to actually “pull back” some of the outreach I’d done in the last few years in building more relationships in broader communities (finance, woo, gaming, music, of all kinds.).

Why the pulling back? Not because I don’t believe community is important, but because increasingly, a lot of it had felt “out there” — on the internet, in the ether. So I just kind of redirected, and started spending what time I can locally: at Church, serving on food lines, or just in my own woods with friends I’ve not seen in too long.

It’s made a real difference. Or at least, it’s helped me feel more agentic — like I’m actually doing something immediate and tangible, even if it’s just for one person, on one day.

It’s not rocket science: Big out of control world? Plant a tree.

I’m trying to follow my own advice there. Plant trees. Meet face to face. Feed someone. Hug a stranger.

Cheers.