Unconventional times call for unconventionable wisdom

Advisers find themselves in unusual situations in this roller coaster financial market, and some are offering advice — which might contradict conventional wisdom.
NOV 30, 2008
Advisers find themselves in unusual situations in this roller coaster financial market, and some are offering advice — which might contradict conventional wisdom. For the first time, Dorann Cafaro, founder of Cafaro Greenleaf of Little Silver, N.J., has advised clients not to read their quarterly investment or 401(k) statements when they arrive in the mail. Joseph Masterson, a senior vice president at Purchase, N.Y.-based Diversified Investment Advisors Inc., takes that advice a step further. He said some clients are so stressed out that they should throw out the statements. "I think people would be better off not opening third-quarter statements and throwing them out," Mr. Masterson said. He worries that if people open their statements, they might begin to panic. "If you were close to retirement and had $1 million and you've lost 30%, you're not longer a millionaire," Mr. Masterson said. In some cases, the grim financial markets have been too much even for financial services professionals to handle. Mark Gutrich, president and chief executive of ePlan Services Inc. of Denver, said his firm used to send out daily e-mails to its staff highlighting the firm's assets and daily changes. As the numbers plunged down, he said, company morale fell, and people couldn't take it anymore. The company stopped sending out the e-mails. Another adviser is using what he calls the "two Ambien" sleep test. Ambien is a prescription drug used to help people sleep. "If they are able to sleep with up to two Ambiens or equivalent, I believe they should keep investing," Rick Shapiro, managing member and attorney at Investment and Financial Counselors LLC of West Hartford, Conn., wrote in an e-mail.

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