BlackRock Survey: Too Much Cash
BlackRock recently announced the results of its "Global Investor Pulse Survey." (You can find the full survey at www.blackrockinvestorpulse.com.) The press release, entitled "American Focus on the Right Goals, But Money Attitudes, Behaviors Get In the Way of Financial Success," says Americans have "too much allocated to cash." It explains, "While Americans said that they ideally should have 33% of their net worth in cash instruments, they admit to holding 65% -- far too high an allocation to achieve their retirement goals, given low interest rates and the diminishing purchasing power of their cash related to the pressures of inflation. The current asset allocation of American portfolios according to the survey includes 65% in cash, 18% in equities, 6% in bonds, 4% in property, 2% in alternatives, 5% listed as "other". It adds, "A key obstacle is the feeling of security that cash brings: Nearly four in 10 (39%) say they want to have "cash saved as a security blanket or reserve for unforeseen events before I can think about investing". Further, respondents said that saving money makes them feel secure (39%), hopeful (29%) and confident (28%), while investing money makes them feel risky (37%) and nervous (35%). More than one-third (36%) of Americans are afraid of taking risks with money or losing money, although only 7% said that they actually have lost a lot of money in past investments." The survey polled 31,139 individuals in 20 nations, including 4,213 Americans. In other news, Crain's Cleveland Business reports, "Cuyahoga County jury says Chicago broker is on hook for $1.86M following Ponzi scheme." It says, "A Cuyahoga County jury has awarded a Cleveland Heights man and two Swedish fraternal organizations he is associated with $1.86 million from a Chicago commodities broker. The case is one of a handful of legal actions growing from a Ponzi scheme spun by former Beachwood investment adviser Enrique Villalba Jr.... He [Villalba] held himself out as an investment manager and claimed he could produce long-term gains of between 8% and 12% for investors using a proprietary strategy he called "Money Market Plus" for investing in the futures market.... Villalba admitted that he had misappropriated client funds and hid his actions from clients of his Money Market Alternative LP (MMA).
