Our Weight: It’s Gaining On Us

Since the late 1980s, America’s average Body Mass Index, or BMI, has been climbing rapidly. As a result, we’re losing life expectancy relative to people in other rich countries.

DFA Gives Managed Accounts a New Dimension

“For as long as I’ve known him, David Booth has had a desire to find a way to improve retirement for everyone, not just people who have millions of dollars,” Michael Lane told RIJ this week. “That’s his vision, and that’s the whole reason we acquired SmartNest in the first place.”

Research Roundup

We summarize four recent papers: 'Portfolios for Long-Term Investors,' 'What is the Value of Annuities?,' 'Public Economics and Inequality: Uncovering Our Social Nature,' and 'Financial and Total Wealth Inequality with Low Interest Rates.'

An Annuity’s ‘Moneyness’? There’s an App for That

How will variable annuity contract owners use their income benefits? That question is vital to annuity issuers and to fiduciary advisers with clients who own VAs. This Texas Dep't of Insurance actuary knows a product that can help them find out.

A Chip Off the Old Rock?

Bloomberg reported this week that Prudential is considering selling its retirement plan recordkeeping business. Prudential didn't confirm the report, but several industry insiders did. Low interest rates, high costs of IT makeovers, and sticky stable value fund guarantees are driving the move, RIJ was told.

The SmartNest Back-Story

SmartNest, the software behind DFA’s new managed account program, was valued at $1.1 million when Trinsum Group, its previous owner, failed in 2009. Last summer, DFA insider Michael Lane, 45, (above) replaced David Deming as the venture’s CEO.

Cold Turkey for Thanksgiving? No Thanks.

Let me channel, for a few paragraphs, the ideas of Warren Mosler, Stephanie Kelton and other proponents of Modern Monetary Theory—which is not a theory so much as a clearer understanding of the way our financial system actually functions.

Bank holding companies earn $1.58bn from annuities in first half of 2012

Despite an overall increase in the banks' annuity revenues in the first half of 2012, twice as many bank holding companies saw lower annuity commissions and fees this year than in the first half of 2011. The director of the American Bankers Insurance Association called that “troubling.”

Investors shun full-service firms: Hearts & Wallets

The percent of investors who cite a financial professional as their primary provider of investment advice fell to 21% in 2012 from 25% in 2011, according to the Boston area research firm. Usage dropped sharply among households with $100,000 to $500,000 and over $2 million in investable assets.

“HENRYs” control $8.3 trillion in savings: SBI

The 21.5 million "high-earning not rich yet" households control 31% of total financial assets in the United States—about $8.3 trillion—and have a combined annual income of $3.1 trillion, says Strategic Business Initiatives. (Left: O. Henry)

Quote of the Week

"Investors are not irrational; they are undecided about which path will be chosen by future investors." -- Roger E. A. Farmer, PhD, from "How The Economy Works" (Oxford, 2010), p. 92.