One would think that Full Service Brokers make the bulk of their profits from the obscene commissions that they charge for securities transactions. In fact, they conveniently provide several creative ways that you can avoid the commissions, by converting then to regular recurring fees of some kind. If they charged less, you would be less likely to nibble at the bait and commit your fortune to their products and special fee arrangements. They don't want the commissions and they don't want your broker to want them either.

Over the years, the propaganda machine has managed to reinvent the investment wheel with a collection of spokes and ball bearings that didn't exist thirty years ago! Most “savvy” investors would agree that Mutual Funds are safer and cheaper than Individual Stocks and Bonds, that commissions and taxes are primary contributors to investment success or failure, and that Investment Professionals are “advisors” first and “Salespersons second” commissions and fees they receive. Brainwashing anyone?

But then there is the reality of the Financial Institutions…all of them. A reality of blatant hypocrisy that is undeniable, omnipresent, and probably actionable. (Eliot, listen up!) You may not believe this, but the facts prove it. They make a whole lot more inside their products than they do with those pesky commissions! Your future is not their concern.

As if the practice of compensating Mutual Fund Managers on their performance vs. their “peer managers” isn’t investor unfriendly enough, this is how the Institutions whip their Financial Advisors into shape. Account executives are paid more for selling products than they are for designing portfolios of individual securities. Lucrative commissions are paid on Mutual Fund and Annuity Products, particularly the “proprietary” variety; fixed fee and Managed Money arrangements are encouraged; the brokers’ portion of individual security commissions has been reduced to a pittance and now (go slowly here) Stock Brokers are actually being assessed a “ticket charge” when they have the audacity to purchase stocks the old-fashioned way. If you don't sell products baby, there won't be any prizes and rewards for you!

So what percentage of Financial Professionals do you think can afford to lead their clients down the path to an individual security portfolio?