President Obama reached his much-ballyhooed 100-day milestone last week, but most financial advisers were in no mood to celebrate.
President Obama reached his much-ballyhooed 100-day milestone last week, but most financial advisers were in no mood to celebrate.
An exclusive InvestmentNews online survey conducted last week found that a hefty 63.9% of advisers did not approve of his overall performance as president. Only 36.1 % of the 1,010 advisers who responded to the survey thought he was doing a good job.
Worse yet, 68.5% said they had either “not too much” or “no” confidence in his ability to fix the ailing economy, while only 31.2% had a “fair” amount or a “great deal” of faith in his capabilities on that front.
The respondents were significantly more critical than those who participated in a similar survey days after his inauguration.
On the week of Jan. 26, 36.4% of 1,632 advisers canvassed said they did not have much confidence in the new president's ability to turn around the financial crisis.
An NBC/Wall Street Journal poll shows that attitudes of a wider sample of the public differ from those of advisers. Of 1,005 Americans surveyed last month, 61% approve of the way Mr. Obama is doing his job.
In last week's survey of advisers, some said they were shocked by the sheer amount money that was being thrown at the financial crisis.
“The degree of spending is so astronomical that he is putting the country in a position of future debt [that we won't] be able to dig out of it,” said Brian Terry, vice president of investments and operations and chief compliance officer at Financial Management Concepts Inc. of Winter Springs, Fla., which manages $85 million in assets.
“[Mr. Obama] has also shown that his administration has only one goal, which is to have a bigger government,” he said.
“He is trying to talk people into being confident and there is no real substance there, particularly since he has not addressed the housing problem to help people keep their homes,” said Lou Stanasolovich, president of Legend Financial Advisors Inc. of Pittsburgh, which manages $350 million in assets.
Advisers were also pessimistic about the efficacy of the $787 billion economic stimulus plan passed in February.
A majority, or 56.2%, of respondents said that plan was a bad idea, while 28.2% said it was too early to tell. Only 15.6% thought it was a good idea.
Again, advisers had more faith in the president immediately after he was elected: While 45.6% of advisers said they thought the plan was a bad idea, 29.7% said it was a good idea and 24.7% were unsure.
“The stimulus plan is a bad idea because it doesn't spend money on the right things, and doesn't spend enough on the infrastructure,” said Joseph Alexopolous, president of Aequitas Wealth Management LLC of Los Angeles, which manages $27 million in assets.
“Stimulus never comes from government spending, it comes from innovation and free enterprise,” Mr. Terry said.
Corporate bail-outs conducted un-der Mr. Obama's watch were also met with displeasure.
“I don't agree with the economic policy of bailing everybody out,” said Kevin Reardon, president of Shakespeare Wealth Management Inc. of Brookfield, Wis., which manages $50 million in assets. “And I think there has been a lack of depth at the Treasury Department.”
Some see the government lifelines eroding to the foundations of free enterprise.
“In the long term, some of the things he is doing will be detrimental to capitalism in general,” said Ray LeVitre, a managing member of Net Worth Advisory Group LLC of Midvale, Utah, which oversee $80 million in assets.
“In 10 years, are we going to see the government firing chief executive officers of public corporations because the precedent was set? Companies should be allowed to fail. We don't need any more enabling in our society.”
But some advisers chose to give the president the benefit of the doubt: “I think it can work, but it's too early to tell,” said Barry Glassman, senior vice president at Cassaday & Co. Inc. of McLean, Va., which has $850 million in assets under management. “I wish [the recovery plan] focused more on stimulus such as job creation, encouraging investment and small business initiatives to help them grow.”
To be sure, not all advisers are disappointed.
Mr. Obama has a clear vision and got his agenda approved with great speed, said Marjorie Determan, owner of the Nevada City, Calif.-based Financial Strategies of Northern California, which manages $53 million in assets.
“I absolutely approve of his performance,” she said. “On domestic issues, given what he has inherited, he has done a great job. He got what we wanted in the stimulus bill. On foreign policy, he has gotten such an incredible response.”
The stimulus plan was a good idea, Ms. Determan added. “It should have been bigger, but it was clearly the right thing to do,” she said.
E-mail Sue Asci at sasci@investmentnews.com.
