Monday, October 7, 1996
I was typing away at my keyboard at my office in Tokyo last week when a bearded, slightly portly, fifty-ish man strode in, an Australian colleague of mine in tow. They retired to a conference room, and emerged about twenty minutes later. He shot me a wink, shook my hand like a pro and handed me an embossed business card with a big schooner watermark in it that said the equivalent of "Rothschild Investments!" "Let me know if I can help you," he said, wink-wink, "do something smart with all that yen you slave away for. You do know that offshore investments protect you from paying taxes, right?"

Hmm. Choice A was to call him on his winksmanship and mouth him a No Thank You. Choice B was to take him up on the "free" consulting session he offered me. It's not everyday that an in-the-flesh Wiseman offers such a convenient and excellent look inside the world of The Bilk.

A week later, we sat in the same conference room. He took out glossy graph sheets with big positive numbers headlined on top, and flipped through them long enough for those big numbers to stick. He must've had people to see, because his sales close came after about ten minutes. "So, which one of these funds will best meet your goals?"

"Er, what's the load on these things?"

(Mumble) "8.5%. Industry standard. Nothing when you consider the returns."

<Sound of jaw hitting floor>

The man was actually offering a mutual fund of mutual funds! It was a melee of Asian mutual funds (Fidelity International, Jardine Fleming, Peregrine), American mutual funds (Rowe Price, Dreyfuss), and European mutual funds (whatever they were), all mine for a measly 8.5%! When I pointed out that there was little reason to buy *no load* funds, let alone ones with 8.5% "loads" on them, he began gathering up his papers in a huff, and out the door he went, never looking back.

Happy ending: My colleague was about to sign on the dotted line, from her meeting of a week ago. A ten-minute version of the 13 steps to Fooldom threw her into a doubting tizzy, and she had to call Mr. 8.5% with the bad news. Chalk one up for a new International Fool.

--- Eric Gower

Transmitted: 10/7/96