Monday, October 19, 1998

Fortune Tellers in Suits
by Tony Luck ([email protected])

"The Economist" recently ran an interesting article on various attempts to regulate or ban fortune tellers. I was amused by the following quote from a California case in 1985 in which a local ban on fortune telling was overturned. Fortune tellers were compared by the court with "economists who prognosticate interest rates and other business conditions" and "investment counselors who forecast stock market trends."

Here we have an official ruling that the talking heads who explain that today "Early enthusiasm wanes as the indices have been drifting lower in orderly fashion this afternoon" (actual quote from an online trading site) are just as valid as a psychic hotline.

So let's do the math: You can use a full service broker and pay $100 for a trade after you receive some advice on what to buy. Or you can find a 1-900 number that charges $5 per minute to get the advice, and then use a discount broker to buy the stocks with exactly the same guarantees that the investment will gain in value! The psychic may also solve other problems for you, too, on the same call.

Personally I'll follow up on the (free) Foolish advice that I find here at www.fool.com with some (free) research on the web before I invest at my discount broker.

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