This week I came across an article published in FundsPeople titled «Client risk in private banking management«. These are obviously arguments put forward by bankers and former private bankers, which already distorts considerably the reality of what wealth management in general and financial investment in particular should be, as we said back in 2008 in «...".«The unbearable lightness of management»(private banking). We advance this warning because the FundsPeople article only deals with the management of bank investments, i.e. money invested in bank investment products, shares handpicked by the bankers and ex-bankers on duty and other investment funds listed in the bank's sales catalogue. We want to make it clear that there is a fundamental deviation from the way we should treat families' money, which should include investments in unlisted companies (private equity), real estate investments and other assets in which, in order to invest, the money must come out of the bank's account. Obviously, private banks do without such investments, as their mission is to keep their clients' money in the bank that generates their income at the end of the month.
We look after your interests
(+34) 93 626 47 75
Torres Sarrià, Carrer de Can Ràbia, 3-5, 4ª Planta BCN 08017
(+34) 91 794 19 82
Pº de la Castellana, 93 2nd floor MADRID 28046
Knowing which types of assets or which companies’ shares are going to skyrocket in the coming months is the pipe dream of those who, rather than investing, speculate. Of those who are hoping for a windfall to bail them out of the financial difficulties they have got themselves into through their own foolishness. But even if Lady Luck were to smile on them, their poor judgement would remain just as bad. Consequently, they will believe themselves to be shrewd investors rather than merely lucky, and their cycle of financial difficulties, windfalls and further difficulties will repeat itself, at best. In the long run, the result for most of them is that their forays as speculators (even though they describe themselves as investors), far from supplementing their income, cost them a significant portion of the wages they have earned through the sweat of their brow over the years. And if at any point they were to make an objective calculation of their gains and losses—something they consciously or unconsciously avoid doing—the balance sheet would reveal the harsh reality: that throughout their investing lives, a large part of their own and their families’ well-being has been taken by Mr Market. 
We had already warned of this in
We have already pointed this out in previous articles 
«Some central banks in Europe are beginning to assess contingency plans for the possibility that some countries may leave the euro area or that the monetary union may collapse completely».» This is the headline of the 
Italy’s debt alone is greater than the combined debt of Ireland, Greece, Portugal and Spain. Germany cannot pay off the PIIGS’ debt, and the other economies still afloat (namely France, Belgium, Austria, etc.) have their hands full simply trying to feign a solvency that is deteriorating more and more with each passing day. The only way to repay the market (institutional and private investors and speculators) the money owed by Italy and the other PIGS is to print it in the purest banana republic style. 
These days we are seeing how the moment of truth is slapping Eurozone politicians in the face. The risk premium, i.e. the market's disdain for Italian debt is throwing the country, and therefore the rest of the Eurozone, into bankruptcy. Watching the Italian giant teetering on debt feet worth more than 120% of its vast GDP, Greece's bankruptcy may seem like child's play. 
Some predict that this is a crucial week for the future of the Eurozone. These are the days when it will be decided how and in what way the 
‘Preserving in turbulent times’ is not the title of this summer’s soap opera, but rather the pressing need for all those who manage their own wealth. It is also one of the guiding principles for some wealth managers working on behalf of others, though unfortunately the latter tend to be more concerned with retaining their long-suffering clients commercially by reducing their volatility, rather than preserving their assets and ensuring their sound long-term growth. Unfortunately, many managers of other people’s money are more interested in today’s bread (their own) and, in their short-sightedness, ignore tomorrow’s hunger (that of their clients and also their own). This brings us back to the old debate as to whether one should only entrust one’s money to advisers who have built up their own wealth and who co-invest with their clients, or whether any independent broker with sufficient technical training would suffice. But that is a discussion worthy of another article.