This article totally fails to make any reference to the distinction between
(1) people making risky/unwise investment decisions
(2) people being tricked into entering a contract with unclear terms (eg, signing away title to their share holdings, buying a partly-paid share which carries an obligation to pay the rest)
(3) theft, or breach of trust by a trustee or equivalent

I'm sure that the US tough love approach is the reason that their economy is doing so much better than ours at the moment.

Oh, wait....

Possibly Rhys but if there's a certain amount of paying back of debt to be done and we're just putting it off (via sharing it around, putting it into future generations' taxes etc), there's an argument that says the US may be taking the better path by opting for the painful-but-short route. They may be in full recovery in a few years time while Australia's gone to the dogs for decades to come.

Strange (and not very fun) times...

Not convinced, Rhys Probert.

>>I'm sure that the US tough love approach is the reason that their economy is doing so much better than ours at the moment. Oh, wait...<<

There's this guy who jumped out of a 34th floor window.

As he passed the tenth floor, he was heard to mutter "Can't think why anyone suggested this is bad for you."

Debt has to be repaid at some point, or written off. Either way, it can be painful.

Coming back to the article for a moment, it is difficult to avoid the conclusion that we are becoming somewhat cargo-cultish in our approach to government responsibility for our welfare.

The end result is bound to be a complete dependence upon government support for our every action.

This will of course require that we fill in an application form every time we want to take a leak, so that we can be duly escorted by a government official, to help us avoid all the pitfalls and drawbacks associated with such a complex endeavour, including (but not restricted to) ensuring the door is fully in the closed position, advising on an appropriately safe distance from live electrical wiring, and ensuring that all clothes fastenings are correctly replaced.

Don't say I didn't warn you.

Catherine Teo says that people have a choice, I am not so sure she is right.

Every one of Storm Financial's investors knew that they were
1. responsible for providing for their old age
2. money in the bank performs worse than shares
3. financial advisors know more about finance than themselves - hell even Centrelink clients are referred to financial advisors
4. read through their 30 page statement of advise wading through the disclaimers hunting for the 2 page action list
5. knew that the financial advisors are registered with and REGULATED BY ASIC

Dirty secrets financial advisors don't want you to know
1. since 1982 money on fixed interest has performed better than shares
2. advisors get paid trailing commissions for each year their client remains in a managed fund - like insurance sales
3. only 5 of the 500 odd managed funds perform better than the market, the other 495 funds lose money - all the time!

I agree that the financial hardship stories depict the burnt investors as victims so that the newspaper reader patronises them as well as walking the green eyed monster - they can afford to save for their old age and I can't!

I would like to see better regulation of the financial services industry - in fact I would like to see it cleaned out in favour of a national insurance system like the UK and put these sharks out of business.

Prudential regulation ? Of course, but all investors should always bear in mind that high returns ALWAYS means high risk, that's why the returns are high, to compensate.