Subject: RE: Questions for Sam Beard:"Investor's License"
Sam Beard writes:
"Investor education must be a cornerstone of American
public policy, particularly related to individual accounts and
Social Security. Education is the key to creating a nation ofsolid investors."
In my mind, this is definitely a very crucial issue. There is a lot of talk about it, but very little action.
Here is a new concept: when a new driver buys a car, he must get a driver's license; to get a driver's license, he must go to driver education. Why not apply this same concept to investments: an "investor's license". With proper basic knowledge, a new investor would be more likely to be reasonably successful. Just like a driver, it is possible to have financial "accidents", but at least with such basic knowledge, the accidents would not be so harmful.
Who would teach the new "drivers"? The stock brokerage houses would seem to me to be the natural place for it.
I realize that colleges have a lot of adult education courses doing precisely that. But I am talking about young adults just starting to work.
So, would it be an extreme position to suggest that a young person would have to show his/her "investor's license" in order to be allowed to invest?
Similarly, an "investor's license" might be required before investing in highly speculative investments such as: options, commodities, penny stocks etc
Finally, individuals with degrees showing equivalent knowledge would be exempt.
I realize that there may be flaws in this idea, but it seems to me that it would fill a huge gap in the education of young people.
