Financial deregulation already in progress

[stpioc]

Friday afternoon, Donald Trump traveled to the US Treasury Department where he’s expected to sign a new executive order. The order aims at making life easier for American companies that want to avoid corporate income taxes, relax regulation on some large financial institutions, and make it harder for federal regulators to wind down big banks that fail during a financial crisis. It’s all part of the Trump administration’s frenetic sprint to put some points on the board ahead of the symbolically significant 100 days mark, though it also certainly seems like a betrayal of the populist themes of his campaign. The good or bad news, depending on how you feel, is that, based on briefings provided in advance by the White House, it does not appear that today’s order actually does anything per se.

Today’s executive orders are the nail in the coffin of Trump’s economic populism - Vox

But now, at Trump's behest, the DOL has postponed implementing the fiduciary rule, which was slated to go into effect this April, and is reviewing it. It's possible the rule will be revoked completely, or changed so the impartial conduct standard is significantly weakened. Yet money is still flowing in the wrong direction. In the first two months of 2017, active U.S. equity funds lost $30 billion, while passive gained $60 billion. Although the rule may be reversed, that won't change the ongoing shift in the advisory model. "For some time financial advisers have been shifting from a commission-based structure to a fee-base structure," says Todd Rosenbluth, director of ETF and mutual fund research at CFRA. "Lower-cost index products fit nicely into that model."

A seismic shift is happening, and billions are pouring into these funds