Episode Details

Do you really own the stocks, bonds, ETFs, and Mutual Funds sitting in your IRA, 401(k), or brokerage account? You do, but not in the way that you think. You are NOT the legal owner of that security. You own a contractual claim, what the law calls a “security entitlement” against a financial intermediary. Does this matter most of the time? No. Does this matter if we have a major financial crisis or if the financial institution you are dealing with gets into serious trouble, yes! If the financial institution pledges your securities as collateral for a loan and they go under, you could lose your investments. You might say, when has that happened? Think Lehman Brothers, Sentinel Management Group, and MF Global. The problem ultimately lies in Article 8 of the Uniform Commercial Code (UCC), which has been amended and adopted by every state legislature in the country. This episode reviewed two articles from The Epoch Times (subscription required) titled “You don’t own your stocks the way you think you do” and “Your property rights have been taken in all 50 states. Here’s how to get them back.” The episode also discusses the book The Great Taking by David Rogers Webb.