President Matt Ruppert welcomed our “visiting Rotarian,” Jared Gibbs. ;)
A Board meeting was announced, to be held following the general meeting.
Matt reminded everyone of the District Assembly coming up on April 23 in Payson and April 30 in Scottsdale, providing a great opportunity to learn more about Rotary and incoming Board positions.
Matt Ruppert and Sharon Stinard will represent Superstition Mountain Rotary tonight (4/20/16) as they award ten $500 scholarships to selected honorees at Apache Junction High School. Bob Homann and Dana Hawman served on the selection committee. Dana will also attend the presentation to photograph the event.
Jim Erickson conveyed the news that the proposed merger between District 5510 and District 5490 has been approved, effective July 1, 2016. The resulting single District will be 5495.
The club received a thank you note from Genesis Project, expressing appreciation for the gift of $125. During the month of March, Genesis served an average of 117 people per day; 5,951 meals total.
Bryant Powell updated the club on the AJ downtown park. Our club has donated $10,000 of the $150,000 needed for the splash pad. For those who do not know, a splash pad, per Bryant, is “a really nice sprinkler.” The City is still seeking additional sponsors; they have collected about 40% of the necessary funds for the splash pad. “This kind of thing can’t happen without community partners. There is going to be a display at the park showing all of the contributors.” New parks director, Liz Langenbach, will provide a presentation for us with a full update about the downtown park in July.
Bryant also informed us about “Mount Trashmore.” The City is currently discussing a landfill closure plan, due to the fact that when the landfill was contracted in 1997, no closure date was set. Right now, the landfill operators have the legal right to fill one more cell, which will take 8-10 years. “What we’re trying to figure out is whether it is worth it to expand 20 feet higher instead of wider… For us, it’s an opportunity to discuss a closing date and create significant dollars toward the end of the life of the landfill to put in a park.” See Bryant for more of the inside scoop about landfill futures.
Our club’s Facebook page is picking up speed. If you haven’t yet, “Like” us HERE.
Mike Dungan was our presenter, discussing changes coming in the security industry.
There are some major structural changes coming to the relationship between clients and investment advisors. The Department of Labor has issued a statement that, “There have been too many shortcuts between advisors and their clients. People are being ripped off.”
There is a distinguishing factor between a broker and a Registered Investment Advisor (RIA). A broker will recommend a product for a client according to a “suitability standard” based on the client’s age, assets, and risk tolerance. A RIA, however, must meet a higher standard called the “fiduciary rule.” The RIA pledges honesty, full facts, current information, listening, and putting the clients’ best interests first, even if it costs the advisor money. “It’s a lot like the Rotary Four-Way Test.” A RIA can be sued if he/she does not live up to the fiduciary rule. “A year from now, when the Department of Labor finally resolves these issues, they’re going to have a set of standards that are different from what you’re used to…the rules will apply to everybody.”
Over the last four years, arbitration has gone up by 20-25% because of shortcuts taken by individuals who represent different plans, to the detriment of their clients’ accounts. “There was a classic case back in 2004 over a conflict of interest. The State of California sued a nationally known broker dealer for about $300 million, because the individuals representing that broker dealer were steering clients to six or seven mutual funds. The mutual funds would then kick back to this broker dealer. They eventually settled with the SEC for about $75 million.”
“You never know when you buy a product if there’s a conflict of interest.” If you are sold a mutual fund, there is a “trail” that comes to the advisor, paying about a quarter of a percent ongoing – supposedly to pay for advertising and other business expenses. That will now be deemed as a conflict of interest. “That’s been going on a long, long, long time.”
Exchange Traded Funds (ETFs) allow for intra-day trading. “They look like a mutual fund, but you can buy and sell them like a stock.” Because they are low cost, “There’s about a trillion dollars of opportunity for the ETF industry to convert mutual funds into ETFs.” The low cost means that every dollar the consumer is saving for retirement goes to retirement, “not to some crook.”
A fiduciary is someone who is responsible for your money and has your trust… it’s a substantial change. The brokerage industry has been fighting this for a very long time, but change IS coming. Brokers will have to do their due diligence and be ready to be audited.
When interviewing a financial advisor, ask about fees; ask about how often he/she will meet with you and on what conditions. “I believe deeply that it’s very important to have an Investment Policy Statement (IPS). It’s a contractual thing, rather like a marriage certificate: ‘What am I, as an advisor going to provide for you; what are the conditions under which I will do that; and what are you, as the client, going to provide for me.’”
Terry and Mary Drader, winter visitor friends from Canada, recently returned from a trip to South Africa part of which was a Rotary project. Here is Terry's background story on South Africa.
"Dutch traders founded Cape Town in 1652 as a way station to and from the orient.
The rival British seized Cape of Good Hope (the point where the Atlantic and Indian oceans meet) in 1806. In 1833 England abolished slavery in all its colonies and about 12,000 Afrikaans farmers or “Boers” made the “Great Trek” north and east to establish new colonies that would not be under British rule.
Diamonds were discovered in 1867 and gold in 1886 spurring an influx of immigration of those seeking to strike it rich.
South Africa is well known for its decades long experiment with apartheid (separation) which ended in 1994. The first general election where all the citizens got to vote and Nelson Mandela became the first black president after 27 years of imprisonment.
South Africa is 1.2 million sq. km. or almost twice the size of Texas with a very diverse population of 54 million people – 80% Black, 8.8% Colored, 6.4% White and 2.5% Asian.
The climate ranges from sub-tropical to semi-arid and with water the agricultural possibilities are enormous, growing everything from grapes to fruit and vegetables to grain, fodder and trees.
The physical beauty is spectacular and constantly changing as you move over the next range of mountains into a new climate ecosystem.
South Africa has possibly the greatest biodiversity of the flora and fauna of any country on the planet and the photo ops are truly endless.
Game parks are both national and private. Some private parks will sell a guided hunt for as little as $200 USD for one of the smaller antelope.
South Africa is noted as a top 10 tourist destination because of value. Currently $1 USD = 14 SA Rand. You can get excellent wine for $3 - $4 USD per bottle. There is great food, good service provided by smiling friendly people, all in a very safe English speaking environment. We had a great time and met some wonderful Rotarians in South Africa and as well as those on our tour group. We would highly recommend South Africa to anyone yearning for an adventurre.
And in the over 50 countries that Mary and I have been hosted in or visited, one truth stands out as universal. People, no matter the culture, religion or geo/political position, all aspire to have a good life for themselves, a better life for their children and an even better life for their grandchildren.
Rotary brings us all together in that universal truth that supersedes all borders and prejudices and allows us to think of ourselves as global citizens. We are all brothers and sisters and if we are all united and committed, we can indeed change the world!"
