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Behavioural economics provides unequivocal evidence that when consumers are faced by an overwhelming decision they are most likely to do one of three things: inappropriately oversimplify it, put it off or check out completely. As a result, providing more disclosure may not only fail to benefit consumers, but it could even cause people to abdicate responsibility for their financial affairs to an even greater degree than they do already.
Behavioural economics provides unequivocal evidence that when consumers are faced by an overwhelming decision they are most likely to do one of three things: inappropriately oversimplify it, put it off or check out completely. As a result, providing more disclosure may not only fail to benefit consumers, but it could even cause people to abdicate responsibility for their financial affairs to an even greater degree than they do already.
(Photos.com)

Private equity firms give up on questionable fees

New figures on the rapid disappearance of so-called “monitoring” fees in private equity deals drive home what investors must have always suspected – the fees were simply a way for fund managers to cream off a little more compensation.

The pension funds, endowments and other institutions that give private equity firms money to run have demanded that the fees be handed over, rather than going to the fund managers. And lo, suddenly managers have stopped bothering to demand them when they do a deal.