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Beware celebrities selling financial literacy

01 April 2021
Dan Ackermann

April is financial literacy month, which means you should expect a steady stream of celebrities like Miley Cyrus exhorting us to "learn more about stocks."

Why it matters: Financial illiteracy is a real problem, but it's not one that can be fixed with a 90-second video or a jaunty slideshow.

  • When you see a financial education site emblazoned with the logo of a financial-services company or a celebrity, what you're looking at is marketing, not useful instruction.

Driving the news: The SEC recently put out an investor alert warning that "Even if a celebrity is involved in a SPAC, investing in one may not be a good idea for you."

The big picture: Arguments in favor of financial literacy generally put the onus on the poor to educate themselves. Financial literacy month effectively turns poverty into a series of individual problems, rather than one big societal problem.

  • It doesn't work very well. Lauren E. Willis of Loyola Law School has examined the research on financial literacy and has found no "causal chain from financial education to higher financial literacy to better financial behavior to improved financial outcomes."
  • If anything, a little financial education can be a bad thing, causing overconfidence rather than sensible caution in the face of complex financial structures.

The bottom line: A carefully-structured school curriculum from the likes of Next Gen Personal Finance can, over time, help kids get up to speed on important financial concepts. A glitzy celebrity-endorsed marketing campaign, on the other hand, will do nothing of the sort.

Transcripts show George Floyd told police "I can't breathe" over 20 times

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Newly released transcripts of bodycam footage from the Minneapolis Police Department show that George Floyd told officers he could not breathe more than 20 times in the moments leading up to his death.

Why it matters: Floyd's killing sparked a national wave of Black Lives Matter protests and an ongoing reckoning over systemic racism in the United States. The transcripts "offer one the most thorough and dramatic accounts" before Floyd's death, The New York Times writes.

The state of play: The transcripts were released as former officer Thomas Lane seeks to have the charges that he aided in Floyd's death thrown out in court, per the Times. He is one of four officers who have been charged.

  • The filings also include a 60-page transcript of an interview with Lane. He said he "felt maybe that something was going on" when asked if he believed that Floyd was having a medical emergency at the time.

What the transcripts say:

  • Floyd told the officers he was claustrophobic as they tried to get him into the squad car.
  • The transcripts also show Floyd saying, "Momma, I love you. Tell my kids I love them. I'm dead."
  • Former officer Derek Chauvin, who had his knee on Floyd's neck for over eight minutes, told Floyd, "Then stop talking, stop yelling, it takes a heck of a lot of oxygen to talk."

Read the transcripts via DocumentCloud.