Mob boss calls a stock bubble
Wall Street traders can be shady, Michael Franzese says. Don't let them decide where to put your money.
Former mob boss Michael Franzese thinks investors should avoid the U.S. stock market. Should you take his investment advice?
"There's a bubble there that's going to burst at some point, and when it does, it's not going to be good," Franzese (pictured), a former mob boss for the Colombo crime family in New York and now an author and motivational speaker, told CNBC.
It's not just the valuations. He's got another reason for advising investors to keep their money off Wall Street.
"I did a lot of things at times with people on Wall Street," said Franzese, who believes there is still a contract out on his life. "A lot of guys are shady and they did shady things with me and I don't trust them. And I don't like other people that I don't know really well taking care of my money. I think that I can do it better."
"No matter what, it's always going to have a value," said Franzese, who dodged a question about whether he'd ever killed anyone. "Unlike stocks, where in our country, you go to sleep, everyone tells you everything is wonderful, you wake up and everything is gone."
To be sure, he doesn't expect financial Armageddon and he still thinks diversification is important, with some caveats.
"You have to have knowledge of what you're diversifying in and not trust somebody else to pick those spots for you unless you know him so well and you have so much confidence and you've done a lot with them throughout the years," said Franzese, who was played by Joseph Bono in the 1990 Martin Scorsese film "Goodfellas."
Should you follow his advice? He has some unusual bona fides.
At the age of 35, he ranked No. 8 on Fortune Magazine's 1986 list of the 50 most wealthy and powerful mafia bosses, believed to be raking in up to $8 million a week at times -- although he told CNBC that if his fortune is still out there, he's not likely to be able to use it.
"Business is business," said Franzese, who served a 10-year prison sentence on federal racketeering charges. "Whether you're doing it on the street illegally or you're doing it legitimately, there are certain principles that carry both ways."
Franzese has another unusual qualification for giving advice: he's still alive. He noted that out of the 50 bosses on the Fortune list, 44 are now dead and three are doing life in prison without parole. He's believed to be the only surviving high-ranking member of a major crime family to publicly walk away and refuse protective custody.
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Franzese is an insider, he should know. I have heard from others that were also insiders comment about wall street.
Look at the high speed trading that's taken over how fast the big banks make money using your money. I'll bet those guys really gloat each day when counting up how many people they screwed over and how much money they made. The govt is busy chasing their tails. Just look at the meltdown in 08-09, and nobody went to jail, instead the banks were bailed out with our money......Vote all incumbent congress out of office to start with, maybe that is a small start.
BEST ADVICE YET. CAN'T TRUST ANYONE THAT WANTS TO HANDLE YOUR MONEY.
Keep it out of the banks and away from the GOVERNMENT.
I'd rather know what Katie Upton thinks I should do about investing. She's done wonders with her assets, and they're real, and they're spectacular.
Damn it ! I just moved my money to play hard. I believe the mob....well time to take it back to safe.
Wall Street has always been and always will be crooked. You don't get that rich on luck!
I'll bet he gives better advice on making money than Jim Cramer... Booyah
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