… for selling products that customers don’t understand? At least that’s what you would think if you read some of the news articles that came up in the newspapers during the past few months. What with some governments fining investment banks for selling them complicated products that the customers didn’t understand, some even filing criminal cases in courts.
But when you buy a product, it is understood that the customer understands all the risks associated with the product. It would be a crime to withhold information from a customer; the excuse that “he didn’t ask about it” is plain stupid. But what if I don’t seem to understand that the thing I am going to buy is going to blow up, even if the shopkeeper says it is. Who is the stupid one here? Is it wrong for the shopkeeper to sell something like that?
To even things out, the products sold by some of the leading investment banks were also sometimes designed by analysts who didn’t quite grasp what was going on. Now, if that is the case, the blame falls squarely on the customer. Not only does the customer not know what the product is all about, but even the designer of the product doesn’t claim to know how the product works. If you are stupid enough to buy the product, how is it the shopkeeper’s fault?
(*By businessmen, I mean businesspersons. 🙂 )