Doctors are some of the lousiest investors

Doctors know everything. Maybe it's because that guy down the street that you know as Dave is addressed as “Doctor” by patients who are 30 years older than he is. I don’t know why. Maybe because I’m a little stubborn, I call my doctor Dave. That’s his name ... and he works for me.

But I digress. Doctors are a pain in the ass because they have delusions of superiority.

In everything.

Many years ago when I was into flying, I read an article about accidents in light planes. At the time, the Beechcraft Bonanza was the Mercedes of private planes. It was fast, it was roomy and it was expensive. It also had a habit of crashing into things … especially in bad weather.

Why?

It had nothing to do with the plane. It had to do with the pilot.

Doctors were drawn to it just as doctors are drawn to Mercedes and Lexus cars. Because they can afford them. So your local doctor would buy a Bonanza and go out flying. But because he was a doctor, and doctors are smarter than everybody, he would fly into weather conditions that mere mortals would avoid. And so another Bonanza would end up as scrap metal on the side of a mountain or augur into the ground.

I have dealt with a few doctors in my business as a financial advisor. They always knew my business better than I did. They were relentless readers of tip sheets and financial newsletters. Despite the fact that their income was so high that they could invest their money very conservatively, they were always chasing the “hot dot,” the next big thing. They were suckers for promises of high returns in exotic investments.

Want to find the money to put up a bunch of ethanol plants? Just promise a group of doctors 50% per year and you’ll have all the money you need.

So I was not surprised to find out that a Fairfield, CT medical practice had invested its entire retirement plan with Bernie Madoff.

The Orthopaedic Specialty Group, a Fairfield surgeons' group with 130 doctors and employees, lost its retirement savings when Madoff's $50 billion Ponzi scheme came tumbling down. The group had invested its entire retirement fund with Madoff, according to a report Wednesday in the Connecticut Post.

"For some of us, it's an entire career's worth of work," Dr. Robert Dawe told the Post. Some of the group's doctors had been paying into the retirement fund for 40 years, he said, and were now left worrying about the future.

"I'm not an expert on finance," Dawe told the newspaper. "I'm an expert in orthopedic surgery."

That's what they say now. Back when they decided to invest with Madoff, they were financial Masters of the Universe.