Morgan Stanley Buying E-Trade is Ominous for Expats Abroad

I don't like dealing in FUD, but that's exactly what I felt when I read the news that Morgan Stanley would be buying the broker E-Trade.

Recently, I've been doing some research on what brokerage was best for normal American expats who want to buy securities with USD but also give their foreign residential address rather than a US address maintained by a relative. I started putting together a spreadsheet, thinking that I'd find a handful with different upsides and downsides.

But honestly, it was worse than I imagined. Nearly every broker's website I visited required a US address, and if a foreign address was allowed, many brokerages would explicitly refuse to allow US citizens living abroad onto their platform. Yes, you read that right. So as of right now, I can find two brokerages that will let an American abroad be honest about their foreign address when creating an account:

All hail Interactive Brokers and Charles Schwab. I use IB, but I'm grateful to both for sticking by us.

Because of this dearth of options, I am worried about the consolidation of online brokerages, and I hope that IB can resist being bought out by a rival who then eliminates US expats from its customer list. Some American friends of mine living in Germany starting an OptionsHouse account back in 2015. OptionsHouse was that rare unicorn who allowed US investors abroad to open an account with a foreign address while being a US citizen. In 2016, E-Trade bought OptionsHouse, and if you try to sign up for E-Trade now, they require a US address but allow a foreign mailing address.

So far, my friends have been allowed to maintain their accounts with their foreign address, but with Morgan Stanley now buying E-Trade, I wonder how long that will last. In 2015/2016, there was a wave of account closings for expats who held their assets at some online brokerages, and with our reliance on the goodwill of a few companies, I'm waiting for the day when another wave starts.

Hopefully that never happens, but our dependence on a dwindling number of companies willing to have us as customers is, bottom line, a risk.

Driving is Absurd

The longer I live without a car, the more absurd driving seems to me.

Maybe it's not even really "driving" but car ownership that's so strange. Buying a car is an absolutely enormous expense. Despite approaching middle age, I've never considered going to a dealership to inquire about vehicles. I guess I could, but why would I? I'm hesitant to buy much less expensive stuff, and a new car just seems like an enormous obligation.

I owned a used vehicle for years while living and working in the US. I know the arguments about how necessary a car is there, and for some of my activities, a car was an absolute necessity. But I'm not certain that those activities themselves were absolute necessities. I ended up doing a lot of things that I never would have done had I not had a car, so, in a sense, it cost me twice by owning the car.

I spent so much money on gas and maintenance. So much of my mental space was clogged with mystery noises coming from the wheel wells or from the engine. It took many trips to many mechanics to find a mechanic that I trusted, and all that meant was that I could spend money with less worry. But I still had to spend the money!

Moreover, cars are dangerous. It's both amusing and annoying how easily freaked out many people are about all sorts of low risk subjects while being completely inured to the dangers of their cars. Last summer, I turned down an invitation because I would have had to have driven there with a rented car, and -- in addition to the financial costs -- driving would have placed both me and my wife at risk. "Is this trip worth the potential costs?" Increasingly, that answer is, "No."

Even without a car, I am affected by them. The air where I live is dirtier, and there is background distress about the pollutants we're breathing. The floor in our apartment builds up a dirty film when we open our windows in the summer thanks to the busy street out front. Walking to work requires serious concentration because the drivers out front are always in a hurry and are super aggressive. I've nearly been hit by cars running red lights here, and I've watched other people nearly get hit by cars. And this is despite the rigorous training German drivers go through.

Oh yea, they're really loud.

And how about the vast amount of space given over to cars? Pedestrians have to push past one another for a narrow bit of uneven sidewalk, while the cars have multiple lanes and huge parking structures given over entirely to their use. It starts to feel unfair once you no longer take part, and it's easy to get resentful that so much stuff is sacrificed to this idol. Thankfully, in Germany, there's always a Fußgängerzone, but that's one of those instances where the exception proves the rule: it shows how the default is automobile driving.

All that said, I can't guarantee that I'll never own a car again. It could happen. If we moved to the countryside or had kids or did a job where driving or hauling stuff became absolutely necessary, then maybe we'd buy a used car again. And I'll certainly drive again: whenever I visit the US, there's nearly unavoidable car use involved.

But I'd rather not if at all possible, and it is an idle wish of mine that cities and countries would back off from further sacrifices to this idol.