No matter how much pain-emotional, physical or financial-comes from advertising that doesn't meet the smell, moral or legal test, we as a nation embrace it and cite all types of arguments to allow its existence. Why? "Don't ever threaten my first amendment rights" is the clarion call of the protectors of our freedom; however, no one would argue it is okay to yell "fire" in a crowded movie theater as a false alarm.

When an advertisement misleads people into risky financial situations and causes them to lose their money, their homes and even their lives, why is this different than yelling "fire?" Is it because the reaction or consequence are delayed, or is it because we don't employ the censors we need as a nation to keep the garbage off the air. I believe that most Americans would love to have truth in advertising and be able to make informed decisions from what they hear, see or read. How do we ever get to that point? There are some solutions.

The number-one solution is for every industry to supervise its own companies. In California, that actually used to happen in the mortgage business when the real estate commissioner's office reviewed all advertising before it could go public. Now the office spends its time checking applicants for felonies and dispatching those who have recent felonies.

Second, people who are employing the services or purchasing the goods of those who advertise need to understand four basic points that will help them identify who is for real and who isn't; what is the truth and what isn't; and whether the goods and services advertised help the general good and/or promote the general welfare of this society. The four are as follows:

Risk/reward ratio: The equation that will show you what reward you will receive by taking the action you are contemplating. In the past week, we have seen a major bank close and some depositors getting hurt. The first question you need to ask yourself is "Why use that bank?"

The answer was a return that was about 1% higher than most other banks. On $100,000 that is $1000 per year. On a million dollars it is $10,000 a year.

Is the risk of placing your money in a bank you most likely hadn't heard of worth the reward? Regardless of the outcome I wouldn't have considered that a good return on the investment. A substantial amount of money plus a world of worry can be saved if you consider this ratio every time you are prepared to act financially.

Cheap vs. inexpensive: I know it seems silly to bring something up as basic as this, but you would be surprised at the number of people who simply don't get it. "Inexpensive" is getting something of the same value at a lower price than is currently being offered. "Cheap" is getting something of a lesser value for a lower price. In either case you are "saving money" but you are only getting value in one of the propositions. A simpler way of putting it is being sure you are comparing apples to apples when you decide whether it is inexpensive or cheap. Continued...