Has the ETF hype gone too far?

It’s not that I’m a humorless curmudgeon. I like to think I’m capable of a good laugh now and then. I like to think I can walk lightly on the earth, and take things in stride. But honestly, it’s starting to feel like maybe the ETF market has arrived—and not in a good way.

The surefire way of knowing you’re a household name is when you start getting abused, misused and confused. Take SPAM and Xerox, for instance. Two perfectly good products (well, if you like SPAM), whose brand became co-opted by the media.

Here’s the kind of thing I’m talking about:

We can chuckle all we want, but this is the content of a certain Web page—I’m reluctant to link it, but a quick google will get you there—being advertised through Morningstar and quite a few other ETF Web sites right now. For all I know, the gentleman behind the Web site and the book is a genius. Maybe he’s the best investor of our generation. But his marketing material is emblematic of get-rich-quick quackery, not real insight. And claims like:

Are obviously ludicrous. And how about this one, from one of the “ETF Mega Trend” dude’s big competitors:

That’s 700 percent in just three years! Sign me up!

Charlatans have always been with us, and if it were just this one guy, I’d laugh it off. But my Bloomberg screen has been popping up with “News” flashes about ETFs for the last few weeks loaded with goofy ideas on how to play [insert news item] with ETFs. The three-letter acronym seems inserted solely for the purposes of making the newswires.

I understand the allure; we are, after all, journalists around here, in addition to being investors and analysts. I like it when people read our stuff too. But honestly, do we really need this headline from TheStreet.com:

“Three ETFs for Betting on Apple's Tablet”

Let’s face it—not every story, every day, has to be about ETFs. Sure, the Apple story is interesting, for Apple. But should we now point out that you can get shares of Berkshire Hathaway by conveniently purchasing an S&P 500 ETF every time Warren Buffett blows his nose?

Yes, ETFs have arrived. Let’s hope they survive the hype.