Is LPL growth just smoke and mirrors?

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BigPayDay's picture
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Take a look:

http://www.onwallstreet.com/bdconnect/profile.cfm?comparison s=52

According to this article:

1. LPL has 6,481 reps
2. Average gross is $150,477
3. 31% of reps or 2,009 Reps make less than $50k gross
4. 17% of reps make between $50-$99k gross
5. thats 48% (almost half) or 3,110 reps making less than $100k gross
6. only 39% or 2,527 Reps are making over $150,000 gross

Could these numbers be right?

troll's picture
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Joined: 2004-11-29

Yes it could be, unfortunately.We have some great technology and some really good OSJ's out there.  We also have some real pikers in the system as well.

spikedkoolaid's picture
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I'm at $440,000 YTD Gross Commissions.  I think that there are a lot of people that bring down the averages...for example people that are doing investments part time.  Just a thought not an examination.

ezmoney's picture
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What the heck does it matter what the average take is at LPL? The ONLY thing that matters is what you'll gross with LPL. I'm at 118,000 gross after 5 months of joining LPL.

vbrainy's picture
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Because ANYONE with over 3 years in this business not grossing $200,000 really stinks. That is ridiculous.

Indyone's picture
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Did no one notice that BPD was using data from 2005?
Candyman, if you're going to bash the firm that's taking all your reps, you might use fresher data...
I'm sure my licensed assistant and the office of CPAs a couple of towns to the west are also dragging down the average.  Personally, I'll be around $300K this year and Ron Carson is on pace to do somewhere close to ten million in production this year...gee...LPL reps really suck!

troll's picture
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Nobody says they suck.  What is being suggested is that the age old adage that "Figures never lie, but liars always figure" may be in play about the supposed growth of LPL.
Every time somebody mentions LPL you trot out Ron Carson as proof that the firm is a great firm.  There are dozens of producers in every wire house in the country who post numbers like that.  Having one of them is hardly something to write home about.
What this type of news does is dampen the value of LPL to those LBO guys who want to sell it.  The reality is when you get into the numbers having a huge portion of your stable producing less than is expected in the third year at a real firm does not enhance the value of the business.
Would it surprise you if LPL jacks up its quota and raises its fees in an attempt to drive the little guys away?

Indyone's picture
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Oh, I don't know...LPL has taken it's share of arrows here.  Jones doesn't like them or RayJay because many of their advisors going independent select one or the other.
"dozens of ten million dollar producers in every wirehouse in the country"?  I don't doubt that wirehouses have highly successful advisors, but methinks thou dost exaggerate...kind of like you did when you made a statement about LPL's top 20 advisors not aggregating a million dollars in production or something equally ridiculous...it's one here somewhere...feel free to correct me, but only with the link of what you actually said.
There are plenty of other folks I could trot out...last I knew, LPL had somewhere in the range of 100 million dollar producers and I'm assuming that number goes much higher with the recent acquisitions.
What was posted was not news...it was really old news.  When the IPO happens, I'm sure the numbers will be diced six ways to Sunday by a bunch of analysts and what candyman posted will be brushed aside as irrelevant by anyone with any savvy at all.
...and no, it would not surprise me at all that LPL continues to make changes designed to reward and attract larger producers.  I suspect that last year's new bonus brackets were a result of other firms trying to poach the Ron Carsons of LPL.  Perosonally, I'll take it.  I went from 90% to 92% on part of my production.  If LPL cuts loose advisors less than $100K due to lack of profitability, you won't see any weeping here.

Dust Bunny's picture
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In addition this study only posts the brokerage business.  As independents, I would assume that the fixed insurance side of the agent's revenue isn't reported.    This is often a quite significant amount of  income which isn't subject to overrides by the b/d.

bspears's picture
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Joined: 2006-11-08

Didn't I just read in the Investment News, or somewhere, about the whole industry inflating its ave production per rep? 

IndyEDJ's picture
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Joined: 2006-12-13

>>Could these numbers be right?<<
Yes. Unfortunately, they are comparable to other firms in the independent side of the business. 
You are going to see where the smaller brokers are systematically run out of the business due to the costs of business, licensing, and compliance.  RJ has been doing that for a couple of years now where minimum gross is $100,000 and minimum branch production is $250,000.    LPL will not be far behind.

BigPayDay's picture
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Indyone wrote: Did no one notice that BPD was using data from 2005?
Candyman, if you're going to bash the firm that's taking all your reps, you might use fresher data...
I'm sure my licensed assistant and the office of CPAs a couple of towns to the west are also dragging down the average.  Personally, I'll be around $300K this year and Ron Carson is on pace to do somewhere close to ten million in production this year...gee...LPL reps really suck!

Indyone,

So are you saying that LPL is counting their licensed assistants in that number? That's impressive.

So you have more recent numbers than 2005? Please do share!

GoingIndy????'s picture
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Joined: 2007-07-01

These low numbers were a concern for me coming from AGE and more of a wire mindset.  When you dig deeper you'll find many small town junior reps, some part time pre-retirement reps, and of course some pikers.  The more I dug the more I appreciated the fact that they are efficient enough for a small producer to be profitable, which makes it even easier for a larger rep.  I'll be moving my 400k crest club production soon and happy not to be contributing to the next Bagby's $25 Million golden parachute. 

Indyone's picture
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BigPayDay wrote: Indyone wrote:Did no one notice that BPD was using data from 2005?
Candyman, if you're going to bash the firm that's taking all your reps, you might use fresher data...
I'm sure my licensed assistant and the office of CPAs a couple of towns to the west are also dragging down the average.  Personally, I'll be around $300K this year and Ron Carson is on pace to do somewhere close to ten million in production this year...gee...LPL reps really suck!
Indyone, So are you saying that LPL is counting their licensed assistants in that number? That's impressive. So you have more recent numbers than 2005? Please do share! You're a big boy...find your own d*mned numbers.  All I'm saying is that if you wanted to discuss EDJ numbers, I'll bet you wouldn't trot out 2005 numbers, you self-righteous prick.
As far as who's in the numbers and who's not, I don't know and frankly don't care...it's speculation.  If you want to know for sure, do some homework...don't present two-year-old numbers as anything other than history.
If I were in your region, I'd defect too.  I'll bet you don't tell your reps that they can net 70% as an indy and they won't have to listen to your hamburger presentation and have you sucking off their production.

BigPayDay's picture
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Indyone,

My point: These are the most current published numbers. If you work for the firm and don't have more current numbers, how would I have them?

2159 posts...dude you need to get a life! Oh that's right this board is your life.

Greenbacks's picture
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Joined: 2004-12-21

Who cares about some one elses production!
I am just a little over 300,000  a year. Does that mean I am not as good advisor as a 500,000 a year advisor and that I am better then a 100,000 a year advisor? I think not!
Do you measure a person by there net worth?
  If you feel this way stay stay at the wire house it is the way they want you to think.
 

troll's picture
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Greenbacks wrote:
I am just a little over 300,000  a year. Does that mean I am not as good advisor as a 500,000 a year advisor and that I am better then a 100,000 a year advisor?
 
Yes, that's exactly what that means.

Indyone's picture
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BigPayDay wrote:Indyone, My point: These are the most current published numbers. If you work for the firm and don't have more current numbers, how would I have them? 2159 posts...dude you need to get a life! Oh that's right this board is your life. I don't buy that.  You're telling me that no one has published any numbers for 2006 yet?  Ten seconds on Google got me this...
http://209.104.135.85/investmentnews/bdsurvey/edit/profile.a sp?bdprofile_id=54
Your bullshit has just been called.
You aren't interested in the truth...that's obvious from your first post.  Your interested in keeping the flock from fleeing, so you post crap like this and your firm puts out "Is the grass really greener" propaganda pieces.
As far as me posting 2-3 times a day, is that all you've got?
That's pathetic.

BigPayDay's picture
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Joined: 2005-01-10

"Mighty"one,

You want to know the definition of pathetic?

How about 45% of your sales force grossing less than $100,000. That's pathetic. Your numbers not mine. I suppose this is not the truth. The growth at LPL is smoke and mirrors I tell you.

You want to know another definition of pathetic?

Over 2100 posts on this board. Yeah it's 2-3 times a day if you have been on EVERY day since May '05. Oh yeah that's right, you have been. What are you giving up by spending all this time on here?

Thanks for sharing the '06 data with us. Make sure and post the '07 data as soon as it is out.

Indyone's picture
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You just keep telling yourself that as you watch more and more of your reps leave to affiliate with such a pathetic B/D.  You asked to be called out when you posted your bag of shit and I did.  You stupidly insisted that your 2005 numbers were "the most current published numbers" when they obviously weren't.
Your snide little comments about the number of my posts isn't an answer to your bullshit being called.  Try again.

troll's picture
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BigPayDay wrote:"Mighty"one,

You want to know the definition of pathetic?

How about 45% of your sales force grossing less than $100,000. That's pathetic. Your numbers not mine. I suppose this is not the truth. The growth at LPL is smoke and mirrors I tell you.

You want to know another definition of pathetic?

Over 2100 posts on this board. Yeah it's 2-3 times a day if you have been on EVERY day since May '05. Oh yeah that's right, you have been. What are you giving up by spending all this time on here?

Thanks for sharing the '06 data with us. Make sure and post the '07 data as soon as it is out. You had to go there, didn't you?You want to know the REAL definition of pathetic?  The hypothetical LPL rep grossing $100,000 has more money net in their pocket to feed their family than a rep at Jones doing $200,000....I'd bet my last dollar on it.

ezmoney's picture
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You want to know what's pathetic a$$hole? It's tolerating a 35-40% payout. I'll take a gross of 100k at 90% payout anyday. Math, can make so much sense!

troll's picture
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Quote:
You want to know what's pathetic a$$hole? It's tolerating a 35-40% payout. I'll take a gross of 100k at 90% payout anyday. Math, can make so much sense!

When you're only doing $100,000 in 2007 it means you have virtually no clients.
You're the death or defection of one or two clients away from oblivion.
As has been said, LPL is God's waiting room for failed brokers.  The last stop on the way out the door.  90% of the LPL brokers failed again and again and there is no reason to think that it will stop just because they can "feed their family" on 90% of what they're doing.
Let's look at numbers for a moment.
100 grand at a 40% payout yields 40,000 before taxes--about 30 grand to feed the wife and kids.
At LPL 100 grand will yield about 85 to 90, let's give the benefit of the doubt and say 90 grand.
Then start to subtract the costs--ticket charges, E&O insurance, retirement plan contributions, office supplies, phone bills.......need I go on?
I know, I know--you can save a lot of money by having the office in the back seat of your car.  Your cell phone can be your business line, and Kinkos is a great place to get things copied and faxed.
Customers don't care what your office looks like, blah, blah, blah.
Customers don't care what your office looks like when the market is going up--but when they're losing money they begin to wonder if their mistake is doing business with the guy who never wears a suit and rents space from the local plumber for an office.

ezmoney's picture
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90k vs. 40k. Let's see, which would I rather make???? My expenses including a very nice office and all the things you mentioned, perhaps 25k.
btw, retirement comes out of your 40k also if you can afford it. I know I can to the tune of about 3k/mth

csmelnix's picture
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What's the turnover on "brokers" at Jones anyway?  How long they been hovering arond the same number of total reps? 
2005 numbers????  And yes, LPL does use total licensed affiliated people in those numbers which does include CPAs, Reg. Sales Assts, etc.,  Curse them for having such a mixed platform that facilitates that v the bullshit A share only platform the "best salesforce" allows.  Lady's Choice aka BPD - keep your head buried in that sand, I will take a platform where I can manage my own expenses and margins any day over that joke platform you work in!!!!!!

troll's picture
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Quote:
90k vs. 40k. Let's see, which would I rather make???? My expenses including a very nice office and all the things you mentioned, perhaps 25k.
btw, retirement comes out of your 40k also if you can afford it. I know I can to the tune of about 3k/mth

Yep, 25 grand can pay rent on a really great office and buy loads of supplies, phone bills, utilities, health insurance premiums, liability insurance, client entertainment and on and on.
If your top three clients left you would you be able to cover your fixed overhead?

ezmoney's picture
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1st of all youre' assuming I produce 100k. hell my fee based and trails alone pay me 120k. I think it would take a jones broker @ 25bps about 30 years to build those trails to my level. It's taken me about 3 yrs. btw I was a successful ir with jones so you're not pulling any wool over my eyes. The jones ir's that stay are quite simply simpletons.

troll's picture
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Quote:
1st of all youre' assuming I produce 100k.

Not at all, what I commented on was how nice your digs must be when you spend--by your own admission--$25 grand on rent and all the associated costs of running your own shop.
If you've got $120 grand in trails why in the world don't you have a nicer office and an assistant?

ezmoney's picture
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I said 25k for all expenses including rent. I don't need an assistant. 1st of all I'm not running a high volume shop, 2nd, the tecnology is such that at this point I can more than manage. I'm not a jones office with all kinds of cash management issues coming from nichol and dime clients. My clients rarely have requests for cash or anything else for that matter.

troll's picture
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Does Nicol have a sister?

troll's picture
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Wait, it's not Nicol, it's nichol.  How about her, does she have a sister?

YHWY's picture
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Bye, bye, Putsy, goodbye.

Indyone's picture
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trollGuest Grouppartycrasher
...the labels get funnier everytime ol' Putz gets the boot...

BigPayDay's picture
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csmelnix wrote: What's the turnover on "brokers" at Jones anyway?  How long they been hovering arond the same number of total reps? 
2005 numbers????  And yes, LPL does use total licensed affiliated people in those numbers which does include CPAs, Reg. Sales Assts, etc.,  Curse them for having such a mixed platform that facilitates that v the bullshit A share only platform the "best salesforce" allows.  Lady's Choice aka BPD - keep your head buried in that sand, I will take a platform where I can manage my own expenses and margins any day over that joke platform you work in!!!!!!

CSMELNIX,

Here's some 2005 Jones numbers:

http://www.edwardjones.com/cgi/getData.cgi?file=/pdf/media/m ap.pdf

Yeah Jones has just been "hovering" over the past
25 years.

Year over year we are up 9% in brokers.

By the way Jones does have licensed BOAs and we don't
use them in our numbers.

ezmoney's picture
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who really cares. jones is a joke.

csmelnix's picture
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The past 25 yrs; do we really want to compare there?  Year over from what year....
Super on the licensed BOA argument....do any of your offices have CPAs in house with attorneys and financial planners.....do any of you jokes really know what a financial plan is?
BPD, you been away from this board for a good year or so after trying to spew some BS about LPL and Jones; now you come back with some more BS.  Do you spend sleepless nights thinking of ways to counter LPL's ability to attract Jones IRs?  Just worry yourself about your next training class instead of LPL would you.  We are just a bunch of business owners trying to make a living and do what's best for our clients.  We don't care about number of reps, avg gross per rep, growth of b/d; we care about what is happening with our own firms locally, how am I best servicing my clients, improving my business process, improving my skill set, being more efficient and how the b/d I affiliate with facilitates that.  Now, if you really want to argue on this stuff and how LPL compares to Jones...we can go all day long son; but honestly, you will just show your ignorance of the business.

BigPayDay's picture
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csmelnix,

Oh you want to change the conversation from under-performing reps at LPL to customer service? Be happy too.

Try this link:

http://bwnt.businessweek.com/interactive_reports/customer_sa tisfaction/index.asp

Or this one:


http://biz.yahoo.com/iw/070417/0238497.html

Indyone's picture
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Joined: 2005-05-30

...sounds like the reps are sharing the Kool-Aid with the clients...

troll's picture
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Could it be that a firm that is so highly ranked by both its employees and its customers is in fact a superb firm?
Maybe this forum attracts nothing but losers who whine?  Maybe the winners are too busy to waste their time on half a dozen message boards every day.
You've posted over 2,100 messages on this board, and thousands more on the others.
Could that be why your production, after being in the business for years and years, is not quite up to first year goals of those who succeed?
Is that even possible?

GoingIndy????'s picture
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Quincy Teacher wrote:You've posted over 2,100 messages on this board, and thousands more on the others.
Could that be why your production, after being in the business for years and years, is not quite up to first year goals of those who succeed?
Is that even possible?I'll be you have more posts with all the name changes you've had.  Also, jones may be a good firm, but I know 6 former Jones reps that are all good producers that bash them and 3 current jones reps looking to leave.  My impression is they are a great training company to get started in the biz and once you figure it out, time to move up.

Indyone's picture
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Putz, you even have Nancy beat when it comes to the worst disguised troll. You're a liar to boot. Name one other forum where I have even 100 posts, much less thousands.

I'm well satisfied with what I'm making and enjoy participating here as a diversion. You attacking a lighthearted post doesn't change that.

Try again.

NaturaLogarithm's picture
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LPL has been adding home office staff, acquiring firms, providing services to other b/d's (through clearing services), and recruiting reps on a grand scale.  Their growth is not all smoke and mirrors. 

csmelnix's picture
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BPD,
Again, you are proving my point.  You are always arguing and viewing things from the view of the big brother.  That is 180 from the view point of the indy business owner.  I rely on my business, my office staff, and myself to manage my client relationship; from start to finish, from when they walk in the door and beyond - not my broker dealer, it is me.  I own it, I control it - my client surveys rank me the tops in customer service, I even lead in HNW clients; they even claim I have the best technology! 
What you are trying to argue here is comical.  LPL has a few thousand "part timers" and maybe some of them are poor producing advisors.  You know what, doesn't affect me.  No other indy firm puts the money they do into their technology, their infrastructure and support like LPL does which allows me locally to serve my clients like I never could at Jones.  LPL also has the highest profit margin of any other independent firm as well as a few of the wirehouses; even with all those less than 100k producers.  And talking about calling the kettle black....Jones is all smoke and mirrors  from the ponzi scheme set up to the limit on product to the idea of being your own business and the pay to play arrangements...look in the mirror, if you ever do get away from teaching new IRs and actually get into production, you may some day see the light too.

BigPayDay's picture
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ezmoney wrote:
1st of all youre' assuming I produce 100k. hell my fee based and trails alone pay me 120k. I think it would take a jones broker @ 25bps about 30 years to build those trails to my level. It's taken me about 3 yrs. btw I was a successful ir with jones so you're not pulling any wool over my eyes. The jones ir's that stay are quite simply simpletons.

I said 25k for all expenses including rent. I don't need an assistant. 1st of all I'm not running a high volume shop, 2nd, the tecnology is such that at this point I can more than manage. I'm not a jones office with all kinds of cash management issues coming from nichol and dime clients. My clients rarely have requests for cash or anything else for that matter.

So you don't have an assistant? Who answers the phone
when you are on the phone or with someone? Who answers
the phone when you're on vacation? Sounds like you're
running a first class operation there!!!

What a joke.

ezmoney's picture
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Joined: 2004-11-30

you're a joke

troll's picture
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Those are very good questions.  If you're a "financial advisor" shouldn't your clients at least get the impression that you're big-time enough to have somebody to help you.
I can't imagine entrusting my money to a guy who rented a former storage room at a dry cleaners as his office, used a computer as his answering machine and I had to ALWAYS leave a message in hopes that he'd call me back.
I know, I know--I should be investing for the long haul and having instant access to my "advisor" is not really that big a deal because all the "advisor" really is is a middle man who has positioned himself in such a way that he really has no duties--well, other than to siphon off 125 basis points every year for agreeing to allot me a few minutes a year to go over a computer printout that I could read on my own.

ezmoney's picture
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sounds like putsy has changed his name again. Btw I don't think having an assistant means one has hit the big time or is any better an FA than one who doesn't employ an assistant.
Ever heard of call fowarding dim wits? I never miss a call. My clients like the fact that when they call, I always answer, not some hair brained assistant who has to put down her nail file to answer the phone.

troll's picture
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Quote:
Ever heard of call fowarding dim wits? I never miss a call. My clients like the fact that when they call, I always answer, not some hair brained assistant who has to put down her nail file to answer the phone.

The secret is to hire an assistant who is not "hair brained."  Of course it's tough on the ego when your assistant is smarter than you are.

BigPayDay's picture
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ezmoney wrote: I don't think having an assistant means one has hit the big time or is any better an FA than one who doesn't employ an assistant.
Ever heard of call fowarding dim wits? I never miss a call. My clients like the fact that when they call, I always answer, not some hair brained assistant who has to put down her nail file to answer the phone.

So let me get this right, you don't believe in having an assistant? So not having an assistant is better than having an assistant? You ought to read "Think and Grow Rich" by Napolean Hill. He would convince you that it is better to delegate and empower the people around you than trying todo everthing by yourself.

But it sounds like you are a pretty smart guy.......Yeah
right.

troll's picture
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Quote:
So let me get this right, you don't believe in having an assistant? So not having an assistant is better than having an assistant?

He's got call forwarding--you can't expect him to have everything.  He's saving up for a stapler and his wife will give him a set of in and out baskets for his desk at Christmas.

ExPropTrader's picture
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Joined: 2006-11-19

And Putsy gets banned for the 47th time.
Think as smart as he claims to be he'd get the hint, huh?

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