BofA will cut Merrill Comp
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Actually we only earn about 35% of that fee. The rest goes to the investment team managing the portfolio, the ones WITH the education, the ones WITH the fiduciary duty. What part of this arrangement did the client not understand? We explained it ad nauseum and they read and signed the papers. Give it up Putzy.The attorney will express amazement and ask, “Are you saying that you earn a fee like that every year, regardless of the quality of your advice?”
[quote=Reggin][QUOTE]The attorney will express amazement and ask, “Are
you saying that you earn a fee like that every year, regardless of the
quality of your advice?”[/quote]
It doesn't matter if the client understood the relationship and signed papers--when they're sitting there they'll say, "Yes that's my signature but he was rushing me and never really did explain it to me."
Then their attorney will choose a particularly wordy portion of the agreement, ask the rep to read it aloud and then explain it.
Does the fact that you only earn a portion of the fee mean the fee was fair to the client?
Your childlike belief in things like signed documents is charming---in a six year old discussing their views with their Daddy at the dinner table.
Your childlike belief that signed legal documents have no bearing on arbitration is foolish. Please keep up the fearmongering, it is humorous.
I really missed your doom & gloom babblings around here Putsy…
But you're only partially right on this one. Yes the industry is consolidating in order to drive out inefficiencies. No it will not squeeze out the independents. In every major city the landscape is dominated by large banking power houses such as BofA,C,JPM or WF but you will always find the presence of the "community bank". Ya'll know those little nicely tree lined brick banks with neatly manicured lawns. They have carved out a place for themselves among the power house banks in every major metropolis & they are not going anyway...the reason comes down to the same concept that we all have been echoing here & that concept is...."personal relationship". That's how many independents run their book & that's why I have lost 0 (zero) accounts ytd. Not saying its not possible in the future but when you build longterm relationships that are based on the right principles you can get through almost any kind of market with your clients even a crappy one like we're having now. No doubt that clients are not "happy" with their performance but I can also rest assured that after years of service they aren't going to turn around and sue me either. One can only gain that level of confidence if you've built a service model within your practice Put.[quote=Broker Fee]I really missed your doom & gloom babblings around here Putsy…
But you're only partially right on this one. Yes the industry is consolidating in order to drive out inefficiencies. No it will not squeeze out the independents. In every major city the landscape is dominated by large banking power houses such as BofA,C,JPM or WF but you will always find the presence of the "community bank". Ya'll know those little nicely tree lined brick banks with neatly manicured lawns. They have carved out a place for themselves among the power house banks in every major metropolis & they are not going anyway...the reason comes down to the same concept that we all have been echoing here & that concept is...."personal relationship". That's how many independents run their book & that's why I have lost 0 (zero) accounts ytd. Not saying its not possible in the future but when you build longterm relationships that are based on the right principles you can get through almost any kind of market with your clients even a crappy one like we're having now. No doubt that clients are not "happy" with their performance but I can also rest assured that after years of service they aren't going to turn around and sue me either. One can only gain that level of confidence if you've built a service model within your practice Put.[/quote]The community bank anaolgy is not a valid one. First the community bank is not dependent on a second party clearing and execution vendor who will be under incredible financial stress just to defend itself against a never ending series of actions--demands for arbitration hearings.
For the umpteenth time, Wall Street has NEVER experienced a loss of trillions of dollars in market value--mostly lost by people who are currently or about to retire. They do not have time for it to come back--regardless of how much their heart tells them to.
You have to be intentionally obtuse to not recognize that there are plaintiff's attorneys out there who advertise on TV, radio and in magazines such as AARP who will be more than glad to take anybody's case for no fee--none, zilch, nada--unless they win.
If you were the Smith family and your account is down a quarter of a million, and all you have to do is is dial 1-800 and talk to a guy who tells you not to worry because he will help you.
I tell you what. If I was not who I am I'd do the same thing. The odds of $500,000 returning to $1,000,000 through the arbitration process are far greater than by market action during he coming decade.
"Mike, I know you did the best job you could, and I know that the markets are dangerous--but you really should have been paying more attention to my situation and I met a lawyer who tells me......................."
Just because it hasn't happened since 1982 doesn't mean it can't happen.
Do you think that there was no documentation in the 1970's blizzard of law suits?
When they come, and they will come, the small firms--and basically all firms that are not divisions of banks are small firms--are going to need every spare penny to defend themselves. There will be no money for anything else.
I didn't just get off the boat. No matter how much experience you have, I have more.
[quote=Provocative Put]Do you envision some sort of Mom and Pop franchises with store fronts were people can stop in for some financial advice and a shoe shine?[/quote]
Now that I single handedly pushed the market up for a change today, time for a quick Putsy break.
That’s a great question you raise, Putsy, as it helps focus in on a key misconception underlying your points. Here’s a link from today’s Investment News of the type of “mom and pop” “muffler and financial planning” franchises you seem to imagine are the norm for independents:
http://www.investmentnews.com/apps/pbcs.dll/article?AID=/20081022/REG/810229987/-1/rss02&rssfeed=rss02
An here’s the executive summary for those not inclined to read the whole thing: (1) a $900 MM Merrill team just left ML to create their own RIA; (2) a UBS team with $750 MM recently opened an RIA firm, despite multi-million dollar offers from ML and other wires; and (3) a third million dollar ML broker is quoted as saying, "The competitive advantage of a wirehouse platform has become a
disadvantage. The paradigm has changed."
I may have missed it but I’m pretty sure neither of these mom and pop shops will use the words “muffler” or “brakes” in their company name, nor are they likely to offer many shoe shines. Of course, I’m just guessing there, kind of like you are doing with your prognositations about the coming dominance of megabanks. But I digress.
If you think these are anomalies, you obviously haven’t been paying attention. The trend is very clearly the exact opposite of what you imagine. Here’s an excerpt from an article in January’s Registered Rep magazine: "From September 2006 through September 2007, Schwab Institutional netted
$129 billion in net new client assets, just short of Merrill Lynch,
Smith Barney, Morgan Stanley and UBS combined during the same time period."
You might need to re-read that to make sure you didn’t miss that part about all wirehouses combined.
Want more evidence of this trend?
As reported in the 4/28/08 issue of Investment News, Schwab Institutional took in MORE new assets in the first quarter of 2008 than ML, SB and MS combined - $19.9 B for Schwab vs. $14.4 B for all the others combined. Fidelity, the #2 institutional custodian, also took in more new assets than all these wires combined - $14.6 B.
More recent numbers? Same story through last available data, Q2 2008:
“Schwab Institutional,
the firm’s RIA custodian, reported $34 billion in net new client assets
for the first two quarters of 2008, $9.4billion of which came from
wirehouse advisors. (In all of 2007, only $9.2 billion in net new client
assets came from wirehouse FAs.) Fidelity’s Institutional Wealth
Services division, Fidelity’s RIA custodian business, brought in $31.3
billion in net new client assets through the first two quarters of 2008.
Of that, $7 billion came from wirehouse FAs.”
"With the
exception of Morgan Stanley, which brought in $24.7billion in net new
client assets in the first six months of 2008, the other wirehouse firms
have had a markedly different experience this year: Merrill Lynch lost a
net $1 billion in client assets in the first half of 2008; Citigroup’s
Smith Barney lost a $12 net billion in client assets during that period;
and UBS’ U.S. Wealth Management unit lost a net CHF 3.9 billion in
the period."
I could go on, Putsy, but I think it’s clear that the megabank trend you predict is not only not supported by the facts, it is demonstrably contradicted.
But other than that your prognostications makes for entertaining reading.
Morphius, what part of “EVERYTHING IS DIFFERENT NOW” can you not grasp?
Pulling up obscure websites with moldy statistics is meaningless.
Holy crap. This has to be the most dedicated thread I have seen. We're talking Pulitzer here...
Put, do you actually work??
[quote=B24]
Holy crap. This has to be the most dedicated thread I have seen. We’re talking Pulitzer here…
Put, do you actually work??
[/quote]As little as possible. Isn't that great so I can spend so much time discussing the industry with the boys--there seems to be no girls here any more.
Babbling is probably at a car show--she was the only girl worth my time. Wait--that's not really true--there was a gadfly gal who was in touch with reality and a zealot of sorts who may, or may not, have been a girl.
Can't think of any other girl worthy of my attention.
[quote=Provocative Put]Morphius, what part of “EVERYTHING IS DIFFERENT NOW” can you not grasp?
Pulling up obscure websites with moldy statistics is meaningless.
[/quote]
Ah. Silly me … wasting time by citing current facts from prominent industry magazines when they contradict your personal crystal ball. What was I thinking?! Sheesh! Of course they are meaningless!! Of course they are moldy!! Of course they are from obscure websites, like the one from the sponsor of this obsure forum!! D’oh!
Mea culpa for not realizing how meaningless mere facts are when confronted with the sheer power of your guesses!
Perhaps if you had simply explained to me earlier that all facts get thrown out the window because it’s DIFFERENT this time. Again. Because I’ve never heard anyone else make that claim before. Except THIS time it’s REALLY different, not different like all those other times different, but, like totally different different.
Hey Putz,
Be sure to wear your Depends tonight when you walk the beast because you are full of shiit.[quote=Morphius]
[quote=Provocative Put]Morphius, what part of “EVERYTHING IS DIFFERENT NOW” can you not grasp?
Pulling up obscure websites with moldy statistics is meaningless.
[/quote]
Ah. Silly me … wasting time by citing current facts
from prominent industry magazines when they contradict your personal
crystal ball. What was I thinking?! Sheesh! Of course
they are meaningless!! Of course they are moldy!! Of course
they are from obscure websites, like the one from the sponsor of this
obsure forum!! D’oh!
Mea culpa for not realizing how meaningless mere facts are when confronted with the sheer power of your guesses!
Perhaps if you had simply explained to me earlier that all facts get thrown out the window because it’s DIFFERENT this time. Again. Because I’ve never heard anyone else make that
claim before. Except THIS time it’s REALLY different, not
different like all those other times different, but, like totally different different.
[/quote]
Virtually all stats that are more than thirty days old are worthless.
Investor sentiment is now such that if there is any rebounding at all it will be used to sell so that losses are reduced.
That’s why it will take YEARS to return to where it was sixty days ago.
Stats that were gathered as recently as July or August are as
meaningless as the September 11, 2001 menu at Windows on the World.
Everything is different.
[quote=Mucho de Tejas]Hey Putz,
Be sure to wear your Depends tonight when you walk the beast because you are full of shiit.[/quote]Hey that's really clever, I'll have to remember that in the future. What makes you much of Texas--I happen to know more than a little bit about Texas myself.
[quote=Provocative Put]
Everything is different.[/quote]
If everything really is different, isn’t all your years of experience and insight that you are relying on to make your guesses now, by definition, worthless? I mean, EVERYTHING is different, right?
Or are you the exception, so everything is different except your omnipotence?
It’s gotta be one or t’other. Just wondering which it is.
[quote=Morphius]
[quote=Provocative Put]
Everything is different.[/quote]
If everything really is
different, isn’t all your years of experience and insight that you are
relying on to make your guesses now, by definition, worthless? I
mean, EVERYTHING is different, right?
Or are you the exception, so everything is different except your omnipotence?
It’s gotta be one or t’other. Just wondering which it is.
[/quote]
It is different than it has been since 1982, and more like it was from 1968 to 1982.
You have no memory of the market from 1968 to 1982 but for those of us who do this smells just like those years.
Up to and including a probable president who will make Jimmy Carter’s
administration appear to have resulted in positive economic results.
It got pretty cold tonight–that’s different than it was yesterday, but not different than it was eight or nine months ago.
[quote=Provocative Put]It is different than it has been since 1982, and more like it was from 1968 to 1982.[/quote]
Got it. Thanks for clarifying. So everything is different, except that it’s like it was a while ago. Gotcha.
Now I understand why facts aren’t of any value in this situation.
This thread has become verbose and boring as all sh*t . You guys should give it a rest.
JMHO
[quote=Sportsfreakbob]This thread has become verbose and boring as all sh*t . You guys should give it a rest.
JMHO
[/quote]
Is someone forcing you to read every post in threads you find verbose and boring?
Branding is the biggest farce. Bank of America gets their lunch eaten everyday, by good advisors. Indy is far superior. People want local personal advice they trust. . . period. You can gather $100 MM in client assets get paid 85% and have a great life without Banc of Amigo. You also have a valuable business that is worth approx 2 to three times gross. When you are ready to retire you have another $2 million to cash out.
With Bank of Amigo you own nothing and need to gather 4 times the assets to equal the comp. No freedom, big corporate non sense. Re-earning your trails every year. Its all crap. Those clowns want you to think their brand means something. Merrills brand is kaput and tainted. The bulls balls have been clipped. Bank of America will implode on itself eventually. Too big to be managed efficiently, like our beheomuth US govt buracracy[quote=daytradah]
Bank of America will implode on itself eventually. Too big to be managed efficiently, like our beheomuth US govt buracracy [/quote]or like Citi