Hiring Process at Smith Barney

[quote=datongdave]

What is the hiring process at Smith
Barney?  Tests, interviews, number of interviews and with whom,
etc.  What is the percentage of people actually hired?  Is it
as selective as they say?

Any word on how the Legg Mason folks are taking the news?  Are
they eager to join Citigroup/Smith Barney?  Or is it a field day
for recruiters?



I’ve always despised the notion that you can “buy” people through
acquisition.  I know sometimes people aren’t happy about being
acquired and leave.  I’m just wondering what the situation is in
this case.



Any predictions on how this will work out?  Good for Legg? 
Legg had to pony up over $1 billion in cash and stock in addition to
their brokers.  I’d have to imagine that over time money
management will become more commoditized and that’ll squeeze
margins. 

Inq,

As an LM broker, I now consider myself a down card. Chip has been waiting to play this hand for sometime, so no great shock. I can say for the contingent that I have spoken to, many are dissapointed with the merger - mostly the top producers. The retention package for 1mm+ is 40% (1/2 cash/ 1/2 R. stock) - vests in 4 years. But the kicker is that they are vesting deferred comp on closing - so a good portion of the bonus will go to pay uncle sam!!

I think a fair number of brokers are looking at this as an opportunity to find out their true market value. I am by no means in the upper echelon, but I still understand the premium I could command. And the chance to "streamline" one's book......something I think all of us consider to be beneficial. Look, any broker worth his salt knows that they are the draw for their clients, not the firm. I feel to let the corporation dictate the best platform for my clients would be a great disservice. I am doing my due dilligence, as are most.

My summary - SB is a reputable firm with branding and technology in it's favor, but I don't think that plus a paltry check will be enough to retain more than 60-70% That might just break this deal as the Big C  looking to have contracts in place "shortly" will force some to jump ship before the dec. 1 close.

[quote=LMBARGINCHIP]

Inq,

As an LM broker, I now consider myself a down card. Chip has been waiting to play this hand for sometime, so no great shock. I can say for the contingent that I have spoken to, many are dissapointed with the merger - mostly the top producers. The retention package for 1mm+ is 40% (1/2 cash/ 1/2 R. stock) - vests in 4 years. But the kicker is that they are vesting deferred comp on closing - so a good portion of the bonus will go to pay uncle sam!!

I think a fair number of brokers are looking at this as an opportunity to find out their true market value. I am by no means in the upper echelon, but I still understand the premium I could command. And the chance to "streamline" one's book......something I think all of us consider to be beneficial. Look, any broker worth his salt knows that they are the draw for their clients, not the firm. I feel to let the corporation dictate the best platform for my clients would be a great disservice. I am doing my due dilligence, as are most.

My summary - SB is a reputable firm with branding and technology in it's favor, but I don't think that plus a paltry check will be enough to retain more than 60-70% That might just break this deal as the Big C  looking to have contracts in place "shortly" will force some to jump ship before the dec. 1 close.

Put, you're obviously still stuck back in the old days when you were once producing.  Back then in the days of brokers selling the stock/option/bond idea of the day over the phone for a commission, the firm was more important to the client because strong relationship hadn't been built.  So, Joe Blow Rep leaves Merrill, etc. and the client was just as happy to get the next broker that takes his place. 

You don't understand that, assuming a rep has built a good relationship with his/her clients, clients view their relationship as being with the rep not the firm.  Quality reps retain their clients almost no matter where they choose to go. 

"If I were to fall over dead this afternoon would all of my clients close their accounts?"

If this were the case I would certainly agree with you. I am not claiming, as you seem to have indicated that LM brokers have any special powers over their clients. That being said, I have found that beyond the personal relationships that most have with their top clients, there is also a large number (quite a few former SB clients I might add) that were drawn to Legg Mason not on the pretense of Bill Miller doubling their investments, but on the credentials and ability of the advisor.

When you are working with a firm a tenth the size of the wirehouses out there, you very rarely find that a "top drawer" name is an important factor in the decision of clients to move their accounts. It is more often then not (dare I say) the individual advisor that they are putting their faith in.

That fact coupled with prudent invetment advice I feel makes for very sticky clients.

And as someone involved in this "turmoil" as you have so eloquently put it, the overwhelming response when I ask my clients their thoughts and feelings on the matter is - I will stay with you (SB or otherwise).

[quote=Duke#1]

Put, you’re obviously still stuck back in the old
days when you were once producing.  Back then in the days of
brokers selling the stock/option/bond idea of the day over the phone
for a commission, the firm was more important to the client because
strong relationship hadn’t been built.  So, Joe Blow Rep leaves
Merrill, etc. and the client was just as happy to get the
next broker that takes his place. 

You don't understand that, assuming a rep has built a good relationship with his/her clients, clients view their relationship as being with the rep not the firm.  Quality reps retain their clients almost no matter where they choose to go. 

[quote=LMBARGINCHIP]

And as someone involved in this “turmoil” as
you have so eloquently put it, the overwhelming response when
I ask my clients their thoughts and feelings on the matter
is - I will stay with you (SB or otherwise).

Put,

I guess life in Chile is pretty much a vacuum, huh. A perfect storm of circumstances all converging on a brokers business at once. My intention is not to get sucked into a pissing match with you, but if I must....

In MY perfect world, (I like to call it reality) there are no predestined outcomes, nor predetermined paths. I understand, as do any fully functioning people on this forum that there are hurdles to be overcome in any business endevour. Success by any measure entails a certain "acceptable loss", be it financial or otherwise.

Take the transactional broker who plateaus in their business at 350K. In order to get to the next level they make a decision to focus their efforts on building in some fee based revenue. They understand going in that there is a high probibility that their gross will drop (2% comm vs. 1-1.5% fee) initially, but that the time that they free up due to less transactions will allow more time for prospecting new business, and therefore result in greater scalability. That drop in gross during the transition would represent an acceptable loss.

That being said individual risk/reward comparisons have to be made in any transition. What loss is acceptable? How long will it take to recoup that loss? What are the rewards? Unfotunately with no efficient frontier for transitioning one's business, one needs to rely on their instinct, experience, and statistics to guide them.

Listen, you and I both know that there is no perfect set of circumstances, and that you playing devil's advocate is just your way of trying to stand out. I don't think anyone dissagrees that any broker making a move is risking some of their relationships, but only the ones that were already at risk or were never there. 

So, I guess while I wait another 4hours for PUT to think up some response based on non-contextual points within this post, I will once again answer INQ's question: many are displeased, and are looking, and my bet would be for 60-70% retention.

And oh yeah - leave my mother out of this!

"Listen, you and I both know that there is no perfect set of circumstances, and that you playing devil's advocate is just your way of trying to stand out."

I think Put attempts to alienate every new forum member so that he can continue his battles... What a life the guy must lead...For such an important cog in a "major NY wirehouse", he sure does have a lot of time to post during the day... And in the evenings watch out- I can envision him running through the subway to get home, pound a reuben sandwich from the $hitty neigborhood deli, and giggle with glee as he assumes his "throne" in front of his computer... What a life..

[quote=blarmston]

“Listen, you and I both know that there is no
perfect set of circumstances, and that you playing devil’s advocate is
just your way of trying to stand out.”

I think Put attempts to alienate every new forum member so that he can continue his battles... What a life the guy must lead...For such an important cog in a "major NY wirehouse", he sure does have a lot of time to post during the day... And in the evenings watch out- I can envision him running through the subway to get home, pound a reuben sandwich from the $hitty neigborhood deli, and giggle with glee as he assumes his "throne" in front of his computer... What a life..

Put,

If you honestly had a life, you wouldn't spend all of it posting on a forum. You have posted almost 700 messages since 4/08/04. It appears that this forum is your life. Why would anyone believe the crap you post when you seem to have so much free time. My guess your unemployed. No one with a job would have the time to waste that you do!

Correction, should be 4/08/05.

I have to step back for a minute and thank Put for his input on each (and it seems every) thread in this forum. Without your needling, we would not be forced to look at all facets of our respective issues. I appreciate your cander in replying to the threads in the manner in which we've come to expect.

That being said I am not an MBA, in fact I am the antithisis of all that you seem to hold sacred about being in this business. I have seen over the last six years many ivy leaguers and blue bloods sit and stare at their screens paralyzed by the fact that they cannot find the answers to their clients needs in a text book. So just as I apprecite your education and wisdom, I am sure that you can see the value of an independant thinker that may not have been born with a silver spoon wedged squarely in their tail.

Oh yeah, mom says hi!

[quote=Coag]

Put,

If you honestly had a life, you wouldn't spend all of it posting on a forum. You have posted almost 700 messages since 4/08/04. It appears that this forum is your life. Why would anyone believe the crap you post when you seem to have so much free time. My guess your unemployed. No one with a job would have the time to waste that you do!

[quote=LMBARGINCHIP]

I have to step back for a minute and thank Put
for his input on each (and it seems every) thread in this forum.
Without your needling, we would not be forced to look at all facets of
our respective issues. I appreciate your cander in replying to the
threads in the manner in which we’ve come to expect.

That being said I am not an MBA, in fact I am the antithisis of all that you seem to hold sacred about being in this business. I have seen over the last six years many ivy leaguers and blue bloods sit and stare at their screens paralyzed by the fact that they cannot find the answers to their clients needs in a text book. So just as I apprecite your education and wisdom, I am sure that you can see the value of an independant thinker that may not have been born with a silver spoon wedged squarely in their tail.

Oh yeah, mom says hi!

[quote=LMBARGINCHIP]



The retention package for 1mm+ is 40% (1/2 cash/ 1/2 R. stock) -
vests in 4 years. But the kicker is that they are vesting deferred comp
on closing - so a good portion of the bonus will go to pay uncle sam!!

I think a fair number of brokers are looking at this as an opportunity to find out their true market value. 

My summary - SB is a reputable firm with branding and technology in it's favor, but I don't think that plus a paltry check will be enough to retain more than 60-70% That might just break this deal as the Big C  looking to have contracts in place "shortly" will force some to jump ship before the dec. 1 close.[/quote]

This is the way I look at it:  If Legg Mason reps wanted to work for Smith Barney they would already be there.  That retention package is PATHETIC!  If you quit on your own and went to Smith Barney before the acquisition was announced you would have gotten a lot more money.  A LOT more.  (Maybe it's not too late!)

The fact is Legg reps ARE joining a new firm.  New culture.  New rules.  New technology (which may or may not be a good thing).  Now, if you folks are happy to join Smith Barney, that's fine.  But if you would be just as happy joining another firm where you would get a LOT MORE MONEY, then you should probably go to another firm.  That makes perfect economic sense.

As I said, I've never liked the notion of "buying people".  I don't.  I can see acquisition as a sound strategy if there is no presence in a given market and you want to buy some branches to create a presence from which to build upon.  A springboard, if you will.  Then if your reps leave, you've got the infrastructure and can replace them.

But this is clearly a case of buying people.  Smith Barney probably already has branches most everywhere Legg does.  How can they possibly think that their PUNY retention package is going to persuade anyone to stay?

Seriously, if what you said is the retention package, 40%, I'd be out of there so fast all you would see is a blur.  That's a terrible package in this highly competitive market.  Absolutely terrible.  (Do those clowns in the executive suite think that package impresses anyone?)

As for what Put said, I don't think any clients are going to be terribly impressed that they are now with Smith Barney.  If that were the case, they would ALREADY be with Smith Barney.

Even small regionals have $1 million and higher producers.  As of now, the rep still has power over the clients.  The rep brings the clients in and keeps them in.  But I think that will change over time.

Good luck and feel free to keep us posted, LMBARGINCHIP.

[quote=Put Trader] [quote=Coag]

Put,

If you honestly had a life, you wouldn't spend all of it posting on a forum. You have posted almost 700 messages since 4/08/04. It appears that this forum is your life. Why would anyone believe the crap you post when you seem to have so much free time. My guess your unemployed. No one with a job would have the time to waste that you do!

[/quote]

The other side of the coin is that I am so well rounded that I am able to contribute so much--it's not my fault that you're so inexperienced that you find yourself with  nothing to add.

The profile button tells you a daily average of postings--mine is between 8 and 9.  That is per day--hardly an obsession, not really much of a contribution considering all the questions that are raised that I know the answer to.

Again, it's not my fault that so many of you are not bright enough--or don't have enough experience--to have opinions that you think are worthwhile.


[/quote]

Aside:(Does anyone else feel like this guy kicks the dog when his wife isn't looking?)

Put,

I have to applaud the tenacity with which you guard your convictions, you might make a pretty-good broker some day.

[quote=LMBARGINCHIP]

Put,

I have to applaud the tenacity with which you guard your convictions, you might make a pretty-good broker some day.

 [/quote]

Been there, done that, still have the T-Shirt.

I see that you too have been unable to keep up with the discussion and have to resort to the age old approach of attempting to minimize the king.

It's OK, my shoulders are broad and my intellect keen.  I am fully capable of dealing with all of you at once.

I write for my own amusement and for the benefit of the dozens of people who write to me in the background telling me that they enjoy how I routinely humiliate the rest of you.

Actually it was an attempt to resort to the "this guy is a waste of time because his vision is narrow and his thought process is tainted so I'll no longer indulge him" approach.

So far as the discussion goes, I have kept up with it perfectly  - inquisitive and I exchanged the pieces of information that were important to us, and went on our merry way. And I thank him for that. 

Put-

You dont question your approach even though you manage to alienate every new forum member - who actually may have solid contributions to this site- within 10 days ???? Your arrogance is sharp- not your intellect... Go ahead, make your used comment about how all of us are "creatures" and that our intelligence doesn't even begin to scale to your heights....

[quote=Put Trader] 

I see that you too have been unable to keep up with the discussion
and have to resort to the age old approach of attempting to minimize
the king.

[quote=Put Trader]

[quote=LMBARGINCHIP]

Put,

I have to applaud the tenacity with which you guard your convictions, you might make a pretty-good broker some day.

 [/quote]

Been there, done that, still have the T-Shirt.

I see that you too have been unable to keep up with the discussion and have to resort to the age old approach of attempting to minimize the king.

It's OK, my shoulders are broad and my intellect keen.  I am fully capable of dealing with all of you at once.

I write for my own amusement and for the benefit of the dozens of people who write to me in the background telling me that they enjoy how I routinely humiliate the rest of you.

[quote=LMBARGINCHIP]

Actually it was an attempt to resort to
the "this guy is a waste of time because his vision is narrow
and his thought process is tainted so I’ll no longer indulge him"
approach.

So far as the discussion goes, I have kept up with it perfectly  - inquisitive and I exchanged the pieces of information that were important to us, and went on our merry way. And I thank him for that. 

[quote=Put Trader]

Has it occured to you that if you were so damn important–not you so much as what you do–Chip Mason would not have sold you?



Why do you think a well respected full service firm such as Legg would be willing to throw it’s retail effort over the side?

[/quote]

I think the realization that the industry is becoming much more
competitive and middle-sized companies like Legg are going to have the
toughest time competing had something to do with it.



The middle sized firms cannot compete with the big players any
longer.  There will ALWAYS be room for niche players in this
industry.  There is no shortage of small advisory firms.  So,
if you can no longer beat the payouts the big firms are paying in order
to attract and retain talent, what other choice do you have?



It used to be the smaller regionals would have higher payouts to
attract reps.  Wachovia’s payout is better than many of the
regionals.



I’m sure other mid-sized companies will be swallowed up, too.

[quote=Put Trader]

If you think about it why would Smith Barney want a bunch of brokers
who they had no interest in trying to recruit before the current turn
of events?

[/quote]

It’s not true that Smith Barney had no interest in Legg brokers. 
That’s false.  If that were true, they wouldn’t be acquiring them,
now would they?  And I’ll bet Smith Barney was calling Legg
branches to recruit, along with the others.

[quote=Put Trader]

If you, and the others at Legg, were actually that desireable the
managers from local Smith Barney offices would have already been
knocking on the door.



Where am I wrong?

[/quote]

You are wrong in assuming that they weren’t already knocking at their door.



Smith Barney is acquiring reps at a fraction of the cost of picking
them off individually.  I’m sorry, but a 40% retention package in
this environment is crap.  Hell, you can go to another firm and
get 100% more.



Maybe Citigroup is unloading crap?

[quote=Put Trader] [quote=Duke#1]

Put, you're obviously still stuck back in the old days when you were once producing.  Back then in the days of brokers selling the stock/option/bond idea of the day over the phone for a commission, the firm was more important to the client because strong relationship hadn't been built.  So, Joe Blow Rep leaves Merrill, etc. and the client was just as happy to get the next broker that takes his place. 

You don't understand that, assuming a rep has built a good relationship with his/her clients, clients view their relationship as being with the rep not the firm.  Quality reps retain their clients almost no matter where they choose to go. 

[/quote]

You really do have the temerity to state that the broker client relationship is stronger today, when all you have to do is explain mutual funds than it was in the days when clients would actually seek to have multiple brokers within the same office because of individual expertise?
[/quote]

It should be stronger because it should no longer be transactionally based. It should be a deeper, more inclusive relationship with much more "grip" than the "You want a bond, I gotta bond" variety.

[quote=stanwbrown]

It should be stronger because it should no
longer be transactionally based. It should be a deeper, more inclusive
relationship with much more “grip” than the “You want a bond, I gotta
bond” variety.

[quote=Put Trader] [quote=LMBARGINCHIP]

Actually it was an attempt to resort to the "this guy is a waste of time because his vision is narrow and his thought process is tainted so I'll no longer indulge him" approach.

So far as the discussion goes, I have kept up with it perfectly  - inquisitive and I exchanged the pieces of information that were important to us, and went on our merry way. And I thank him for that. 

[quote=Put Trader] [quote=LMBARGINCHIP]

Actually it was an attempt to resort to the "this guy is a waste of time because his vision is narrow and his thought process is tainted so I'll no longer indulge him" approach.

So far as the discussion goes, I have kept up with it perfectly  - inquisitive and I exchanged the pieces of information that were important to us, and went on our merry way. And I thank him for that. 

[/quote]

Has it occured to you that if you were so damn important--not you so much as what you do--Chip Mason would not have sold you?

Why do you think a well respected full service firm such as Legg would be willing to throw it's retail effort over the side?

If you think about it why would Smith Barney want a bunch of brokers who they had no interest in trying to recruit before the current turn of events?

If you, and the others at Legg, were actually that desireable the managers from local Smith Barney offices would have already been knocking on the door.

Where am I wrong?
[/quote]

Ok, here come my closer 1-2-3 inning boys:

1st batter: You cursed, automatically discrediting the rest of the question, but I will oblige. My clients and my family make what I do so damn important. When I find the industry evolving to a point that my skill set is overly commoditized, or that I can no longer add value for the people that matter to me I will evolve as well - again fully functioning, thinking people would agree - this is the only alternative. Chips motivation is closely tied to the higher PE afforded by pure asset managers - less volitile revenues=higher stock price. Check the insider holdings - Mason, Brinkley, Sabelhouse made a killing.

2nd Batter: SB has chosen to pursue distribution over manufacturing product as they are better suited to it. LM's B/D represented only 18% of earnings whereas SB's B/D is a much greater % of their bottom line. Play to your strengths. Citi faced increasing pressure from regulators to remove conflicts of interest from their business, as well as soem pretty hefty fines so for them throwing the funds over the side was their solution as the fund group had been plagued by poor performance and record outflows.

3rd batter: I have spoken with several brokers throughout the northeast who had entertained the recruitment efforts of SB managers over the past year (myself included), and ultimately for each of the folks I spoke with SB was not an ideal fit for their (my) business. The fact that I could have written a deal with them for 100% in the recent past only adds to the disappointment in the current retention package that has been offered. I can assume the same for each of the brokers I have spoken with this is also the case.

So, where are you wrong you ask? I think someone of your superior intellect can probably figure it out. If not, there is a kid fresh out of UCONN in the bullpen (don't worry he's an MBA) that I could refer you to.

[quote=LMBARGINCHIP]

Ok, here come my closer 1-2-3 inning boys:

1st batter: You cursed, automatically discrediting the rest of the question, but I will oblige.

[/quote]

Oh no, a curse word.  Cover your ears boys and girls as we quickly leave the room.

Years ago the now retired CEO of my B/D--even before he was the CEO--was having drinks with several of us.  He let go with a nasty phrase and some guy at a nearby table came over and asked him to watch what he said.

The boss looked at him with that dismissive way, nodded, and turned back to our table.  Then in a loud voice he said, "Ya know--I've never met a person who objects to the language being used who was not a moron."

As the years have gone by I have come to realize how right he was.

One wonders how you hypersenstive types are able to go to the movies?  Do you ever poke your finger in your eye as you sit there in your frenzy of covering your ears and your eyes at the same time?

[quote=LMBARGINCHIP]

My clients and my family make what I do so damn important. When I find the industry evolving to a point that my skill set is overly commoditized, or that I can no longer add value for the people that matter to me I will evolve as well - again fully functioning, thinking people would agree - this is the only alternative. Chips motivation is closely tied to the higher PE afforded by pure asset managers - less volitile revenues=higher stock price. Check the insider holdings - Mason, Brinkley, Sabelhouse made a killing.

[/quote]

Done a lot of committee work with Jim Brinkley--one of the good guys.  I think Sabelhouse spells his name Sabelhaus.

It's nice that you're in this for your family and your clients.  I'll bet such a self deprecating type would find somebody with my confidence to be overbearing--even rude.  You know, not sensitive to the needs of others.

Is Chip wrong to seek to consolidate the business--to focus on the firm's strengths.  Tell me something.  The other day you said it was a card that Chip had been hoping to play and that you were not surprised.

Why then had you not already jumped ship--accepted one of the 100% relocation packages that you claim were being thrown your way?  For that matter, seeing as you're in the business for your family why in the world would you not do what was best for your family at every turn--you're sitting there telling me that managers galore were waving large sums at you and you didn't see accepting one of those offers to dance as being a shrewd play in light of the coming tossing over the side?

[quote=LMBARGINCHIP]

2nd Batter: SB has chosen to pursue distribution over manufacturing product as they are better suited to it. LM's B/D represented only 18% of earnings whereas SB's B/D is a much greater % of their bottom line. Play to your strengths. Citi faced increasing pressure from regulators to remove conflicts of interest from their business, as well as some pretty hefty fines so for them throwing the funds over the side was their solution as the fund group had been plagued by poor performance and record outflows.

[/quote]

I do not disagree with that at all.  Who got a better deal will be the question to be answered in the future.  Legg bought a bunch of poorly performing funds and in return gave up a thousand or so poorly performing brokers.

Knowing that you'd never use a dirty word like damn anyway, I should remind you that you told the assembled that the B/D was hardly a contributor to the Legg income statement--so it's not a leap in logic to conclude that the reason why is because it was a collective group of also ran producers.

[quote=LMBARGINCHIP]

3rd batter: I have spoken with several brokers throughout the northeast who had entertained the recruitment efforts of SB managers over the past year (myself included), and ultimately for each of the folks I spoke with SB was not an ideal fit for their (my) business. The fact that I could have written a deal with them for 100% in the recent past only adds to the disappointment in the current retention package that has been offered. I can assume the same for each of the brokers I have spoken with this is also the case.

[/quote]

Again, in light of the foresight you had--what with knowing what the Legg Board was going to do--why in the world did you not accept the 100% offers as they were being made.

What is going to happen now is formerly eager managers at competitor firms will know that you're being faced with a retention package that you consider unacceptable.  If you were to sit down across from me I'd know that you're weighing 40% versus whatever I offer you--say 50%.

Add to the mix that a lot of Legg offices are off the beaten path, shall we say, and brokers in those offices may be faced with long commutes in order to catch on with a firm willing to give them much more than Smith Barney is offering.

Finally, is it possible--JUST POSSIBLE--that the 40% offer is nothing more than an opening bid.  Do you suppose that the sales management team at Smith Barney is prepared to negotiate with Legg brokers they want to keep, while lettinig the rest of them go away?

Just as accepting a package to move your business from one firm to another provides an opportunity to cull your book--these situations offer the firms an opportunity to cull the herd.

[quote=LMBARGINCHIP]

So, where are you wrong you ask? I think someone of your superior intellect can probably figure it out. If not, there is a kid fresh out of UCONN in the bullpen (don't worry he's an MBA) that I could refer you to.

[/quote]

Thanks for the offer, but when it comes to pure cognitive abilities
I’ll take a 65 year old housewife over anbody who is less than forty.

[quote=Put Trader] [quote=LMBARGINCHIP]

Ok, here come my closer 1-2-3 inning boys:

1st batter: You cursed, automatically discrediting the rest of the question, but I will oblige.

[/quote]

Oh no, a curse word.  Cover your ears boys and girls as we quickly leave the room.

Years ago the now retired CEO of my B/D--even before he was the CEO--was having drinks with several of us.  He let go with a nasty phrase and some guy at a nearby table came over and asked him to watch what he said.

The boss looked at him with that dismissive way, nodded, and turned back to our table.  Then in a loud voice he said, "Ya know--I've never met a person who objects to the language being used who was not a moron."

As the years have gone by I have come to realize how right he was.

One wonders how you hypersenstive types are able to go to the movies?  Do you ever poke your finger in your eye as you sit there in your frenzy of covering your ears and your eyes at the same time?

[quote=LMBARGINCHIP]

My clients and my family make what I do so damn important. When I find the industry evolving to a point that my skill set is overly commoditized, or that I can no longer add value for the people that matter to me I will evolve as well - again fully functioning, thinking people would agree - this is the only alternative. Chips motivation is closely tied to the higher PE afforded by pure asset managers - less volitile revenues=higher stock price. Check the insider holdings - Mason, Brinkley, Sabelhouse made a killing.

[/quote]

Done a lot of committee work with Jim Brinkley--one of the good guys.  I think Sabelhouse spells his name Sabelhaus.

It's nice that you're in this for your family and your clients.  I'll bet such a self deprecating type would find somebody with my confidence to be overbearing--even rude.  You know, not sensitive to the needs of others.

Is Chip wrong to seek to consolidate the business--to focus on the firm's strengths.  Tell me something.  The other day you said it was a card that Chip had been hoping to play and that you were not surprised.

Why then had you not already jumped ship--accepted one of the 100% relocation packages that you claim were being thrown your way?  For that matter, seeing as you're in the business for your family why in the world would you not do what was best for your family at every turn--you're sitting there telling me that managers galore were waving large sums at you and you didn't see accepting one of those offers to dance as being a shrewd play in light of the coming tossing over the side?

[quote=LMBARGINCHIP]

2nd Batter: SB has chosen to pursue distribution over manufacturing product as they are better suited to it. LM's B/D represented only 18% of earnings whereas SB's B/D is a much greater % of their bottom line. Play to your strengths. Citi faced increasing pressure from regulators to remove conflicts of interest from their business, as well as some pretty hefty fines so for them throwing the funds over the side was their solution as the fund group had been plagued by poor performance and record outflows.

[/quote]

I do not disagree with that at all.  Who got a better deal will be the question to be answered in the future.  Legg bought a bunch of poorly performing funds and in return gave up a thousand or so poorly performing brokers.

Knowing that you'd never use a dirty word like damn anyway, I should remind you that you told the assembled that the B/D was hardly a contributor to the Legg income statement--so it's not a leap in logic to conclude that the reason why is because it was a collective group of also ran producers.

[quote=LMBARGINCHIP]

3rd batter: I have spoken with several brokers throughout the northeast who had entertained the recruitment efforts of SB managers over the past year (myself included), and ultimately for each of the folks I spoke with SB was not an ideal fit for their (my) business. The fact that I could have written a deal with them for 100% in the recent past only adds to the disappointment in the current retention package that has been offered. I can assume the same for each of the brokers I have spoken with this is also the case.

[/quote]

Again, in light of the foresight you had--what with knowing what the Legg Board was going to do--why in the world did you not accept the 100% offers as they were being made.

What is going to happen now is formerly eager managers at competitor firms will know that you're being faced with a retention package that you consider unacceptable.  If you were to sit down across from me I'd know that you're weighing 40% versus whatever I offer you--say 50%.

Add to the mix that a lot of Legg offices are off the beaten path, shall we say, and brokers in those offices may be faced with long commutes in order to catch on with a firm willing to give them much more than Smith Barney is offering.

Finally, is it possible--JUST POSSIBLE--that the 40% offer is nothing more than an opening bid.  Do you suppose that the sales management team at Smith Barney is prepared to negotiate with Legg brokers they want to keep, while lettinig the rest of them go away?

Just as accepting a package to move your business from one firm to another provides an opportunity to cull your book--these situations offer the firms an opportunity to cull the herd.

[quote=LMBARGINCHIP]

So, where are you wrong you ask? I think someone of your superior intellect can probably figure it out. If not, there is a kid fresh out of UCONN in the bullpen (don't worry he's an MBA) that I could refer you to.

[/quote]

Thanks for the offer, but when it comes to pure cognitive abilities I'll take a 65 year old housewife over anbody who is less than forty. [/quote]

Touche - or should it be spelled with a 'd'? Let's play this a little differently.

Why would one, so profoundly educated assume any of the details you've outlined to be within a stones throw of the truth?

Where is it that you have fallen from that makes you so hate the dynamics of the business these days?

As I sit here now and absorb the aloe from my wife's gentle fingertips, the cooling, soothing cream penetrating my over-exposed shoulders, I wonder - am I that man....will I become that man.................screw it, let's wake the neighbors!

[quote=LMBARGINCHIP]

Why would one, so profoundly educated assume any of the details you’ve outlined to be within a stones throw of the truth?

Where is it that you have fallen from that makes you so hate the dynamics of the business these days?

This is an exercise in futility I see. You did create scenerios that were quite detailed in nature. As a matter of fact you had me working for Wachovia in one instance, and vetren SB brokers raiding my book. Let's take a look at the problems with these "facts." First, I have never stated that I was looking to move my business anywhere. I mearly stated that I was performing my due dilligence as anyone would do in this situation. It helps to set your clients at ease when you can explain the features and benefits of SB vs. other firms. And second the opportunity for vetren SB brokers to raid any LM clients would not come for at least eight months as LM branches will operate autonomously at least until the integration period presidents day weekend - and we've been told (which may or may not come to be) that the northern region will stand alone for at least 18months following the 12/1 close.

As far as my comment about the dynamics of the business, I have read more than one post from you in other threads that you make very clear your dislike for the "used car salesmen selling mutual funds" being a direct effect of the industry's dumbing down.

I have wasted enough time with you, and would expect that someone such as yourself would gather more facts before you spout your worthless advice. If you would like, we could begin a thread (in fact Starka may have already) that talks more to the uselessness of your typing.

I have read with amusement the petty banter on this board, and feel
that I should chime in with my perspective on the LM/Citi deal.



As a successful advisor at LM, I have been sought by numerous
wirehouses over the years. I stayed at Legg because I liked the
atmosphere and the ethics of the firm. I have always felt there was
room in the market for a nimble, mid-sized firm to compete with the
elephant Merrills and Smith Barneys. 



The B/D biz at Legg has been one of the most profitable on the Street,
with 20% margins, though this was not enough when compared to the asset
management side of the firm. Of course, they fed and nourished that
side, and (lately) starved the B/D side, so it’s no wonder the asset
management biz looks good in comparison.



I’m not sure if they will regret this move, but time will tell.



There are many of us who feel this retention package says much about
how Citi views Legg’s salesforce. They evidently think that most of us
are captive, and tied into Legg funds with large capital gains if sold.
While that may be true for some, I know that there are a variety of
business models practiced by FAs at the firm that do not tie us to Bill
Miller or other Legg products.



So, I guess I will be going on interviews this summer…

[quote=LMBARGINCHIP]

This is an exercise in futility I see. You did
create scenerios that were quite detailed in nature. As a matter of
fact you had me working for Wachovia in one instance, and vetren SB
brokers raiding my book. Let’s take a look at the problems with these
"facts." First, I have never stated that I was looking to move my
business anywhere. I mearly stated that I was performing my due
dilligence as anyone would do in this situation. It helps to set your
clients at ease when you can explain the features and benefits of SB
vs. other firms. And second the opportunity for vetren SB brokers to
raid any LM clients would not come for at least eight months as LM
branches will operate autonomously at least until the integration
period presidents day weekend - and we’ve been told (which may or
may not come to be) that the northern region will stand alone for at
least 18months following the 12/1 close.

As far as my comment about the dynamics of the business, I have read more than one post from you in other threads that you make very clear your dislike for the "used car salesmen selling mutual funds" being a direct effect of the industry's dumbing down.

I have wasted enough time with you, and would expect that someone such as yourself would gather more facts before you spout your worthless advice. If you would like, we could begin a thread (in fact Starka may have already) that talks more to the uselessness of your typing.

Ah…if you behave yourself ClerkBoy, I may let you shine my shoes one day.  (Don’t hold my breath, though.  You’re not even close to worthy yet.)

[quote=Starka]Ah…if you behave yourself ClerkBoy, I may let you
shine my shoes one day.  (Don’t hold my breath, though. 
You’re not even close to worthy yet.)[/quote]



See what I mean, anger fueled by stupidity.



The phrase is “Hold your breath.”  It is impossible for me to hold your breath Starka–go look it up.

[quote=Put Trader] 



 Do you understand the power of telling a client,



“Mr. Johnson
in investing there is one thing that works best–consitency.  You
are fully invested at this time, Bob Broker moved to Wachovia because
Wachovia gave him a huge upfront bonus.  In order to justify that
bonus it is expected that Bob will move you out of all of your current
positions into new ones.  It may not happen right away, but you
can bet it will happen.



On the other
hand, if you simply stay here at Legg–then Smith Barney–there will be
no such suggestions, no pressure…just consistency.



The reality is
your money is being managed by fund managers, not Bob or me.  If
you feel a “loyalty” to Bob you should not, he’s not loyal to you or he
wouldn’t be asking you to go through this turmoil.



Please, for the sake of your own financial future, be very careful following Bob around.



I could have jumped ship too, but decided that stability for my clients was too important.



If Smith Baney doesn’t work out, I can go later…why do you suppose that Bob didn’t wait to see what was going to happen?”



(Shut up and listen)



"Well, the
easiest way to maintain the consistency you need is for you to tell me
to instruct our operations people to not transfer your account to
Wachovia…all I need is for you to tell me now, we’ll send you a
letter to confirm it.



Do you want me to do that, keep the consistency working for you?"



That I mention this is not some sort of proof that I hate the business
or don’t understand the dynamics of it. 

[/quote]



All salesmen script their work. Putzy, the lines above demonstrate your
skills at “pushing product” to be very impressive. Leading questions.
Building consensus. Rhetorical statements. More leading questions.
Great job, sport.



Amateur salespeople talk about product. Junior salespeople ask about wants and needs. 
What you have done is nothing short of dumbfounding. The positioning of
the need for consistency in ones life as a deliverable product is sapid
to me (I just looked over at the mirror Putzy sent me for Arbor Day
which reads - Smile Saphead - and admired my vacant slackjawed
expression of awe at the profundity of the P-man’s
salesmanship…Wowsy.)



Putz, your playbook (does it have Roger Staubach’s name somewhere on
the cover?) probably includes the above scripted-play. It’s an
aggressive defense that might deliver some mediocre results in a
scrimmage against “The Greatest Generation” (or, any argyle-socked,
Lake Wobegon wannabe, balletomane-boy and fervent admirer of all things
archaic) and their wants and needs for consistency. This same script
bounced against the babyboomer or X-type’s would meet would meet with a
dismissive shake, rattle and juke. P-eater, just a  quick update,
"Elvis has left the building."



A competent salesperson would first validate an understanding of the
situation. Then probe into problem areas. And only then, combine the
two to twist the knife on the problem. Good luck, Killer.

I was recently contacted and recruited by a Smith Barney branch manager
for the Financial Consultant training program. I have 5 years
experience in the Insurance/Marketing industry but do not have a series
6,7 or 63 and my degree is in Literatue. I was told that I would be
brought in under a 3-year training program where I would learn the
industry and take the tests as I’m trained. I was told I needed to take
a 2 tests before a serious interview, one based on basic math and
economics and the other I have no idea. Perhaps an IQ test of some
sort? I read the threads and was just wondering if any of you can offer
some info/tips to give me a jump start on the process.



Thanks        

I went through the process at Smith Barney, and from what I remember the tests are routine- personality testing, etc. They ask questions like- ’ What do you prefer doing- sitting in a closet twiddling your thumbs or out at a networking event socializing…". That sort of stuff… Be honest, because they have a system that weeds out people who are " too eager to give the answer that is desired"… Basically they ask the same type of questions but its worded differently, etc…

Will do - thanks for the tip