Somebody's Doing Things
I keep hearing from my former associates that clients are angry and
that there is a lot of movement of assets, yet if you read this forum
you’d conclude that every advisor has 100% of his clients assured
that all is well and they’re holding on for the long haul.
Reports that the funds are encountering daily liquidations at a never
before seen rate, yet if you read what the “advisors” on this forum
have to say you’d conclude that nobody is redeeming at all.
A cynic would conclude that the truth ain’t in those who post here—or
that they don’t really have clients and are making it up as they go
along.
Ever thought that there are a ton of DIYer’s out there? Or that there are other advisors than those on this forum?
Or, how about that people could be liquidating the hell out of their 401k's on their own? I am sure some clients are mad as hell. Oppy's muni bond fund is down 35% YTD...that's unreal. I don't own any of that by the way. By far and away, I have more clients staying the course than liquidating.[quote=snaggletooth]Ever thought that there are a ton of DIYer’s out
there? Or that there are other advisors than those on this forum?
Boy isn't the Internet great. Ugly girls are beauty queens and fat boys are football stars.
I have been re-patriating a lot of client money with the recent trend of the dollar vs. foreign currencies. If you were to ask the international and emerging markets managers I use, they would probably agree that a fair amount of money has been flowing out the door over the past six months.
And failed brokers who were forced to accept management positions or get real jobs can lecture people who actually are fighting the good fight everyday.
Boy isn’t the Internet great. Ugly girls are beauty queens and fat boys are football stars.
[quote=Provocative Put][quote=snaggletooth]Ever thought that there are a ton of DIYer’s out there? Or that there are other advisors than those on this forum?
Or, how about that people could be liquidating the hell out of their 401k's on their own? I am sure some clients are mad as hell. Oppy's muni bond fund is down 35% YTD...that's unreal. I don't own any of that by the way. By far and away, I have more clients staying the course than liquidating.[/quote]Boy isn't the Internet great. Ugly girls are beauty queens and fat boys are football stars.
[/quote] And old, washed up small dick men who molest boys are still old, washed up small dick men that molest boys.
I have clients who have liquidating all or parts of their 401ks or DYI investments but have stayed the course with me.
I kinda think that’s why some people have advisors – to keep them invested.
Do I worry that the market will fall even further or languish for years and they’ll start liquidating their stuff with me – yes. Do I worry that I’m doing the right thing – yes.
We’ve had a few clients liquidate their SMAs, and a few clients go to cash in the last 30 days, but it’s less than 2% of our client base.
Again, to echo Snaggs, I’ve heard a lot of the DIYers and Fidelity 401k clients are liquidating like mad.
[quote=greyhairedbrker]
And failed brokers who were forced to accept management positions or get real jobs can lecture people who actually are fighting the good fight everyday.[/quote]
One of life's truisms is that those of us who succeed will always be envied by those who do not. Brokerage firms do NOT offer management positions to failures, failures are terminated or left alone until they wander off on their own.
Nonetheless that doesn't stop those who have no chance in hell of ever being offered adult level responsibility, opportunity and mega paypackages from suggesting that those of us who pull their strings are not qualified to do so.
I assure you that I had the jobs that I had because I was the absolute best person among the 35,000 or so employees of the firm.
Sneering at somebody like me is like a city councilman in a town like Louisville sneering at a US Vice President as being unaccomplished.
It is to laugh.
[quote=snaggletooth]
And old, washed up small dick men who molest boys are still old, washed up small dick men that molest boys.[/quote]
You should not be so tough on yourself--a positive self image is key to your success.
[quote=buyandhold]I have clients who have liquidating all or parts of
their 401ks or DYI investments but have stayed the course with me.
I kinda think that’s why some people have advisors – to keep them invested.
Do
I worry that the market will fall even further or languish for years
and they’ll start liquidating their stuff with me – yes. Do I
worry that I’m doing the right thing – yes.
[/quote]
Refreshing honesty in this land of liars and posers.
[quote=gvf]We’ve had a few clients liquidate their SMAs, and a few
clients go to cash in the last 30 days, but it’s less than 2% of our
client base.
Again, to echo Snaggs, I’ve heard a lot of the DIYers and Fidelity 401k clients are liquidating like mad.
[/quote]
How do you hear about what is happening at Fidelity?
FYI…my clients have liquidated little. However, I have several 401Ks. The plan participats are liquidating A LOT.
[quote=Provocative Put] [quote=snaggletooth]
And old, washed up small dick men who molest boys are still old, washed up small dick men that molest boys.[/quote]
You should not be so tough on yourself--a positive self image is key to your success.
[/quote] Oh come on man...if you can't laugh at that, then you are truly bitter.
[quote=NOVA]FYI…my clients have liquidated little. However, I
have several 401Ks. The plan participats are liquidating A
LOT.[/quote]
With my own “serious” money I have been holdiing also–so has my wife,
althought she did buy a few things yesterday. She’s a fan of
Fortune Brands and did some serious averaging yesterday–not enough to
have to report her holdings, but it’s by far the largest individual
holding in our family at this time.
My mother inherited a large position in GE–70,000 shares in
2006. She also has about 75,000 shares of “Big Oil”–COP, XOM, BP
that sort of stuff. In 2006 my brother and I got her to sell
30,000 GE. We tried to get her to sell half of the oil stocks but
she declared that the GE was enough for her to tolerate at one
time. She feels that it’s betraying her parents to sell things
she inherited from them–my brother and I have not allowed ourselves to
be so burdened.
The taxes on her sale of the GE in 2006 pissed her off and she has
declared that she will do nothing else—that once we inherit we can do
whatever we want but that there will be no more selling.
It’s good to delay incuring a tax obligation. If you hold long enough you can convert gains into losses.
[quote=snaggletooth][quote=Provocative Put] [quote=snaggletooth]
And old, washed up small dick men who molest boys are still old, washed up small dick men that molest boys.[/quote]
You should not be so tough on yourself--a positive self image is key to your success.
[/quote] Oh come on man...if you can't laugh at that, then you are truly bitter.[/quote]
I did laugh at it, but I find it oddly pathetic that somebody would be so down on themselves.
[quote=Provocative Put]Boy isn’t the Internet great. Ugly girls are beauty queens and fat boys are football stars.[/quote]
And bitter old brokers can become investment gurus and superstar prognositcators.
Sure they do. That's exactly where a failing broker who wants to stay in the business seeks to hide. It's also the failures that ended up in management that tend to be the most bitter towards those who've succeeded.Brokerage firms do NOT offer management positions to failures,…
agree
I can tell you, I have been asking many of my clients how their colleagues are handling the crisis. By a landslide, I am being told that they are shifting their entire 401K balances to whatever the “safe” option is (fixed account, MMKT, GTD bucket, whatever). Most of them are people that don’t yet use advisors. My clients have mostly held where they are based on my recommendations - mostly because it seemed to me (and most advisors) to be too late to “get out”. All those DIY’ers got out of their 401K’s in September and October, and probably won’t get back in (because of inertia) until the market has already re-captured the upside swing. So my clients (like many advisors’) will likely end up about the same or better, as the DIY’ers, but in very different ways. Mine will have captured more of the downside, but also all of the upside. The DIY’ers will miss some of the downside, but also miss some of the upside. Hard to tell yet, but few of us will escape “unscathed” by all this.
Put… you make some interesting points here and other places on the forum. A couple of questions, instead of the fee based aum model most of us here now work under, what do you think the new model should look like? How would you be doing business today if you were in production? Where would you do it?
Seems to me the big firms do represent a safe port in the storm to some clients- yet, we all see reports daily of large teams leaving the major firms and going RIA or to a firm that has not had the conflicts of interest (Raymond James is a recent example). If the large wires are the place to be for now, do the management teams want to do what it will take to keep top advisors around? I know choices are more limited now but top producers can and have left. Lots of media opinions are that the real strength of Merrill is the brokers, I would think that would be especially true today after the subprime meltdown, ARS etc. if that's the case, wouldn't Mr. Lewis at BofA want to keep the brokers, and especially keep the top FA's around and happy? Not flaming here at all just some thoughts and questions.The interesting thing about 401k redemptions is that people use the “Stable Value” bucket which historically is the last bastion of safety (4-5% ror with no market adjustment). I am being told that even those are seeing hits. Today will test people’s mettle being limit down but I still think if you have ridden it this far down (the market that is), why get out now?
I'm seeing, what is that fancy wall street term, oh yeah- net cash inflows right now. But I'm tax free bond heavy. It's party time for muni buyers! For my buy and hold income muni buyers it is my sincerest wish that the dumb assses who run our markets crash the muni market at least once a year giving buyers unbelievable entry points and then holding those suckers until they mature. For bond buyers right now it's BUY BABY BUY!!!!!!!!!
[quote=BondGuy]
I'm seeing, what is that fancy wall street term, oh yeah- net cash inflows right now. But I'm tax free bond heavy. It's party time for muni buyers! For my buy and hold income muni buyers it is my sincerest wish that the dumb assses who run our markets crash the muni market at least once a year giving buyers unbelievable entry points and then holding those suckers until they mature. For bond buyers right now it's BUY BABY BUY!!!!!!!!!
[/quote] You do not see an incoming Obama administration as being Carter all over again? You don't see rising rates?Past performance is not indicative of future results.
[quote=Provocative Put][quote=BondGuy]
I'm seeing, what is that fancy wall street term, oh yeah- net cash inflows right now. But I'm tax free bond heavy. It's party time for muni buyers! For my buy and hold income muni buyers it is my sincerest wish that the dumb assses who run our markets crash the muni market at least once a year giving buyers unbelievable entry points and then holding those suckers until they mature. For bond buyers right now it's BUY BABY BUY!!!!!!!!!
[/quote] You do not see an incoming Obama administration as being Carter all over again? You don't see rising rates?[/quote] It is the best of times for muni buyers. It is the worst of times for muni holders. The printing of what was it- over a trillion new dollars, was to say the least- inflationary - which in normal times is a huge sell signal for the bond market. So staying short would be the normal course to follow in that situation. BUTTTTTTTTTTTTTTTTTTTTTTTTTTTTTTTTTTTT the muni market fell off a cliff. That credit lock up thing that everyone was talking about, well that was the muni market. A sea of institutional sellers looking to liquidate high quality assets in a world void of buyers. I mean NO BUYERS! A buy and hold retail buyer's dream. Yields through the roof. For example Harvard Univ AAA bonds selling at a 6.50 level tax free versus the thirty tres at 4% taxable? The world is upside down. That's what a liquidity crisis will do to prices. Way out of whack! As the market recovers, unfreezes, as we've started to see this week, yields will drop. I think on weds alone we had a 100bp move down in some munis. As for Obama becoming Carter reincarnated: Ok, could happen but the future is unknowable. I'm not smart enough to predict future markets so my view is that the best time to buy munis is when the client has cash. We can vary maturies case by case for those who are concerned and ladder portfolios for those looking to commit a one time lump sum investment. For income buyers it's go long and collect those coupon payments. All on a case by case basis. The way I see it, if the worst investment I ever make for a client is a 6% tax free bond, well, we're going to have a long successful relationship. BUY MUNIS NOW! And remember, munis, unlike some men, ultimately mature![quote=BondGuy]
BUY MUNIS NOW! And remember, munis, unlike some men, ultimately mature! [/quote] A compelling argument, sir. It's clear that you are not one of the punks who don't even understand the concept of not belonging.De minimis is disclosed but not overly discussed. That, like the LT cap gains on discounted and OID bonds is a question for their accountant.
The reason we don't spend a lot of time are these: There are way too many varibles to count. Situations arise where the client might accrete 4/5s of the gains on a straight line daily accrual, and realize 1/5 of the gain as a cap gain. All depends on buy price/sell price/holding period. And is a job for the CPA. Additionally, de minimis, on high quality bonds, really only comes into play on LT bonds. Anyone here want to take a guess as to what the tax code will be 25 years from now? Ok, we can take a guess that a year or two from now, if Obama gets in, as to what it will be, but we can't even go much beyond that. And by the way- Obama getting in- another reason to buy tax frees now! De mininimis has been around for a long time and is not a factor.[quote=BondGuy]
<>De mininimis has been around for a long time and is not a factor.[/quote]
I'd wager that less than 10% of those who should become involved with obscure things like the De mininimus tax rule ever pay any attention to it. Declaring a gain and paying taxes on it will be sufficient unless you're encountering a ball buster audit.
Ferris Bueller doesn't even know what it is. He looked up "Muncipal Bond" in an investor dictionary and saw something to the effect that investors might want to be concerned about the De Mininimus tax rule and thought it would add gravitas to his diminutive status on this forum if he asked one of the respected members about it so he did.
Then he SCREAMED it out from the back of the room--way back in the corner with the other retards.
I’m glad you smart guys explained wha DA mininimus tax rule was…
I've never heard of da thing & I have sold allot of municipals.[quote=Provocative Put]
Ferris Bueller doesn’t even know what it is. He looked up
"Muncipal Bond" in an investor dictionary and saw something to the
effect that investors might want to be concerned about the De Mininimus
tax rule and thought it would add gravitas to his diminutive status on
this forum if he asked one of the respected members about it so he did.
[/quote]
More silly guesses, with nothing to back them up but your empty words, Putsy. How about this: you never heard the term “bond” before looking it up today. There - I wrote it so it is true!!
Now I get your approach!! Thanks! Simply make something up and it is true! That is so much easier than the hard work of actually coming up with supportable arguments! What a hassle that is! What was I thinking?!
Oh, and really nice job with your pathetic attempt to suck up to BondGuy in the hopes of trying to find someone - anyone - to be your friend. Hope that works out well for you.
Actually Put is right in that it rarely comes up. Active bond buyers are fully aware because the rule has been around for a long time. When i say we disclose it we don’t dwell on it. And we never bring the term De minimis into the conversation first. That’s a deal killer for sure on the average muni bond sale. We tell the client that at maturity the gain will be treated as ordinary income. The KISS rule applies.
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