Money in Motion

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Jul 16, 2008 4:53 pm

So if we're looking for money in motion, did any of you think to go to your local IndyMac bank and meet and talk with the people getting their money out of there?  There were lines of people just sitting there waiting.

Jul 17, 2008 2:40 pm

And what is it that you would sell all the people in line at IndyMac Bank?

Jul 17, 2008 2:51 pm

Lemonade.  Or I'd give them my card and tell them that if we can deposit their IndyMac check, we aren't going anywhere.  Or I'd empathize with them and tell them that I help folks get back on track with their finances and investments after events like this.

 
But you're with Merrill, aren't you?  So for you, it would kind of be like the blind leading the blind, right?
Jul 17, 2008 3:35 pm

Lemonade is probably your best bet, I think your the same guy that was selling preferreds a couple weeks ago.  Did you jump on any of those 8%-9% yielding Fannie and Freddie's?

 
 
What firm are you with where you think you can call Merrill the blind?
Jul 17, 2008 3:44 pm
BullBroker:

Lemonade is probably your best bet, I think your the same guy that was selling preferreds a couple weeks ago.  Did you jump on any of those 8%-9% yielding Fannie and Freddie's?

 
 
What firm are you with where you think you can call Merrill the blind?



How does your business work? If I need a bull, why would I be better off calling you when I can just go straight to the ranch and eliminate you from the process?

Jul 17, 2008 5:17 pm
BullBroker:

Lemonade is probably your best bet, I think your the same guy that was selling preferreds a couple weeks ago.  Did you jump on any of those 8%-9% yielding Fannie and Freddie's?

 
 
What firm are you with where you think you can call Merrill the blind?
 
Don't be all pissy because your company's ratings were just lowered.  Yeah I hold some financial preferreds of solid companies that are guilty by association.  They weren't funding shitty loans nor packaging that garbage, and I wasn't out promoting ARP's (not saying you were, but your company definitely was involved in it).
 
More and more people like the independent model because their money isn't tied to institutions they hear nothing but negative stuff about in the news.
 
I don't claim to know anything spectacular, but I do know people aren't trusting MER, C, WB, WM, UBS, and many others.
 
 
Jul 18, 2008 9:06 am

No, I wasn't out promoting ARP's I had one client that we bought $200,000 in ARP's in mid 2007, and I inherited 1 account from a failed trainee that had $200,000 in an ARP.  Fortunately, for my original client we decided to put the money to work for us in a couple of drilling stocks in late 2007 before the ARP freeze up.  I still have the inherited account in the ARP because I can't sell it, but the guy could really care less he doesn't need the liquidity and he is clipping a failed rate coupon of 4.5%.
 
I do find it comical that you in hindsight would judge the individuals/companies that were out promoting ARP's.  Sure they all look like idiots now but at the time it was a good tool for short-term cash.  You can't sit there and tell me that you would turn down 5.5% liquid every 7 days, and some of the municipal yields were returning 8%-9% TEY's.  You can't tell me you of all people would have turned down a higher rate because you could foresee what was about to happen in the credit market, and knew that ARP's would freeze up.  Don't sit there and judge others and pretend like they are bad FA's because of ARP's.
 
What makes you think that more people are trusting independents right now vs. the MER, C, WB, UBS?  Do you think 95% of the population even knows who independents clear through or where their money is kept when they give it to an independent?  Do you think 95% of the population knows the credit rating of the independent clearing firms?  Do you know?  What's the rating on LPL, Raymond James, ect... bank?
 
Here is what you are trying to tell me; you are going to take your family on a trip to the Grand Canyon and are driving through some podunk town in Arizona.  The kids are all crying that they are hungry and you see a Mcdonalds up a head.  You start heading towards the Mcdonalds and right across the street from Mcdonalds is "Big Al's Burger World" housed out of a stripmall beside Dollar Tree and Pak n' Save.  These are the only two joints in the town and you have to eat because the kids are screaming.  Which do you choose Dad?  Where do you feel safer eating at?  Sure Big Al's could be great, clean, and keep up with health codes, and Mcdonalds could have the worst kitchen staff in the state but which one do you choose?  Where do you feel safe taking your kids to eat?
 
Know take that analogy and apply it to our business, but don't think like an Advisor think like a uneducated client.  Sure there are some you let CNBC affect their decision, but there are also some that don't trust Big Al's investment emporium in the park city strip mall. 
 
Are you trying to tell me that the independent channel has found a way to get more SIPC or FDIC coverage for their clients?  Are you telling me anyone in the independent channel has a $600 Million dollar Lloyds of London policy for every single one of their clients like Merrill Lynch?  
Jul 19, 2008 11:10 pm
BullBroker:

.
 
I do find it comical that you in hindsight would judge the individuals/companies that were out promoting ARP's.  Sure they all look like idiots now but at the time it was a good tool for short-term cash.  You can't sit there and tell me that you would turn down 5.5% liquid every 7 days, and some of the municipal yields were returning 8%-9% TEY's.  You can't tell me you of all people would have turned down a higher rate because you could foresee what was about to happen in the credit market, and knew that ARP's would freeze up.  Don't sit there and judge others and pretend like they are bad FA's because of ARP's.
 
 
 
 
Yes I can.  Yields on fixed income are a measurement of risk.  About three weeks before the sh*t hit the fan, another broker in my office was bragging about the millions of $ he was putting in ARS and how I was missing the boat.  I told him that the rates seemed quite high (4.75%, 7 day, AAA) for such a "safe" investment and that something (did not know what) was going on.  It amazes me that so many brokers fail to engage their brain when looking at investment options for their clients.  AAA paying 200 bps over the market with daily liquidity?  Sign me up!!!  Then the broker acts surprised when something goes wrong.  Pathetic.
Jul 19, 2008 11:43 pm
Jul 21, 2008 11:30 am
Primo:
BullBroker:

.
 
I do find it comical that you in hindsight would judge the individuals/companies that were out promoting ARP's.  Sure they all look like idiots now but at the time it was a good tool for short-term cash.  You can't sit there and tell me that you would turn down 5.5% liquid every 7 days, and some of the municipal yields were returning 8%-9% TEY's.  You can't tell me you of all people would have turned down a higher rate because you could foresee what was about to happen in the credit market, and knew that ARP's would freeze up.  Don't sit there and judge others and pretend like they are bad FA's because of ARP's.
 
 
 
 
Yes I can.  Yields on fixed income are a measurement of risk.  About three weeks before the sh*t hit the fan, another broker in my office was bragging about the millions of $ he was putting in ARS and how I was missing the boat.  I told him that the rates seemed quite high (4.75%, 7 day, AAA) for such a "safe" investment and that something (did not know what) was going on.  It amazes me that so many brokers fail to engage their brain when looking at investment options for their clients.  AAA paying 200 bps over the market with daily liquidity?  Sign me up!!!  Then the broker acts surprised when something goes wrong.  Pathetic.
 
Wait, let me guess not only did you avoid the ARP's because you just knew it would blow up.  You also went to cash back in December missing the Jan-Mar lows and put everything back in the market last week catching the 4%+ pop making all your clients millions, oh and you called Indymacbank failing too.  (//rolls eyes//). 
 
You gotta love how 1000's of the brokers and billions of dollars flowed into these things, but somehow in hindsight mind you, you have a bunch chest thumpers coming out saying they knew this was going to happen.  Goldman was truely the only people who saw this coming and played the other side. 
Jul 21, 2008 11:32 am
joedabrkr:
BullBroker:

And what is it that you would sell all the people in line at IndyMac Bank?



MER is cheap....and probably getting cheaper....

 
UP 5% + since your post, why don't you go ahead and buy some JAN09 Puts joe since your sure it's getting cheaper. 
Jul 21, 2008 12:28 pm
BullBroker:
Primo:
BullBroker:

.
 
I do find it comical that you in hindsight would judge the individuals/companies that were out promoting ARP's.  Sure they all look like idiots now but at the time it was a good tool for short-term cash.  You can't sit there and tell me that you would turn down 5.5% liquid every 7 days, and some of the municipal yields were returning 8%-9% TEY's.  You can't tell me you of all people would have turned down a higher rate because you could foresee what was about to happen in the credit market, and knew that ARP's would freeze up.  Don't sit there and judge others and pretend like they are bad FA's because of ARP's.
 
 
 
 
Yes I can.  Yields on fixed income are a measurement of risk.  About three weeks before the sh*t hit the fan, another broker in my office was bragging about the millions of $ he was putting in ARS and how I was missing the boat.  I told him that the rates seemed quite high (4.75%, 7 day, AAA) for such a "safe" investment and that something (did not know what) was going on.  It amazes me that so many brokers fail to engage their brain when looking at investment options for their clients.  AAA paying 200 bps over the market with daily liquidity?  Sign me up!!!  Then the broker acts surprised when something goes wrong.  Pathetic.
 
Wait, let me guess not only did you avoid the ARP's because you just knew it would blow up.  You also went to cash back in December missing the Jan-Mar lows and put everything back in the market last week catching the 4%+ pop making all your clients millions, oh and you called Indymacbank failing too.  (//rolls eyes//). 
 
You gotta love how 1000's of the brokers and billions of dollars flowed into these things, but somehow in hindsight mind you, you have a bunch chest thumpers coming out saying they knew this was going to happen.  Goldman was truely the only people who saw this coming and played the other side. 
 

Bull, I don't understand your hostility.  Everyone on here is selling their services.  If we don't work for a wirehouse, then right now we have something to sell against.  If some shit hit the fan with indy's, then you wirehouse guys would have something to sell against.
 
For the guys who did move to cash at the end of 2007, it turned out to be a great move.  I'm sure the rest of us wish we could've as well.  So for those guys, they have something to promote about themselves, and they should use it to their advantage.
 
It seems like you're a little testy because right now MER is easy for us to jump all over right now.  You will get your shot eventually to jump all over us for something.  But when every little flaw or mis-step made by another company can be exploited to try to win over new clients for my business, well I sure as hell will try to put more bread on my table.   I am sure you would do the same.
 
All Primo said was that he avoided the ARPs market.  You're blowing the rest out of proportion.  Just let us whose companies haven't gotten involved in bad debt, or had CEO's fired enjoy this time.  You will have yours. 
Jul 21, 2008 6:57 pm
BullBroker:
Primo:
BullBroker:

.
 
I do find it comical that you in hindsight would judge the individuals/companies that were out promoting ARP's.  Sure they all look like idiots now but at the time it was a good tool for short-term cash.  You can't sit there and tell me that you would turn down 5.5% liquid every 7 days, and some of the municipal yields were returning 8%-9% TEY's.  You can't tell me you of all people would have turned down a higher rate because you could foresee what was about to happen in the credit market, and knew that ARP's would freeze up.  Don't sit there and judge others and pretend like they are bad FA's because of ARP's.
 
 
 
 
Yes I can.  Yields on fixed income are a measurement of risk.  About three weeks before the sh*t hit the fan, another broker in my office was bragging about the millions of $ he was putting in ARS and how I was missing the boat.  I told him that the rates seemed quite high (4.75%, 7 day, AAA) for such a "safe" investment and that something (did not know what) was going on.  It amazes me that so many brokers fail to engage their brain when looking at investment options for their clients.  AAA paying 200 bps over the market with daily liquidity?  Sign me up!!!  Then the broker acts surprised when something goes wrong.  Pathetic.
 
Wait, let me guess not only did you avoid the ARP's because you just knew it would blow up.  You also went to cash back in December missing the Jan-Mar lows and put everything back in the market last week catching the 4%+ pop making all your clients millions, oh and you called Indymacbank failing too.  (//rolls eyes//). 
 
You gotta love how 1000's of the brokers and billions of dollars flowed into these things, but somehow in hindsight mind you, you have a bunch chest thumpers coming out saying they knew this was going to happen.  Goldman was truely the only people who saw this coming and played the other side. 
 
Go back a read my post again.  I did not know what was going to happen.  I do however understand a 7 day ARS paying 4.75% and AAA rated is more than it seems.  My post was history not hindsight.  There is a considerable difference.
Jul 22, 2008 10:11 am
snaggletooth:
BullBroker:
Primo:
BullBroker:

.
 
I do find it comical that you in hindsight would judge the individuals/companies that were out promoting ARP's.  Sure they all look like idiots now but at the time it was a good tool for short-term cash.  You can't sit there and tell me that you would turn down 5.5% liquid every 7 days, and some of the municipal yields were returning 8%-9% TEY's.  You can't tell me you of all people would have turned down a higher rate because you could foresee what was about to happen in the credit market, and knew that ARP's would freeze up.  Don't sit there and judge others and pretend like they are bad FA's because of ARP's.
 
 
 
 
Yes I can.  Yields on fixed income are a measurement of risk.  About three weeks before the sh*t hit the fan, another broker in my office was bragging about the millions of $ he was putting in ARS and how I was missing the boat.  I told him that the rates seemed quite high (4.75%, 7 day, AAA) for such a "safe" investment and that something (did not know what) was going on.  It amazes me that so many brokers fail to engage their brain when looking at investment options for their clients.  AAA paying 200 bps over the market with daily liquidity?  Sign me up!!!  Then the broker acts surprised when something goes wrong.  Pathetic.
 
Wait, let me guess not only did you avoid the ARP's because you just knew it would blow up.  You also went to cash back in December missing the Jan-Mar lows and put everything back in the market last week catching the 4%+ pop making all your clients millions, oh and you called Indymacbank failing too.  (//rolls eyes//). 
 
You gotta love how 1000's of the brokers and billions of dollars flowed into these things, but somehow in hindsight mind you, you have a bunch chest thumpers coming out saying they knew this was going to happen.  Goldman was truely the only people who saw this coming and played the other side. 
 

Bull, I don't understand your hostility.  Everyone on here is selling their services.  If we don't work for a wirehouse, then right now we have something to sell against.  If some shit hit the fan with indy's, then you wirehouse guys would have something to sell against.
 
For the guys who did move to cash at the end of 2007, it turned out to be a great move.  I'm sure the rest of us wish we could've as well.  So for those guys, they have something to promote about themselves, and they should use it to their advantage.
 
It seems like you're a little testy because right now MER is easy for us to jump all over right now.  You will get your shot eventually to jump all over us for something.  But when every little flaw or mis-step made by another company can be exploited to try to win over new clients for my business, well I sure as hell will try to put more bread on my table.   I am sure you would do the same.
 
All Primo said was that he avoided the ARPs market.  You're blowing the rest out of proportion.  Just let us whose companies haven't gotten involved in bad debt, or had CEO's fired enjoy this time.  You will have yours. 
 
 
I agree with what you have said, but it really doesn't match with the point I was trying to make with the guy stating how he "knew something was going on and avoided the ARP".  What I was saying had nothing to do with Merrill vs. Big Al's Investment House or any other independent.  My argument was why is this guy coming on here acting like he "knew somthing" that the smartest minds in the industry didn't.  It's just a pet peeve of mine for people to claim they knew something in hindsight, course this guy says it's history. 
 
A great investor once said, "Predicting rain doesn't count.  Building an ark does."   -Warren Buffet.
 
I will give the Goldman guys credit for building the ark, they were on the other side of the ARP trade and made money while everyone else lost their hat.  All the Primo guy did was say "hey you guys there are clouds on the horizon it could rain".  Inless he put money on the opposite side of the trade don't come on here and thump your chest against the guys who lost money.  I am mainly standing up for some very good advisors who have been around 25+ years that are still stuck in these things, as I myself had next to no exposure to ARP's but not because of some foresight on my behalf.  So inless Primo works for Goldman(highly unlikely) he is just claiming rain, and claiming it in hindsight. 
Jul 22, 2008 11:42 am
BullBroker:
I agree with what you have said, but it really doesn't match with the point I was trying to make with the guy stating how he "knew something was going on and avoided the ARP".  What I was saying had nothing to do with Merrill vs. Big Al's Investment House or any other independent.  My argument was why is this guy coming on here acting like he "knew somthing" that the smartest minds in the industry didn't.  It's just a pet peeve of mine for people to claim they knew something in hindsight, course this guy says it's history. 
 
A great investor once said, "Predicting rain doesn't count.  Building an ark does."   -Warren Buffet.
 
I will give the Goldman guys credit for building the ark, they were on the other side of the ARP trade and made money while everyone else lost their hat.  All the Primo guy did was say "hey you guys there are clouds on the horizon it could rain".  Inless he put money on the opposite side of the trade don't come on here and thump your chest against the guys who lost money.  I am mainly standing up for some very good advisors who have been around 25+ years that are still stuck in these things, as I myself had next to no exposure to ARP's but not because of some foresight on my behalf.  So inless Primo works for Goldman(highly unlikely) he is just claiming rain, and claiming it in hindsight. 
 
Sometimes the lack of doing something is the best you can do.  Come on, if Primo said he avoided the ARP's market because he thought the yields were too high, that's a good thing for his clients.  It doesn't mean he has to be on the other side.  There are plenty of other investments to be in.
 
It's like the tech bubble.  If an advisor avoided loading up on techs, but didn't short the techs, did he not build an ark?  Maybe he was in bonds or sat in cash.  You can't fault someone for not being directly on the other side of something. 
 
It's not always about how much money you make, sometimes it's about how much you don't lose. 
Jul 22, 2008 3:02 pm
snaggletooth:
BullBroker:
I agree with what you have said, but it really doesn't match with the point I was trying to make with the guy stating how he "knew something was going on and avoided the ARP".  What I was saying had nothing to do with Merrill vs. Big Al's Investment House or any other independent.  My argument was why is this guy coming on here acting like he "knew somthing" that the smartest minds in the industry didn't.  It's just a pet peeve of mine for people to claim they knew something in hindsight, course this guy says it's history. 
 
A great investor once said, "Predicting rain doesn't count.  Building an ark does."   -Warren Buffet.
 
I will give the Goldman guys credit for building the ark, they were on the other side of the ARP trade and made money while everyone else lost their hat.  All the Primo guy did was say "hey you guys there are clouds on the horizon it could rain".  Inless he put money on the opposite side of the trade don't come on here and thump your chest against the guys who lost money.  I am mainly standing up for some very good advisors who have been around 25+ years that are still stuck in these things, as I myself had next to no exposure to ARP's but not because of some foresight on my behalf.  So inless Primo works for Goldman(highly unlikely) he is just claiming rain, and claiming it in hindsight. 
 
Sometimes the lack of doing something is the best you can do.  Come on, if Primo said he avoided the ARP's market because he thought the yields were too high, that's a good thing for his clients.  It doesn't mean he has to be on the other side.  There are plenty of other investments to be in.
 
It's like the tech bubble.  If an advisor avoided loading up on techs, but didn't short the techs, did he not build an ark?  Maybe he was in bonds or sat in cash.  You can't fault someone for not being directly on the other side of something. 
 
It's not always about how much money you make, sometimes it's about how much you don't lose. 
 
Agreed
Jul 22, 2008 4:37 pm
joedabrkr:
BullBroker:

And what is it that you would sell all the people in line at IndyMac Bank?



MER is cheap....and probably getting cheaper....

 
Up another 11% again today, I hope you are not in the business of investing other peoples money. 
Jul 22, 2008 5:07 pm

Financials all good today...hope that trend continues, but it seems pretty early to get real fired up...

Jul 22, 2008 7:00 pm

You can't sit there and tell me that you would turn down 5.5% liquid every 7 days, and some of the municipal yields were returning 8%-9% TEY's.




 
 
Yes I can.  I also shared the conversation I had with another broker about this very issue before the market freeze up.  I did not know anything beyond my understanding of fixed income, nor did I predict anything, but turns out I called it right.  Deal with it.  As far as you saying that if I did not short the ARS market (how would you do that BTW) it doesn't really count is just plain dumb.
Jul 23, 2008 10:05 am
Primo:

You can't sit there and tell me that you would turn down 5.5% liquid every 7 days, and some of the municipal yields were returning 8%-9% TEY's.




 
 
Yes I can.  I also shared the conversation I had with another broker about this very issue before the market freeze up.  I did not know anything beyond my understanding of fixed income, nor did I predict anything, but turns out I called it right.  Deal with it.  As far as you saying that if I did not short the ARS market (how would you do that BTW) it doesn't really count is just plain dumb.
 
The thing that cracks me up about you is that you say you didn't know it was going to happen, but you knew that historically something that pays 4.5%+ on AAA is too risky.  That had nothing to do with why the market failed, it didn't fail because Closed Ends were paying a higher yield than they could afford and defaulted.  They are actually having to pay an even higher failed rate now than they were before.  Your reasoning for avoiding ARP's was completely wrong, it was basically dumb luck that's why I am calling you out.  Did any of the ARP's default?  Has anyone lost their money?  Has anyone lost a dime of interest?  If the answer was yes then I would agree with your reasoning that the yields were too good to be true.  Unfortunately, for you none of the above are true and the reason you avoided them has nothing to do with why they failed. 
 
Basically you avoided them for the complete wrong reason, by dumb luck you just happened to be right in the call to avoid them, even though you did it for the wrong reason.  Now you are coming on here thumping your chest stating how stupid other brokers were for being in them.  Just try and show me something more ignorant!
 
I never said you could short them why don't you reread the post and try again.  I stated that Goldman made money on the other side of the trade, not only did they see what was happening they positioned themselves to make money when everyone else was having to do massive writedowns.