Thank's to all the Jones Haters

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Dec 8, 2005 11:51 pm

KAL, you & I will never share any Kool-Aid (I don't like the taste), but I am impressed with the effort you put into your response and am anxious to see Lance's response...nothing better than a good, educated debate...

Dec 9, 2005 8:26 am

KAL,


So now you're a Fin-Op?  Is that what the Series 7 is all about?

Dec 9, 2005 9:00 am

Kool Aid,


You can not fool me or the rest of us with the thin spin you put on your post...



1. Baed on the amount of recieveable from customers noted on the EDJ fianancial statement their required min is estimated to be about $200 million.  Go back and study 15c3 a little more


2.  Drexal Burnham went under becuase of a judgements from a civil court as well as SEC fines.   Can anyone explain the difference between junk bonds and undisclosed revenue sharing - of course it depends on what spin you put on it. Personally we made a killing buying junk bonds after the meltdown


3. General American did not go under becausse of medicare fraud although that was alledged later.  It went under because of a capital run on the outstanding GICs that they had issued.  The clients wanted their money back after their ratings dropped.  Of coure the PR at GA was to try to blame the rating agency.  This sounds a lot like the PR at EDJ blaming the SEC for chasing them down on Revenue Sharing.


4.  Drysdale Securities was shut down because they did not have the copital to stand behind the trades they made after a huge back office blunder.


5.  MJK in MN went under becuase they got tagged with a $200 million debit (hit to net capital) after a bad stock loan deal.


My point to your goofy EDJers is that no matter what kind of capital ase you have...at the end of the day it can be taken away.


FACT:  EDJ minimum capital in at least $200 million based on the financial statement.  Just ask your GP for a copy of the FOCUS II reoport that they have to file monthly.  Of coure they will not give it a kid from the sticks like yourself


FACT:  EDJ can not raise any capital.  BECAUSE of the pending litigation.  Again just ask  why they have not had a LP offering lately ...they can not get a legal opinion!  Can any one refute this?


FACT:  When their is a judgement against a BD it is a direct liability and direct hit to the capital base.   What the GPS would do if and when that would happen....DEPENDS...they could run for the hills or they could take the cash that they have pillaged from the CO. and put it back...What would you do?  I think I would take the cash and not look back! head to a beach somewhere.  CON over


FACT if their is a $300 million judgement form class action or AG then all of the GPs will be saying Novena's. 


You knuckleheads just refused to believe that this can happen.   It is very plausible given the circumstances.  Then y'all will blame it on the AG or the plaintiff bar or something other than the GP greed and arrogance!  Then we will all have a nice laugh.


Merry Xmas!




Dec 9, 2005 12:03 pm

Lance, great counter-punch...it's like watching Borg & McEnroe all over again...


KAL...it's you turn...

Dec 9, 2005 2:44 pm

Lance thanks for proving my point about you not having a clue.  You made claims of certain items as “Facts”, yet they aren’t even true.


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1)      Your claim that the minimum capital requirement is $200 million, is in direct conflict with what Jones has stated in the “statement of financial condition”.  So who to believe, you or the Jones.  Lets see if you’re wrong what’s the penalty, now if Jones misrepresents that document what’s the penalty?  Hmm, I think I’ll drink the Kool-Aid.


2)      Jones can’t raise anymore capital, hmm where would profits from ongoing operations go. 


3)      “When there is a judgment against a BD it is a direct liability and direct hit to the capital base.” Yet in the settlement with the SEC and the AG of Missouri, the GP’s paid for it from there own pockets.  The reality of a partnership being that the GP’s are personal liable for the partnership.  I do think you made a good point though.  When things get tough criminals run, honest people stick around.  I’m going to draw the conclusion that my GP’s are good people, and based on your response that your not.


4)      “FACT if their is a $300 million judgment form class action or AG then all of the GPs will be saying Novena's.”  It’s nice to know that you have a crystal ball and you can state a hypothetical as fact.


Lance thanks for the discussion. Have a happy holiday.
Dec 9, 2005 4:01 pm

Kool Aid Kid,


Maybe your are right and I have no clue of what I am talking about! 


But it says on page 4 of the ED Jones June 30th statement that Min Net Capital (using the alternative meathod) was $550,223 and that the currrent Net Capital was $598,669.  [all of these numbers in '000s) So I was wrong they only got $48 mil in excess capital!  Wow if they get hit with another judgement or fine!  Can this be right?  Does anyone have historical financials to compare the published June 30th '05s with?  Here is the link to the June 30th numbers - y'all take a look.


http://www.edwardjones.com/cgi/getData.cgi?file=/pdf/stateme nt_financial_condition.pdf


If this is right the GPs at Jones are already saying Novena's with only $48 million excess!  Any kind of signficant fine or settlement or award could put them out.


You see Koolie the more margin balances they take on the higher their net capital requirements go.


You are completely confused about this partnership nonsense. The SEC, NYSE and FED look to the company (regardless of the strucure)for regulatory capital. 


Another interesing aspect is the bank loans..it would be fun to look at those loan indentures....I wonder what event would trigger those loans to be called - a net capital violation would be one that comes to mind! 


Capital Call - Capital Call - Capital Call  Could you imagine the GPs scrambling over that one! They can't go to the drones and clowns for LP financing...the lawyers will not let them! They would have to dig in!


The FACT is that if they are not saying Novena's they should be. 


Good Luck Koolie!


Cheers


Lance







Dec 9, 2005 4:27 pm

Ding, ding, ding!


The judges have awarded a split decion.


And the winner and still champion is...LANCE LEGSTRONG!


Dec 9, 2005 4:32 pm

 Thanks Malcolm!

Dec 9, 2005 4:32 pm

Lance, this isn't my battle, but I did read the EDJ financials you linked to.  You're misinterpreting things.  The notes say:


"At June 24, 2005, EDJ’s Net Capital of $598,664 was 24.7% of aggregate debit items and its Net Capital in excess of the minimum required was $550,233."


I'm no fin-op, but I think you're miss-reading this when you said their minimum net capital was $550,233,000.  Based on that note, that's their EXCESS net capital over the required minimum.  Stated another way, it looks like their required minimum net capital is something around $48 million. They're also saying their net capital was 24.7% of aggregate debit items, when the minimum net capital requirement is only 2% of debit items.  So, it looks like they're net capital is about 12 times the required minimum.

Dec 9, 2005 5:31 pm

Have to laugh about the 'lawsuits' that are pending.  They are falling down on merit everywhere.  When clients had the chance to run from the 'travesty that was profit sharing' only about 2-3% did so. If you generously figure that half of those were people legitimately bothered by the revenue sharing, it still would show that apparently very few felt 'injured' enough to actually leave the investments!


The CA case is dying a slow death and everyone now knows it.  It will never see court and is on its way to the heap of paper in the basement. 


Edward Jones may be one of the top 3 most secure investment firms in America today...Love 'em or hate 'em...they aren't going anywhere. 


Dec 9, 2005 5:50 pm

Hey Duke Maybe you are right....I could be wrong. I wonder what those loan indentures say...Foot Notes are so much fun.  Please read left column of page 4 again it states that the minimum Partnership Capital that must be maintained is $400,000 (000s) and that the minimum net capital was $181,616.  Maybe a nice person at Jones HQ can post their recent FOCUS II .  But I think what this means that IF the capital drops below $400 million then the bank loans are called....MELT DOWN!  Of course I could be wrong.  This is just an internet chat room!


Proud LP....why can't EDJ issue any LP units?  You know you sound just like Dick Liddy when General American was going under, NO you sound like Ken Lay setting the troups straight at the Enron meeting! "Nothing can happen to us we are too great, too big...blah blah blah"


You Jones   are so much fun to deal with!  Y'all get so sour when we suggest that there could be pee in those jugs instead of Kool Aid.  The GPs are peein' in y'all LPs jugs! 


Dec 9, 2005 7:10 pm

Touche' Sonny Clips 


Of course there is the other side of that equation...


Willing it NOT to happen does not mean it will NOT happen


You are why I love this board


Have a great day! 


Dec 9, 2005 7:27 pm

how many ej fin-ops are there posting on this site?

Dec 10, 2005 3:54 pm

Read the On Wall Street article this year regarding Regional Firms, which is what Jones was classified as.  We need to get a neutral view on this firm.