EDJ Bonds

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Sep 18, 2008 5:53 pm

Ok after the whole Lehman debacle I'm terrified to sell anything out of structured inventory but some of these bonds are yielding 7.5% and up.  Are any of you guys touching this stuff?

Sep 18, 2008 6:38 pm

If there was enough inventory in JPM, maybe.  You go ahead and make that call to your clients on Bears Stearns.  Let us know how that conversation goes. 

 
If I were calling on any bonds right now it would be munis. 
Sep 18, 2008 10:40 pm

I saw a Goldman Sach's in inventory today yielding 12%.  BAC yielding 8%.  I've got to think now is the time to add these as part of a balanced portfolio right now.  400 BP's above treasuries?  Talk about a risk premium on decent paper. 

Sep 18, 2008 11:25 pm

"Calling" to sell something in the midst of this situation makes you look like the true tools that you are.  I've taken almost $3 million from EDJ this month.   Keep callin' and sellin', MORONS!  I'll clean up your mess later.

Sep 19, 2008 9:00 am

Liar.

Sep 19, 2008 9:22 am

One account is about $1.7 million.  A nice laddered portfolio of GMAC notes+Ford notes+CIT notes+Lehman notes+buying AEPGX and AGTHX with the market near 14,000=ACAT!  Should hit today.  I don't think the guy meant any harm--pretty sure it is his largest client.  But, he's a kid and didn't know any better.  Did what he was taught in training.  I know the training.  Went through it myself.  I'm not a liar, but you're still a tool.  Hope we all have a great day today.

Sep 19, 2008 9:58 am

Congrats on your new account Sooth but here's a noticable difference between you and the indy's vs the Jones on here... Your rarely see us bragging about big accounts we stole from other brokers although I'm sure we get our fair share.  The fact that you have to brag about it on an internet forum to show how "superior" you are is laughable.  When you score a touchdown, act like you've been there before.

 
Sep 19, 2008 11:35 am
Soothsayer:

"Calling" to sell something in the midst of this situation makes you look like the true tools that you are. I've taken almost $3 million from EDJ this month. Keep callin' and sellin', MORONS! I'll clean up your mess later.





Are you that out of touch Sooth? I've been burning up my phone calling PROSPECTS with these irrational yields. The 3 accts I've picked up with only $40,000 total will within a year (if not sooner) have all/most of their money with me. They just don't know it yet. And to your $1.7 M household, I don't believe you, because as everyone knows, we don't have clients with more than $50,000 total.

Sep 19, 2008 11:41 am
Soothsayer:

One account is about $1.7 million.  A nice laddered portfolio of GMAC notes+Ford notes+CIT notes+Lehman notes+buying AEPGX and AGTHX with the market near 14,000=ACAT!  Should hit today.  I don't think the guy meant any harm--pretty sure it is his largest client.  But, he's a kid and didn't know any better.  Did what he was taught in training.  I know the training.  Went through it myself.  I'm not a liar, but you're still a tool.  Hope we all have a great day today.

 
So, you just picked up a pile of dog poop off the floor.  Good for you.  How are you going to miraculously going to turn that pile of poop into a bed of roses, oh wise one?  BTW, have you seen the track record on AEPGX and AGTHX?  Make sure you don't show them the Lipper or Morningstar reports on those.   
Sep 19, 2008 5:32 pm

I'm only going to put them into munis that are "insured", Spiffy!  You see, Hulk, I don't need to be calling clients to pitch them on, "Wow, look at this yield!" to get new accounts.  I'm getting new clients and accounts by staying on the horn or meeting with present clients face-to-face 11-13 hours a day.  I'm not giving them some canned message from Onionhead which speaks in ridiculously vague generalities, ends with everything is going to be okay, and manages to pat EDJ on the back (We avoided exotic investments like ARS.) 6 or 8 times in the process. 

 
I show them where each of their accounts are relative to the market and/or a blend of benchmarks that most accurately reflects the allocation of their account.  I remind them of tactical decision we've made in the past (staying way the hell away from the vast majority of financial stocks for more than 2 years for example), how they are allocated now, and any changes that I recommend to their allocation based on present circumstances.  I have concluded by telling some of them that the pillars of the US mortgage market failed, the largest insurance compnay in the world lacked adequate capital to continue operating, and two Wall Street banks that survived The Great Depression and every other financial crisis before this one vanished just weeks apart.  We are in unchartered territory, and I'm not sure where this ends or how long it's going to last.  At the end of the meeting I ask, "Is there anyone you know is is panicking and has made or is going to make very irrational decisions with their money.  I'd be more than happy to have a meeting just like this with them.  Tell them why you're not panicking, and what the performance of your portfolio has been in your time as a client.  You don't have to tell them how much money you have or exactly what you own, but you can throw out a number.  If you're happy, then I'm certainly not embarrassed."
 
Then, when I meet with the referral, I don't have to pitch them on my hot bond du jour to add a $10K account which hopefully will come my way over the next year.  I prefer a meaningful discussion about what they have now, their spending habits, interests, goals, and what they think my role and function should be.  Then I tell them how I operate, how I manage money, what some of my values are, etc.  I then bring over the entire account on the first meetng, or I agree that we may not be a good match. (Never because they don't have enough money.)  If we're not a match, I try to send them to someone who may work differently than me, but is still an honest, reputable, fair, and upstanding human being.  Believe it or not, a couple of times that has even been a fairly new Jones guy in the area who is way too smart to be working there.  (Kind of like Spiff.)  I give him another 2-3 years before he jumps ship, but he's a thoughtful, dedicated, and hard-working guy in the interim.     
Sep 19, 2008 9:20 pm

Liar.



Just kidding, Sooth. I was just giving you some crap back there. I was feeling a little "bobby-hull" at the moment. I could care less what you took from who. We're all stealing from each other right now. I had a client call me the other day to tell me that some guy from Morgan keeps calling him for an appointment, telling him he's "losing money" with his Edward Jones guy. Of course, my client hadn't told him dick about what his account was doing. Little does he know about my secret American Funds portfolio strategy!! My client told him to go blow smoke, but wanted me to know (I think he was offended by this guy - I don' think he realizes this kind of stuff goes on in our industry all the time, since I am his first advisor - 700K 401k rollover).

Sep 22, 2008 9:54 am

Sooth - I'd bet that if my best client owned the bonds and funds you mentioned they'd be thinking about moving to a different FA right about now.  My point was, what do you do with those assets now?  You're taking on assets that are selling at a fraction of what the client originally put into the accounts.  How do you stomach telling those folks to sell what they have, take the losses of up to probably 75% on some of them, and do something different.  They're probably getting a pretty good income stream from the bonds and the funds are pretty good long term.  I'm just curious what you might be proposing to those people that won't be screwing them in the process. 

 
 
Sep 24, 2008 8:21 pm

Sooth-B24 was just bustin yer chops...always assume humorous voice inflection from him.  Unsolicited Jones clients have been coming to me lately as well.   It's good to have so many options for them on the outside.

 
Spiff-The Indy voice from within u is calling...Spiff-Answer the calling....Don't fight it any longer. 
 
 
Sep 25, 2008 9:31 am

If I hadn't read that in my Darth Vader voice inside my head, you might have convinced me.  Instead, all I can think about now is Princess Lea in that little bikini.