MS announcment on 11/3?

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Oct 29, 2006 9:37 pm

Well obviously word leaked out and there will be comp changes to be announced. I will say i am impressed with Mikebutler intuitiveness. Must be in upper managment are an Assistant Manager. Oops, didnt mean that since they are removing that position in December. The question really is how good is the bookkeeping? We know that there will be an increase in compensation for those who do over 300k. But i also know there is no free lunches! Oh yes, discount shareing thats the answer! Lets penalize brokers who discount!


Oct 29, 2006 9:45 pm
Elvis:

Lets penalize brokers who discount!



If you sold computers would you expect your employer to allow you to reduce their profit without sharing any of that cost?

Oct 29, 2006 10:19 pm
Elvis:

Well obviously word leaked out and there will be comp changes to be announced. I will say i am impressed with Mikebutler intuitiveness. Must be in upper managment are an Assistant Manager.


Could it be I just listened to Gorman saying exactly that at the last town hall meeting? Gezzeeeeee

Oct 30, 2006 12:44 am

Haven't we been saying that the comp changes were coming and that they would be pretty good for a change?

Oct 30, 2006 8:54 am
Devil'sAdvocate:
Elvis:

Lets penalize brokers who discount!



If you sold computers would you expect your employer to allow you to reduce their profit without sharing any of that cost?



It happens all the time.

Oct 31, 2006 2:05 am

Yes MS will have to up comp packages to stem attrition. Payouts will probably increase for those who do North of 300k. Payouts will also prob increase for tickets bigger than $400-500 dollars. Wachovia is really leading the way with the different platforms. MS mgmt must realize that the ol Merrill way: "My way or the hiway" just won't cut it at this point. Both Wachovia and the independents are putting tremendous pressure on the big wires to pay up or lose another wave of brokers...and the clients that would follow.

Oct 31, 2006 12:37 pm
BondJamesBond:

Both Wachovia and the independents are putting tremendous pressure on the big wires to pay up or lose another wave of brokers...and the clients that would follow.



ROFLMAO, I doubt any of the changes will come as a result of pressures from Wachovia and Indies...

Oct 31, 2006 9:21 pm

Remeber the game "Musical Chairs" where the last two or three to find a seat would push and shove to get that seat?  That moment the music stopped playing and this sense of desparation that surrounded everyone.  It's still a fun game...to watch from a distance.  Much like MS.  You can only remove so many chairs (clients, brokers, branches, staff,etc) and then the game is over.  The music on MS stopped playing long ago.  It really has become a sad shadow of what it once was...or could have been.

Oct 31, 2006 9:42 pm

Disagree w/$ n the Bank!!! I have worked at Morgan for sometime now, and i believe it is still better then most firms out there. The point i am making, is that they cant fess up that anytime there is a change someone always loses out. Most of the time it is the broker. Come 11/2 they will hype this new compensation as a benefit for the broker (yes in someways) but not explain the math on how they are going to do this. Creative bookkeeping!!! Transactional brokers will lose out, and therefore brokers will leave.


Oct 31, 2006 11:03 pm
$ N the Bank:

 The music on MS stopped playing long ago.  It really has become a sad shadow of what it once was...or could have been.



ROFLMAO, clearly you haven't a clue. What it was, was "stocks and sox", what it's becoming is much, much better.

Oct 31, 2006 11:12 pm
Elvis:

The point i am making, is that they cant fess up that anytime there is a change someone always loses out.


For crying out loud. Could you spend much more time looking for dark clouds? "Fess up"???? Still sore because they're aren't going to be more cuts, as you predicted? Everyone over 10 yrs of age understands there are no free lunches and that most everything involves a trade-off.


Elvis:

Come 11/2 they will hype this new compensation as a benefit for the broker (yes in someways) but not explain the math on how they are going to do this. Creative bookkeeping!!!


If that’s what you want to call discount sharing, as many firms already had, and as will be clearly explained.


Elvis:

Transactional brokers will lose out, and therefore brokers will leave.


If you say so, and without even seeing the plan yet, oh negative one. Transactional brokers should have learned a long time ago that their business model isn't in vogue. They've been getting a 10% haircut on that sort of business most everywhere (MS included) for years.

Nov 1, 2006 7:31 am

Do any of you think it's possible--JUST POSSIBLE--that the big wires are attempting to deal with the relatively unprofitable retail side of their business, and if not successful will simply close all virtually all of their branches and fall back on the much more profitable institutional brokerage and investment banking?


Y'all just don't understand that in today's environment the far flung networks of retail branches are not able to justify its existence.


Clients are more and more comfortable with 800 numbers, Internet access, real-time email alerts and all the rest.  The fee based model came into existence in a frenzy to replace transaction oriented commissions which went to the discounters--next to go will be retail, replaced by call centers and highly focused, and targeted, on-line seminars and training sessions.


The retail producer is going to be given an opportunity to accept what amounts to the role of an independent, or to attempt to transfer their book to another firm, or to retire from the business.


The age of computer literate investors is upon us.  I am at the leading edge of the baby-boomers.  For several years I have been giving my Dad laptops, but he uses his to write letters and do geneology type things.  He has no desire to invest on line, while I cannot imagine not investing on-line.  Those who are younger than me are even more comfortable doing things on their own.


Think about the accounting firms.  Years ago doing individual tax returns was a large part of their business--many firms looked to their corporate clients to pay the overhead and the individual clients were the profit.


Enter H&R Block kiosks in malls and Turbo-Tax.  How did the "Big Eight" frms adapt?  They consolidated and closed offices.  If you didn't have the personality and skills to be an institutional accountant you drifted to other work.


The only constant in business is change.

Nov 1, 2006 8:35 am

That may be true to an extent, but didn't we hear the same war cry a few years ago when everyone who could set up a website was making millions in the online retail businesses?  In the age of the "New Economy" weren't the big box retailers going the way of the dodo?  (Personally, I felt that the jig was up when an IPO came out for a company that would allow consumers to buy dog food online.)


Naturally change is inevitable.  It's always been inevitable.  But it's not coming in one fell swoop, it's evolving--just as it's always done.  There will be a need for retail brokerages for the foreseeable future.  If this were not so, why then are the majors all hiring like mad?  I think they would be able to see the handwriting on the wall if your scenario of the future was accurate.  Or are you claiming an omniscience that no one else posesses?

Nov 1, 2006 8:52 am
Starka:

That may be true to an extent, but didn't we hear the same war cry a few years ago when everyone who could set up a website was making millions in the online retail businesses?  In the age of the "New Economy" weren't the big box retailers going the way of the dodo?  (Personally, I felt that the jig was up when an IPO came out for a company that would allow consumers to buy dog food online.)


Naturally change is inevitable.  It's always been inevitable.  But it's not coming in one fell swoop, it's evolving--just as it's always done.  There will be a need for retail brokerages for the foreseeable future.  If this were not so, why then are the majors all hiring like mad?  I think they would be able to see the handwriting on the wall if your scenario of the future was accurate.  Or are you claiming an omniscience that no one else posesses?



They're hiring bodies in an attempt to generate revenue--every new broker has potential to bring in much needed revenue.


Don't be so sure the changes cannot come in one fell swoop.  There were a couple of thousand Legg Mason brokers who woke up one day to find that their branch was going to close.


Even if the morphing is relatively slow, how does that fit into the long term planning of a man or woman in this industry?  If you plan to sell your book at some point in order to retire who is going to buy it if the clients are going to the Internet and other places?

Nov 1, 2006 8:59 am

I've never made that claim.  Personally, I could retire again tomorrow.  I've set something aside for years against the day that I couldn't work anymore.  Why?  Because I've always known that change comes to all entities.


Are you saying that all brokerages have business models as flawed as Legg?  Further, you claim that brokerages are hiring like crazy to generate revenues.  Why else would you hire like crazy?


Your reasoning here is defective...where are the widespread branch closings?  One anecdotal example is not a trend.

Nov 1, 2006 3:02 pm
Devil'sAdvocate:

Y'all just don't understand that in today's environment the far flung networks of retail branches are not able to justify its existence.


Clients are more and more comfortable with 800 numbers, Internet access, real-time email alerts and all the rest.  The fee based model came into existence in a frenzy to replace transaction oriented commissions which went to the discounters--next to go will be retail, replaced by call centers and highly focused, and targeted, on-line seminars and training sessions.


Said as only a failed-broker cum-middle management flunky could. I hear the same speech in 1993, Schwab was going to put us all out of business.....

Nov 1, 2006 3:03 pm

hear = heard

Nov 1, 2006 3:11 pm
Devil'sAdvocate:

Do any of you think it's possible--JUST POSSIBLE--that the big wires are attempting to deal with the relatively unprofitable retail side of their business, and if not successful will simply close all virtually all of their branches and fall back on the much more profitable institutional brokerage and investment banking?


Y'all just don't understand that in today's environment the far flung networks of retail branches are not able to justify its existence.


Clients are more and more comfortable with 800 numbers, Internet access, real-time email alerts and all the rest.  The fee based model came into existence in a frenzy to replace transaction oriented commissions which went to the discounters--next to go will be retail, replaced by call centers and highly focused, and targeted, on-line seminars and training sessions.


The retail producer is going to be given an opportunity to accept what amounts to the role of an independent, or to attempt to transfer their book to another firm, or to retire from the business.


The age of computer literate investors is upon us.  I am at the leading edge of the baby-boomers.  For several years I have been giving my Dad laptops, but he uses his to write letters and do geneology type things.  He has no desire to invest on line, while I cannot imagine not investing on-line.  Those who are younger than me are even more comfortable doing things on their own.


Think about the accounting firms.  Years ago doing individual tax returns was a large part of their business--many firms looked to their corporate clients to pay the overhead and the individual clients were the profit.


Enter H&R Block kiosks in malls and Turbo-Tax.  How did the "Big Eight" frms adapt?  They consolidated and closed offices.  If you didn't have the personality and skills to be an institutional accountant you drifted to other work.


The only constant in business is change.



Once again you have proven yourself to be completely clueless about the real world......spouting the same speech that was given to financial advisors throughout the latter half of the 90's.

There is a vast gap between the skills and ability required to log onto a website and the knowledge and emotional discipline reqired to be a successful investor.  Most people don't possess those key attributes.  I have seen this first hand, as over the last decade I've had MANY clients consolidate assets with me after finding out how badly they could hurt themselves trying to do it on their own and following the latest hot idea.  Call centers and focussed online seminars aren't going to change how people react to fear and greed.....

Nov 1, 2006 5:53 pm

All Iwant to say is that I left a year ago and it was the best business decision of my life. Management has never had an original thought in their life. Every change in compensation or account fees was because "merrill" or some competitor did it first. They have 8000 brokers now. from 1990 to 2004 they hired about 1000 trainee brokers a year. How many are left from the 14000 hires. The answer is very few. This does not mean they are all out of the business, some work elsewhere. 


MS is now bragging how they are hring top "talent". They are hiring million dollar producers because they are paying so much for them. They are blowing money on this and the "rising star" program.  What is more profitable, to keep  two  loyal 500k producers ,or pay a million plus for a million dollar producer who has jumped ship 3 times in the past.


Mr. Butler, whatever your real name is, why do you defend this company?  Did you really inherit enough accounts from the thousands that left that you feel you must defend it? John Mack does not care about you. James Gorman does not either You are a number and your clients are a number.


Enjoy the comp changes. Send me your IRA's that are going to the call centers.I wil take the 200k  rollovers in the future I hope all of you at Morgan and Merill chase the high net worth only.  That leaves a lot of business for brokers like me.


Nov 1, 2006 6:07 pm
aldo63:

All Iwant to say is that I left a year ago and it was the best business decision of my life. 


You bought high and sold low, that is unless you were asked to go a year ago...


aldo63:

What is more profitable, to keep  two  loyal 500k producers ,or pay a million plus for a million dollar producer who has jumped ship 3 times in the past.


You can do both, as last QTRs number proved.


aldo63:

Mr. Butler, whatever your real name is, why do you defend this company? 


Because thus far they're doing exactly the right things. If they start doing things I disagree with, you'll hear that too.


aldo63:

Enjoy the comp changes.


Will do, thanks.



aldo63:

Send me your IRA's that are going to the call centers.


"Call centers"? You're barking up the wrong tree.



aldo63:

I wil take the 200k  rollovers in the future I hope all of you at Morgan and Merill chase the high net worth only.  That leaves a lot of business for brokers like me.


Oh, you moved to Jones?