I miss EDJ

Pend/32 FSPEND/12

There! Feel better now?

ahhhhhhh…that’s better…thanks

Wow, that’s funny. Let’s see if we can organize a PM Promo…We’ve got some pretty nice Jones picture frames we can give out as prizes.

Seriously though, man, I really miss Summer Regionals. I miss getting together with my fellow IR's , learning about new products like... uh, well, getting together anyway.

And I miss those Elmer Fudd cartoons they used play at the beginning of the Regional Meeting. Oh wait, those were Doug Hill videos. Hey, is it just me or does he sound like Elmer Fudd to you?

"People, we have pwoblem. We must gwow. If we don't gwow, we die. Gwowf. Gwowf. Gwowf. That must be ouw mantwa."

I couldn't help but to find humor in everyone of those posts.  In the first post I ever made, I mentioned I was actually split down the middle w/ Jones, and when it comes to the things mentioned previously, well, I agree.  Never hated it like all of you, but your all right about everything listed above.  Was it all that bad though???  Few FSPENDS?? Hell, you didn't have to go to PM Promo's.  I had buddies @ the Reg Metting's, we just clowned on everyone that drank the kool aid.  You can still make it as a Jones IR and not drink the aid, but I bet there are a few of you that will clown on this post, so feel free and fire away.  Don't think you scared me off, I will be out of town @ weddings all weekend, but I will be ready for all the kind words when I return. 

Have a nice weekend fellas, look forward to chatting again next week.

"Yes, MR IR, I know you just asked a perfectly simple question, but I am going to need you to go ahead and send a wire to #__  and we will get back to you in about a week" 

I don't miss that s*$t

"And I miss those Elmer Fudd cartoons they used play at the beginning of the Regional Meeting. Oh wait, those were Doug Hill videos. Hey, is it just me or does he sound like Elmer Fudd to you?"

I personally think the biggest cartoon character of the GPs was Fes Shaughnessey (SP?).  What a goofy dude he is! 

Yeah...he was a little weird looking. Big drippy earlobes and weird nose. But what about Alan Skrainka? With that big egg head?

Seriously, had a client who had HUGE crush on Alan Skrainka and was two steps away from being a stalker!

Been with JOnes 7 years and love it.  Do I love ALL parts?  No.  Never have, never will.  BUT, last year I grossed $517,000 which netted me about $196,460.  I also got $42,000 in bonuses and 10,730 in profit sharing.  So, $249,190/$517,000, I had a 48% payout on cash items.  I didnt figure in things like trips because you clowns some how dont value them at all.  I agree you can go on your own trip with your family.  Remember, you will  NEVER spend $600-$1,000/ night on a plush hotel.  Dont say you will.  So, I will take a 48% payout and deal with email restrictions, field supervision and A-share annuities.  No problem.  I dont care how much Weddle makes.  Thats like working and BAC and worrying that their CEO made a gazillion dollars.  who cares.  SO, you are your 90% payout is fiine, but at the end of the day, you get to keep what 60%.  I’m not leaving for an extra 12% payout.  Yep, leave it on the table.  I was actually thinking about all this as I was laying in the infinity pool in Italy. 

I miss the sexual harrassment and inclusion videos myself...

Success--back out your office overhead which comes out of your net...and I assume your assuming 1% of net from Jones advertising?  And, that's in an extremely high bonus bracket enviornment.

Also, you are losing tax deductions as well being an employee.  Your first 2% off your AGI doesn't count. 

Trailing 12, I grossed about 730k netted about 590k and had about 120k of office overhead (did alot of advertising --but cutting back so I should be lower on overhead going forward) which brings me to 470k net.  Thats about a 65% net/net.  I also get mega tax benefits and own my own business.  I put 60k into a safeharbor plan last year for the wife and I (yes, she is listed as an employee).  17% better net/net than Jones--NOT counting overhead at Jones?  So, the real difference is closer to 20% on payout.  On 700k of gross--that's 140k more I take home than I would have at Jones.  My trails and fee business will generate over 300k gross this year and probably get close to 400k next year.

Almost 12k per month difference and your still like a hamster on a wheel generating trade after trade to get paid.  nothing wrong with that.  I congratulate you on your achievements.  But, you don''t have it near as good as you think you do.

(ps also got 1000 free stock options--presplit from RJ last year)

Success-

How big an office did you inherit? Very few have done it from scratch to the numbers you describe. What is the rest of the story? Cmon tell us.

More have built offices from scratch than you think…

Success

You are the "ultimate employee" for Jones. You will always be an employee...yes you do make some money but what are you going to do at the end of the road? Give it all away to some GP's punk nephew. Get the hell out of there while you still can and become an owner, the rewards are bigger on the indy side. Oh and BTW did I mention there is email on the indy side.

Run baby Run!!!!!!!

Hey Success-

48% is reduced by at least 3-4% for expenses not covered by Jones. Zacko is right on again. My point regarding the 512K in 7 years. Firm average is .70 so assets would be around 74M, an average of 10.5M per year. That would be quite a story. Maybe some of have seen that, in my region I can't think of anyone.

I built my office from scratch and my numbers are in the range mentioned, but about 5% lower. The difference is, I’m out under 5 years. I actually like the trips a lot…honest.

In 5 years I was over 500k also.  I got about a 1% turn on my assets until I got to 50-60 million.  Now, it's abut .70 or maybe even a little less.  If I ran a Jones style business--I would have been able to do a million last year.  But, when your putting new $$ in wrap accounts, it slows you way down on the production.  I'm not complaining as it's all part of my long term business plan.

I liked the trips too for a bout 5-6 years.  After that, wife and I always did our own thing and blew off the Jones dinners.  Took cash on alot of them too in favor of going on my own vacation.

The RJ indy trips (gotta do 700k to go) are nicer and more lavish--but the Jones trips weren't that bad.  I did some stuff I wouldn't have ever done.  RJ's 1099 on my nevis trip last year was 8k so I gotta pay taxes too. 

What will Jones reaction be once revenue sharing is gone as we know it

today?

The Truth: What will Jones reaction be once revenue sharing is gone as we know it today?

--------------------------------------------- 

Correct me if I'm wrong, but the primary problem with revenue sharing is the fact that it wasn't disclosed to the client. The practice is not illegal per se, unlike it's nondisclosure. So, I don't think it will be eliminated.

However, if it was eliminated, who do you think would bear the brunt of the loss of a major source of revenue? You score 100 points if you said, "The broker's payout".

zacko has some good points concerning taxes.  you are also right that i am limited on my retirement savings (401k).  Dont get me wrong, i think independent absolutely has its benefits.  however, if there were no downside, no one would work for anyone else.

I started from scratch.  I received 0 accounts from anyone.  no family money either.  i worked 70 hrs week the first year and opened 395 accts.  a wife and 2 kids later, i work about 30 and having fun.

Success,

Some people just don't want to have their own businesses.  They would rather not have the additional responsibility and liability.  I spend about 2-3 hours per month doing payroll, paying bills...etc.  As an indy, you pay your also pay your own E&O.  I also think most brokers who know about indy--who don't go are afraid.  They are scared they might be wrong in leaving their current firm...after all if it sounds too good to be true, it probably is.

At Jones--it's sort of like your half way there already.  In fact, to most clients--the perception of being indy or being at Jones is the same.  They see you as being in a one man office.  Of course, I could hire brokers now if I wanted and get an override.  I've chosen not to for now. 

zacko,

thanks for the conversation.  its nice to actually read a post that doesnt bash JOnes or any other firm for that matter.

Zacko, you nailed it............................

What price is there for real FREEDOM.........MONEY and a lot more of it!

The biggest benefit and Zacko I think you really outlined it is the fact when you are indy and OWN your own business - you control your margins!!!!  You actually get to determine what and where you spend and how much of it you spend.  Look at your gross after paying the costs to do biz at your indy shop - it's probably a 83-85% payout:  from there, you are making the choices on how to best spend the money and as a result can determine what your net will be.  More importantly, you control spending that money in areas that directly affect your business locally v having a GP or whoever else determining how to best spend it for you. 

 Imagine a million dollar producer who nets 40% and Jones or whereever else - the b/d determines how to best spend the $600k they took from you.  Take that indy million dollar producer who is seeing $850k hit his/her grid and determining where they are going to spend their dollars to affect their business.  Now they net $600k or better.   They took $250 k and spent it where it helps their business as they determine. 

Now ask:  What did you get for the $600k jones took from you?  A BOA, an office, a trip or two, 1/2 expenses paid on the office and a few other things like????   Compare that to the $250k the indy owner spent.   They're getting probably 2 - 3 admin assistants, marketing targeted specifically to their ideal client, a level of local service due to the support staff they have that their clients never felt before and etc....  Point being, with the $250 k I spend as an indy - at a minimum I am giving/getting the same that it costs the jones advisor but for $450k less. 
I control it, I know where it'll benefit me and my business and in the end receive a much greater level of benefit as a result of it.

does anyone know how the independents in Louisiana are doing? 

I am certain you have a point success… perhaps you should just state it.

[quote=success]does anyone know how the independents in Louisiana are doing?  [/quote]

What does that question mean?  Are you trying to say that being and independent is..... oooooh .....scary music.......dangerous?  Of course it is.  When you are in business for yourself (any business), you'd better be ready to go up against the wall, go all out and put everything on the line.

I would imagine that they experienced some difficulties with accounts transferring out, if their clients have moved away and do not intend to come back.  Possibly they had some damage to their buildings if they were in the area that was affected. I expect they were insured.

You do realize that all of Louisiana didn't get wiped off of the map and that the investments that the reps are managing are nice and snug somewhere else?  Living in the path of known dangers such as hurricanes, tornadoes or on top of earthquake faults is just one risk that people take.  Most of us plan for the eventuality of that risk and don't expect someone else to pick up the pieces for us.  That is also the difference between being an Independent and being somebodies employee.

success - they're doing ok, for the most part.  I think that there are select groups that were impacted more than others.  I know a group of five really well and they have had to move offices 4-5 times since Katrina hit, but are settled now.

I know some reps were initially hit when clients had to withdraw some money to handle repairs, build new homes, move, etc., and this caused them to take a small hit in production initally, but they have rebounded since then. 

Just saw a response from Weddle on the suggestion box responding to the question, "should we as IR's be concerned that over half of the firm net revenue is  from revenue sharing." The questioner went on to ask," Will Edward Jones go out of business if revenue sharing practices are banned completely."

His first response was "It sounds like you have been talking to a recruiter from another firm." I was amazed he did not respond in the usual form, That's a great question, I am glad you asked.

Question for BrokerReucruit-

Should we be concerned? Is there a move a foot to ban the practice?Or is this as Weddle suggests a scare tactic? 

No, I am not scared.  I am very confident in my ability and what firm I work for.  Yep, thats right. I work for somene.  We all do, you just may not reallize it yet.  I have never and will never say Jones is perfect, but it sure beats working for a wirehouse.  Now, the independent thing has merit.  You own your business, but I am not sure I have ever heard of being able to retire on selling my book.  But lets say you are banking on selling your book to help with your retirement nest egg.  How much do you have to sell your book for it to provide, say, 30k-40k a year?  600k?, 700K ?  Who in their right mind will pay you that?

As for revenue sharing.  Its like a statistic.  you can create whatever answer you want when asked what impact it will have on JOnes.  Bottom line, it would reduce overall revenue by that amount. Simple.  Not half, not a third.  maybe 4%. 

Whether you convince your client to buy an A share or you choose to put everytihing in managed money, at the end of the day its what you think is best for your client.

[quote=success]

  I have never and will never say Jones is perfect, but it sure beats working for a wirehouse. 

[/quote]

I don't think rev sharing will be banned.  Jones would certainly be affected if they eliminated it.  In fact, more than just about any firm they would be hurt.  IR compensation would be reduced with certainty.  So would bonuses.

Weddle brings up a recruiter?  That's too funny.  I'd imagine that Weddle and others have to deal with the fact of ongoing departures.  It must be on his mind.  Especially with the long weekend coming up.

Success-

Read the disclosures. 220M out of a net of 300M came from revenue sharing. I count insurance revenue sharing as well.  Where does your calculator come out to 4%.

Not suprised. Most IR's are big picture reps.

[quote=success]

You own your business, but I am not sure I have ever heard of being able to retire on selling my book.  But lets say you are banking on selling your book to help with your retirement nest egg.  How much do you have to sell your book for it to provide, say, 30k-40k a year?  600k?, 700K ?  Who in their right mind will pay you that?

[/quote]

Wow, the kool-aid must have really gone to your head. 

Go to this website and see what your biz would be worth,... www.fptransitions.com

footsoldier,

Total gross revenue of 3.1 billion would.  Take away $220M, whats your total revenue now?  2,880,000.  Will it have an impact, sure.  If the NASD ever decides to look into wrap account, i bet you income drops in half and if they crack down on variable annuities, you're done.

[quote=success]

footsoldier,

Total gross revenue of 3.1 billion would.  Take away $220M, whats your total revenue now?  2,880,000.  Will it have an impact, sure.  If the NASD ever decides to look into wrap account, i bet you income drops in half and if they crack down on variable annuities, you're done.

[/quote]

It never fails. At some point in a discussion about the different business practices of Indy Vs Jones the Jones reps get the same snotty holier than thou attitude.  Its the same feeling you get when you are talking to your know-it-all teenager.  You just know that they will have to learn the hard way.  Sigh.

Success-

Gross revenue minus expenses = 300M. That is called net profit to partners. If rev sharing reprents 220M which is 95% net to the GP's your numbers are bullsh*t.

Perhaps in a way you can understand. It is not how much you make, it is how much the GP's keep. That's why rev sharing is so important to our firm.

its not being a snotty teenager.  its a fact.  my point is not to be sarcastic.  it is sto imply to point out that there are many things that can neg. impact all of our businesses.  revenue sharing for us and wrap fees for you.  those are just 2 examples.  I have no problem with you being indy.  its fine.  i didnt say you drank indy kool aid.  people are so quick to through this kool aid thing out.  maybe i like working for jones.  maybe i dont care if i can sell my book.  i’ll give it to my daughter.  maybe i will like drawing 40k a year in LP earnings.  maybe when i am 80, i may regret not going indy.  by then, money wont be able to help me.

i’ll give it to my daughter.

success-

Did you get your financial planning training yet? How about a calculator? I am sure your destined for greatness at Jones. You could be one of the company leaders someday.

No matter if your indy or working for someone else, you have to do the math at some point. Mr. Gecko said it best. It's all about greed.

If you can understand a 10K, maybe even you would be enlightened.

how about this question mr babble.  what makes you happy?

I really won’t ever sell my book…why would you?  Bring in a partner, and share in the revenues for the rest of your life…why would you ever “retire?”  What’s the point of building a fee based practice (which would otherwise provide you with lifetime income) and selling it?

[quote=success] it is sto imply to point out that there are many things that can neg. impact all of our businesses.  revenue sharing for us and wrap fees for you.  those are just 2 examples.  [/quote]

Wow, they really do drive that "wrap fee = evil" message in hard, don't they?

Mike,

i didnt say i am against wrap fees.  I think it can be appropriate as long as the fees are not too high.  Wrap accounts give the client more flexibilty.  However, most folks i know do it for the recurring revenue.  There are pros and cons to ever platform out there.  They can all be "evil" if taken advantge of. 

I agree with Zacko.  the arguement about selling your book is non sense.  I think  a better arguement is saving more in a 410k, more deductions, and better product selection. 

success-

Maybe what you ought to do is become a GP. You have double speak in your blood. "I did not say wrap fee was bad." Go back a few pages and look. Babs was right. The only way to defend is attack.

Have you looked at fees associated with mutual funds (personalfund.com dude, check out transaction costs)? And you are worried about wrap fees. Did you know that your/my firm participated in directed brokerage (a fee was paid to Jones to transact for the funds) until it was banned? Did you know that the GP's had an ownership interest in Hartford mutual funds since 1995, and terminated the relationship with a 70M payment to the GP's along with other income durng the last 10 years? Did you get any of that? I didn't. Are you still paying 1300/ month for the most ridiculous technology on the street. Do you have financial planning software (do you even know how to calculate IRR). Can you communicate with the rest of the known world in an effecient manner. By the way, I have company email but am unable to send attachements.

Oh yeah, the final question. How do you feel about giving the GP's 60% and they only made 60M of the 300M as a result of yours and my efforts? The rest (get your calculator out) came from back door arrangements? So when Weddle is asked the question should we be worried ( and bozos like you say its only 4% of revenues but 60% of net profits) the rest of us just shake our heads and say its not a matter of if but when we choose to change b/d's.

So congrats on your production and enjoy the trips. You'll figure it out someday, maybe.

[quote=footsoldier]

success-

Have you looked at fees associated with mutual funds (personalfund.com dude, check out transaction costs)?

[/quote]

Footsoldier! THANK YOU! I had stumbled upon personalfund.com a while back and couldn't remember what it was called....(duh).

< I'm jumping out of my desk and throwing both arms in the air a'la Mary Catherine Gallagher...You're a SUPAH STAH!>

Last year they took 70%. Factor revenue sharing against net income. That

paints a clearer picture. The GPs will never take a lower payout.

success-

Appears that others have a different calculation than you. (Remember your comments on this thread that rev sharing is only 4%)

Could mean that you'll be taking over for Weddle in a few years. Truth comments in his last sentence above is probably the most powerful words of the day.

"I really won't ever sell my book...why would you?  Bring in a partner, and share in the revenues for the rest of your life...why would you ever "retire?"  What's the point of building a fee based practice (which would otherwise provide you with lifetime income) and selling it?"

There are so many reasons to sell a book of business.  In many ways, it should be no different than selling any business.  However the main reason that someone would sell is that sale price is worth more to the seller than the continued stream of income + any potential headaches.   (Clients don't like new person, continuing ed becomes pain in the ass, etc..... and there are LOTS of etc.)

Great accounting work going on in here.  By the logic displayed here you could easily say that Income was 1000% of revenues. 

Read the books more carefully and you will see that RS makes up about 4% of total revenues.  Even if you used power logic...that means that about 4% of income was from revenue sharing.  

I don't think any company wants to lose 4% of income but it is not like revenue sharing makes or breaks Edward Jones as a company.

footsoldier,

relax dumb ass.  In an earlier post, I had my cash payout last year at 48%.  Include commission, bonus and profit sharing.  I am fully that bonus is based on my PL statement.  If we assume the avg. bonus bracket is around 30% (sometimes its 0 and somtimes its 50), then 48% is a good number. I am cool with that number.  i dont care how much weddle makes. Maybe someday something will happen at Jones and many more will go indy.  But for right now, if i maintain about 48% payout, great!  And yes I enjoyed Italy at the hotel carusso. 

success-

You had zero out of pocket expenses (that would be described as money out of your pocket or money deducted from your paycheck)? I average about 16K last year with out of pocket expenses, how do you explain that. And you tell me to relax. I won't bother with your other comment.

Get a grip dude. Just look at real net numbers. That's the point with revenue sharing. Rev Sharing at Jones represents (here comes the calculator again) 73% of net profit.  I concede that 4% of revenues is not that much, but 73% of net profit (to the owners, i.e. general partners) does present a different and potentially changing scenario.

In the context of my earlier responses, when our managing partner was asked what are the potential issues to EDJ if rev sharing was banned, he responded with sarcasm. Actually similar to you.

I'm raising my hand with a question here....

Success...When has bonus bracket @ Jones EVER been 50%? I can't recall a time in the last few years?

foorsoldier,

ok, if i had 10k out of pocket, im still at 46.87.  still fine with me.

devoted,

the year was 2000.  for numbers sake, i assumed an average bonus bracket of 30% over that past 10 or 20 years.  maybe its 25%.  whatever.  the point is its cash to me.  i may be leaving 13% on thr table.  i'm cool with that.

Success-

I calc (I know you can't) your difference close to 20%. So that means 100K a frickin year difference at your production.

You are so smart. Let's just take a look at what that means to your bottom line, 100K invested at 10% annually over your lifetime (assume 20 years). Gee that is 2.16M. If you are as young as you sound, assume 30 years, and your (in your words cool with that) decision cost you 3.39M. Just a drop in the bucket.

Welcome to the world of finance. It's no wonder Jones reps ripped on these forums.

footsoldier,

I know what my income is and i know what cash is.  I know what my annual out of pocket expenses are and most comes out pretax.  Everything else I write off.  Very simple math.  Its funny how you can spat numbers off like you can see my tax return.  I know exactly what I make, NET of everything.  If i buy something for the office, I write it off, just like you do.  My printer broke yesterday, I made 1 phone call and it was fixed in 2 hours.  I didnt even have to write a check.  Hears a question.  Why would anyone buy a franchise like Mcdonalds, Chick-fi-la, etc and pay royalties.  why not just open a mom and pop diner and call it footsoldier cafe.  You could easily make more b/c there are no royalties, right?  Well, i would prefer a chick-fi-la sandwhich over your any day.   I guess you could say that the 55% or so that jones keeps is a royalty.  If you dont think chick-fi-la has a huge royalty, call em!!!!!!!!!!

Success, I'll grant you that the franchises makes tons of money, but the product is terrible.  If you want a good burger you have to go to the Rocky's, the Big Kahuna burger, or the "mom and pop diner".  Sure, the consumer may spend a bit more at the independently owned restaurant, but they get SIGNIFICANTLY better quality and service than at the franchise.

success-

Now we are getting to the heart of the matter. Basically your inferring that you NEED EDJ to run your biz because you can't or won't. You are problably right on that issue (and its a big one I agree). But please spare us the numbers. You lose hands down the argument.

Zacko, and others I am sure would be happy to comment on their experience after they left the mother ship as to their true SUCCESS with client retention.

That sealed it Success. Been watching your posts for a few days and seeing you call people names and be hostile. Was trying to be tolerant of your perspective but when you compare our business to fast food your kool-aid spilled on my suit and it pissed me off. I get your royalty analogy. I understand the Jones “tradeoffs”. What you and other IR’s with only Edward Jones as your experience can not seem to grasp is that indeed you are serving chicken sandwiches while many of us are striving to be gourmets. I have 4 relationships that if you totaled them would represent an office that alot of seg 3 IR’s would fight to takeover. They just don’t want “chicken sandwiches”. You can think “just sell’em a good growth and income fund and it’s all the same.” and you would be very wrong. I certainly get leveraging the brand name and there is value to that but do not think being the low cost provider is what sophisticated investors are looking for or you will always be pushing hard till the last Tuesday of the month rather than trying to truly mange money.

Ok to be fair…not everyone is an entrepreneur and feels comfortable on their own.   If Success thinks that the trade offs he is making by having less income, less control and having a “brand name” to lean on is worth it… then that is his decision.  I’m Ok with that. It wasn’t good for me and I am much much happier where I am now.

But here is the rub and the annoyance with the EDJ clones who post here is that they always insert some sort of snide "we are better than you" comment.  They refuse to acknowledge that they have a more limited business model. They also seem to think that if you abandoned the Mother Ship you have somehow turned into Snively Whiplash and are fleecing the widows and orphans and they are Dudley Doo-Right defending the innocent.    I've seen some very good people at Edward Jones and I have seen some people I wouldn't trust with a toilet bowl plunger.  That's true of pretty much all companies.

What I don't miss about Jones?  The interminable, boring and pointless meetings.  The limited product line to offer my clients.  The hypocritical "inclusion" crapola. Listening to some clueless noob, who just had 30 million dollars dropped in her lap through a goodnight program, being held up as some sort of super sales person.  Gee wiz..give me 30 million on a platter and I bet I could rush through the segments too.  I also don't miss the camaraderie or socializing with the other IRs since I never did it anyway.  Being NOT one of the guys by default (I'm a woman), I was also not one of the guys by choice as well.

What makes me happy?  I get to keep more of the money I am making. I don't have some artificial deadline, quota, number of dials I have to make.  It is up to me what I do, when I do it and how I do it. Of course this doesn't mean there is no compliance...in fact there is more.  I can determine how much of my income I want to devote to advertising, overhead, computers....you name it. 

I am in control of my life.....hallelujah!

To speak to Success' analogy about the chain food vs mom & pop shop.

After we left Jones and began meeting with clients to "pop the big question" one client pretty much summed it up by saying...

"Well who is Edward Jones anyway? Isn't that guy dead? What do we want our money with a dead guy for? We want to come with you, where do we sign!"

Maybe some people are not good with recipes and choose to use the "company secret sauce"..while others can create a kick a$$ chicken sandwich from scratch. (myself I'd take the kick a$$ sandwich)

Success: Yeh, you “write it off” OK, but only to the extent of which your biz expenses EXCEED 2% of your income (misc. deduction on sched A) and ONLY if you itemize. Don’t even make me start in on AMT issues of 2106 deductions. Care to argue this?

Revealer

I am glad to see somebody point that out!

ok, apparently i have struck a nerve with some of you.  I apologize if i seemed sarcastic, etc.  I like working at Jones and I would probably do very well as an Indy.  In fact I have no doubt i would be just fine as an indy.  However, my final point is this.  I have never once critized the independent platform except on the occasion to rebut arguments wrap fees and bad annuities.  I happen to like the idea of managed money, but not all type.  I can see the value in having an account where my clients can buy the best mutual funds out there regardless of the fund family.  What i dont like is the constant “kool aid” and other jones bashing comments.  I think it is great that many of you own your business and you can control your revenue and expenses.  Just dont say I am stupid for leaving some money on the table.  I like money, but its not my life.  At least not anymore. 

success-

I too don't like the kool aid analogy. Your defense of yours/my company just shows you haven't yet got it. When you see the true manipulation for what it is, the constant double speak, half-truths, and sometimes outright lies, if you have an ethical bone in your body you just have to question the leadership.

I'll say it one last time. Check out the 10K. It reveals many companies that the firm owns (including another brokerage firm with Doug Hill as President). It is very evident as to who the real customer is at Jones. And it is not who they say it is. What a shock.

Success: its cool. I just think when you are speaking about something you don’t have all the facts on it is difficult to sound truly informed. I’ll put it in poker terms (maybe  another bad reference point for an analogy) I’ve played with the hand you have and I’ve played with the hand I have, like my hand now alot. (I am in the minority however on this point but I still loved the trips. That may change when I have time to start planning my own, been busy in transition) On some level many of us may feel we are trying to do some a favor by exploring other options and give them serious consideration.

I have never once critized the independent platform except on the occasion

to rebut arguments wrap fees and bad annuities.



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Bad annuities? Have you checked your revenue sharing annuity roster

against some of the other annuities that you conveniently don’t sell? Not a

good point to argue on your part.

If you have been reading the threads, proudlp and success are convinced rev sharing doesn't matter because its only 4% of total revenues.

When the computation of NET revenue to the greedy GP's (excuse me the owners) is done, the picture gets a little clearer as to why it is so important to EDJ to keep rev sharing and now must disclose until the cows come home. So if it goes away how do they replace 220M. A reasonable question that deserves an answer.

So far nothing but hot air from EDJ reps, and nothing but sarcasm from manangement. Rev sharing matters most to EDJ.

I'm not into picking fights...just pointing out the fact that Revenue Sharing is only 4%.  4% of Revenues equates to roughly 4% of Income equates to 4% of the return.  Even if the return was 50% last year, 4% of that would mean that Jones GP would still pay 48% 

Incidentally revenue sharing was only around 125 million last year.  Not 220.  If you figure about 3.1 Billion in revenues, 125 million is about 4% of that. 

It is a complete misunderstanding of corporate accounting to assume that if Income was 300 million and 127 million was revenue sharing, that somehow revenue sharing was 1/3 of income.  It just doesn't work that way.  You are comparing apples to shoes. 

I've said before that if revenue sharing disappeared completely then Jones would be hurt...by about 4%, though...not enough to likely cause the business to burst into flames and go away the way so many here would like. 

[quote=footsoldier] So if it goes away how do they replace 220M. A reasonable question that deserves an answer.

[/quote]



The answer to that question, is Jones eating crow and offering some sort of wrap acct. Personally, I hope it happens sooner than later.

Proud LP--

What you don't understand is that $125 million, $220 million--or whatever the hell the number is (why don't they just own up to it?)--just shows up on the Jones doorstep for product that has already been sold.  In some cases, that product was sold years and years (if not a decade or more) ago.  There is no capital outlay on the part of Jones, no training, no added cost of doing business, nothing.  It is just a big old helping of extra cheese on the enchilada.  Take away that cheese, and Jones ain't got such a good enchilada. 

The first thing to get whacked at Jones if significant changes comes to revenue sharing agreements as they exist today will be the Jones training program, because their insatiable desire to "throw sh*t at the wall" will very quickly go away (along with the Growth Leader position).  I was never a GP, but I have a degree or two in finance, I've read the 10-K, and I can push my HP financial calculator to the outer limits of its capability.  Without revenue sharing, EDJ is in a world of hurt.  Period.  If Weddle wants to bring a #2 pencil, a legal pad, and a financial calculator to a showdown with old Sooth, then I say, "Game On, Genious!"

That is a facetious spelling of “Genius.” 

Proudlp-

According to the edward jones website, mutual funds 172M , insurance 30.3M.  More than you stated and less than I quoted. 202M out of 300M (remember 95% of rev sharing flows through to the GP's) net profit. Roughly 67.3%.

  http://www.edwardjones.com/cgi/getHTML.cgi?page=/USA/product s/mutualfunds_revenue_sharing.html

http://www.edwardjones.com/cgi/getHTML.cgi?page=/USA/product s/investments/annuities_rev_sharing.html

This is proof that rev sharing is a huge profit center and critical to the firm. What say you proudlp and success now. Your firm could be in for a major change if the regulators do their job.

This paragraph is very telling at the bottom of the last page of the mutual fund disclosure. Hartford paid 3x as much as American last year to EDJ.

7. Hartford and Edward Jones also participated in a profit-sharing agreement entitling Edward Jones to a percentage share of Hartford Investment Financial Services, LLC's ("Hartford Financial") net income, paid annually. Edward Jones' profit-sharing participation in 2005 is included in the total revenue sharing earned from Hartford in the preceding chart. Effective Dec. 29, 2005, Edward Jones and Hartford Investment Financial terminated Edward Jones' profit-sharing participation. Edward Jones received a $70 million termination payment from Hartford Financial, which is included in the total earned in the preceding chart.