Revenue Sharing
There has been discussion of revenue sharing at Jones here recently. Revenue sharing for 2005 was $127 million of $717 million in asset fees, and was 4.1% of the $3.1 billion in total revenue.
But-
If you read the disclosure you will see a little different number. 172M with funds and 33M with insurance. What source were you using?
[quote=Butkus]There has been discussion of revenue sharing at Jones here recently. Revenue sharing for 2005 was $127 million of $717 million in asset fees, and was 4.1% of the $3.1 billion in total revenue.[/quote]
Who cares?
[quote=footsoldier]
But-
If you read the disclosure you will see a little different number. 172M with funds and 33M with insurance. What source were you using?
FS- It seems ButKiss suffers from some form of Dyslexia. There is medication for it. But it reacts negatively when mixed with Koolade.
Adding insurance increases the revenue sharing contribution to overall revenue from 4.1% to 5.2%.
Remember, Mr. Butkus, as it states in the disclosure, it is ONLY a potential conflict of interest. Mr. Butkus, when do you feel it would constitute a real conflict? How do you describe this to your clients? Or are you like most IR's who don't read and have your head in the sand and hope your clients follow along.
Just wondering.
What happened to Guest1, proudlp, success, and the green monster? It would be nice to hear a competent rebuttal without a lame personal attack. After all the rest of us have gone to the dark side.
You just cautioned me against giving a "lame personal attack" right you gave me one. No wonder there isn't much thoughtful discussion here as many people don't want to stoop to it.
Obviously it would be a real conflict if the revenue sharing affected my investment recommendations. I don't believe revenue sharing affects my recommendations, and neither do my clients. I think I explain it clearly and simply. No one that I have met with has rejected an investment recommendation because of revenue sharing and the disclosure.
I don't have a dog in this fight, but it seems to me that the retail investor is not the one hurt by this type of shell game. The betrayal is between the firm and the broker. Arguably, many firms engage in the practice; however Edward Jones is the firm that a) seems to have been involved to a much larger extent, and b) was foolish enough to kick sand in the face of much larger and more upright firms via an ad in the Wall street Journal, yet expected no reaction.
It would seem that the emperor has no clothes.
[quote=Butkus]
You just cautioned me against giving a "lame personal attack" right you gave me one. No wonder there isn't much thoughtful discussion here as many people don't want to stoop to it.
Obviously it would be a real conflict if the revenue sharing affected my investment recommendations. I don't believe revenue sharing affects my recommendations, and neither do my clients. I think I explain it clearly and simply. No one that I have met with has rejected an investment recommendation because of revenue sharing and the disclosure.
[/quote]
Try recommending a Pacific Life insurance product to your client, and you'll see where revenue sharing compromises your objectivity. (You can't do it.......hint, hint)
Good pt Sooth. That would be selling away at Jones. Take a look at some
independent sources that rank sub-account performance, riders, cost, etc.
Most of what Jones sell are inferior just like their funds.
Butkus, how often do you offer anything to your clients that isn't on preferred fund family list?
In my opinion (and as I've been told it isn't worth much from the Jones IRs posting here) that's where the conflict of interest lies. We were always spoon fed the mantra at Jones that we only offer 7 (at the time) preferred fund families of companies with a proven, historical track record for success. (how does anyone explain Hartford being on that list btw?)
Devoted-
The GP's owned a stake in the Hartford Mutual Funds since 1996. No track record needed. Just pay to play. The ultimate conflict especially for the GP's who are selling.
I use a non-preferred occationally and haven't heard a word from St Louis. I started using it after the RS issue came up though. Although I believe one can do better with asset allocation in a wrap account, the results from a balanced AF portfolio are hard to ignore. It works fine for a conservative, no frills, retired person. It has to work or EDJ would be out of business. I believe they have a niche.
Being able to give my client an All-Star lineup AND get paid to do research to keep it that way... that is better for both my client and myself. Not to mention no conflict of interest.
And I love this place. I had no idea about the Hartford and EDJ connection prior. They don’t tell you such things.
Revenue sharing is PURE profit paid to Jones. It’s an ongoing kickback that shouldn’t be buried in asset fees. The number is much larger as a % when you take it as a % of net income. Withput even looking at the 10-k, I’ll bet that revenue sharing made up at least 50% of Jones profit.
Zacko or is it Karnak-
Hopefully most of you remember Johnny Carson. He did a Karnak the Magnificent routine. If you haven't seen it you ought to go and rent it for a good laugh. Now to the question at hand by Zack.
172M mutual funds. 35M insurance. 330 net profit. My calculator says 63% of net came from the backdoor. Zacko is right on once again.
Zacko and footsoldier,
You bring up an absolutely moronic point. What does it matter how much of revenue sharing makes up of profit? Stock trades make up over 200% of profit, bond trades over 100%.....so what. Put on that red pitcher suit they give you at Raymond James and jump through a brick wall.
[quote=rankstocks]
Zacko and footsoldier,
You bring up an absolutely moronic point. What does it matter how much of revenue sharing makes up of profit? Stock trades make up over 200% of profit, bond trades over 100%.....so what. Put on that red pitcher suit they give you at Raymond James and jump through a brick wall.
[/quote]That's right Rank, when faced with an issue you can't overcome, resort to personal attacks. That is always and effective technique!
The size of revenue sharing relative to overall profits(or revenues) is relevant in that it indicates how much the GEEPS rely on this profit sharing to keep the firm profitable. Pretty simple, but then again I don't expect a kool-aid drinker like you to understand any analysis which relies on independent thinking! Just keep selling them long-term bonds and preferred funds and stop thinking there, sonny!
Rank-
Stay the course. They need you to keep the growth numbers stagnate.
[quote=zacko]Revenue sharing is PURE profit paid to Jones. It's an ongoing kickback that shouldn't be buried in asset fees. The number is much larger as a % when you take it as a % of net income. Withput even looking at the 10-k, I'll bet that revenue sharing made up at least 50% of Jones profit.[/quote]
Why would you take it as a % of net income? I have never seen a balance sheet that shows a revenue source as pure profit. So your saying that EDJ doesnt use any portion of the revenue sharing money to pay for any kind of overhead? I am certainly not an accounting expert but that doesnt make any sense to me.
Folks, I'm enough of an accountant to know that if Revenue Sharing amounts to 5% of revenues, then it brings in about 5% of net income. I don't have any idea how Jones' accountants figure it, but from my super-powers, that means that if RS goes away, Jones would take about a 5% hit. I'm sure that hurts, but I doubt we can all go celebrate their ultimate demise over it.
Not1ofthem--Wrong. Go back to school.
MY POINT is that revenue sharing is not really earned income. It doesn't come from any Jones rep placing a trade--nor is much (if any) ever shared with the broker. Jones keeps about 90% of all revenue sharing dollars.
LOOK AT THIS WAY: Funny how a firm that claims that they are so against fee based accounts and wrap programs derives over 50% of all their profit from....ONGOING REVENUE SHARING FEES. If that's not the epitome of hypocracy--I don't know what is. Jones has essentially elimnated the possibility of incurring losses by guaranteeing themselves an income stream. The GP's have annuitized their income. They promote and participate in the very thing they choose to not allow their IR's to do so. How can that NOT piss you off if your a Jones IR? In 2002, there was no bonus for IR's--yet GP returns were the 5th highest on record?
Those of you who are in your third fourth, or even fifth year at Jones think your at someplace special. News flash--It's special for the GP's and not for you. You only think it is because you never earned over 100k-150k before and now that you are--you think Jones is responsible for your success. You follow the mantra like a second religion.
Truth is most of you are clueless about much of what else is out there and when challenged, are incapable of spouting much more than the company line. That's why they have so many meetings at Jones--to keep the "message" ingrained in your skulls. They know that once original thought surfaces you will be looking elsewhere fairly soon.
This is a great business to be in--and you can do well for yourself and your clients. Fact is that BOTH can be better served as an indy and certainly not at Jones.
Revenue Sharing is not really earned income therefore it is not used to cover any type of overhead expense? Pretty weak statement. None of it goes to cover employee salaries, building maintenance, LP payout ect ect?
Simple formula Revenue - Expenses = Income, it doesnt matter if the salesperson directly creates the revenue or if its paid by a company to do business with another company.
Schools out Zacko.
NOT1OFTHEM is a ruse. It's another name change.
He can't agree with you Zacko, because he is Not One Of THEM-
THEM=I R / Regular GUY/ LP
He's either Guest1 or another just like him.
He LOVES the Revenue Sharing Formula- he sleeps with it.
You defend a major source of revenue and the largest source of net profit for your firm for the very assets you have on the books IN YOUR BRANCH--yet recieve little or none of the benefits? Now, that's priceless!!!
I wasnt defending anything, I was questioning your accounting. I have never seen in any business where any form of revenue is pure profit. I’m really just saying that your wrong about the pure profit statement.
[quote=munytalks]
NOT1OFTHEM is a ruse. It's another name change.
He can't agree with you Zacko, because he is Not One Of THEM-
THEM=I R / Regular GUY/ LP
He's either Guest1 or another just like him.
He LOVES the Revenue Sharing Formula- he sleeps with it.
[/quote]
NOT1OFTHEM never defended revenue sharing either, he just stated an accounting opinion. Its funny that you read so much into the post that isnt there. Do you see communinst under every rock as well?
Ok for all of you that won't take the time to read the 10K. Straight from the horses mouths.
There are regulatory proposals being considered that could significantly impact the disclosure and potentially the amount of compensation that broker-dealers derive from mutual funds and annuity products. The Partnership believes it is likely in the future that broker-dealers will be required to provide more disclosure to their clients with respect to payments received by them from the sales of these products. It is also possible that such payments may be restricted by law or regulation.
The Partnership derived 67% of its total revenue from sales and services related to mutual fund and annuity products in the first three months of 2006 and 68% in the first three months of 2005. The Partnership derived 30% of its total revenue for the first three months of 2006 and 34% for the first three months of 2005 from one mutual fund vendor. Significant reductions in the revenues from these mutual fund sources could have a material impact on the Partnership's results of operations.
So those of you who think we are blowin smoke up your rear making comments that EDJ could be in real trouble if RS is changed by the regulators, your firm at least feels there is concern if you don't.
[quote=Maxstud][quote=munytalks]
NOT1OFTHEM is a ruse. It's another name change.
He can't agree with you Zacko, because he is Not One Of THEM-
THEM=I R / Regular GUY/ LP
He's either Guest1 or another just like him.
He LOVES the Revenue Sharing Formula- he sleeps with it.
[/quote]
NOT1OFTHEM never defended revenue sharing either, he just stated an accounting opinion. Its funny that you read so much into the post that isnt there. Do you see communinst under every rock as well?
[/quote]
Communists under EVERY rock? NO, but I must ask, are you always so paranoid? I was speaking to Zacko- why do you feel you must defend Not1ofthem? Are you feeling guitly about something?
I read that as all revenues not just revenue sharing, agree?
Partly correct Max.
Most are unaware that at least 95% goes directly to the bottom line. Zacko's point. Imagine if 63% of your net income was suddenly gone. You would have to figure out how to replace it.
Clearly the GP's are smart enough to have contingency plans. What say you Guest1. Care to comment?
[quote=munytalks][quote=Maxstud][quote=munytalks]
NOT1OFTHEM is a ruse. It's another name change.
He can't agree with you Zacko, because he is Not One Of THEM-
THEM=I R / Regular GUY/ LP
He's either Guest1 or another just like him.
He LOVES the Revenue Sharing Formula- he sleeps with it.
[/quote]
NOT1OFTHEM never defended revenue sharing either, he just stated an accounting opinion. Its funny that you read so much into the post that isnt there. Do you see communinst under every rock as well?
[/quote]
Communists under EVERY rock? NO, but I must ask, are you always so paranoid? I was speaking to Zacko- why do you feel you must defend Not1ofthem? Are you feeling guitly about something?
[/quote]Your post are very funny keep it up I love them. Speaking to Zacko on a public board, try pm it much more direct. I'm not defending Not1ofthem, just pointing out that fact that your post that he said he loves revenue sharing when his post didnt even imply that at all. Also to answer your direct question, no I dont feel guilty, hungry right now but not guilty.
Really keep posting you crack me up!!!
[quote=footsoldier]
Partly correct Max.
Most are unaware that at least 95% goes directly to the bottom line. Zacko's point. Imagine if 63% of your net income was suddenly gone. You would have to figure out how to replace it.
Clearly the GP's are smart enough to have contingency plans. What say you Guest1. Care to comment?
[/quote]I really don't know if I have the energy or even the desire to try and correct this 95% bottom line bs. So if I decide I do I'll come back and try to explain it, but I doubt if its worth the effort.
[quote=Maxstud]
Revenue Sharing is not really earned income therefore it is not used to cover any type of overhead expense? Pretty weak statement. None of it goes to cover employee salaries, building maintenance, LP payout ect ect?
Simple formula Revenue - Expenses = Income, it doesnt matter if the salesperson directly creates the revenue or if its paid by a company to do business with another company
[/quote]I'll try by reposted the above quote.
Good luck
If the EDJ GPs are only concerned about lining their pockets as you say, then we will have wrap accounts very shortly. If/When we do have wrap accounts, you will tell us that it is only for them to make more money, while you tell us now that wrap accounts are good for the clients. I look forward to the day when this is the topic of debate…
Max-
Your theory would have more validity if YOU shared evenly with the owners. Unless you are one.
60M from the EDJ Brokerage. 88M as a result of overrides or other companies. 172M from Mutual fund and 35m from Insurance.
There's the grocery store model. Nothing wrong or illegal about their businesses or their model. But what they tell us is usually the exact opposite of what they do. When you can't grow and you are losing vets at the same rate that you bring new ones on, clearly change is imminent.
[quote=footsoldier]
Max-
Your theory would have more validity if YOU shared evenly with the owners. Unless you are one.
60M from the EDJ Brokerage. 88M as a result of overrides or other companies. 172M from Mutual fund and 35m from Insurance.
There's the grocery store model. Nothing wrong or illegal about their businesses or their model. But what they tell us is usually the exact opposite of what they do. When you can't grow and you are losing vets at the same rate that you bring new ones on, clearly change is imminent.
[/quote]First things first, I am ONLY discussing the assertion that 90-95% of the revenue sharing is PURE PROFIT, it is NOT. There is no such thing as pure profit in business, there is ALWAYS overhead and it doesnt matter if the revenue is directly generated from a salesperson or from a meteor dropped from the sky, someone needs to pay the guy that picks up the cash inside the meteor. In other words there are expenses that the business pays and that is deducted from ALL revenue. I cannot explain it more clearly, I could ask the CPA I league bowl with to explain it but I would feel to stupid to ask such a question. So I would maintain this is not a theory but a basic accounting fact.
Grocery store model??? Please if you have been involved in any other business in your life you would KNOW this is how business is done. Businesses make deal with other businesses to do business.
News flash: Golden Rule is he who has the gold makes the rules. I have never been involved in any business, little league sporting event, bowling leage, or frikin PTA meeting that people ddidn't put thier personal interest ahead of yours or anyone else's. Grow up and learn that or you'll be whining about why your kid doesn't get to start the game ahead of the coaches kid for the rest of your life. Everyone is in it for themselves so if you worried about the greedy GP your worrying about the wrong thing.
PS I love my clients. Thank you and goodnight
Guest1? He ran off like a little bitch when he was outed on another thread.
Maxstud is now using analogies with meteors, comets, lightning, things dropping from the sky. Holy sh*t, he's about to go GP on me, and start quoting the bible and different psalms to back up the Jones position. So, here's the question:
If revenue sharing were to cease tomorrow, what part of the Jones overhead would go away proportionately, if at all? What capital is Jones risking, pledging, or holding captive by participating in their various revenue sharing agreements?
I have long maintained that the revenue sharing payments that Jones receives largely funds the training costs (trainers, plane tickets, meals and rooms at the Westport, 24K annual salaries, etc.) for all of the "stuff" that they seem to endlessly, mindlessly, and blindly throw at the wall. If those agreements are compromised in any way, your Regional Growth Leader will be looking for a new way to "voluntold".
Zacko states "LOOK AT THIS WAY: Funny how a firm that claims that they are so against fee based accounts and wrap programs derives over 50% of all their profit from....ONGOING REVENUE SHARING FEES"
Where did you get your accounting degree? Let me guess: Corky's University. "PURE PROFIT"...where are you coming up with this stuff?
To answer Soothsayer, if revenue sharing payments went away, overhead would be reduced substantially simply by foregoing the revenue sharing disclosure related paperwork, dedicated team, lawyer fees, etc.
Who cares which about how much of profit is derived by revenue sharing?
Maybe you would also care about how much profit is derived from annual account fees? transfer fees? TOD fees?
What about Raymond James? How much profit is derived from ticket charges? This whole thread is rediculous. You should know better Zacko. I now think much less of you.
I think we need a group hug
"Maxstud is now using analogies with meteors, comets, lightning, things
dropping from the sky. Holy sh*t, he’s about to go GP on me, and start
quoting the bible and different psalms to back up the Jones position."
Thats funny.
It IS pure profit for the "firm" (GP's).
While it might be legal accounting to post it the way they do (Of course I understand accounting), it's additional revenue that's generated without any true cost to obtain that revenue. It's hard dollars paid for shelf space--nothing more.
Okay, let me get this straight. Jones spends far more than $207 million per year on paper, ink, envelopes, extra postage, and a team of lawyers to continue revenue sharing in its present form. If revenue sharing dried up, these expenses and then some would go away completely; therefore having no material effect on Jones’ overall operating income. Got it. Thanks for the clarification.
[quote=Soothsayer]Okay, let me get this straight. Jones spends far more than $207 million per year on paper, ink, envelopes, extra postage, and a team of lawyers to continue revenue sharing in its present form. If revenue sharing dried up, these expenses and then some would go away completely; therefore having no material effect on Jones’ overall operating income. Got it. Thanks for the clarification.[/quote]
Yea, have to agree that doesn’t make much sense. Who would want to keep a revenue stream that is eaten up be the cost to maintain it.
[quote=zacko]
It IS pure profit for the “firm” (GP’s).
While it might be legal accounting to post it the way they do (Of course I understand accounting), it's additional revenue that's generated without any true cost to obtain that revenue. It's hard dollars paid for shelf space--nothing more.
[/quote]When I was in college I started working for an electronics retailer, right around the time Directv was just starting and we were selling the RCA dish for something like $500. At that time Directv had an agreement with the retailer that they would pay residual payments forever for every customer we sold a dish to and signed up to Directv, as long as the customer kept the service. Is that money pure profit to the owner of the electronics store? Or does he use it to grow his business, help with raising expenses, and cover other costs? If the residual payments are 5% of his revenue doesnt that mean its around 5% of his profits? If all the customers cancelled their service doesnt that mean he loses 5% of his revenue and 5% of the profit? Does that mean he needs to cut costs by 5%?
[quote=jonesescapee]I think we need a group hug[/quote]
Is that a banana in your pocket?
[quote=Maxstud] [quote=jonesescapee]I think we need a group hug[/quote]
Is that a banana in your pocket?
[/quote]
its a flashlight
[quote=rankstocks]What about Raymond James? How much profit is derived from ticket charges? This whole thread is rediculous. You should know better Zacko. I now think much less of you.[/quote]
Wow, Zacko...how can you live with yourself?!! The King of Kool-Aid doesn't LIKE you!!!
Whew...3 pages ago I posted something about accounting and caused the sky to fall...Look I don't really give a darn about Revenue sharing. I don't really care about EJ at all, but it is laughable to say that Revenue sharing is 60 or 90 percent of Income because you could just as easily say that Mutual Fund sales are 400% of income or that the brokerage brings in 200% of income...By that logic, the owner would owe someone money instead of making anything...It just couldn't work that way.
In the interest of being fair, I read the one reply that seemed to make a case, but it, too, says that EJ gets revenues from these sources. Revenues don't equal profit in my book. If you disagree, that is fine...No sweat off my back and I don't take it personally.
[quote=Incredible Hulk]If the EDJ GPs are only concerned about lining their pockets as you say, then we will have wrap accounts very shortly. If/When we do have wrap accounts, you will tell us that it is only for them to make more money, while you tell us now that wrap accounts are good for the clients. I look forward to the day when this is the topic of debate...[/quote]
Mr. Hulk (the real one) I think the more interesting topic of debate would be why Jones changed it's position on WRAP accounts. Another Jones IR posted that he thought Weddle would bring about WRAP accounts soon, and that there were rumblings about the possibility. What do you think about that?
[quote=zacko]
It IS pure profit for the "firm" (GP's).
While it might be legal accounting to post it the way they do (Of course I understand accounting), it's additional revenue that's generated without any true cost to obtain that revenue. It's hard dollars paid for shelf space--nothing more.
[/quote]
Zacko-
Here's an interesting point also- What does ENRON and EDWARD JONES have in common?
ANSWER: THEIR ACCOUNTING FIRM- who remembers that up until about 3 years ago Arthur Anderson was Edward Jones accounting firm. AND BYTHEWAY- Arthur Anderson FIRED EDJ not the other way around- it happened right about the same time EDJ was served with notice to start turning over documents about Revenue Sharing.
Coincidence- I think not.
Hmmm,
It's hard dollars paid for shelf space--nothing more. Now tell me how that differs from my local grocery store.
I guess one difference is that they take off the top as well. Split the reduced commission with the revenue generators, and make them feel like your giving more than they should.
[quote=Maxstud] [quote=Maxstud]
Revenue Sharing is not really earned income therefore it is not used to cover any type of overhead expense? Pretty weak statement. None of it goes to cover employee salaries, building maintenance, LP payout ect ect?
Simple formula Revenue - Expenses = Income, it doesnt matter if the salesperson directly creates the revenue or if its paid by a company to do business with another company
[/quote]
I'll try by reposted the above quote.
Good luck
[/quote]
MAX- Glad you love hearing from me. But since this is such a simple formula for you, can you please tell me the answer to this:
If Revenue Sharing goes into the STL "Pot" so to speak, then expenses are deducted, why does the Investment Representative make only 40% of Gross Commission Generated each month?
If you were running a company with 9000+/- offices, and each one generated NEW commissions each month, wouldn't you make sure the overhead was covered out of THAT MONEY FIRST? Of course you would. And the General Partners have. AND please keep in mind, that every good Jones Broker volunteers time to train new brokers. NO MONEY paid for that.
Don't get me wrong, the formula is pure GENIOUS. But Revenue Sharing is PURE PROFIT. Overhead is paid out of the monthly commissions earned by each IR in the field.
[quote=munytalks][quote=Maxstud] [quote=Maxstud]
Revenue Sharing is not really earned income therefore it is not used to cover any type of overhead expense? Pretty weak statement. None of it goes to cover employee salaries, building maintenance, LP payout ect ect?
Simple formula Revenue - Expenses = Income, it doesnt matter if the salesperson directly creates the revenue or if its paid by a company to do business with another company
[/quote]
I'll try by reposted the above quote.
Good luck
[/quote]
MAX- Glad you love hearing from me. But since this is such a simple formula for you, can you please tell me the answer to this:
If Revenue Sharing goes into the STL "Pot" so to speak, then expenses are deducted, why does the Investment Representative make only 40% of Gross Commission Generated each month?
If you were running a company with 9000+/- offices, and each one generated NEW commissions each month, wouldn't you make sure the overhead was covered out of THAT MONEY FIRST? Of course you would. And the General Partners have. AND please keep in mind, that every good Jones Broker volunteers time to train new brokers. NO MONEY paid for that.
Don't get me wrong, the formula is pure GENIOUS. But Revenue Sharing is PURE PROFIT. Overhead is paid out of the monthly commissions earned by each IR in the field.
[/quote]Wow this got to be the most pointless argument yet. It doesnt matter where you allocate whatever revenue source it is all just one big pile of money!!! So back to my one and only point...Revenue Sharing is not 50% of EDJ income it is 5% of the revenue. That is all.
BTW your Auther Anderson post is very funny.
[quote=footsoldier]
Hmmm,
It's hard dollars paid for shelf space--nothing more. Now tell me how that differs from my local grocery store.
[/quote]
There isn't somebody standing in the grocery store isles pitching one product over another.
The grocery store doesn't call you at home an offer products to you that have paid for shelf space.
The store itself or the store employees have no interest in whether you buy the product or not.
If everyone chooses not to buy the product placed on the higher shelves and buy a box of cereal at ankle height because it tastes better, the store will no longer stock the high shelf item and offer the ankle height cereal company the opportunity to pay for shelf space.
[quote=munytalks][quote=Maxstud] [quote=Maxstud]
Revenue Sharing is not really earned income therefore it is not used to cover any type of overhead expense? Pretty weak statement. None of it goes to cover employee salaries, building maintenance, LP payout ect ect?
Simple formula Revenue - Expenses = Income, it doesnt matter if the salesperson directly creates the revenue or if its paid by a company to do business with another company
[/quote]
I'll try by reposted the above quote.
Good luck
[/quote]
MAX- Glad you love hearing from me. But since this is such a simple formula for you, can you please tell me the answer to this:
If Revenue Sharing goes into the STL "Pot" so to speak, then expenses are deducted, why does the Investment Representative make only 40% of Gross Commission Generated each month?
If you were running a company with 9000+/- offices, and each one generated NEW commissions each month, wouldn't you make sure the overhead was covered out of THAT MONEY FIRST? Of course you would. And the General Partners have. AND please keep in mind, that every good Jones Broker volunteers time to train new brokers. NO MONEY paid for that.
Don't get me wrong, the formula is pure GENIOUS. But Revenue Sharing is PURE PROFIT. Overhead is paid out of the monthly commissions earned by each IR in the field.
[/quote]Golden Rule- He who has the gold makes the rules. Didnt they tell you your split when you were hired? Or did you forget to ask?
Max-
It is obvious you do not have an argument anymore. You did not answer the question, you are merely trying to deflect away from the point and further, do what all Jonesers do when they realize they are wrong, try to insinuate another person is less intelligent than yourself.
Glad you also liked the Arthur Anderson fact. Since you find it humorous, you must not have been around when it occurred. It is fact.
When asked, in a SUGGBOX wire to Bachmann, why EDJ would keep AA during such negative publicity about them, Bachmann replied that EDJ had a long standing relationship with them and would not abandon them during this time. You can look this up in the Records Department, but I doubt you will.
And you would have had to be on Leadership Team to be aware of when AA requested a termination of their agreement with Jones-and how this should be explained back out to the troops. Obviously, you weren't on Leadership Teams either.
Now, either get back on the phone or pack your bags- isn't this pretty close to Holy Week time when you all gather together to reassure yourselves that you are doing what is right? And get the update on Growth Numbers. Don't forget to pack your green name badge, you KNOW how they hate it when they can't identify you right away.
Golden Rule- He who has the gold makes the rules. Didnt they tell you your split when you were hired? Or did you forget to ask?
I thought the Golden Rule was: do unto others as you would have them do unto you?
I think the thing that's got most folks' panties in a bunch (mine included) is not the fact that Jones has/did/does revenue sharing. It's the fact that they
a) settled for $75mil and THEN issued the swift kick in the balls to their working force by letting it hit the papers FIRST, THEN issuing a mild wire saying.."ok there might be some negative publicity right now"
b) allowed us to work our *sses off explaining away revenue sharing by telling people, "everybody does it, WE just settled so WE would appear to bewilling to work on this"
c) then delivered yet another blow by waiting two weeks to tell the "best darn salesforce in the world" that a part of the settlement REQUIRED DH to step down as managing partner.
d) then CONTINUES to villify other firms, by continuing to tout that we only offer 7 preferred fund families, with a proven track record of success.
The halo started to slip for me at that point.....I know I know, I'm just a Sales Assistant (or BOA - whatever) but I marched in line with everybody else, took my share of ranting and raving phone calls so my rep could get some work done, volunteered, supported, cheered etc.
PS - before there’s any cracks about my double references to male genitalia, I’m an USAF wife, I’ve got a set of my own.
Doug Hill should call Phil Purcell to try to join his firm in Chicago. This way, they can have the most futile and worthless leadership ever.
[quote=munytalks]
Max-
It is obvious you do not have an argument anymore. You did not answer the question, you are merely trying to deflect away from the point and further, do what all Jonesers do when they realize they are wrong, try to insinuate another person is less intelligent than yourself.
Glad you also liked the Arthur Anderson fact. Since you find it humorous, you must not have been around when it occurred. It is fact.
When asked, in a SUGGBOX wire to Bachmann, why EDJ would keep AA during such negative publicity about them, Bachmann replied that EDJ had a long standing relationship with them and would not abandon them during this time. You can look this up in the Records Department, but I doubt you will.
And you would have had to be on Leadership Team to be aware of when AA requested a termination of their agreement with Jones-and how this should be explained back out to the troops. Obviously, you weren't on Leadership Teams either.
Now, either get back on the phone or pack your bags- isn't this pretty close to Holy Week time when you all gather together to reassure yourselves that you are doing what is right? And get the update on Growth Numbers. Don't forget to pack your green name badge, you KNOW how they hate it when they can't identify you right away.
[/quote]
My only point in the discussion is that revenue sharing is not 50% of income it is 5% of revenue. So I'm really not sure how that doesnt answer your question, I have tried to make this point in many different ways and I am out of ideas to try and explain myself. ( See my direcTV example). My only other point is that there is no such thing as pure profit in business. Zacko believes if the revenue is not directly generated by an activity then its pure profit, so be it.
I found your AA post funny because you made it seem like one of the largest accounting firms in the US had only two clients EDJ and Enron. Yes, I know you didnt come out and say that but thats the way it read and I thought that was funny.
Every other point you've made about EDJ is really just so much noise at this point. We can keep going back and forth on this but it really turns into a big circle. Much like going to a Democrats meeting to argue in favor of W Bush, noones ever going to be persuaded.
Cheers.
Just to clarify something...I've never insinuated that the brokers make anything off of Revenue sharing...I don't have a clue whether they do or not. I'm just saying that the owners (in this case partners...both limited and Managing) get about 5% of their income from the revenues off of revenue sharing if 5% of revenues comes from revenue sharing.
You could probably say that all of the money they make off of selling insurance is 'pure profit' and equal to a gazillion percent of income just as easily...it doesn't make logical sense....Revenue is revenue is revenue in the accounting world.
Max-
On the point of not being able to agree- we can Agree!
So CHEERS back at you. Get yourself a drink on me at the Open Bar. And, drive carefully to Regional.
Max-
I'll spend my net revenue. You spend your gross before expenses. And you claim to be a financial advisor.
My grandfather once told me It is not what you make its what you keep.
[quote=footsoldier]
Max-
I'll spend my net revenue. You spend your gross before expenses. And you claim to be a financial advisor.
My grandfather once told me It is not what you make its what you keep.
[/quote]
Yea, I'm done with this. My only point is to disagree with the statement that if revenue sharing goes away EDJ will lose 50% of their net income.
Good Luck
Max,
It is good to see that you can at least use the right adjective to describe Jones' revenue from kickbacks. You are right, it is "their" revenue. How much of that "gross" (as you call it) revenue ends up in "your" net.
Max-
Call Guest1. He is a GP. You need someone to agree with you.
[quote=footsoldier]
Max-
Call Guest1. He is a GP. You need someone to agree with you.
[/quote]
No, I really don't need someone to agree with me.
Good Luck
Max-
When you are at the regionals and they ask you to write a note to your spouse about how they have made a difference to you, and then they intend to read it in the spouse's meeting, remember back to our discussion about Gross and NET. The agenda is set, and the firm is intent on using your spouse to further their cause.
You will spending your NET(out of your pocket) time looking for that one good idea to implement when you get back with other peers while the rest of us are producing GROSS which will NET us far more than the touchy feely crap that is being promoted by management. But you will feel good about your company until you learn to read between the lines.
Gross is NEVER as important as NET. Whether it is your revenues or the GP's!!!
foot,
Sorry to disappoint you but unlike many of the people on this forum, ex-jones or jones, I am a cynic and I dont believe anyone is looking out for me or has my interest in mind. When push comes to shove everyone is out for themselves. EDJ is a big business and acts like any other big business. Sorry you fell for it. Lucky for me my wife is a lot like me. So the only touchy feely we care about is with each other.
Thank you and goodnight.
[quote=Maxstud]foot,
Sorry to disappoint you but unlike many of the people on this forum, ex-jones or jones, I am a cynic and I dont believe anyone is looking out for me or has my interest in mind. When push comes to shove everyone is out for themselves. EDJ is a big business and acts like any other big business. Sorry you fell for it. Lucky for me my wife is a lot like me. So the only touchy feely we care about is with each other.
Thank you and goodnight.
[/quote]
I couldn't have said it better myself...
[quote=munytalks]
Max-
On the point of not being able to agree- we can Agree!
So CHEERS back at you. Get yourself a drink on me at the Open Bar. And, drive carefully to Regional.
[/quote]Thanks Muny
[quote=Devoted SA]
[quote=Incredible Hulk]If the EDJ GPs are only concerned about lining their pockets as you say, then we will have wrap accounts very shortly. If/When we do have wrap accounts, you will tell us that it is only for them to make more money, while you tell us now that wrap accounts are good for the clients. I look forward to the day when this is the topic of debate…[/quote]
Mr. Hulk (the real one) I think the more interesting topic of debate would be why Jones changed it’s position on WRAP accounts. Another Jones IR posted that he thought Weddle would bring about WRAP accounts soon, and that there were rumblings about the possibility. What do you think about that?
[/quote]As I’ve said before. I look forward to the day that Jones offers wrap accounts. There are a number of reasons we will. First off, fees. Everyone in the industry has them because it smooths out revenues in the down quarters/years. Second, there are many rumblings within our ranks for them. Third, the argument can be made for the benefits of wrap accounts. Fourth, it is difficult enough to convince a transfer broker to come to EDJ without an upfront check, but near impossible when we tell him he can’t move the 50% of his book that is in wrap accounts into them. Who in their right mind would give up that kind of revenue stream? It’s a matter of when, not if…and pricing. Will it be 1-3% with discretion to the broker? I don’t know.
But what do I know, I’m only 3 months into the business and will be out in 3 more, right Greenbacks?
The Real IH-
Are you conceding that the transition to wrap fees is in the wind due to regulatory changes looming or are you suggesting the firm just needs to be current with what clients want.
Another way to ask the question,
Are the GP's worried that their annuity stream may go away? The double speak is getting interesting. Weddle says in his latest broadcast , " Don't hold your breath for us to adopt fees." Is that code for ready or not here it comes? Anyone else sensing a change?
Listening to a GP is like listening to my wife. It's not what she said, it is what she meant. 25 years of marriage teaches you a few things.
footsoldier,
Listening to a GP is like listening to my wife. It's not what she said, it is what she meant. 25 years of marriage teaches you a few things.
and I bet you are still learning.
Sorry to bring back old news but I thought this was worth sharing. According to Weddle in his weekly q & a,
57% of revenues are from fees including revenue sharing. He also was quick to mention that revenue sharing is not critical to the firm and not to ask about revenue sharings importance to the firm.
And the doublespeak continues. Let me understand correctly. Firm fee revenue accounts for more than half of total revenue. And revenue sharing is the major component of firm revenue. Therefore no one should even consider the worst case scenario and its impact on the firm. This firm is so wrapped in fund relationships, that it could never compromise its integrity and do what's right for the client. The stench is never ending.
Another perspective.
http://www.homeschoolblogger.com/stevebraun/112047/
Since compliance doesn't like the grocery store analogy, maybe they will appreciate the soccer analogy. The caption is priceless.
"Take Bribes but Be Fair, Soccer Refs Told"
[quote=footsoldier]
Sorry to bring back old news but I thought this was worth sharing. According to Weddle in his weekly q & a,
57% of revenues are from fees including revenue sharing. He also was quick to mention that revenue sharing is not critical to the firm and not to ask about revenue sharings importance to the firm.
[/quote]
So said the addict with a needle in his arm..."I'm not addicted, I can quit any time." Rev sharing is GP heroin. They're so hooked, they cant see straight.
[quote=footsoldier]
Sorry to bring back old news but I thought this was worth sharing. According to Weddle in his weekly q & a,
57% of revenues are from fees including revenue sharing. He also was quick to mention that revenue sharing is not critical to the firm and not to ask about revenue sharings importance to the firm.
And the doublespeak continues. Let me understand correctly. Firm fee revenue accounts for more than half of total revenue. And revenue sharing is the major component of firm revenue. Therefore no one should even consider the worst case scenario and its impact on the firm. This firm is so wrapped in fund relationships, that it could never compromise its integrity and do what’s right for the client. The stench is never ending.
[/quote]You should reread Weddles corner. 57% of revenue did NOT come from fees.
Hulk-
Stand corrected. 57% of revenue came from transaction in May.
43% came from somewhere else.
Care to guess?
[quote=footsoldier]
Hulk-
Stand corrected. 57% of revenue came from transaction in May.
43% came from somewhere else.
Care to guess?
[/quote]I don’t understand why you bitch and moan about Jones and continue to “pay the GPs.” If you are going to quote Weddle’s internal memos on this public site, at least quote them correctly.
Hulkster-
I am sorry if you feel it is bitching and moaning. I'll reframe the question counselor.
Where did more than 40% of the revenue come from last month? Fees. And most of the fees came from........drum roll...REVENUE SHARING.
I have opened my eyes to the real customer at Edward Jones. Sooner or later you will too.
So, with that in mind - when will you jump ship foot?
Unless the conflicts go away (and they most certainly won't) I would expect a change in the future. Ducks in a row come to mind.
Timing is everything. Fragrasso's book is a gold mine of information on how,why,and when to make the change.
[quote=footsoldier]Timing is everything. Fragrasso's book is a gold mine of information on how,why,and when to make the change. [/quote]
You bet it is. Anybody considering a jump to indy should read it.
Prepare...prepare...prepare...
[quote=footsoldier]
Hulkster-
I am sorry if you feel it is bitching and moaning. I’ll reframe the question counselor.
Where did more than 40% of the revenue come from last month? Fees. And most of the fees came from…drum roll…REVENUE SHARING.
I have opened my eyes to the real customer at Edward Jones. Sooner or later you will too.
[/quote]Yes, I do feel that 9 out of 10 of your posts are bitching and moaning.
I examined my own P&L and less than 1/3 of the fees that I see come from Revenue Sharing.
If you honestly believe that Jones’ only purpose is to make money for the GP’s you are dumber than you sound on this site. Are they out to make money? Yes. At the expense of the client? No.
I kinda like the other IH better
IH-
Eliminate the conflicts of interest and you will get my attention. Otherwise I failed you my green man. It should be 10 out 10. I wouldn't want to make an impact on you.
Have fun at the regionals.
[quote=Incredible Hulk] [quote=footsoldier]
Hulkster-
I am sorry if you feel it is bitching and moaning. I'll reframe the question counselor.
Where did more than 40% of the revenue come from last month? Fees. And most of the fees came from........drum roll...REVENUE SHARING.
I have opened my eyes to the real customer at Edward Jones. Sooner or later you will too.
[/quote]Yes, I do feel that 9 out of 10 of your posts are bitching and moaning.
I examined my own P&L and less than 1/3 of the fees that I see come from Revenue Sharing.
If you honestly believe that Jones' only purpose is to make money for the GP's you are dumber than you sound on this site. Are they out to make money? Yes. At the expense of the client? No.
[/quote]
Incredible-
I think this is EXACTLY the point:
You said "When I looked at MY OWN Profit and Loss Statement..."
Let me ask you : When you looked at YOUR OWN P & L - I assume the final number is a positive? Is says you are "profitable" in $XXX.
Did YOU get a check in that amount?
Was it automatically deposited into YOUR personal account?
Can YOU control ANY/ALL of the numbers on there?
A Profit and Loss statement at Edward Jones is another ruse. It's a fake. It's smoke and mirrors to make people feel like they are running their own branch.
The Profit and Loss Statement is another myth. This is merely a formula created by General Partners to measure a branches' profitability. The positive number you finally reach (maybe 2-3 years out) is only the measurement by which you are given :
a) Quarterly Bonus
b) Limited Partnership Offering (if the number meets the minimum)
And keep in mind, LP offering involves YOU cutting a check to EDJ or EDJ financing your LP and charging you interest.
Am I right so far? Have I said anything untrue?
When you are given credit for Revenue Sharing on 'your P & L' - it is nothing more than a number assigned in a plus category. And that number is based on the total dollars you maintain in Mutual Funds/Annuities/Life Insurance. The supposed NET PROFIT of YOUR Branch is really still held in the General Fund. You are given a bonus using that number- and then it is condensed and placed on a tiered basis. CORRECT or NO?
Then, when all is said and done the FINAL REAL PROFIT made from every branch on all THREE (according to Bachmann) continents are totaled- WHO GETS THE FINAL CHECK SPLIT 387 ways?
Jack Kauff GP
Ivanna Humpalot GP
Ima Hogg GP
Get the picture? Even if Edward Jones gave you FULL credit for Revenue Sharing- you'll never see the check. That Regional Leader with the GP after his name gets the check for every hour you stood on your feet recruting at the Job Fair in the local college.
Okay, I am done with this. But Jeez Oh Pete- use your head man- your profit & loss statement is freakin' joke. As a matter of fact, I kind of wonder when the IRS is going to jump on them for the formula washing.
He's been taken into double secret GP witness protection program.
From the moment Spiked outed him, field supervision task force (in full riot gear)repelled down the side of his office building, burst through the window, dropped in tear gas, threw pillow cases over his and the heads of his BOAs, whisking them out the back door into an unmarked EDJ green van, squealing down the alley.
The next thing they knew...the pillow cases were jerked off and they were sitting in old meat locker type room with one light dangling above them....manilla folder shoved across the table....
"Your new name is Incredble Hulk, your new office is next door to a chinese restaurant, your last job was at a proctologists office refilling the ky jelly dispenser."
I think Devoted SA writes for the show “24”.
guest1-
I trust you had a wonderful time humming kumbaya with your troops at the regional meeting.
The real question. Do they know who you really are?
[quote=doberman]I think Devoted SA writes for the show "24".[/quote]
Dobe... You sure know how to flatter a girl. Truth is I spent a lot of time at shool looking out the window daydreaming.
Foot...Sure, Guest1's troops know who he REALLY is. IF they serve on leadership team under him. From afar when we were new/news our RL looked like THE nicest guy, smiling, waving, shaking hands, kissing babies etc. Then my rep joined the "russian mafia" and we quickly learned what the REAL RL was like......
One wrong move, one waver under command and he would unzip his head like in "Men in Black" and let the alien that lived inside come out to rip your head off, leaving only a trail of primordial ooze behind.
viva la Edward Jones!
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