Future of individual bonds
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[quote=Greenbacks] The only problem I have with LPL is you need to buy a minimum amount of bonds, say ten or 50 bonds in one holding.
I just got off the phone with a client and had to explain this to him, he made the comment that his WA broker could buy one or two bonds at a time. I then explained to him I am indy and do not hold an inventory of bonds or stocks.
I further explained how holding an inventory of anything can be a conflict of interest between the client the rep and the dealer.
He understands now and will be carefull of anything his WA broker is pushing.
Like I told him if it is a good investment why would WA be trying to get rid of it? If it is a
sh!#y investment they could not unload it fast enough. [/quote]
WA, I assume you are referring to Wachovia, is trying to sell the bond because they like other wirehouse or regionals do not buy the bonds as an investment for the company to hold, but bring them in so their brokers can sell them on the retail side. You are misinforming your client in my opinion.
[quote=Greenbacks]The only problem I have with LPL is you need to buy a minimum amount of bonds, say ten or 50 bonds in one holding.
I just got off the phone with a client and had to explain this to him, he made the comment that his WA broker could buy one or two bonds at a time. I then explained to him I am indy and do not hold an inventory of bonds or stocks. I further explained how holding an inventory of anything can be a conflict of interest between the client the rep and the dealer. He understands now and will be carefull of anything his WA broker is pushing. Like I told him if it is a good investment why would WA be trying to get rid of it? If it is a sh!#y investment they could not unload it fast enough. [/quote] you're acting in an unethical manner and you are uneducated in the operations of the industry. you should not work with the general public.[quote=go_huskies][quote=Greenbacks]The only problem I have with LPL is you need to buy a minimum amount of bonds, say ten or 50 bonds in one holding.
I just got off the phone with a client and had to explain this to him, he made the comment that his WA broker could buy one or two bonds at a time. I then explained to him I am indy and do not hold an inventory of bonds or stocks. I further explained how holding an inventory of anything can be a conflict of interest between the client the rep and the dealer. He understands now and will be carefull of anything his WA broker is pushing. Like I told him if it is a good investment why would WA be trying to get rid of it? If it is a sh!#y investment they could not unload it fast enough. [/quote] you're acting in an unethical manner and you are uneducated in the operations of the industry. you should not work with the general public.[/quote]If you've read this guy's posts for any length of time it becomes clear that he not only doesn't understand the business, he lacks some really basic understanding of ethical behavior. How’d you like to have compliance or OSJ responsibility for someone like him?<?: prefix = o ns = "urn:schemas-microsoft-com:office:office" />
[quote=Greenbacks]The only problem I have with LPL is you need to buy a minimum amount of bonds, say ten or 50 bonds in one holding.
I just got off the phone with a client and had to explain this to him, he made the comment that his WA broker could buy one or two bonds at a time. I then explained to him I am indy and do not hold an inventory of bonds or stocks. I further explained how holding an inventory of anything can be a conflict of interest between the client the rep and the dealer. He understands now and will be carefull of anything his WA broker is pushing. Like I told him if it is a good investment why would WA be trying to get rid of it? If it is a sh!#y investment they could not unload it fast enough. [/quote] Why would the firm be trying to get rid of a good investment? Seriously? Do you really think that, or is that just a line you feed prospective clients? That's like saying "hey, why would XYZ Realtors want to sell you a really good house when they could keep it as an investment? If they want to sell it, it must be a sh*tty house!" Hey, I'm all for casting doubt on the "other firm" in the clients' eyes, but let's use something legitimate. Every B/D firm is in the business of brokering securities.[quote=B24][quote=Greenbacks]The only problem I have with LPL is you need to buy a minimum amount of bonds, say ten or 50 bonds in one holding.
I just got off the phone with a client and had to explain this to him, he made the comment that his WA broker could buy one or two bonds at a time. I then explained to him I am indy and do not hold an inventory of bonds or stocks. I further explained how holding an inventory of anything can be a conflict of interest between the client the rep and the dealer. He understands now and will be carefull of anything his WA broker is pushing. Like I told him if it is a good investment why would WA be trying to get rid of it? If it is a sh!#y investment they could not unload it fast enough. [/quote] Why would the firm be trying to get rid of a good investment? Seriously? Do you really think that, or is that just a line you feed prospective clients? That's like saying "hey, why would XYZ Realtors want to sell you a really good house when they could keep it as an investment? If they want to sell it, it must be a sh*tty house!" Hey, I'm all for casting doubt on the "other firm" in the clients' eyes, but let's use something legitimate. Every B/D firm is in the business of brokering securities.[/quote] Greenbacks- Cmon on man......You really need to taper off that medication not take more of it.Noggin, I like the new tagline. The guy in that commercial sort of reminds me of me. OK, I’m not Latin, I’m not that interesting or cool, I don’t have nearly as many women as him, and I don’t dress quite as well, oh and I don’t have facial hair, and I’m much younger than him. But other than that, we’re like brothers (In a Schwarzenegger/DeVito sort of way).
So you do not think selling bonds out of your inventory is a conflict of interest.
Get real. As far as the realtor goes, if your realtor would show you homes that he had listed and no others would you keep him or look for another realtor?[quote=Greenbacks]So you do not think selling bonds out of your inventory is a conflict of interest.
No, I don't. They aren't proprietary products, there is no benefit for us to sell one bond over another other than the benefit for the client. We all mark them up and sell them at a profit, you are no different. We just buy them differently (apparently).
By your logic, there is as much conflict for you as for us.
Green, you're stretching here. First off, your argument about the realtor would be valid if firms only sold the bonds that they underwrite. Since the firms go out and fill their inventory with all different bonds, it's an invalid argument. And Somewhere is right, it makes no difference whether we sell a 15 year Kentucky GO bond or a 15 year Florida hospital bond. 1.5pts, 2pts, whatever the markup, it would be the same on both.
Bottom line, as has been discussed ad nauseum, is that every channel has conflicts of interest, even "fee only financial planners" just tryng to sell you a plan. Sell a stock you don't need, a plan that takes "8 hours" to complete (really? that long?), keep you invested in that wrap account or RIA fee account instead of paying down your mortgage or credit cards, buying LT bonds instead of CD's, buying whole life instead of term (if terms all you need), whatever your "product", there is a potential conflict of interest.I cannot believe you do not think a company that holds bonds say 200 million dollars worth in inventory,that it does not effect the company’s balance sheet.
Imagine what a small change in interest rates can do to it! Tell me your stand up company will not push them if they are loosing money. A realtor does not recieve income from house he has listed, they will not change the realtors balance sheet. As emploees you guy's look at the company and do not see the effect they have good or bad on the earnings. When you become an owner (indy) of your own firm you will look at things differently.Actually, you’re wrong. I follow Jones’ financial every month and quarter. Holding bonds in inventory has been part of the business for 70 years, and the model has essentially not changed. Financing inventory is jsut a cost of doing business, it does not DRIVE the direction of the business.
Get off your pompous high-horse.[quote=Greenbacks] I cannot believe you do not think a company that holds bonds say 200 million dollars worth in inventory,that it does not effect the company’s balance sheet.
Tell me your stand up company will not push them if they are loosing money.
A realtor does not recieve income from house he has listed, they will not change the realtors balance sheet.
As emploees you guy’s look at the company and do not see the effect they have good or bad on the earnings.
When you become an owner (indy) of your own firm you will look at things differently.
[/quote]
That is why we hedge our bond positions.
Are you seriously in charge of your own company?
[quote=Greenbacks]I cannot believe you do not think a company that holds bonds say 200 million dollars worth in inventory,that it does not effect the company’s balance sheet.
Imagine what a small change in interest rates can do to it! Tell me your stand up company will not push them if they are loosing money. A realtor does not recieve income from house he has listed, they will not change the realtors balance sheet. As emploees you guy's look at the company and do not see the effect they have good or bad on the earnings. When you become an owner (indy) of your own firm you will look at things differently. [/quote]You're either too stupid or too drunk to be running your own business. You’re a piker and a liar.