Wall Street blood letting continues...

[Masshog]

Member that story from two minutes ago about Goldman Sachs telling first years whose services are no longer required at the firm that they're not being fired, they're just graduating early from an "accelerated one-year analyst program" they'd secretly been taking part in? We just received a little more color on the revolutionary approach, from a young alum, who notes:

"At one point I actually though the MD was going to say, 'Congratulations!'" which we can obviously all agree would have been awesome.

Supposedly, the conversation went like this:

    MD: You're being placed into the accelerated one-year analyst program.


    Analyst: You mean I'm being fired?

    MD: No, you're being placed into the new accelerated one-year analyst program and will be paid through August.

    Analyst: I'm being fired.

    MD: There will be nothing on your record indicating you were fired. It'll say you were in the one-year analyst program.

    Analyst: I'm being fired.

[BlackKnightHogFan]

It is just part of the market cycle that happened in 2002, 1989-90 and so on.  I am so glad I don't work for one of the "big" Wall Street firms.  Much easier to sleep.

[SultanofSwine]

BK I whole heartedly agree. If I was at a big wirehouse, I'd be looking for an escape route. I seriously doubt the cuts in that area are close to an end.

[Masshog]

Ran into a young guy this AM on my way in, he was standing just outside one of the dealers with a cardboard box and lost look on his face...  really felt terrible for him. 

[PorkRyan]

Retail brokers should be fine but I would not want to be in investment banking right now. 

[BlackKnightHogFan]

Retail brokers should be fine but I would not want to be in investment banking right now. 

Tell that to the retail brokers at Morgen Stanley, Morgan Keegan, Merrill etc.  This bear market continues and retail brokers who are not superstars get wacked.

[Masshog]

I don't think anyone is particularly safe.... and don't forget, one of the first things these wirehouse bastards do is wack your payout.  Its a consistently brilliant way to cut expenses. 

[PorkRyan]

At this point the only profit center are the brokers.  It would be suicide to start cutting brokers right now when you can't make a dime from the investment banking side of the business.  MS and ML had blowout quarters from the brokerage business, it was everything else that killed them.  The deals the wires are offering are great right now, I'd like to see them cut payout and see how quickly everyone moves across the street for a 150% check.

[Masshog]

I hope your right Pork, but I don't think Wall Street leadership has ever been particularly foresighted.   

[BlackKnightHogFan]

At this point the only profit center are the brokers.  It would be suicide to start cutting brokers right now when you can't make a dime from the investment banking side of the business.  MS and ML had blowout quarters from the brokerage business, it was everything else that killed them.  The deals the wires are offering are great right now, I'd like to see them cut payout and see how quickly everyone moves across the street for a 150% check.

MS and ML don't need the brokers when the ask for help from overseas investment.  Besides, I think we see more consolidation in the area with a merger of Citi and Merrill or HSBC and MS.  I believe that is coming, then the brokers get wacked.  Never, have we had a big bear market when wirehouse brokers didn't get wacked.  Heck, MS wacked brokers in a bull market.

[PorkRyan]

I think consolidation of the financials is likely but I can't see any scenario where ML and Citi merge.  I could see Barclay's and ML, possibly.  I still think most of the consolidation will happen among the banks.