Wall St. Firms Hiring

I thought it was going to be petrfitz, but JuiceMan came to the rescue!

Let's see what they really say:

"Morgan Stanley could spend $1bn on new hires

"Morgan Stanley plans to use up to $1bn saved from cutting 4,800 jobs this year to hire top-level executives and bolster its presence in areas such as derivatives, risk management and proprietary trading."

So, they cut 4,800 to save $1 billion, and they're going to recruit "top-level executives."

Of course they are. And they're going to get rid of the "bottom-level executives" who currently hold those jobs.

"Morgan Stanley estimates it saved $1bn from this year’s compensation bill by cutting about 10 per cent of its workforce, particularly in areas such as investment banking, fixed income and research, in two waves of lay-offs in January and April. People close to the company said it had already reinvested $400m of the savings in the salaries and bonuses of new staff. They added that Morgan Stanley could use the remaining $600m before the end of the year to lure other recruits but only if it found enough good candidates."

So basically they cut $1 billion and reinvested $400 million. That to me adds up to a cut of $600 million.

This is NOT a massive jobs program, is it, JuiceMan? It's just a natural part of what happens when there's a huge retrenchment. And just in case you think it is:

"In spite of the stream of writedowns, credit losses and lay-offs, many Wall Street firms say that they are looking to make strategic hires to strengthen their expertise for when the capital markets and economy finally rebound."

Read this: strategic hires.

Then your other article:

"Help wanted on Wall Street

"Some workers are actually in demand right now at top financial firms. But the inexperienced need not apply.

"NEW YORK (CNNMoney.com) -- No one would dare go so far as to say that the Wall Street job market is bright.

"Through June, financial firms of all stripes have shed an estimated 63,000 jobs over the past year, according to the latest employment figures from the Labor Department. That's due in large part to the housing slump and credit crisis.

"The pain is particularly acute on Wall Street. Investment banks and brokerages have shed an estimated 7,600 jobs, or roughly 4% of their workforce during the past year, according to the latest figures from the New York State Department of Labor.

"If previous market downturns are any guide, analysts project that Wall Street could cut anywhere between 20% to 25% of its workers if the economy gets even worse.

AND THEN IT SAYS what you printed:

""The headlines may scream gloom and doom but recruitment activity is continuing throughout the industry," said John Benson, CEO of the job site eFinancialCareers.com."

by: CEO of the job site eFinancialCareers.com.

Talk about cherry-picking a quote out of context and quoting a source with a vested interest.

You might as well just wish on a star, JuiceMan, instead of posting such unmitigated out-of-context crap.

Whent they get to 50k hires (number cut already), let me know.

BTW, even the city has projections of net job losses on wall street going another 2 years.

And, when you let go of low end folks and spend that money on high end folks, you end up with less folks. (thats called math)

The real dismissal figures haven't come out yet b/c these people got good packages, & they can't claim unemployment until the package terms have expired.

I love how I get criticized for cherry-picking (not) & JuiceMan publishes one sentence among thousands of words of text, just to try to prove his (nonexistent) point.

More importantly, bonuses are already well on the way to being decided. The money gets put away in advance. 10 employees or 10 million employees, the bonus pool is getting TINY.

In the end, this just sounds like grasping at straws to me...

The bonus pool is turning into restricted stock that doesn't vest for years.

And will now be split between more folks. This is getting exciting!

"publishes one sentence among thousands of words of text, just to try to prove his (nonexistent) point."

I published the entire articel steve, you clicked on the link didn't you? What point was I trying to make? The one where all positive news is dismissed and all bad news is law? Yup, I think I proved that point once again. So predictable steve.

Uh, no, you didn't publish the entire article. You put up a link. And steve is totally right.... you tried to spin it.

You put up this phrase:

"Wall St. still hiring"

This was the description of an article that starts with "No one would dare go so far as to say that the Wall Street job market is bright. " then notes that 63k jobs were cut,and then notes that it could be cutting more, up to 25%.

The article notes some areas have bright spots, but makes it pretty clear that the overall trend is AWFULLY poor.

And you tried to play that off as a wall street rebound. Sorry, but that is about as much of a slant as you can possibly get...

Then the Morgan Stanley article notes 4,800 cuts, and a small fraction of that in rehires. Still a clear net MAJOR loss of jobs. Again, only slant from you.

> So predictable steve.

Nowhere as predictable as shilling from JuiceMan!

"Uh, no, you didn't publish the entire article. You put up a link."

You are insinuating that I was spinning because of a posted a link instead of the article. That's what you are supposed to do on a blog EW, post the link. It is good etiquate.

"The article notes some areas have bright spots, but makes it pretty clear that the overall trend is AWFULLY poor."

My point was there are bright spots and, not surprisingly, you and steve focused only on the negative.

"And you tried to play that off as a wall street rebound."

Did I EW? Is that what I said? Or is that what you wanted me to say?

"Nowhere as predictable as shilling from JuiceMan!"

Someone has to throw up a story or two that offsets the doom and gloom garbage the two of you cough up. If that's shilling, well I'm guilty I guess. However, I would look a little harder to determine who the shiller is EW. You and steve throw up so much one sided conjecture and certified poopy that it is hard to tell what is real and what is fiction.

Steve is known to be very one sided and loud.

"I published the entire articel steve,"

No you didn't. You published a headline and a link, with the one "positive" statement in the whole thing, by the head of a recruiting firm. Fess up - it was disingenuous, and if I had done such a thing you on the other (wrong) side of the aisle would have chewed me up.

"The one where all positive news is dismissed and all bad news is law?"

Absolutely not. Just reality. If rents rise in some places I will publish it. If they fall I will publish it.

"I think I proved that point once again. So predictable steve."

Again, absolutely not.

"Someone has to throw up a story or two that offsets the doom and gloom garbage the two of you cough up."

Operative phrase: "throw up."

If there's something positive I am the first to admit it. As I said before, though, I also believe that falling real-estate prices IS positive for New York as a whole. And so is reining in the excessive bonuses on Wall Street, the biggest trickle-up scheme ever: sell mortgages to people who don't understand them, who make less than you, who can't ever pay them off, rate them Triple-A, then give yourself a huge bonus because you did such a good job.

It's disgusting. Where is A.P. Gianinni when you need him? (For the ignorant: founder of Bank of America, inspiration for "It's a Wonderful Life".)

> Someone has to throw up a story or two that offsets the doom and gloom garbage

Except it didn't. The article said, that as we noted before, Wall Street is bleeding jobs.

You tried to play it off as an article that said something it didn't...

As Steve said, that is completely disingenuous.

"Steve is known to be very one sided and loud."

ootin is known for not contributing anything.

JM- I have no problem with your post. I actually think that's important to stay informed, of all moves by these firms. My biggest complaint has been, the secrecy of these firms, from the beginning. You can't have it both ways. If a firm has a plan that should always be applauded, if a good one will be proven in the future, however not to have a plan is a recipe for disaster.

I would expect nothing less from every firm. Their survival will ultimately lay with the smartest employees. If you can horde the talent then go for it.

Looking beyond the hires and layoffs is the compensation of those still employed. We all know the bread and butter are the bonuses. There have been many figures 30, 40, 50, 60%...... decreases. Who knows? But the other figure that is just as important is how much will be paid in stock options that can't be accessed for several years. So if the bonuses are down 40% that's a big hit everybody is anticipating. The problem is if the bonuses given that are already down 40% are pain say 70% in stock options then the real effect for RE in NYC will be devastating. The available a usable cash will be almost Zero compared to bonuses of the past.

> My biggest complaint has been, the secrecy of these firms, from the beginning
Agreed... although that kind of thing is pretty much the American way these days.

Cramer - who I don't normally love - had an interesting point in NYMag. He said the reason why Bear tanked and Lehman is at risk is because they said everything was rosy for too long... settling themselves up to be shorted like mad by the hedge funds who could point out real issues.

Goldman went public with every little thing that was wrong, and they took some lumps, but they're in fantastic shape in relative wall street terms.

> But the other figure that is just as important is how much will be paid in stock options
> that can't be accessed for several years.... if the bonuses given that are already down
> 40% are pain say 70% in stock options then the real effect for RE in NYC will be devastating.
> The available a usable cash will be almost Zero compared to bonuses of the past.

Absolutely. If cash dries up, look the f out...

"I have no problem with your post."

I do: "The headlines may scream gloom and doom but recruitment activity is continuing throughout the industry," said John Benson, CEO of the job site eFinancialCareers.com."

When what it actually said was, "Through June, financial firms of all stripes have shed an estimated 63,000 jobs over the past year, according to the latest employment figures from the Labor Department. That's due in large part to the housing slump and credit crisis.

"The pain is particularly acute on Wall Street. Investment banks and brokerages have shed an estimated 7,600 jobs, or roughly 4% of their workforce during the past year, according to the latest figures from the New York State Department of Labor."

"As Steve said, that is completely disingenuous"

Wow, steve and EW calling someone else disingenuous. Now that my friends, is the ultimate spin.

"My biggest complaint has been, the secrecy of these firms, from the beginning."

dco you are right, and you had this stance early on. Much of what you said these firms were hiding has indeed come to light.

"Cramer - who I don't normally love - had an interesting point in NYMag"

Cramer is everywhere and he is horribly inconsistant. I think we are facing a classic example of over exposure here. He has become the Emeril Legasse of finance.

"steve and EW calling someone else disingenuous. Now that my friends, is the ultimate spin."

Without commenting on EW, show me, JM, exactly where I've been disingenuous. You can't, because it's untrue. I'm not the "a member of the Obama election team" guy; you are.

I do, however, agree with you on Cramer - a friend of mine worked for him and knows him, and apparently he's unbearable. Seems in person he's exactly like he is on TV.

"It is good etiquate."

What, precisely, is "etiquate"?

You can't even spell it when a mere right-click on the mouse when it's underlined in red would show you how it's spelt.

"Spelt"? Don't you mean "spelled"? Or are your snacking on pretzels?

haha- "Or are your snacking on pretzels", don't you mean "Or are (you) snacking on pretzels"? This is not a grammar or spelling contest, so give us a break.

That's called a typo, dco.

you guys are having fun wailing on each other, but here's my two cents: part of my job is to observe what's happening on Wall Street. You could say that I work on the fringes of the Street.

And believe me, the Street is one its knees. When people in the financial industries get together and schmooze these days, the talk always turns to which house will be the next to crumble, after Bear Stearns -- will it be Lehman, or will it be Wachovia? Whose balance sheet is more of a nightmare?

I'm sure it's true that in a few corners of the Street -- mainly where the short sellers live -- they are in a position to hire people who know what they are doing, because the short guys can make money off of negative sentiment.

But in big picture land, people are actually wondering if our financial institutions are even going to survive. And here some of you guys are fighting over how aggressively they may be hiring!

Come back to planet earth, ya'll. Communal denial may be fun but it doesn't help solve anything.

"steve and EW calling someone else disingenuous. Now that my friends, is the ultimate spin."

Its usually the biggest spinners of all who complain about spin, and this case is no different.

We're talking about a guy who links to an article about massive cuts on Wall Street and names it "Wall Street is hiring". I haven't seen spin that bad since Hamas...

haha: "Spelt"

Look it up. It is correct. I wrote it on purpose, to see who would take the bait.

Or better, from Oxford:

"spell. verb (past and past participle spelled or chiefly British spelt)"

Thanks for the insight (both on Wall Street and on the wailing), GraffitiGrammarian. My old pals still at BB firms have pretty much been saying the same thing to me for a few months now..

Home prices are still falling. I laugh when people say, so what if California, Arizona, Nevada..... decrease, this is NYC. Well I'll tell you why you should care. As the rest of this country continues to decrease so goes wallstreet. These banks can't even put a real estimate on the losses. This paper is going to border on Zero in the next few months.

The Fed can do what ever they want, however this problem is bigger then the federal government. You can't stop it. I have said, this was never a sub-prime problem. Even prime borrowers are now going into foreclosure. All estimates were for sub-prime. How are they going to raise capital for the next $500 Billion.

GM, Chrysler, Lehman, Wachovia and WaMu just to mention a few are actually bankrupt for all intensive purposes. What's the Fed going to do when GM officially goes under? Are they going to bail them out? Can you imagine the cost. The Dow is down about 19% off its highs. Most bear markets touch the 30% decline before a recovery. This is in no way a normal bear market. Greenspan stated this week that "it's a once in a century event". Now because that fool Cramer in CNBC said the market has bottomed, we should all buy into this market. Give me a break.

I'm sticking to my analysis and the events I anticipate for the future. In a nut shell the Dow will have to decrease at least 40% off it's highs. So the way I see it, we still have 20% down side before we can even think about a bottom.

dco, didn't you publish that elsewhere?

stevejhx- HAHAHA. Yes I just figured that this post will cover all my responses for the day. I'm going on vacation tomorrow and I'm feeling quite lazy. Don't hold it against me.

"Without commenting on EW, show me, JM, exactly where I've been disingenuous. You can't, because it's untrue."

When I read that I yelled, The Plane...The Plane..., because I could swear this is Fantasy Island.

steve, when are you going to invite me to a tea dance?

"When I read that I yelled, The Plane...The Plane..., because I could swear this is Fantasy Island."

Exactly, because you can't.

"steve, when are you going to invite me to a tea dance?"

Anytime you want.

DCO, another 20% from the lows in the stock market? I don't think so. That is crack you must be smoking. Earnings are not off that much. Valuations can't come in that much either. You are talking about Dow 8500. I don't think you have a concept of how the market functions. Fear would have to be at levels beyond comprehension, or the fundamentals would have to deteriorate much beyond where we are today in order to see those levels. In most professionals' opinion, that is not happening. The RE market is another story, but I am calling "nuts" on that prediction.

I agree with dmag. A fall of that magnitude would be as bad as the Great Depression. A 40% correction - which is what you're calling for - is not feasible given the general health of the nonfinancial sectors which, though it has lost oodles of dough, still has access to capital.

HOWEVER, housing prices will indeed fall that much. We're just seeing the beginning of it here. An illiquid asset that earns no income, generates no efficiencies and is 100% correlated to incomes and leverage, cannot rise over time more than incomes and leverage. Incomes are provably down in NYC; we know the leverage story. Reregulation of the financial sector is inevitable. There is but one way to go.

JuiceMan calls it "Fantasy Island." I'm still waiting to find out what's so fantastic about it.

Remember, the current market includes something like a 75% decline in financials.... so there isn't a lot more to take away there...

That being said, I wouldn't be totally surprised to see another 5% off the last bottom, so maybe 25% in total. But I think 40% is a long stretch. There is enough cash on the slidelines to bump things up if an opoprtunity is seen..

I don't think we are going to retest the lows, we've seen the worst in the market.

One of our guys just left to invest in real estate and we are now hiring in my group, but we pretty quickly found a replacement.

"Look it up. It is correct. I wrote it on purpose, to see who would take the bait."

This nicely sums up what's been going on on this board the past few months. Sad.