Credit Suisse Q1 write-downs of $5.3B drives $2.1B loss (AP)
The big write-downs just keep coming. A $5 billion write-down and a $2.1 billion loss at Credit Suisse. Surprisingly, its the banks first loss during this whole mess, so in some respects, they're really behind the curve. Said CEO Brady Dougan: "I am confident that we will continue to serve as a safe haven for clients in uncertain and volatile markets, and to seize the opportunities that arise in times of market dislocation to create long-term value."
Debt Collection Done From India Appeals to U.S. Agencies (NYT)
Now they're outsourcing the debt collectors too! What a ridiculous outrage! In these economic times, we should hope that debt collection would be the one growth industry, there to provide millions, or at least hundreds of thousands of jobs to laid-off Americans. But nope. The debt collection industry -- rather than feeling a duty to the American worker -- has decided to shift more labor to India, apparently because it's cheaper, while still rather effective. Profiteers, all of them.
Apple Riding a 51% Jump in Mac Sales (NYT)
The Mac is back. Ok, it's already been back for awhile, and you'll have to forgive the obnoxious McCain reference. But it is back big. And now Apple is right back to square one: it's a computer company again. Sure, the iPhone is a big deal, and the iPod Touch (iPhone sans-phone) may be the future of the iPod, but for real growth, look no further than those things you find on tables at coffee shops, with stickers on 'em. And they're still just a sliver of the overall market.
CEO Says Microsoft Could Forgo Yahoo (WSJ)
Ballmer is trying to make Yahoo shareholders nervous, implying that Microsoft could, in the end, change its mind, particularly if Yahoo balks at the current price. Negotiating tactic much? Probably. But also probably a little truth, since, well, Microsoft could live without Yahoo. Oh and Microsoft employees are said to be growing increasingly wary. Not surprisingly. It's like being 17, and your parents are about to have a new kid.
Thai rice hits new record, feeding food fears (Reuters)
In places where rice is a diet stable, spiking rice prices are disturbing. In the US though, it's probably a good thing. Unless you must have your crispy duck with rice, it's really just wasted space in your stomach. Empty calories without much to show for it. Yeah, some sticky white rice can be nice. And arguably its the sina qua non of good sushi rolls, but really. No need. So we're sort of happy that Wal-Mart is now rationing the stuff. And since Wal-Mart=retailing, there's basically a big public rationing going on, the likes of which have not been seen here in quite awhile.
Peak Performance (Capital Spectator)
Another interesting discussion of whether the worst is over in the credit markets.
Shanghai index soars 9.3 percent on tax cut (AP)
Interesting: it wasn't all that long ago, that the Chinese government was doing everything in its power to slow down the raging stock market. You know, just cool it off a little. These included various measures aimed at borrowing and margin requirements and the like. Well, those measures worked too well, some might say, and now they're busily reversing course, trying to pump up the flagging Shanghai market. Stocks soared over 9 percent last night, as the government slashed a general tax on share transactions. The original tax was just proposed last May, so this is a sharp reversal.
L.A. Times parent Tribune Co. rescinds fee on smokers (LA Bizjournal)
We have no idea whether Sam Zell will be able to turn around Tribune or not. It's going to be tough and he's on a short shot clock. But we like the moves he's been making to get employees motivated. The latest: rescinding a fee levied on smokers. Under the old regime, those who smoked were compelled to pay an extra toke into their health insurance fund. Zell isn't having it. Said a spokesman, "We didn't feel it was consistent with the culture." Though the company still wishes employees would show good judgment.
Posted by guest , Apr 24, 2008 8:21AM
Just dont raise the price of eggrolls.......
Posted by guest , Apr 24, 2008 10:31AM
staple, not stable...cmon guys
Posted by guest , Apr 24, 2008 10:40AM
I just wanted to say for the record (in light of all the recent criticism floating about) I like Joe Wiesenthal's morning posts.
Posted by guest , Apr 24, 2008 11:52AM
'sine qua non', not 'sina qua non'...cmon guys
Posted by guest , Apr 24, 2008 12:02PM
April 24, 2008,
9:15 am
Mean Street: How Not to Get Fired on Wall Street
Posted by Deal Journal
I’m not sure I should be writing this column. First of all, for many of you reading this column it may already be too late. The layoff lists at many Wall Street firms were drawn up weeks ago.
Second, I’m not sure you should be taking advice from someone who himself was fired on Wall Street. Then again, maybe that makes me particularly qualified. And truth be told, I have had the distinct displeasure of firing many people in the course of my career, so I have seen it from both ends.
I remember surviving one series of cuts at Goldman Sachs in 1994. After months of obsessive anxiety, I did keep my job. I was relieved, but I wasn’t happy. I was furious at myself for not having enough confidence in myself and for believing that the job was the most important thing in the world.
Trust me, it isn’t. But in the meantime, here is a short course in how not to end up unemployed on Wall Street:
Get yourself a guaranteed contract. A strategy best employed when you join a firm or after a particularly good year when management thinks (usually mistakenly) that you may flee to a competitor. Typically available only to already-wealthy senior managing directors. Logic: Management is sensibly reluctant to part with headcount that they will pay for regardless. Best outcome: To be fired anyway and keep guaranteed money.
Have a powerful rabbi. It is critical to keep your name off the lists, so it is obviously best to have a boss or well-placed friend (”rabbi” in Street-speak) compiling the lists. I believe this helped save me a couple of times, although nobody ever comes out and tells you so. Logic: The powerful need loyal followers to stay powerful. Best outcome: Keep job and pledge naming rights on first born to mentor.
Make your boss’s job easier. Bosses don’t like extra work. Especially work they can delegate and forget about. If you are the boss’s “go to” guy or gal, you will be passed over in the first few rounds of layoffs. Be warned, however. The importance of competence is typically overrated by bankers and traders alike. Logic: Usually plenty of incompetent colleagues to fire first. Best outcome: Keep job but need to compete harder with remaining, competent peers.
Shamelessly market yourself. Even a mediocre banker can usually put themselves in a positive light. I was endlessly amused when a midlevel banker would come into my office claiming, “I made $20 million for the bank last year.” Oddly, this revenue claim game seemed to work with other senior bankers. Logic: Many decision-makers are so busy exaggerating their own contributions that they may buy your outrageous claim and think you are valuable. Best outcome: Keep job but actually need to generate revenue next year.
Lay low and cross your fingers. If you are lucky you will be on an active deal that will give you the excuse to be out of the office often. If you are unlucky, you will have to resort to filling your schedule with meaningless pitch meetings. My experience was that the floors were like ghost towns before the firings began. Logic: the less my boss sees of me the better. Absence makes the heart grow fonder. Best outcome: Miss first round of layoffs. Buy time before eventual firing.
Extortionary tactics. Exploit any minor incident that could hypothetically have involved misconduct with clients, extramarital affairs, drug or alcohol abuse, sexual or racial discrimination. Strategy only to be used under extraordinary duress where you are comfortable spending the next few years in law suits or arbitration. (Banks have a lot of lawyers, so I would strongly argue against this method.) Logic: Investment banks are so terrified of bad press, they won’t fire me. Best outcome: Keep job but lead a life of extreme paranoia and guilt.
Comment by Sir Topham Hatt - April 24, 2008 at 9:24 am
All good advice, except when the budget gets cut, there’s no way that marketers like myself can stay longer than the bankers and operations folks.
Admittedly, this is crying over spilled milk, but anyone who’s been laid off seems to forgo any sympathy when it’s their turn to hire.
No one asks your ex-boss, “Why didn’t you do more to keep Hildegard, who was the most productive member of your team?” Somehow, it was your fault that you couldn’t stop the train wreck of layoffs.
In the future, a little empathy goes a long way.
Comment by Laid off at Bear, boutique investment bank and Deutsche Bank - April 24, 2008 at 9:42 am
Laid - you got fired THRICE? Ouch.
Comment by TooGoodToBeFired - April 24, 2008 at 9:44 am
First of all, I am glad to hear that you were fired. That would be a payback for those that you terminated. It has somehow become a cultural thing in this country to quote the famous Donald Trump words”your fired”,and feel proud.
There are peoples dignities at stake when that happens. They have families that depend on them.In NYS you can fire an individual for cause, or no cause at all.I dont like him. I dont care if he/she performed better than competitors.I can fire them.At will employment is a bigger threat to this society than sub prime loans.Citi not only is an institution that cares little for its shareholders and customers, but it’s employees as well.
Comment by Michael Fers - April 24, 2008 at 9:53 am
It is a sorry commentary that this sort of advice is actually quite effective. The reason is that the manipulative little weasels who do this stuff end up surviving in greater numbers than those who try to keep their heads down and do a good job. They do so because the SOBs who survived previous layoffs, rose through the ranks to senior management, and make the hiring and firing decisions recognize them as kindred spirits. It is a cycle of shame that contributes directly to the overall incompetence and lack of integrity among senior management on Wall Street.
There are plenty of senior bankers like me who recognize all these tricks for what they are. Heaven help you if you try to pull this sh*t on us: if we can, we will fire you immediately. On the other hand, few of us actually make it to the top, so your odds as a weasel on Wall Street are pretty good.
Comment by The Epicurean Dealmaker - April 24, 2008 at 10:02 am
Hey, aren’t bankers the living embodiment of the creative destruction of capitalism? Why would anyone therefore worry about getting fired? It’s going to happen, it’s built in to the status quo. And, it’s also part of the game to get rehired. Just as there is creative destruction there is creative “restruction.” To game things with these Seinfeld ploys (can’t you see George trying all these tactics?) misses the whole point of capitialism.
Of course, I’m not now, nor have ever been a banker, so what do I know? You’re always the smartest guy in the room when it’s not your job.
Comment by Steve - April 24, 2008 at 10:12 am
While trimming the worst 20% of a firm’s employees could be very healthy, it’s often the case that too much dead wood remains and too much quality goes out the door.
Comment by Mark Gavagan - April 24, 2008 at 10:18 am
Unfortunately, some of the most creative and honest folks are frequently the first to be axed because they have run afoul of those who occupy the “great middle” of mediocrity and who resent folks who go the extra mile.
What’s left is the flotsam and jetsom who have done the best job hiding. The result is that the top performers then can command more compensation since the “bench” has been weakened by cutting 2nd line players with potential in favor of keeping the taxi squad. Go figure.
Comment by Damocles - April 24, 2008 at 10:32 am
I have never lost a job where I did not find a better one. It is usually the best connected who stay. Unfortunately “loyalty” is prized above compentance so companies do not make themselves leaner and meaner after the layoffs but leaner and duller.
Comment by Laid off Smaidoff - April 24, 2008 at 10:37 am
If you live in fear of being fired then the company has you by the b*lls. Being fired can often be a blessing. If you live in fear of being fired and have to resort to some of the above tactics, I suggest looking for another gig NOW. Life is too short to become as nefarious as the managment in some of these companies.
Comment by midwestnorwegian - April 24, 2008 at 11:35 am
Its shocking to see this job-clinging commentary from Wall Street bankers, MBA-types and the readers of the bastion of capitalism - WSJ.
It works both ways and the simple truth is - You will only be employed till you provide value to your employer (boss, company, HR etc). You should stay employed only as long as your employer gives you a reason to.
To Michael Fers - be aware the next layoff is only 6 months away. Stash-away a rainyday fund, keep your resume & skills updated, have a foot in the market all the time.
To the bosses - be aware that your people are looking for other jobs and can put in a notice anytime. Cross train your people, have a pipeline internally & externally, sign-up for less than 100% of your team’s capacity
Comment by MainStreetCapitalist - April 24, 2008 at 11:41 am
Unfortunately, it is the politically connected who survive. The ones who get laid off may include dead wood, but many quality workers also get canned. The result is more incompetence within organizations. New managers get brought in and they in turn axe existing workers to bring in staff loyal to themselves. When the new managers get booted the process is renewed.
Comment by Laid off 3X - April 24, 2008 at 11:44 am
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