We're snacking this morning on the delicious irony that Merrill Lynch's stock is getting hammered by rumors that it will announce new losses from Alt-A mortgages on the same day that analysts at Merrill Lynch cut their earnings outlooks for several large regional banks, and predicted dividend cuts from Bank of American and Wachovia. It's credit crunch for breakfast!
Merrill Slashes Outlook For Banks, Market Slashes Merrill With Write-Down Rumors
Posted by John Carney, Jun 20, 2008, 11:42am
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Posted by guest , Jun 20, 2008 11:55AM
I thought all you Wall Street IB folk were suppose to have been smart. Effective immediately my firm is only going to hire MBAs from The University of Oklahoma at Norman.
Posted by guest , Jun 20, 2008 12:08PM
IB Folk are not smart...just kinky..andalot have them have really hot feet and love getting them massaged!
Posted by beentheredonethat , Jun 20, 2008 12:12PM
It would be a much better idea to toss the MBA's and bring back the NY natives with street smarts who used to be hired on Wall Street. They were the most cost-effective antidote to the intellectual arrogance and blind faith that has brought this mess on. Now you even have MBAs processing trades. WTF?
Posted by guest , Jun 20, 2008 12:18PM
@11.55- Boomer. Sooner.
Posted by guest , Jun 20, 2008 12:18PM
we're still here ;D
Posted by guest , Jun 20, 2008 12:20PM
ML needs to merge with CS or LEH to survive.
Posted by Peon , Jun 20, 2008 12:23PM
Hiring MBAs is all about image. Clients are a lot more likely to trust a well-groomed guy from HBS than a classless, old school, Lewis-Ranieri-type with an 8th grade education, even if the latter is far better and smarter trader.
Posted by guest , Jun 20, 2008 12:25PM
Bigotry, corruption, hubris, greed.
Add these four up. You get what you deserve! ML needs a major shake up!
Posted by guest , Jun 20, 2008 12:27PM
nothing like an MBA with nice pedicured feet!!
Posted by guest , Jun 20, 2008 12:28PM
An MBA at Georgetown or Univ or MD College Park are better than one from Harvard or Wharton.
Posted by guest , Jun 20, 2008 12:31PM
Bess and Carney are going at it in the handy stall.
Posted by guest , Jun 20, 2008 12:32PM
1220 hahaha
Posted by guest , Jun 20, 2008 12:34PM
@12:20 - I concur. Cultures collide, but performance would improve exponentially. We need a tri-merger between ML, CS, and LEH. Mega broker-dealer with the global reach needed to diversify in this market.
Posted by guest , Jun 20, 2008 12:39PM
Boomer Sooner indeed
Posted by Judson_Clark , Jun 20, 2008 12:46PM
Hook 'em Horns!!!!
Posted by jaems , Jun 20, 2008 12:55PM
These big league MBA's deserve a bit more credit. They knew that racking up big gains sourcing and securitizing debt would result in big bonuses in '03, '04, '05, '06, and even '07. Now a bunch get laid off in '08. But if you have 5 years of good bonuses on Wall Street, you can coast for a while. Not to mention, who really wants to work Wall Street hours for more than 5 years anyway.
It's really all about incentives. Short-term incentives in this case, which are paid for taking long-term risks.
Posted by guest , Jun 20, 2008 2:07PM
Hoot 'em Owls
Posted by guest , Jun 20, 2008 2:26PM
@ 12:39, 12:46
cu is going to do just what we did to ou last year to texas this year. darrell scott!
Posted by guest , Jun 20, 2008 2:34PM
@12:20. The overall sentiment of the market is that ML is more likely to merge with BOA and Wachovia at this point. I would look forward to this in 2nd quarter 2009. This would indeed be a landmark tri-merger that would reshape the financial industry landscape.
Posted by guest , Jun 20, 2008 3:06PM
Been in IB for 5 years now, and MBA's from the "top-5" have to be some of the dumbest mofo's I've ever met. Great in the classroom, dumb as rocks on the street. Give me a hungry, state-schooled kid any day over these pansies.
-ashamed Wharton grad
Posted by guest , Jun 20, 2008 3:08PM
@12:28PM - Agree
Posted by guest , Jun 20, 2008 3:36PM
@2:34 now you are the dumbest mofo on the street. The overall sentiment? Nobody who knows even the first thing about financials thinks that a BAC-WB-MER three way is going to happen.
Posted by guest , Jun 20, 2008 11:33PM
I think MBA's are some of the worst examples of Weapons of Mass Destruction the world has failed to recognise.
The 1987 stock market crash was caused by the computer programme trading systems invented by MBA's.
The dot-com bubble was caused by MBA's at internet start-ups and their MBA pals at the investment banks and venture capital funds. Not to mention a few very very dodgy 'Star' anal*ysts.
The subprime debt instruments and most of the other toxic derivative instruments were dreamt up by MBA's with math or engineering degrees.
Posted by guest , Jun 21, 2008 12:05AM
@12:34. When will people wake up to the fact that M&A between investment banks don't produce any value? The idea of trying to combine CS, MER, and LEH is just ludicrous!!!!!! Think about it, you have at least three people vying for each of the senior positions. Can you imagine the shit fights that would prevail throughout the bank???
Furthermore, you'd have all these fiefdoms that only look after themselves. Case in point is UBS. There are still UBS, SBC, Warburgs, PaineWebber factions in the bank. Or Citi, there are those who still call themselves the SSB contingent (just in case if you forgot SalomonSmithBarney) and the Citigroup bankers.
To me, right now at this moment, Goldman aside, Deutsche Bank (just edging out JP Morgan) has been and is the best at navigating the subprime troubles and will likely to come out much stronger than before. For a bank that is so reliant on fixed income; credit trading, leveraged finance and DCM, Deutsche's writeoffs are miniscule compared to all other 'balance sheet' banks. Their other franchises have not suffered too. They are still in the top three in European M&A by value (even though P/E deals have dried up) and their European ECM business is also top notch. Whichever way you look at Deutsche, they have done a fine job. Deutsche will not get into any M&A with any other i-banks unless the target is served to them on a platter. In the near term, it is the Deutsche Postbank and Citi Germany that Deutsche has its sights on.
Posted by guest , Jun 21, 2008 7:24PM
Well, well, well. Once again, bloggers have sniffed out truth and justice the American way. I recently came across the astute observations of a guest blogger who had connected the dots beteen Gasbagarino, DB, the piece about Dick Bove and Mike Mayo. Apparently, Wall Street executives like Jimmy Cayne, John Thain, John Mack, Dick Fuld, Loyd Blankfein, etc have instructed their respective staffs to have no contact with Gasbagarumor due to his erroneous information, hostile nature and moronic observations. Despit this, the blogger has observed, Mike Mayo appears to be a frequent and anonymous source for the on-airhead editor. Oooops, he/she points out, watch yourself Mike - you're next to be fired!
So, here's the rub: I cut and posted this astute posting a number of times. However, it has been removed by someone with administrative access. Hmmm. One can only conclude that some collusion between Carney, the Gasbag and Mike Mayo to mislead the blogosphere is in play here. Big mistake guys - you don't want to lose your loyal followers! Better that the bad guys be exposed for what they truly are -fucking stupid.
Posted by guest , Jun 22, 2008 1:12PM
Exactly what staff would Jimmy Cayne be instructing?