Anyone work in the financial field?

NotaSuv

After reading the same posts on many different boards by many different posters I see that there are as many opinions as posters.....

Was wondering how many here actually work in the financial world

Sales or research? or are alot of the posts just repeating what was heard or read?

no troll..... just curious....

DollarDave

I work at a good sized bank of 7 billion in assets and over 130 locations. We are in very sound financial shape, almost completely unaffected by the swirl around us.

Kris Siegel

I technically do... on the IT side though so I don't know anything

I decided to try investing this past summer (basically when it was starting to go down). I had thought we were at a floor and I was getting in on the cheap... oh boy I got out when I lost half my money and I'm glad I did as I would have much less now.

Oh well, lesson learned. I only lost a total of $600 so I didn't play with too much. Afterwards I put a few dollars in penny stocks just to see what happens (I don't expect to make if any money on them; it's just fun).

dkg999

I work in the marketing services side of the largest US credit bureau, so pretty closely tied to the financial industry. Not every bank is in trouble, just every financial institution with highly paid senior executives :eek: (or so it seems!).

shack

I've been a banker for 30 years...primarily as a private banker. I have worked for a couple of the largest banks in the country (AmSouth/Regions and SunTrust) but now I work for a small regional bank started by some friends of mine. I have a couple of serious problem customers right now but our bank as a whole is well capitalized and will be able to withstand the storm. I have seen a lot of the down cycles over the years and this is THE WORST so far. I don't think we have seen the bottom yet. Housing/mortgages is still a huge problem. It has not moved to commercial real estate...yet...but if the economy worsens that could start to be a big problem that could equal the housing issues. Credit card debt is also on the horizion IMO. It continues to grow and household incomes are not keeping pace. Something has to give. We'll see. The financial landscape as we know it may never be the same. It sucks to be a banker right now.

avelanchefan

shack wrote: »

I have seen a lot of the down cycles over the years and this is THE WORST so far. I don't think we have seen the bottom yet. Housing/mortgages is still a huge problem. It has not moved to commercial real estate...yet...but if the economy worsens that could start to be a big problem that could equal the housing issues. Credit card debt is also on the horizion IMO.

The problem I see Shack, is that people that bought their house say five years ago are barely able to break even if they were to sell today. At least it is that way here in AZ. I have seen two houses sell for 10,000 dollars less than what they sold for new 5 years ago. These are the people that are really scared. They bought these houses at 145,000. Never did a second mortgage, only to find out the 100,000+ equity they had has now become -10,000. I know equity is very subjective, but scary times none the less.

Try owning two houses like me. Not a very fun time to be in right now.

shack

avelanchefan wrote: »

The problem I see Shack, is that people that bought their house say five years ago are barely able to break even if they were to sell today. At least it is that way here in AZ. I have seen two houses sell for 10,000 dollars less than what they sold for new 5 years ago. These are the people that are really scared. They bought these houses at 145,000. Never did a second mortgage, only to find out the 100,000+ equity they had has now become -10,000. I know equity is very subjective, but scary times none the less.

Try owning two houses like me. Not a very fun time to be in right now.

I know some about the AZ market. I know a bank with a portfolio of AZ mortgages that wrote down and charged off 20% of their problem mortgage loans thinking they were getting the loans down to where the collateral was close to market price. Not even close. They can't sell them with that markdown because everybody else is selling their forclosures at 30-40% off of the original values to get them off thier books. Good luck.

avelanchefan

shack wrote: »

I know some about the AZ market. I know a bank with a portfolio of AZ mortgages that wrote down and charged off 20% of their problem mortgage loans thinking they were getting the loans down to where the collateral was close to market price. Not even close. They can't sell them with that markdown because everybody else is selling their forclosures at 30-40% off of the original values to get them off thier books. Good luck.

Yep that is exactly what I am seeing here. Oh well. I will keep plugging away at the mortgage. Nothing I can do. I am just glad I can afford it. Plus I have a renter...that always helps.

dkg999

I've been looking to pick up a property out here in Northern IL where I work and currently have an apt. So far the banks are not willing to let go of their properties at anything close to the 30% to 40% discount. I think they will eventually get there, but they are fighting it. I'm looking to pick up a property now via a number of bankruptcy lawyers I have been talking to. It's a good time to be a bankruptcy lawyer, or so they tell me!

avelanchefan

It's not so funny, yet ironic, that the CC companies wanted the Bankruptcy laws changed. They lobbied for it and got it done in what 2003-04? I cannot remember, but now people are racking up huge debt that is not written off in Bankruptcy anymore. How are they going to collect their debt if people cannot pay, and have no viable equity?

dkg999

The CC companies will be forced to write-off debt that can't be paid back, no matter what the bankruptcy laws have been changed to. However unlike in the past, additional impact to a person's credit report, along with tax implications, provide some break in the revolving door of bankruptcy that some individuals were able to make a career out of. At least that's what I have been led to believe.

shack

dkg999 wrote:

I've been looking to pick up a property out here in Northern IL where I work and currently have an apt. So far the banks are not willing to let go of their properties at anything close to the 30% to 40% discount. I think they will eventually get there, but they are fighting it.

You guys are probably 7-8 months behind Fl, CA, AZ, MI as far as the housing problems. These guys were first and the realization is they have to move their forclosures because it is putting a huge strain on their capital. They have to move stale assets to cash asap. Some banks are hoping to sit on the inventory and wait until housing turns. If they have enough capital they can...most don't.

carpenter

I'm in the Fixed-income-trading-technology business.
Luckily, the traders I work for belong to the cash desk (Government bond prices are rising faster then my W@ng when I'm thinking about Sarah Palin ), so I'm not fixing my CV, yet. (...)

btw, a big problem nowadays is not just with people who can't pay off they mortgages; some of them simply don't want to pay, even though they can afford the monthly returns.
Say if someone bought a house for 400K, with 100% funding. now the price dropped to say 210K. many folks just put the key an envelope (so to speak) and wish the bank good luck finding a buyer to the property.
why pay 400K for something that's worth 200K? so even though those people's credit score gets trashed, and they will only be eligible for another mortgage in 7 years, some choose to walk that path.

dagame27

dkg999 wrote: »

I've been looking to pick up a property out here in Northern IL where I work and currently have an apt. So far the banks are not willing to let go of their properties at anything close to the 30% to 40% discount. I think they will eventually get there, but they are fighting it. I'm looking to pick up a property now via a number of bankruptcy lawyers I have been talking to. It's a good time to be a bankruptcy lawyer, or so they tell me!

I'm in the same situation right now. Prices have started to drop dramatically in the south burbs. I'm sure the northside will not be too far behind.

edbert

I work for a retirement/insurance company in the lending department. We provide benefits to Southern Baptist churches and other associated Baptist organizations since the early 1900's. We haven't really been affected by everything going on, other than a lot of people calling in asking what to do. Over the past 90 years they have never had to lay people off because of a poor economy, market downturns or anything else of that nature.

Jstas

Like Mr. Siegel, I work on the IT side of the house. But, if anyone knows anything about being in IT and doing database management, financials is a big part of it all. I used to work defense and regularly developed reports and such for financials for defense industry level numbers. These reports were generated regularly and I would review them for obvious errors before they were sent out.

Now I'm working for one of the largest HR Outsourcing, reinsurance and financial risk management companies in the world doing some real "Big Brother" type of stuff to beef up the privacy protection measures. But again, I get to see reports and other critical and confidential information. I am, of course, contractually obligated to protect the info and such so that is all I will say on it.

But overall, I'm just an amateur at the whole financials market. My interest comes from my abilty to recognize trends fairly quickly from my years of staring at financials reports and checking statistical math on embadded SQL and PL/SQL scripts. I found a small interest in it in college when I took the economics classes that were required and it just clicked. Needless to say, while my degree is a B.S. in I.T., all my elective courses were filled up with business courses. I took roughly 75% of what an undergrad business/management major would have taken in addition to my I.T. and MIS classes. So I have a fairly solid background which helps me understand what alot of the news stories are actually saying. I seem like I repeat alot of what is said in certain news articles but that is usually because I only write about the articles I agree with rather than teardown an article I don't agree with.

jdhdiggs

Let's see, I currently work for a consulting company doing international business devlopment... Before that, I was working to optimize network supply chains domestically in the US which involved a lot of business forecasting.

Technically, my masters and PhD are in "Mineral Economics" (which is what it says on the diplomas) but they are really in Operations Research and Managment Science.... Undergrad in "economics and business" (Along with an ME degree with minors in CE and EE) for what that's all worth.

Technically, that's not the financial field at all: When it comes to financial stuff, you should just ignore pretty much everyone here except Shack, who will generally advise you to go hire a real expert...

DollarDave

jdhdiggs wrote: »

....When it comes to financial stuff, you should just ignore pretty much everyone here except Shack, who will generally advise you to go hire a real expert...

Gee thanks, a couple of us with 20+ years experience appreciate the compliment. The OP didn't ask for advice, only wanted to know how many of us worked in the field. I probably wouldn't hand out any advice, but I am quite capable...

jdhdiggs

DaveMuell wrote: »

Gee thanks, a couple of us with 20+ years experience appreciate the compliment. The OP didn't ask for advice, only wanted to know how many of us worked in the field. I probably wouldn't hand out any advice, but I am quite capable...

Well, EXCUSE me, I forgot that I had your resume sitting right here and overlooked it... :rolleyes:

DollarDave

jdhdiggs wrote: »

Well, EXCUSE me, I forgot that I had your resume sitting right here and overlooked it... :rolleyes:

Good point, you don't have our resumes so don't pass judgement on our credibility.

jdhdiggs

DaveMuell wrote: »

Good point, you don't have our resumes so don't pass judgement on our credibility.

Can I pass judgement on the fact that you COMPLETELY missed the op's implicit point?

Jstas

jdhdiggs wrote: »

Technically, that's not the financial field at all: When it comes to financial stuff, you should just ignore pretty much everyone here except Shack, who will generally advise you to go hire a real expert...

That's pretty much why I don't offer advice. Just opinion, conjecture and assumptions on what's going on with the economy!

NotaSuv

jdhdiggs wrote: »

Can I pass judgement on the fact that you COMPLETELY missed the op's implicit point?

NO not here on Polkaudio.....we never change the the intended topic of a thread

I can say my brother who has a sr position with Wacovia is breathing alittle easier....driving around there were TONS of houses for sale and could only imagine the awful impact it would have to lose so many local positions...was also AMAZED at how much Charlotte has grown in a few years and getting the NASCAR site was a huge plus for the area.

Jstas

I read earlier that Wacovia was getting a helping hand from Mogan Stanley because they got converted to a bank holding company along with Goldman Sachs.

It gives those two alot more leeway to buy up commercial banks to put under their financial empire umbrellas to allow them to remain doing the investment work but have their own banks to manage the funding for the investing. That is an over simplified way of putting it but it essentially means that Wacovia and WaMu, two banks in deep doo-doo might get a reprieve without having to get bailed out. At least not directly.

Hawkeye

I by no means am a financial expert. What I find frightening is that MS and GS are now regular banks if I read this correctly. Since they have already raped and pillaged the investment side of the banking industry, what is to stop them from doing the same to the Main St. people who have their life savings now available to these thieves? They will raid the little guys accounts and pass the loss on to the FDIC.

Jstas

Hawkeye wrote: »

I by no means am a financial expert. What I find frightening is that MS and GS are now regular banks if I read this correctly. Since they have already raped and pillaged the investment side of the banking industry, what is to stop them from doing the same to the Main St. people who have their life savings now available to these thieves? They will raid the little guys accounts and pass the loss on to the FDIC.

Ummm...I dunno what you are reading but GS and MS are not involved in the bailout. They are doing just fine because they didn't go overboard with the high risk stuff. The only reason they are going along with the conversion of the other banks is because they didn't want to get killed by the ensuing lack of confidence from investors.

What they are essentially doing is taking their billions in deposits and finding a commercial bank partner to handle them. That way, they are only handling the investments, not the capital behind them. They are gonna let the commercial banks do it.

Mortgage lenders loaned massive amounts of money to homebuyers that they knew couldn't pay them back. But they figured "Hey, they don't pay, we take the house!" But this in turn caused a glut of new homes to be built and bought way out of financial comfort zones for many people. When the loans started defaulting, the number of houses on the market due to sheriff's sale or forclosure auction almost quadrupled and prices plummetted. There goes the financial backing to get the high-risk money out.

But the problem came from the lenders trying to stablilize the risk. They did this slicing up the debt load and selling it off to investment banks as "mortgage backed securities". What that means is that the interest payments are paid with the interest and principle payments of the loans extended to the high-risk borrowers. But the added value from the prosperity of the investmeents would also help the mitigate the risk ffrom the borrowers. Can you see where this is going?

Well the lenders then loaded on more mortgage based assets and in order to prop up the financial position and keep investor confidence high, they persuaded places like AIG to insure the risk.

So, the investments were built in to funds based on the payment scales of the high-risk loans. When borrowers started defaulting on the loans, the money flow dried up and the interest on the securities kept going up but the lenders were going in to debt by trying to keep up with the inteerest...which was driven by the growth of the housing market. That's a market bubble.

If you can't put 2 and 2 together here and see how it panned out, I'll finish. But, if an individual was to do something like this, it's embezzlement. But when a giant corporation does it, they get a bailout. Nice, huh?

I am soooooo glad I did not get one of those loans and didn't listen to what eveyone was telling me 4 years ago. I saw the numbers, I didn't know where the capital to offer the lending and rates was coming from and rightfully so. It wasn't coming from anywhere. It was all proped up with empty promises and vaopr. Just like the Tech Bust in 2001.

But MS and GS are not going to be able to rob the banks of the "little guy". They can't because of the way the laws work, especially the new ones put in place yesterday. Besides, if they snag these smaller banks to prop up investments (which is a valid, stable and smart way to do it) then they need these banks to stay solvent. They kill the bank, they cut their own feet off.

And the FDIC won't save anything, just what is in the individual accounts, as long as there is something in the Federal Reserve to cover it.

shack

Jstas wrote:

Ummm...I dunno what you are reading but GS and MS are not involved in the bailout. .

They reached a deal Sunday night that will allow them to become full fledged banks with a national banking charter. They can now open/own bank branches and have all the powers and products of a bank....not just a brokerage firm.

Hawkeye wrote:

Since they have already raped and pillaged the investment side of the banking industry, what is to stop them from doing the same to the Main St. people who have their life savings now available to these thieves? They will raid the little guys accounts and pass the loss on to the FDIC.

Not likely. They are National Banks now and are under the purview of the OCC (Office of the Comptroller of the Currency) as well as the FDIC. The rules of banking have changed dramatically in the last 24 months. Trust me when I tell you that these guys relish the opportunity to find anything wrong with the financial instiutions they oversee. The examiners are incented to wring out every little mistake, oversight, problem or issue they find. It is how they move up within the organization. They are taking particular delight in the problems of the banks today and are even more zealous in the examinations than in the past (which is maybe what they should have been doing all along!). What they were able to do under the scope of the SEC they will not be able to do as a national bank.

PolkThug

shack wrote: »

Housing/mortgages is still a huge problem.

I think we'll see another small hit around 2013 when the 10-year interest only ARM balloon payments are due.

Jstas

PolkThug wrote: »

I think we'll see another small hit around 2013 when the 10-year interest only ARM balloon payments are due.

DING!

Unless of course a moajority of those manage to refinance. But after this mess, I doubt the housing market is going to really start recovering until some time in 2011.

But hey, the world is going to end in 2012 apparently so it's all a wash, right?

Jstas

shack wrote: »

They reached a deal Sunday night that will allow them to become full fledged banks with a national banking charter. They can now open/own bank branches and have all the powers and products of a bank....not just a brokerage firm.

Yeah but they aren't going to be able to milk the banks dry otherwise they will be in a worse position than they are now.

ohskigod

Jstas wrote: »

DING!

Unless of course a moajority of those manage to refinance. But after this mess, I doubt the housing market is going to really start recovering until some time in 2011.

But hey, the world is going to end in 2012 apparently so it's all a wash, right?

rollin with the Mayans on that one eh? LOL