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Have we finally reached bottom? Bloomberg reported late last week that Lehman expects to cut up to 1,000 jobs or 4% of its work force.

Things have been bad for months, but do you guys think in terms of cuts we've finally reached bottom or is there more pain to come?

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Comments (13)

  • John Mack's picture

    My estimate is that we are in the opening scenes of the second act.

    and what gives with the captchas? have you got a spam problem?

  • In reply to John Mack
    Cornelius's picture

    John Mack:

    and what gives with the captchas? have you got a spam problem?

    Yup. There have been about three spammers I've seen so far. One guy was posting his life story and questions on almost every thread. The other two were just writing random messages to jack up their points.

    But I agree, its only the second act. I expect to see more hiring freezes and more bloodletting. No one knows how bad its going to get before the end. I don't even know if we're anywhere near the climax yet.

    I wonder if it'll end like Hamlet where everyone dies. Majority of the BB CEO's have stepped down and one bank has passed away.

    I'm making it up as I go along.

  • In reply to John Mack
    WallStreetOasis.com's picture

    John Mack:
    what gives with the captchas? have you got a spam problem?

    hey John, yeah, we've had some problems with spam lately. The captcha should only prompt each user once...once you pass it once you shouldnt be asked to do it again.

    This is to prevent fake robot users (if they do sneak through) from crashing the site by posting 1,000s of comments on every thread in 1 minute. Hopefully it's not too annoying.

    Any thoughts on which bank will announce the next round of layoffs? ...assuming this is only the beginning of the 2nd act.

  • Clueless Wanderer's picture

    I think what would be more interesting is to know where the majority of the cuts will be occurring.

    Also, I can see Citi cutting next.

  • ST2008's picture

    Do you mean bottom in terms of layoff or the strength of the economy?

    I believe that once taxpayers get immediate tax reliefs in first half of 2009' and also once houses prices start to rise, you will see a rebound in the economy.

  • ideating's picture

    Yeah I would say we are at about the 40-50% mark in terms of write-offs. If you want to relate it to lay-offs, I don't know if it's 1:1 (i.e. at the 40-50% mark in terms of layoffs) but it should be in the ballpark.

  • John Mack's picture

    how many people on Wall Street got laid off in the great depression? That'll tell you when we're near the end.

    I vaguely recall a thread from last year when some posters gave me shit for predicting the second great depression. Well, we've just had the chancellor of the exchequer admitting that the UK economy is in its worst shape for 60 years, and I see this being repeated the world over.

    So, to answer the question who's next? All of them.

  • oasising's picture

    GS and JPM have been wielding the knife preemptively (and going deep I might add) despite the fact that they're among those that are in good shape. I can see the other bulges following suit pretty soon.

    What do you guys think about boutiques, especially the elites such as Lazard, Evercore, etc? M&A activity is still relatively robust and they don't have massive writedowns killing their P&L.

  • CompBanker's picture

    My incredibly biased opinion is that now is the time when you want to be in the middle market and not working at bulge brackets. While working long hours sucks pretty bad, the worst thing you can do is work long hours and not get any experience. Mega-deals have pretty much dried up while the MM is still going strong, just not as strong as 06/07. At the end of the day, experience trumps brand names (though both would be optimal). I imagine Lazard, Evercore, and similar elite boutiques are dipping down into the middle market, which would make them the optimal places to work right now.


  • In reply to ST2008
    yesman's picture

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