Re: "total expense ratios rose"

Posted by JR on November 06, 2009 at 14:29:38:

In Reply to: Re: "total expense ratios rose" posted by Old Joe on November 06, 2009 at 13:52:12:

my only comment would be to this "you don't necessarily fire people".

all asset managers (may be with the exception of pimco) laid off people in this recession. some, like fidelity, made big announcements. others didn't. but you're right, there are buildings that are owned outright, equipment, and other fixed costs. in many examples, even if you vacate a portion of the building, you're still under the contract. you can't even sublet because THERE IS TOO MUCH OFFICE SPACE for all those who lost assets under management and people. oops.. did i digress?

: If the fund assets go down you don't necessarily fire people or trade less or need less space to rent, so the fixed costs don't change much. Of course the expense ratio will increase. Ratio is the key word here.

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Comments:	: my only comment would be to this "you don't necessarily fire people". : all asset managers (may be with the exception of pimco) laid off people in this recession. some, like fidelity, made big announcements. others didn't. but you're right, there are buildings that are owned outright, equipment, and other fixed costs. in many examples, even if you vacate a portion of the building, you're still under the contract. you can't even sublet because THERE IS TOO MUCH OFFICE SPACE for all those who lost assets under management and people. oops.. did i digress? : : If the fund assets go down you don't necessarily fire people or trade less or need less space to rent, so the fixed costs don't change much. Of course the expense ratio will increase. Ratio is the key word here.
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