How are those credit default swap obligations said to be in the neighborhood of $56 Trillion coming along?

"I welcome comments from those who can explain why they keep their money with a commissioned broker."

good question, Prof Cohan.

despite some success as a stock trader, i thought i was too impulsive to handle the 'real money' and decided to rely on a broker i liked, a 'professional'. i hadn't even thought of a for-fee advisor.

i now realize that this guy i trusted probably recommended that my 'cash' go into ARPS for the lousy 1/4 point it got him. now that i've looked over everything else, i see he also recommended extremely expensive mutual funds.

when i'm on my own i check out every detail, but when i'm relying on an advisor it seems i am less careful. these 'full service' firms say we're paying all their fees to get expert advice, and now they say we should have read the fine print. which is it?

never again. bye bye Merrill, hello Fidelity.

Wall Street has worked hard at trying to make itself irreplaceable. They've created instruments that are so complicated, it's almost impossible for a non-professional to understand them (and woe to those of us who don't understand what they sold us!).

I've tried to learn how to evaluate banks -- just so that I won't end up with CDs from banks about to go bankrupt (like Indymac, a popular investment bank pick) -- but it's a struggle.

I'm prepared to take on the responsibility, but sooner or later, I'll want professional help -- and I'm not even sure I know how to evaluate a certified financial planner.

Peter, I took all my money out except ARS in April.
I never felt better knowing my money do not help the bottom line of UBS (United Bandits of Switzerland) http://sergebirbrair.com/UBS.html

This is the honest to gods truth, whatever that is worth nowadays. I was not educated about brokers, in fact I was completely ignorant what the title Vice President, Financial Advisor meant. At the age of 49, this is the first time I ever met a Financial Advisor, let alone a Vice President of the third largest bank in the nation. Look what happened to us? I did not realize that this country is full of crooks that lie and steal peoples money. Never in my wildest dreams did I ever think something like this could happen to people that put their money in a bank.



I became friends with this person because I bought her car while I was taking care of my mother in law, that was terminally ill at the time.

Through the bond we shared of her father just dying and my mother in laws failing health, I thought this person was a genuine soul with a good heart and I trusted her completely with my cash.

She had the talk, did the walk, had the salespitch. I honestly thought my money was in UBS bank and was told it was backed by $500,000.00 S.I.P.C. , triple A rated, you know the drill.

I am not a sophisticated investor, I didn't even know what the words securites, fund companies, even meant. Even reading the confirmation notes, I had no clue what any of it meant, I just believed and trusted that this FA had my best interest at heart and would never do anything to jepardize my life savings.

I had no reason to believe that I was being lied to. I didn't know the difference between a commissioned broker or any kind of broker.

I have never invested in stocks, and this person was well aware of this and took advantage of this fact.

I have learned something in these past 5 months, thanks to all of these evil people, I now will never trust another person with a title that has anything to do with any kind of bank.

Oh, by the way the answer to your question.

I do not have any money with any commissioned brokers except for the one and only that burned me in UBS.

Peter, good question....

I took all my money out of UBS in April (except ARS) and feel VERY good about it. I don't know how people can trust this institution.
http://sergebirbrair.com/UBS.html
In my opinion today UBS is the weakest link of the International Banking System.

Peter...Good article..I bot $50000.00 of New Jersey Student Loan bonds from Fidelity in Boston in April 2008...I paid $50,000.00 for the bonds...On my May 2008 Fidelity Statement ,Fidelity listed the value of these bonds...at Zero...thats right...Zero...Fidelity should change their name to Pirate for selling me these toxic investments...Thanks...Mike Sullivan....

Peter..Good article...I bot $50,000 New Jersey Student Loan Bonds in April 2008 from Fidelity in Boston...Paid $50,000...On my May 2008 Fidelity statement..Fidelity listed the Bonds value at ZERO...thats rite Zero..Fidelity advised me to keep trying to sell them at auction dates...No luck there...All auctions have failed...and I am told months prior to my purchase...All auctions on these TOXIC bonds had failed...Michael Sullivan

Fidelity Brokerage Services had on their Municipal Reset Web page NJHESSA.This stands for New Jersey Higher Education Student Loan Authority.The only thing that may be Municipal about these bonds is that the word New Jersey is placed in front of Higher Education Student Loan Authority.In other words these are NOT Municipal resets.Fidelity misplaced & misrepresented exactly what these secutities were.I purchased along with a friend the total amount of $200000 on 4-28 & 4-29-08.Approx 3 days later Fidelity called me & said the securities are valued at ZERO.It is hard to imagine that Fidelity had no knowledge of the toxicity or the cancer like terms that these bonds were being called in the financial markets.It will take a government agency to raid or subpoena the Fidelity offices to see exactly what Fidelity knew & when.If they knew nothing they are negligent,If they knew something & did not share the information they are trading before their customers money which is illegal.

Alan,

I'm in the same boat with the NJ HESSA, bought from Fidelity.

However, they are in fact "municpal bonds." Have you read the indenture? It's over 300 pages long, available at

http://emma.msrb.org/Default.aspx

just put in the CUSIP from your Fidelity account.

HESSA is an agency of the state of New Jersey, it's not as though these were private sector student loans. If these weren't considered muni bonds, you wouldn't find them at EMMA.

My question is, does UBS have any liability as the issuers of these bonds?

Futhermore, I'm sure you realize these bonds are tax exempt. What other bonds are tax exempt other than "municipal" bonds?

Good news followup...

Spoke to a Fidelity rep today, asked him whether the UBS settlement applies to UBS as a broker (i.e. just UBS retail brokerage clients) or whether it applies to UBS as underwriter (of the NJ HESSA).

He told me he it applied to UBS as underwriter, so we should be able to exit our positions by the end of October.

Additionally, there is talk of a "global" settlement.

http://www.thestreet.com/s/global-deal-near-in-auction-rate-probe-report/newsanalysis/banking/10433194.html?puc=googlen&cm_ven=GOOGLEN&cm_cat=FREE&cm_ite=NA

Type in Auction Rate Securities Take Prompt Action.In An article written by Heidi Turner the fifth paragraph down Nygaard Esq. says Student loan authorities are not municipal bonds but were sold as municipal bonds.They are actually long term bonds issued by private companies & quasi public authorities.The cover of the offering statement seems to distance itself from the State of New Jersey as far as taxing powers,debt or liability as to repayment.This is nothing more than a corporate junk bond & should have been listed as a secondary non investment grade bond investment.Emma is a Pilot project & refers to itself as a work in progress.I along with you do hope that the settlements by the various attorney generals will extend to the broker dealers e.g. fidelity who had to purchase these from the larger broker underwriters that are in the process of working out various settlements.

Fidelity spends millions of dollars on tv commercials callling themselves advisors, consultants & planners.Fidelity has a name that is around for a long time.There is a lot of good will built into the name.Like Cartier or Tiffany it is reasonable that when a customer enters their retail stores to buy a diamond or gold they expect that when they left the store they bought gold or diamonds.To find out later that you bought a cubic zirconia or gold plated jewelry is filled with misrepresentations & misplacement of merchandise & somewhat if the vendor knew this fraud.In Fidelity's case I relied on thier website as my due dilligence.At one time Fidelity offered 600 what was listed as Municipal resets.There had to be more than 1000 Municipal resets.If Fidelity listed only 600 I expected that Fidelity went through the others & left them off of the web page because they may have had negative issues & were not suitable for investment. A few days after I purchased the NJHESSA resets I received a call stating the bonds were going to be valued at Zero.Did Fidelity own these in their own inventory?The only way to find out is if an Attorney General subpoenas their inventory records.It is possible that traders from UBS called Fidelity & told them to move these out.The Mass. A.G. did read emails from UBS that explained this as a disaster waiting to happen.How is it possible that Fidelity did not know the toxicity of this issue?Didn't Fidelity speak with the people from Inter Active Data Corp? The question is what Fidelity knew & when.If Fidelity did not know that other brokers were calling these bonds cancerous then they are negligent.These NJHESSA bonds should not have appeared as late as 4-28 & 4-29 -08 on Fidelity's web page.These are not Municipal resets in the common sense of the word.They appeared on the Municipal Reset Page of Fidelity.This publication was misplaced & misleading.I hope along with many others that the attorneys general of each state get a global or uniiversal settlment that all holders should be bought out & made whole.The settlements should include ALL persons that hold these Auction Rate Securities.

I can add some more details on the Fidelity situation. Fidelity has a "high net worth" fixed income desk. This desk has FAs who advise "high net worth" clients. The folks put me into several SLARs. They told me that the failed auctions would have to start working again - or the SLARs would be "called" - since the penalty rates were so high. These FAs had no absolutely clue themselves about the fact that the penlaty rates were high only temporarily and would later reset to very low rates. In fact, when the first SLAR reset to 0, they were completely surprised. I was the person who told them about this provision. It was after my conversation with Fidelity that Fidelity removed SLARs from its website, and added the (inadequate) warning. So, Alan, I can personally prove that Fidelity had no clue about what they were selling - this is on recorded conversations, and I have folks who will confirm this.

As all of you who bought from Fidelity know, your trade confirmation statement states clearly "solicited trade". Fidelity marketed the SLAR from its own inventory on its website.

So far, Fidelity has refused several requests to redeem the SLARs. Apparently, few people know about this part of Fidleity's business so they do not care. In fact, my account executive has hinted that if we all join forces and make this more widely known, Fidelity will be forced to listen.

I am very interested inhearing from others in the same situation with Fidelity. I will be happy to exchange my phone number / e-mail and work collaboratively with folks. I have some decent contacts in the media (and the US Congress), so if we join forces, I am sure we can get some attention.

Maybe we should start a separate thread ???

Alan said,The Financial Advisors at Fidelity's fixed income desk were mostly clueless about auction rate securities.Either they were instructed not to say much or they were uneducated & poorly trained in explaining the product when asked questions.I remember talking to some of their advisors who told me that the NJHESSA were insured & rated AA.Never was I told that the dollar amout of these bonds could be ZERO.I relied on their comments & what I found published on the Fidelity Municipal Auction Rate Securities Web Page & then purchased.It is unfortunate that these NJHESSA bonds are not Municipal Bonds in the common sense of the term Municipal Bonds.They are basically corporate junk bonds & have nothig to do with the State of New Jerseys taxing powers. When I spoke with an attorney from the Mass.A.G. office who was involved with the filing of the complaint vs.UBS I was specifically asked if I knew that Fidelity sold me these bonds from their own inventory.Your comments above state that Fidelity was selling NJHESSA & other Student Loan Bonds from their own inventory.This is illegal & called fronting the customers order.The Mass.A.G. attorney would I assume like to have this information.Fidelity knowingly,willfully & intentionally published NJHESSA & other SLARS on their web pages which thier customers relied on causing thier customers instant financial damages.If they didnt know they are negligent.From what I have been hearing on CNBC the Settlements do NOT include Fidelity account holders

Alan and hmpierson:

I have personal, first-hand knowledge of the goings-on at Fidelity. We should connect to discuss our next steps. Clearly, Fidelity has decided that since it is not in the limelight, it will not do anything. I am happy to speak to the Mass AG - do you have the contact number?

Alan, you are correct. Look at your trade confirmation - it will say "solicited order".

I have personal, first-hand documented knowledge that can help the Mass A.G. in investigations. In fact, it is very likely that if asked, my client executive will corroborate everything. They had no clue - as I mentioned, I am the person who brought this to their attention. After my phone call to their VP, they immediately removed the SLARs from their website the next day.

How do we organize and highlight Fidelity's misconduct? I am happy to do what is needed here. I am currently out of the country, but would like to speak with you when I return.

Serge, perhaps you can help start a thread on this on your website?

Does anyone has contact details for the Mass AG or NY AG investigating Fidelity?

Hi, I'm a reporter with a leading newspaper, looking to speak with people who believe that they were mis-sold ARS by Fidelity and other smaller brokers. Fidelity has said they were not "actively marketing" these securities. If you are someone who can shed light on this issue, please email me at supershef@gmail.com.
Thanks!
S.A.