Question-and-Answer Session
Operator
(Operator Instructions) The first question comes from the line of Mike Carrier – UBS.
Mike Carrier – UBS
First a question on the costs. When we are looking at the different buckets I know there is going to be some noise that you gave related to comp next quarter but primarily the other buckets, when we are looking at IT, advertising and other, X the seasonality you mentioned you had sort of a pretty good run rate given the current environment and if things were to worsen do you have some more flexibility there?
Gregory Johnson
I think the answer is in those specific line items probably a pretty good run rate if you adjust for seasonality there in the IT line and advertising line. With regard to the second question there is some flexibility in those line items particularly the IT line item if things were to get worse.
Mike Carrier – UBS
Part of the biggest shift in terms of flows that we saw was in the international fixed income bucket. Just wondering, granted there were outflows pretty much across all of the sectors or buckets during the quarter for the industry but I’m just wondering when you look through the products in that bucket whether certain things and certain customers you were really exiting? Because on the institutional side when you look at the total flows it doesn’t seem that it was all fixed income. So any granularity on that and if you expected to sort of moderate to more normal levels?
Kenneth Lewis
It is hard to say. I do expect it to moderate because I think if you look at the flow activity it really correlates with what is happening in the financial services sector capital markets and when you get the headlines it is almost immediate on the retail side. If you look at the industry flows in the quarter any kind of bond fund that was long-term, global bond funds, high yield munies, there was a very rough period there and there was a flight to quality and if you have another period and people run to treasuries you might see another blip in that but I think that was more of a one-term and I think the trend is improving and I think it is not something that people are abandoning. What I think is it is the most attractive sector that exists today.
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