Question-and-Answer Session
(Operator Instructions). Our first question will come from Robert Lee with KBW.
Robert Lee - KBW
Thanks. Good afternoon. One or two modeling questions first maybe. Just on compensation, obviously, you had the full impact I'm assuming the headcount reductions in Q2. Is there any reason to expect, assuming you can continue with the solid asset top line growth and performance, we shouldn't start to see that kind of at least trend up a little bit from these levels or do you expect this is kind of be where this is as you just keep a close tab on expenses for at least the next several quarters?
Ken Lewis
Thanks, Robert. I think that June is a pretty good quarter in terms of run rate reflecting the headcount reductions pieces. Most of that was behind us in the previous quarters, but of course, variable compensation's a big component of the compensation. So, that will fluctuate with revenue. So, if revenue does go up, you can expect that line to go up as well.
The only thing I'd mention is there's other expenses in there. So, that could have a little bit, I wouldn't say material, but a little bit of an upward pressure, things like compensation tied to the price of our stock, for example, could have upward pressure if the markets continue to go up.
Robert Lee - KBW
Okay. Maybe a question for Greg. You gave some tables and color on US versus non-US
business trends, but can you maybe give us a little bit of sense on at least from a retail perspective, how investors outside the US and in the US, and maybe compare and contrast them. Are you seeing investors outside the US start to come back and take more risks? Is there kind of a little bit more of a lag effect there? How do you think that would kind of play out?
Greg Johnson
I think there is bit more of a lag effect versus the institutional, but between the US and international for us, the reason you haven't seen the kind of turnaround in net flows outside of the US is because of the strength of fixed income within the US, and we really don't have the benefit of the muni funds and other fixed income products that really were the story for the last three or six months in our industry.
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