Is Merrill's Web move the "death knell" for fund companies
From The New York Post
Is Merrill Lynch's decision to all but eliminate commissions the "death knell" for the fund industry. That is the question asked by today's Post. The paper's thesis is that funds are losing sales to Americans buying stocks directly. With Merrill on the low cost bandwagon, fund companies most profitable customers may be the next to jump ship.

Merrill brokers sweat over paychecks
From The Wall Street Journal -- registration needed
The Wall Street Journal follows up yesterday's scoop on Merrill's plans to offer cut-rate Web trading with another series of stories. The most interesting solicits feedback from some of the broker's 14,800 investment consultants, each of whom typically earns $300,000, according to the article. They should expect a 25% haircut says Alan Johnson, who runs New York-based Johnson Associates. Merrill will compensate affected brokers with stock options. A second article outlines some of the technological and operational hurdles that Merrill will have to meet to make its December 1 launch date.

Registered Rep downplays Merrill's move, quoting a broker saying that Merrill already allows customers to trade for a fee under its existing Financial Advantage account.

The San Francisco Chronicle reports on Merrill's crossing the Rubicon from the the Silicon Valley viewpoint. Other than a quote from E*Trade CEO Chris Cotsakos foretelling that Merrill's branches will one day be fast food outlets, it adds little to the discussion.

E*Trade zigs while Merrill zags
From The Boston Globe
The impact of Merrill's move to offer web-based trading and rippled through the nation's press. Charles Farkas, head of global financial services at consulting firm Bain & Co., called the Merrill's move a "defensive" "me too" play in the Globe. Meanwhile, E*Trade took yesterday as an opportunity to expand its beachhead and take the battle to the banks. The erstwhile brokerage announced its intent to buy TeleBanc Financial Corp. of Arlington, Va., a Web-only bank with 11,000 accounts and $2.6 billion in assets, for $1.8 billion in stock.

The Washington Post offers home town coverage of E*Trade's purchase of TeleBanc. The deal was cooked up over sushi in a Palo Alto eatery.

The San Francisco Chonicle provides the home town coverage for E*Trade. It points out that E*Trade is paying $13.8 million for TeleBanc customer and that the bank has not ATMs.

The San Jose Mercury News unsurprisingly provides the most rah rah coverage of the deal.

Pioneer's CFO Quits
From The Boston Herald
John Boynton, 44, CFO of the Pioneer Group is resigning to start a consulting firm, the paper reports. His move is "amicable" and his own choice, it adds. Eric Reckard, 42, will take over for Boyton, who had held the post for just seven months. Pioneer's fund group earned $8.1 million last quarter, down from $9.5 million a year prior.

PBGH takes reigns from McCall
From The Wall Street Journal -- registration needed
For the second day running Pilgrim Baxter is the focus of a WSJ article. Pilgrim Baxter has been in a high profile legal fight with James McCall, manager of four of the company's funds. McCall, it seems, is trying to jump ship to Merrill Lynch and PBGH is arguing that he is still under obligation to the fund. Today the paper breaks the news that PBGH relieved McCall of his management duties on May 28, the same day the two parties met in judge's chambers. Gary Pilgrim and a "team" is handling three of the funds. Jeffrey Wrona is managing the core growth fund.

Putnam, Neuberger win as market rotates
From Investment News
The paper profiles Putnam Small Cap Value Fund as a winner as the market shifts out of growth stocks. Another winner, it says, may be Neuberger Berman LLP, which may again try to IPO and will launch a mid-cap value fund early next month and reopen its Genesis small-cap value offering to new investors. Its winners list also includes Pioneer Group, John Hancock Funds, Liberty Financial Cos., Brinson Funds, New England Funds and Scudder Kemper Investments. 

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