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Even more Wall Street employees are getting fired as a result of the subprime crisis. Merrill Lynch said today that it has begun clearing out executives with connections to risky mortgages, including its global head of fixed income, Osman Semerci, his deputy, Dale Lattanzio, and the former co-head of institutional securities, Dow Kim.
Merrill is following the example of other U.S. banks with high subprime exposure. Yesterday, Bear Stearns announced plans to cut 310 jobs in its mortgage lending business. Earlier this week, Morgan Stanley said it would ax 600 residential mortgage employees, mainly sales and administrative staff.
Now what? Well, Merrill’s Kim plans to start his own hedge fund. If that’s not an feasible option, you might take solace in this piece of advice from BusinessWeek columnist Liz Ryan.
BusinessWeek editors Chris Palmeri, Prashant Gopal and Peter Coy chronicle the highs and lows of the housing and mortgage markets on their Hot Property blog. In print and online, the Hot Property team first wrote about the potential downside of lenders pushing riskier, "option ARM" mortgages and the rise in mortgage fraud back in 2005—well ahead of many other media outlets. In 2008, Hot Property bloggers finished #1 in a ranking of the world's top 100 "most powerful property people" by the British real estate website Global edge. Hot Property was named among the 25 most influential real estate blogs of 2007 by Inman News.