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April 1, 2001

More Stock Traders Pound the Pavement

By Sanford Wexler

In a sign of the shaky stock market, a trading firm that weathered the 1987 market crash without firing anyone has now announced plans to reduce staff.

Bear Stearns is handing out pink slips to about 400 employees, or about four percent of its staff, as it tries to ride out the current storm. A "small number" of traders will be among the group, said a Bear spokesman.

While half of the eliminated jobs will be from Bear's information-technology group, layoffs are expected in other departments, including the firm's sales and trading operations.

Aldo Parcesepe, who heads up Nasdaq trading at Bear, contended that there are seats available at the firm for "good traders" though he acknowledged that current market conditions are not helpful.

The sluggish market has prompted several big firms to reduce their head counts in recent months, including Credit Suisse First Boston, J.P. Morgan Chase & Co., Merrill Lynch, and Prudential Securities. Morgan Stanley is also scaling back.

The employment outlook for equity traders is uncertain. "We've had cutbacks in almost every industry in the past several months. It is not surprising that the financial services industry has not escaped," said Lee Korins, president of the Security Traders Association. "We may even see a few more [cutbacks] before it all turns around again."

Alan "Ace" Greenberg, Bear Stearns's former chief executive and now chairman, back in 1987 told employees in an internal memo that Bear is "hiring instead of firing" as other firms were swiftly axing employees.