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Bank of America Pull International Offers

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Re: Bank of America Pull International Offers [#permalink]

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New post 09 Mar 2009, 16:11
refurb wrote:
falibay wrote:
H1-B are elligible to receive unemployment benefits so I am not sure if it does reduce the unemployment statistics.


Once they lose their jobs, H1-Bs have 10 days to leave the country.

They don't get to collect unemployment.

RF


I have not looked at the laws, but my friends in that position have been able to collect unemployment and have had at least 2 months to get out. Firms do pay unemployment taxes for them so it would make sense.

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New post 09 Mar 2009, 16:27
refurb wrote:
falibay wrote:
H1-B are elligible to receive unemployment benefits so I am not sure if it does reduce the unemployment statistics.


Once they lose their jobs, H1-Bs have 10 days to leave the country.

They don't get to collect unemployment.

RF


Thinking about it, I think my friends were on their notice period and severance so, still on the company payroll. Some of them have collected unemployment benefits but that may not be legal... Not sure there.

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Re: Bank of America Pull International Offers [#permalink]

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New post 09 Mar 2009, 16:28
My reaction to this is that BofA (and perhaps others to follow) is just looking for excuses to cut costs. They probably concluded in some strategy/planning meeting that they are 10/20/50% overstaffed for the coming months. They will definitely have to lay people off, but a lot of the incumbents have guaranteed severance and stuff like that that makes them more expensive to let go. It's simply cheaper and easier to just tell people not to show up for work (even if they've already paid out signing bonuses and such). In this case, I think the internationals are just an easy target and given the challenges in the economy, a group that can be targeted with minimal backlash.

I agree that in terms of adding long-term value to the company, this is a terrible idea; but that is a separate issue altogether. If you cut spending now (on talent, capital expenditures, maintenance, whatever), it will show up in your business down the road. The problem is that banks are fighting to stay alive and considering what is going to happen in the next few months, not the next few years. Any company with a long-term outlook should be drooling at the talent they can get their hands on in this market, top candidates that in normal years would be inhaled by the banking industry that can be the basis of real competitive advantages down the road; but few companies have the luxury of looking out more than a few months.

It really sucks for international students. They're just caught up in a situation that nobody knows how to control (not unlike people at failed firms and others).

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Re: Bank of America Pull International Offers [#permalink]

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New post 09 Mar 2009, 16:42
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Probably wont win fans with this but in my opinion the system is broken. Tons of of them go to Indian outsourcing firms, say what you want but often those dont pay the same. Microsoft gets the most of any US company and they typically pay the close to if not the same wage. Studies have shown the indian companies pay 10k+ less than the prevailing wages for the same job. This artificially lowers the pay for all people in certain jobs. If you are a software engineer (even an H1B holder), thanks to these outsourcing companies you most likely are losing thousands in pay over what US companies would pay. Companies dont have to prove they are paying the visa holder the same they would be paying an american, they just have to say they are...and they dont have to prove they can't find an equally qualified american to fill the position. There have been numerous people have spoken out against the way the system is put together including U of Chicago's own Milton Friedman who won a nobel prize in economics so I would say he is a pretty smart guy.

Its pretty clear that the visas arent going to only the best and the brightest and its time to come up with a new way of giving them out. A better system would be more along the lines of the UK's point system for highly qualified workers. Create lists of the top 50 schools world wide for different degrees thats are in need and put them at the front of the line. Give preference to people who get degrees in the US and have student loans to pay back. Decide which degrees and careers are the most valuable for us...Personally someone going to a top 20 business or engineering school in the US should immediately get a visa when they graduate. They just spent 100k+ trying to get these degrees and they want to pay them back and since they occupied a seat at a highly competitve school we should want them to stay here. Instead of allowing companies like Infosys and Wipro come over and get 10k visas for jobs they will pay people 60k for instead of the going rate of 80k.
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Re: Bank of America Pull International Offers [#permalink]

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New post 09 Mar 2009, 16:49
Senator Shelby was on Sunday morning talk show and he said instead of helping the big banks, we should just "bury" them if the bank is in trouble. How is shutting down few big banks going to solve this crisis when the unemployment rate is high already, and consumer confidence is affected by this high unemployment rate?

This is the second time I heard a high profile US senator made a comment like this recently.

Are they making these comments just for attention or are they really radicals?

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New post 09 Mar 2009, 16:56
i think river got it right, as much as i love infy/wipro et al i personally know the 60k/80k is one of the chief reasons why there is some anger over h1b. However, when someone (my friend) who leaves his infy/wipro job, instead pursues MS at a top 10 (UPenn) univ and then interns at a top I-bank (Barclays) and receives the job offer at the same wage as an american- only to be transferred (thank god -not laid off) to another country as he didn't win the lottery for an h1b visa- that sucks and that hurts.

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Re: Bank of America Pull International Offers [#permalink]

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New post 09 Mar 2009, 18:48
riverripper wrote:
Probably wont win fans with this but in my opinion the system is broken. Tons of of them go to Indian outsourcing firms, say what you want but often those dont pay the same. Microsoft gets the most of any US company and they typically pay the close to if not the same wage. Studies have shown the indian companies pay 10k+ less than the prevailing wages for the same job. This artificially lowers the pay for all people in certain jobs. If you are a software engineer (even an H1B holder), thanks to these outsourcing companies you most likely are losing thousands in pay over what US companies would pay. Companies dont have to prove they are paying the visa holder the same they would be paying an american, they just have to say they are...and they dont have to prove they can't find an equally qualified american to fill the position. There have been numerous people have spoken out against the way the system is put together including U of Chicago's own Milton Friedman who won a nobel prize in economics so I would say he is a pretty smart guy.

Its pretty clear that the visas arent going to only the best and the brightest and its time to come up with a new way of giving them out. A better system would be more along the lines of the UK's point system for highly qualified workers. Create lists of the top 50 schools world wide for different degrees thats are in need and put them at the front of the line. Give preference to people who get degrees in the US and have student loans to pay back. Decide which degrees and careers are the most valuable for us...Personally someone going to a top 20 business or engineering school in the US should immediately get a visa when they graduate. They just spent 100k+ trying to get these degrees and they want to pay them back and since they occupied a seat at a highly competitve school we should want them to stay here. Instead of allowing companies like Infosys and Wipro come over and get 10k visas for jobs they will pay people 60k for instead of the going rate of 80k.

Pretty accurate, except for two things.

1. Assuming that an international who has an MS/MBA from a top 20 school is smarter than someone who does not. i have lived my life around engineers (including ones from IITs) and I have never come across anyone who would chose a top 20 MS over a top 50 w/$$. The simple reason being that it is unaffordable. If you are talking of big debts in dollar terms, imagine how big they are in rupee or <<insert any other currency with lower value>> terms. I know a lot of smart people who could not even afford the application fee + FedEx $$ + air fare which alone comes to several thousand dollars. These people are smart and can definitely add value to the US despite not having an MS/MBA.

2. How does having a debt qualify a person for a job or a Visa? You are talking strictly from a student's point of view. If you look at it from an employer's POV, he/she couldn't care less about somebody's debt. If it happened, it would be more sympathy than merit. You knew about the debt when you started school. The best person should get the job, student loan or not.

Other than that, I do agree that a lot of IT companies abuse the H1 system.
PS1: You is not You as such. You = international student with debt.
PS2: I come from India.

Last edited by mba07 on 09 Mar 2009, 19:02, edited 1 time in total.

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New post 09 Mar 2009, 18:57
riverripper wrote:
Companies dont have to prove they are paying the visa holder the same they would be paying an american, they just have to say they are...and they dont have to prove they can't find an equally qualified american to fill the position.

A better system would be more along the lines of the UK's point system for highly qualified workers.


Well companies do have to prove they are paying the prevailing wage and they have to prove they can't find a qualified US citizen. You can argue that the process of proving these things is broken (which I would agree with), but the fact remains they do have to "prove" it.

I don't necessarily think the point system is much better. Canada uses the point system and has a ton of qualified people immigrate each year who end up working menial jobs because there are no positions for them. I actually think the process of linking up immigrants with actual jobs is a better way of doing things.

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New post 09 Mar 2009, 21:25
refurb wrote:
riverripper wrote:
Companies dont have to prove they are paying the visa holder the same they would be paying an american, they just have to say they are...and they dont have to prove they can't find an equally qualified american to fill the position.

A better system would be more along the lines of the UK's point system for highly qualified workers.


Well companies do have to prove they are paying the prevailing wage and they have to prove they can't find a qualified US citizen. You can argue that the process of proving these things is broken (which I would agree with), but the fact remains they do have to "prove" it.

I don't necessarily think the point system is much better. Canada uses the point system and has a ton of qualified people immigrate each year who end up working menial jobs because there are no positions for them. I actually think the process of linking up immigrants with actual jobs is a better way of doing things.

RF



The problem is that the prevailing wage is really low for most competitive position. The "prevailing wage" considers the average position in the US. So bank's prevailing wage are understated by 40-50%, which leaves some room to underpay H1-B. I think I was slightly underpay because i was on an H1-B (Doesn't everyone think they are underpaid? :) ), but it was way higher than the prevailing wage.

The process needs fixing but it does not change the fact that recruiting the best, whatever the origins makes economic sense.

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New post 10 Mar 2009, 00:09
My friend who works for B of A as an I-banking analyst just got let go this week.

It makes sense they will pull offers of employment, if they are laying people off....

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New post 10 Mar 2009, 08:06
my question is this: why would you want to go to BofA right now anyways? Why would you go to any ibank (aka US govt) if you can find a better option? Ibanks are not what they used to be.

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New post 10 Mar 2009, 08:13
sonicjiafei wrote:
my question is this: why would you want to go to BofA right now anyways? Why would you go to any ibank (aka US govt) if you can find a better option? Ibanks are not what they used to be.



yeah but right you take whatever you have... If BofA was thinking about establishing a IBanking franchise, that's not the way to go...

What I don't understand is the fact that they specifically target International students. I know it is easier to do that but I would not have issues if it happened across the board. If they were to do that on merit or need within their business.

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Re: Bank of America Pull International Offers [#permalink]

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New post 10 Mar 2009, 08:31
Well, the primary reason companies such as Microsoft and Google make for wanting more H1B visa is that America do not have enough talents for the Demand of market. And they need to interview certain number of candidates to justify it. That's why I think that Google have full time people who just do interviews to turn people down. So they can go to Congress and say "I interview 500 people and they're not qualified, we need foreigners!"

With 8.1% of unemployment rate, it's hard to justify hiring more H1B.
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New post 10 Mar 2009, 08:35
sonicjiafei wrote:
my question is this: why would you want to go to BofA right now anyways? Why would you go to any ibank (aka US govt) if you can find a better option? Ibanks are not what they used to be.


Now I don't want to burst your bubble, but going to business school doesn't mean you pick your company and your job. When only 1/30 applicants get an offer in the field you recruit in, you take what you get.
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Re: Bank of America Pull International Offers [#permalink]

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New post 10 Mar 2009, 08:40
hskillet79 wrote:
Well, the primary reason companies such as Microsoft and Google make for wanting more H1B visa is that America do not have enough talents for the Demand of market. And they need to interview certain number of candidates to justify it. That's why I think that Google have full time people who just do interviews to turn people down. So they can go to Congress and say "I interview 500 people and they're not qualified, we need foreigners!"

With 8.1% of unemployment rate, it's hard to justify hiring more H1B.



Yes, companies have dedicated people for these interviews. You have a case for finance where the US has a lot of talent but for science/engineering that's a much harder claim. Look at the Top CS and EE program in the nation and most of their Master/Phd students are foreigners. It is not like you can't find an American to do the job; it is just that their are not the top in their fields (on average).
I would argue that GOOG, MSFT, INTC would want the top Phd students from MIT and Stanford regardless of origin and regardless of unemployment rates. If not , you will just let them go back home where they will contribute and compete against GOOG, MSFT...

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Re: Bank of America Pull International Offers [#permalink]

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New post 10 Mar 2009, 09:48
falibay wrote:
hskillet79 wrote:
Well, the primary reason companies such as Microsoft and Google make for wanting more H1B visa is that America do not have enough talents for the Demand of market. And they need to interview certain number of candidates to justify it. That's why I think that Google have full time people who just do interviews to turn people down. So they can go to Congress and say "I interview 500 people and they're not qualified, we need foreigners!"

With 8.1% of unemployment rate, it's hard to justify hiring more H1B.



Yes, companies have dedicated people for these interviews. You have a case for finance where the US has a lot of talent but for science/engineering that's a much harder claim. Look at the Top CS and EE program in the nation and most of their Master/Phd students are foreigners. It is not like you can't find an American to do the job; it is just that their are not the top in their fields (on average).
I would argue that GOOG, MSFT, INTC would want the top Phd students from MIT and Stanford regardless of origin and regardless of unemployment rates. If not , you will just let them go back home where they will contribute and compete against GOOG, MSFT...



Maybe that's also part of the problem, people who are well educated and extremely smart being turned down at masters and Phd's so because the schools are filled with international students. I think 1 problem is that although a US degree opens doors for internationals, International degree mean virtually nothing in the US (with very few exceptions). So american students are pretty much locked into studying within the US, while students in China and India have most of asia, north american, europe, and australia to choose from.
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New post 10 Mar 2009, 09:51
Signs of changing times I'd say. Authorities in US have always known that H1B and L1B are much abused visas, but they kept blind eyes because they needed foreign workers. However, with economy in recession, there is no need for additional workforce, and so witchhunt has begun.

Lets accept the fact that foreign workers are welcome only when needed; domestic needs/interests will always take precedence. Developed world bandies about globalisation and scorns at protectionism only when it needs to do so.

International who consider such expensive education/investment as MBA from US/UK business schools must appreciate potential down-sides, and seriously reconsider before taking the plunge.

Disclaimer : Am currently on H1B.

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Re: Bank of America Pull International Offers [#permalink]

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New post 10 Mar 2009, 10:06
GoBruins wrote:
falibay wrote:
hskillet79 wrote:
Well, the primary reason companies such as Microsoft and Google make for wanting more H1B visa is that America do not have enough talents for the Demand of market. And they need to interview certain number of candidates to justify it. That's why I think that Google have full time people who just do interviews to turn people down. So they can go to Congress and say "I interview 500 people and they're not qualified, we need foreigners!"

With 8.1% of unemployment rate, it's hard to justify hiring more H1B.



Yes, companies have dedicated people for these interviews. You have a case for finance where the US has a lot of talent but for science/engineering that's a much harder claim. Look at the Top CS and EE program in the nation and most of their Master/Phd students are foreigners. It is not like you can't find an American to do the job; it is just that their are not the top in their fields (on average).
I would argue that GOOG, MSFT, INTC would want the top Phd students from MIT and Stanford regardless of origin and regardless of unemployment rates. If not , you will just let them go back home where they will contribute and compete against GOOG, MSFT...



Maybe that's also part of the problem, people who are well educated and extremely smart being turned down at masters and Phd's so because the schools are filled with international students. I think 1 problem is that although a US degree opens doors for internationals, International degree mean virtually nothing in the US (with very few exceptions). So american students are pretty much locked into studying within the US, while students in China and India have most of asia, north american, europe, and australia to choose from.


if the goal of US universities is NOT to be institutions of excellence that's the way to go. Reduce the # of international students. Competition for internationals at top schools is even harder. When I got rejected by MIT for my master, I received a letter saying the international pool was especially competitive and that we are encouraged to apply to other programs.

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Re: Bank of America Pull International Offers [#permalink]

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New post 10 Mar 2009, 12:49
Lot of good discussion going on in this thread..

But, I want to add some research that has been done regarding the benefits that H1Bs provide to US economy.

This is the commentary from the Economist: (Note: I do realize that this might be a copyright violation, but in interest of adding value to this discussion I hope the mods will understand :-)

Give me your scientists…
Mar 5th 2009
From The Economist print edition

Restricting the immigration of highly skilled workers will hurt America’s ability to innovate

Illustration by Jac DepczykJOE BIDEN, America’s new vice-president, is prone to gaffes. In 2006 it was the turn of some Americans of Asian descent to take offence at his comment about needing “a slight Indian accent” to go to a 7-Eleven or a Dunkin’ Donuts in Delaware. Mr Biden’s defence was that he was trying to compliment the immigrant group on its entrepreneurial zeal.

Many Americans are less favourably disposed towards immigrants. And rising unemployment is hardening attitudes. In the hubbub over the insertion of “Buy American” provisions into President Obama’s fiscal-stimulus package, the Grassley-Sanders amendment was largely overlooked. This restricts the freedom of recipients of federal bail-out money to hire high-skilled foreign workers under the government’s H-1B visa programme. Some people were delighted at what they saw as a significant, if small, first step in cracking down on those who they fear crowd skilled American workers out of the workplace. But others contend that such restrictions could dull America’s edge in innovation, just when it is needed to help revive the economy.

Mr Obama says that part of the solution to America’s economic problems should come from its universities and research laboratories. Yet these institutions in America are now manned disproportionately by immigrants, who made up 47% of scientists and engineers in America with PhDs, according to the 2000 census. Immigrants accounted for two-thirds of the net addition to America’s stock of such workers between 1995 and 2006. Their role in innovation may seem obvious: the more clever people there are, the more ideas are likely to flourish, especially if they can be commercialised. But although contemporary theories of growth emphasise the importance of ideas, they assign no special role to immigration. Economists have tended to think of innovation as driven by the demand for better goods, which generates a need for skilled innovators. People’s choices of career and education should respond to the labour market’s demands, encouraging more of them to become innovators if needed. But because career choices cannot be expected to adjust instantly, there might be scope for skilled immigrants to fill the gap.

Addressing these issues requires data on just how inventive immigrants are, a question that until recently was the province of educated guesswork. But William Kerr, an economist at Harvard Business School, used name-matching software to identify the ethnicity of each of the 8m scientists who had acquired an American patent since 1975. He found that the share of patents awarded to scientists born in America fell between 1975 and 2004. The share of all patents given to scientists of Chinese and Indian descent living in America more than tripled, from 4.1% in the second half of the 1970s to 13.9% in the years between 2000 and 2004. Nearly 40% of patents filed in 2005 by Intel, a silicon-chip maker, were for work done by people of Chinese or Indian origin. Some of these patents may have been awarded to American-born children of earlier migrants, but Mr Kerr reckons that most changes over time arise from fresh immigration.

What of the criticism that these workers are displacing native scientists who would have been just as inventive? To address this, Mr Kerr and William Lincoln, an economist at the University of Michigan, used data on how patents responded to periodic changes in the number of H-1B entrants. If immigrants were merely displacing natives, increases in the H-1B quota should not have led to increases in innovation. But Messrs Kerr and Lincoln found* that when the federal government increased the number of people allowed in under the programme by 10%, total patenting increased by around 2% in the short run. This was driven mainly by more patenting by immigrant scientists. But even patenting by native scientists increased slightly, rather than decreasing as proponents of crowding out would have predicted. If anything, immigrants seemed to “crowd in” native innovation, perhaps because ideas feed off each other. Economists think of knowledge, unlike physical goods, as “non-rival”: use by one person does not necessarily preclude use by others.

…and your huddled mathematicians
But does all this emigration from the developing world harm the originating countries’ capacity for innovation? A new paper** uses data on the patents cited by scientists working in India in their applications to America’s patent office. It finds that proximity does matter: Indian patent applicants refer to research by people in India much more often than they cite work by those elsewhere. In that sense, having many scientists leave India does harm innovation there. But Indian researchers also refer to scientists of Indian origin in America more than very similar work by scientists with whom they do not share ethnic ties. So a scientific diaspora gives countries of origin a leg-up in terms of access to the latest research, mitigating some of the problems of a “brain drain”. And given that the same scientist is likely to be more productive in America than in a developing country because of better facilities and more resources, immigration may help overall innovation (some of the benefits of which may flow back to firms in poorer countries).

Over time, knowledge flows between countries, and innovations in one place may benefit people elsewhere. So in the long run it may not matter where research takes place. Nonetheless, innovation benefits from clusters. Until there are Silicon Valleys all over the place, the world (and not just America) would be better off if American firms could hire the best people regardless of where they come from.


Also, check out these 2 papers that document research in this issue: (I have attached these papers in the post)

William Kerr and William Lincoln, “The Supply Side of Innovation: H1-B Visa Reform and US Ethnic Innovation”. HBS Working paper 09-005, December 2008.

** Ajay Agrawal, Devesh Kapur and John McHale, “Brain Drain or Brain Bank? The Impact of Skilled Emigration on Poor-Country Innovation”. NBER Working paper No. 14592, December 2008.
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File comment: William Kerr and William Lincoln, “[b]The Supply Side of Innovation: H1-B Visa Reform and US Ethnic Innovation[/b]”. HBS Working paper 09-005, December 2008.
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File comment: Ajay Agrawal, Devesh Kapur and John McHale, “[b]Brain Drain or Brain Bank? The Impact of Skilled Emigration on Poor-Country Innovation[/b]”. NBER Working paper No. 14592, December 2008.
Impact_Skilled_Emigration_on_Poor_Country_Innovation.pdf [217.61 KiB]
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Re: Bank of America Pull International Offers [#permalink]

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New post 10 Mar 2009, 13:28
falibay wrote:
The problem is that the prevailing wage is really low for most competitive position. The "prevailing wage" considers the average position in the US. So bank's prevailing wage are understated by 40-50%, which leaves some room to underpay H1-B. I think I was slightly underpay because i was on an H1-B (Doesn't everyone think they are underpaid? :) ), but it was way higher than the prevailing wage.


I'm sure there are some companies that underpay H1-Bs, but in my company, your level of pay was completely independent of immigrations status.

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Re: Bank of America Pull International Offers   [#permalink] 10 Mar 2009, 13:28

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