In these troubled times, independent broker/dealers have a unique set of issues. With margins thin to begin with and their reps hurting from the market’s travails and client reticence to invest, there are some who believe only the very large or the very niche-y B/Ds will survive. Then there’s Berthel Fisher & Co. With 350 representatives, it’s not on the large size, though it does have reps in nearly every state; because of its size, you might expect it to offer plain-vanilla investing vehicles, but it specializes in alternatives like REITs, oil and gas investments, and private equity; it’s based in the relatively small town of Marion, Iowa, but its executives and reps are anything but unsophisticated. On a visit to New York in January, founder and CEO Tom Berthel spoke to Editorial Director Jamie Green.

How are you coping with the crisis?

It’s the first time since 2001-2003 that people are scared and wondering what to do, but [a crisis] also creates lots of opportunities. In 2008 we had a record number of new account openings . . . mostly from wirehouses. Our alternatives have helped us–REITS, and oil and gas partnerships; at a time like this, cash flow helps. There are now some wobbles in the REITs–an outgrowth of the credit crisis. Some companies [in commercial buildings] are not renewing their leases.

And baby boomers are finally getting more conservative and moving toward cash.

Our 1031 business slowed down–to a screeching halt–as real estate sales went down. It accounted for 24% of our business, but we replaced it with new [lines of] business.

I assume there are other broker/dealers in trouble, and some have put themselves into a position that they have to grow, and thus have to acquire.

I’ve taken seven to 10 serious calls [about selling Berthel Fisher].

How are your representatives doing?

We say that it’s like football: if you’re not winning, it’s likely you’re not doing the fundamentals. Do you talk to your clients, do you service them?

Are you attracting reps to Berthel Fisher?

Recruiting went well in 2008. The ability to offer all those products gets brokers excited. We’re pretty profitable, though we distribute much of that to the employees. We have no debt; we were down about 8% last year [in revenue], so profits wore down a little bit.

How do you think we get out of this mess?

We wont’ see any improvement until liquidity improves, but the mortgage crisis did not reflect a poor state of the fundamentals of American business. It seems that the Midwest isn’t quite feeling the problem as much as everybody else. The farm economy has been strong, so there’s more confidence.

How do you feel about the new Administration taking power?

I’m optimistic, but I’d like to hear from Obama that it’s time to help people make more money, not just calls to tax the wealthy.