9/10/10

I was reading an article in the WSJ titled " Wall Street Layoffs: Meredith Whitney's Case for a Bloodbath". When I came across this paragraph it didnt make me feel warm and fuzzy considering I was wanting to break into the industry upon graduation. What are the thoughts from those in the industry regarding her prediction?

"Layoffs are coming. Layoffs are coming. Forget those high-profile hires , such as CIT Group's former CEO Jeff Peak landing at Barclays or American International Group's former chief Martin Sullivan going to the Willis Group, the legions of lower level traders, analysts and salespeople may be in for a rude awakening. Whitney expects lay offs of 40,000 to 50,000, or 5% to 10% of the U.S. securities industry."

Comments (10)

9/10/10

No more prop, no more pop...what did you think FinReg was about?

http://www.jasonbondpicks.com
9/10/10

I want to be optimistic, but it looks pretty bleak, especially for sales&trading. M&A banking and private equity should be fine, since there's been a lot of M&A and buyout activity going on.

S&T, however, is a different beast. The financial regulation bill has forced a lot of banks to either transfer traders over into asset management divisions or get rid of them altogether. For example, Credit Suisse laid off 30% of its prop desk, and JP Morgan is getting rid of it entirely. Anecdotally, a friend of mine is starting his second year at Chicago Booth MBA, and he said trading jobs were VERY tough to get.

9/13/10

I knew banks were getting rid of prop desks but I didnt read her comments as Prop although she doesnt specify.

9/13/10

We shall see.

Jack: They're all former investment bankers who were laid off from that economic crisis that Nancy Pelosi caused. They have zero real world skills, but God they work hard.
-30 Rock

9/13/10

Depends what kind of trading you're talking about. As other posters above said, prop trading is going away at many of the major banks.

At my bank, we're increasing our sales force. You're going to see a growing trend in trading, where it's harder and harder to make a profit as commissions are getting squeezed. With commissions being cut bymany of the major institutional players, the only way banks can remain competitive and keep their revenues high is by hiring a larger sales force.

In reply to iBANKhard
9/14/10
iBANKhard:

Depends what kind of trading you're talking about. As other posters above said, prop trading is going away at many of the major banks.

At my bank, we're increasing our sales force. You're going to see a growing trend in trading, where it's harder and harder to make a profit as commissions are getting squeezed. With commissions being cut bymany of the major institutional players, the only way banks can remain competitive and keep their revenues high is by hiring a larger sales force.

Hey, it makes sense that to rebuild a client-facing trading practice, you'd want to hire more brokers to bring in flow. Two questions:
1) any more client-servicing traders being hired?
2) how is it looking for MBAs? Or are only undergraduates and experienced hires getting love?

9/14/10

I'm interested in doing sales coverage for a desk. iBank, do you have any suggestions on where I should look? Anybody know what the outlook for sales is like?

2/1/11

Bump, would like to hear comments on the 2nd question from jtbbdxbnycmad. What about for MBAs that are attempting a complete career switch into trading (from a non-finance background)?

2/1/11

prop only traders are a fairly low percentage of the total amount of traders. And prop is just going to be mixed in with flow. I know of a couple desks that are called 'flow XYZ" but are basically prop desks that price stuff for clients on the side.

Its kind of like if you have strippers and prostitutes, but you know strippers also do a bit of 'prop' in the back rooms. If you make prostitution illegal you will just see a larger focus of prostitution within strip clubs.

2/1/11

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