Breakingviews

Morgan Stanley growth plays 2016 version of Godot

April 18, 2016

The Wall Street firm’s $1.1 bln Q1 showing makes it unlikely CEO James Gorman will this year hit his 10 pct return on equity target. Even giving investors all the bank’s excess capital wouldn’t do the trick. Cost cuts might help, but higher earnings are taking forever to arrive.

John Gutfreund takes old Wall St model to grave

March 10, 2016

The ex-Salomon Brothers boss led investment banks from partnerships into prop trading – and ended up in a scandal. His era was, at least, one where bankers’ excesses didn’t put the system at risk. That lends his kind of risk taking a degree of perverse charm that will be missed.

Cox: Bloomberg’s White House hurdle is Wall Street

By Rob Cox
February 4, 2016

The media mogul mayor may yet try to be U.S. president. Hands down he’d be the richest contender ever. It would take extreme candidates Bernie Sanders and Ted Cruz as nominees for Michael Bloomberg to run. The bigger issue is that he’d have his deep ties to finance to explain.

Deutsche Bank risks its own “keep dancing” moment

January 28, 2016

Despite a rotten quarter in investment banking, Germany’s biggest lender will keep adding risk and rainmakers. CEO John Cryan is entitled to see fixed-income issues as cyclical. But in time his stance may echo ex-Citi boss Chuck Prince’s 2007 pledge to stay at the subprime ball.

Goldman and rivals’ pay cut may have bright side

January 20, 2016

Staff compensation at the Wall Street firm is 8 pct less on average than in 2014 and down almost 11 pct at Morgan Stanley. JPMorgan workers fared better but still took a hit. With share values way down, though, those paid in stock may get a great deal – barring another crash.

Too-big-to-fail cabal nursing $130 bln in damages

January 15, 2016

That’s the amount of market value swiped from the top six U.S. banks in the past two weeks. All but Wells Fargo now trade below book value. It’s not a reaction to lackluster fourth-quarter results, but a sign investors expect a year of pain. Whether they’re right is a toss-up.

Review: “Billions” delivers modest TV-time return

January 15, 2016

Wall Street finally gets a series for itself with an over-the-top clash between a hedge-fund boss and a federal prosecutor. Hard-to-depict high finance isn’t helped by hammy dialogue and storylines. It’s just enough fun, though, for a bros’ “Dynasty” meets “Desperate Housewives.”

Morgan Stanley revamp puts a CEO on the market

January 7, 2016

The Wall Street bank’s boss James Gorman has chosen Colm Kelleher as heir apparent, leaving wealth management chief Greg Fleming up for grabs. Kelleher may be the ultimate survivor, but Fleming’s skills may be of use to firms from BlackRock to Amex to U.S regional banks.

Wall Street’s pay reveal has germ of a good idea

January 6, 2016

U.S. banks now say how many of their staff in Europe earned 1 mln euros or more in 2014. Knowing that 1,107 bankers from the top five did so is no great surprise. But JPMorgan’s policy of cancelling bonuses if long-term return targets aren’t met could make pay more defensible.

The Fed may be cutting rates again within a year

By Rob Cox
December 17, 2015

With official U.S. money finally costing something, there’s a risk that market overreaction saps funding in emerging markets and hurts exports as global demand softens. While a swift retreat might be insignificant on paper, it would harm the central bank’s credibility.