Wall Street's Engines Of Profit Are Slowing Down (NYT)
While the numbers will not be known until after the third quarter ends and financial companies begin reporting earnings in October, the pace of trading this summer was slow even by normal summer standards. Trading in shares listed on the New York Stock Exchange was down by 11 percent in July from 2009 levels, and August volume was off nearly 30 percent. “What’s happened in the third quarter is that after a very slow summer, people expected things to come back,” said Meredith Whitney. “But they haven’t, and the inactivity is really squeezing everyone.” Keith Horowitz, a bank analyst at Citigroup, said he expected Goldman Sachs to earn $7.8 billion in 2010, a 35 percent decline from the $12.1 billion it made last year. Mr. Horowitz had predicted Goldman would make $1.75 billion in the third quarter, or $3 a share; he now expects Goldman’s profit to total $1.34 billion, or $2.30 a share. For Morgan Stanley, his revision was even steeper, with earnings expectations revised downward to $140 million, or 10 cents a share, from $726 million, or 53 cents a share.
Ranks Of Women On Wall Street Thin (WSJ)
In the past 10 years, 141,000 women, or 2.6% of female workers in finance, left the industry. The ranks of men grew by 389,000 in that period, or 9.6%, according to a review of data provided by the federal Bureau of Labor Statistics. The difference is pronounced at brokerage firms, investment banks and asset-management companies. The figures suggest that women bore the brunt of the layoffs in the recent recession. But other forces are at play. Across the economy, computers have replaced junior, back-office workers, jobs that were largely filled by women. Since 2000, the number of women between the ages of 20 and 35 working in finance has dropped by 315,000, or 16.5%, while the number of men in that age range grew by 93,000, or 7.3%. The losses are steepest for the youngest women, including those just out of college. The number of women entering finance-industry jobs at age 20 to 24 fell 21.8% over the past decade. For jobs across all industries, the overall number of women in the work force was unchanged over the same period.
FBR's Miller Discusses Elizabeth Warren, Consumer Board (Bloomberg)
Banks are apparently "afraid" of Liz.
Elizabeth Warren Rides In (NYP)
Warren phoned a number of banking bosses, including Jamie Dimon, Vikram Pandit and John Stumpf, in an effort to ease tensions. "Vikram Pandit and Elizabeth Warren had a good conversation when they spoke on the phone [on Friday]," said a spokeswoman, in a statement to The Post. "Citi is very focused on helping consumers in our country and Vikram looks forward to working with Ms. Warren as she guides the development of this important new agency." A spokesman at JPMorgan confirmed that Warren caught up with Dimon in Russia, where he is attending a conference. Dimon is said to have described the conversation as a "constructive first move."
Goldman Casts Its Partnership Pool Wider (Telegraph)
The Brits' term for "de-partnering" is so much better: "defanging". Also: Although the number of new partners appointed is expected to be in the region of 100 – similar to 2008's intake of 94 people – the current 370-strong club of "partner managing directors" is expected to swell to the upper 400s.
Donald Trump Cut From Wall Street 2 (NYP)
"It'll be on the DVD," director Oliver Stone says. "I only cut it because it was distracting. He was at the end of the movie and all of sudden, 'Hey, there's Donald Trump!' Structurally, I think we put him in too late."
Greek Bank Stress Tests Delayed (FT)
The international community has postponed bank stress tests for Greece to give the country breathing space as Athens prepares to test the success of its European roadshow last week by raising more money in the capital markets. The so-called “troika” – the International Monetary Fund, European Commission and European Central Bank – has agreed with Greece’s central bank to delay testing the solvency of the country’s struggling bank sector by one month to the end of October.
MF Global Refashions Its Business Model (IDD)
"We are a broker on our way to being a broker-dealer on our way to being a full-line investment bank," the former U.S. senator and New Jersey governor told analysts and other market players this week at Barclays' 2010 Global Financial Services Conference.
Fantasia, Ex-Tudor, Theory, To SAC (FINalternatives)
Theory Capital Partners co-founder Carl Fantasia is set to join SAC Capital Advisors. The former Tudor Investment Corp. analyst will start at SAC on Oct. 1 and will work at the firm’s Boston office. Fantasia and co-founder Robert Broggi last month told investors they would close Theory, which launched just last year. The two cited fundraising difficulties; despite the support of former boss James Pallotta, who last year shuttered his own firm, Raptor Capital Management, the fund was never able to raise more than $20 million. To lure Fantasia, SAC reportedly promised him an analyst and about $300 million to play with.
The Angry Rich And Taxes (NYT)
Paul Krugman: "If you want to find real political rage — the kind of rage that makes people compare President Obama to Hitler, or accuse him of treason — you won’t find it among these suffering Americans. You’ll find it instead among the very privileged, people who don’t have to worry about losing their jobs, their homes, or their health insurance, but who are outraged, outraged, at the thought of paying modestly higher taxes."