Try to read this extended whinge by Wall Street jackasses without wanting to break something:
“They’re not going to make the kind of money they wanted,” said William Hambrecht, chairman of San Francisco- based WR Hambrecht & Co., who designed the Dutch auction of Google Inc.’s 2004 initial public offering. “I’m not sure people really have come to terms with the fact that what we had was a financial bubble.”
New rules from the Basel Committee on Banking Supervision will more than double capital requirements for banks. Fixed- income revenue could fall 25 percent under a draft of the Volcker rule, which may outlaw so-called flow trading, according to an Oct. 10 note from Brad Hintz, a Sanford C. Bernstein & Co. analyst. Leverage has been cut by more than half at banks including Goldman Sachs and UBS AG, and an Oliver Wyman and Morgan Stanley (MS) report estimates that regulation may reduce returns on equity by 4 to 6 percentage points.
The new rules are the result of “societal objectives of a populist administration in Washington,” private-equity investor Wilbur Ross said in an e-mail. John Phelan, co-founder of MSD Capital LP, a New York-based fund that manages assets for billionaire Michael Dell, said “the whole capitalist system is being called into question.”***
Uncertainty didn’t stop some on Wall Street from profiting during the U.S. housing collapse, when Deutsche Bank AG trader Greg Lippmann helped create and profited from a multibillion- dollar market in subprime-based derivatives. He said Wall Street will have fewer exotic products to sell and trade, drawing an analogy to the popular no-reservations restaurant Torrisi Italian Specialties.
“No choosing, great food, low price, no pizzazz,” said Lippmann, co-founder of New York hedge fund LibreMax Capital LLC. “A couple of years ago, the hottest place to go would be someplace that they just spent $5 million decorating and they’ve got three or four models answering the phones. People want stripped-down now.”***
Options Group’s Karp said he met last month over tea at the Gramercy Park Hotel in New York with a trader who made $500,000 last year at one of the six largest U.S. banks.
The trader, a 27-year-old Ivy League graduate, complained that he has worked harder this year and will be paid less. The headhunter told him to stay put and collect his bonus.
“This is very demoralizing to people,” Karp said. “Especially young guys who have gone to college and wanted to come onto the Street, having dreams of becoming millionaires.”
I’ve always wondered where the assholes on HGTV shopping for their first home at the age of 25, and bitching about the appliances not being stainless steel or that the bathroom only has one sink came from. Now I know.