An upbeat note from Morgan Stanley chief and chair James Gorman, on the back of disappointing second quarter results out last night.
“Solid results….challenging market environment….subdued client activity….but…more constructive tone.”
The view from the trading floor is a bit less constructive, and goes like this: “Are they going to sack you or me?”
Post Covid investment banks decided it was possible to use their HR departments to do things other than shove people out the door.
Let’s ask our staff how they are doing, and let’s not go through that ridiculous hiring and firing frenzy ever time there’s a trading boom followed by an inevitable bust, they said.
Let’s cherish our people!
This cuddly phase was never going to last long.
Morgan Stanley paid out $308 million in severance costs for 3000 job cuts in the last three months alone.
Goldman Sachs, the bank that used to get cross at being called a great vampire squid but now wishes anyone thought it still had those sorts of killer instincts, reports results later today.
The debate on Wall Street is this: how bad will they be?
Goldman has already axed many thousands in New York and London but may not be done yet.
As for chief executive David Solomon, who moonlights as a DJ, questions are starting to be asked about whether he too should spend more time with his turntables.
I think we can assume a few more of his traders are going to have to dance out the door first, but the point remains: it’s grim out there.
If inflation does keep falling, interest rates follow and clients switch back to equities and away from bonds, things will look up.
Until then, it’s murder on the trading floor.
