It's official. According to CNBC Goldman Sachs has inaugurated the second
stage of Wall Street's development after Dodd-Frank and the Volcker Rule. The first post-reform stage was the
transformation of proprietary trading units into market-making trading units.
Before Volcker, Wall Street firms risked their own capital
trading securities with counterparties. After Volcker, Wall Street firms risked
their own capital trading securities in anticipation and reaction to customer
order flow. The old way was to ask: "how can we make money by reacting to
market events?" The new way is to ask: "how can we make money by
reacting to customer reactions to market events?"
No comments:
Post a Comment