Wall Street Sees Record Revenue in ’09-10 Recovery From Bailout

[TomClash]

Source: Bloomberg

Dec. 13 (Bloomberg) -- Wall Street’s biggest banks, rebounding after a government bailout, are set to complete their best two years in investment banking and trading, buoyed by 2010 results likely to be the second-highest ever.

The five largest U.S. firms by investment-banking and trading revenue -- Goldman Sachs Group Inc., JPMorgan Chase & Co., Bank of America Corp., Citigroup Inc. and Morgan Stanley -- will likely have a better fourth quarter than the previous two periods, driven by equity underwriting and higher volume in stock and bond trading, according to data compiled by Bloomberg. Even if this quarter only matches the third, the banks’ revenue will top that of any year except 2009.

The surge has come after the five banks took a combined $135 billion from the Treasury Department’s Troubled Asset Relief Program and borrowed billions more from the Federal Reserve’s emergency-lending facilities in late 2008 and early 2009 following the collapse of Lehman Brothers Holdings Inc. Since then, the firms have benefited from low interest rates and the Fed’s purchases of fixed-income securities.

“This is a once-in-a-lifetime opportunity for most of these banks, and I think they’ve recognized it as that,” said Charles Geisst, a finance professor at Manhattan College in Riverdale, New York, who has written about Wall Street’s history. “The profits they’re making now will allow them to replenish their capital and take care of the other things they need to do.”

That may include beginning to return more of their profits to shareholders. The Fed issued guidelines last month on how it will decide whether large U.S. banks may increase dividends and buy back shares.

Read more: http://noir.bloomberg.com/apps/news?pid=20601087&sid=ayEx8NSV7lwY&pos=1

[hedgehog]

1. What I don't understand is why New York State is still in such a bind,

since so much of the state's revenue is from Wall Street.

[rfranklin]

4. Can't tax them too heavily because they might leave the city...

Intriguing idea...hear all the Wall Street types into Siberia.

[TomClash]

7. Actually they go anywhere they want

They can be anywhere because they can trade from their modified desktop.

[TomClash]

6. The bonuses aren't being paid in cash

And the number of employees shrank significantly.

[progressoid]

2. Woo Hoo! Some of that is going to start trickling down soon!

It'll be a Goldman shower!

[Octafish]

3. A golden Goldman shower.

Who is Henry Paulson?

[Arctic Dave]

10. ROFL. Duzy!

[Bigmack]

5. And these assholes call it capitalism!... nt

[ixion]

8. gee, it would have been nice for Main St. to get a bailout

instead, Main St. is still sucking big time.

[midnight]

9. In spite of bailed out banks record profit the pain will be inadequately shouldered on the

on the working class.... I guess that is Reganomics..... Only the debt is shared and profits are privatized...

[Gin]

11. the fact that they were, and are, rewarded for crashing our economy

is part of my anger at the administration...nobody paid for anything except the tax payers......then insult to injury were piled on..and the beat goes on.