On paper, things look sound.
Banks have a lot of money in its coffers, merger mania seem to be opportunistic instead of desperate, large Wall Street firms have made strong earnings since the Crash of '08 and people seemed cautiously optimistic at last weeks' SIFMA trade show. On a personal note, the Metronorth train to Manhattan is packed every morning with people racing to work.
But with all this good news, why are things so bad?
Today, US jobless claims rose by 9,000 in the week that ended on June 18 to 429,000, according to the US Department of Labor. According to a news report, "The level of claims exceeded the highest estimate in a Bloomberg News survey in which the median projection called for 415,000 filings. The number of people on benefit rolls was little changed, while those getting extended payments rose."
One would think that high finance would be immune to layoff jitters but this is sadly not the case. This week Morgan Stanley saw a round of layoffs of a number of positions with one estimate being around 400. The NYTimes Dealbook quoted a Morgan Stanley rep saying "we have no plans for cuts in our institutional securities business (IBD, FID or equity)."
In other sobering news, there might be even more layoffs of Wall Street. According to Reuters:
Challenger, Gray & Christmas, an employment consulting firm, said the financial sector has outlined 21 percent more job cuts so far this year than it did in 2010. Banks, insurance firms and brokers have outlined plans to eliminate 11,413 positions through May...
So, is this the new normal? It might be as we enter a jobless recovery where firms bounce along, stocks go up and down, consumers are cautious and firms have periodic layoffs to make their (sometimes outrageous) margins.
One thing is certain, if you're lucky to have a job then you are very busy these days. After all, you are doing the work of at least three people.
Carry on. Phil Albinus is the former editor-in-chief of Advanced Trading. He has nearly two decades of journalism experience and has been covering financial technology and regulation for nine years. Before joining Advanced Trading, he served as editor of Waters, a monthly trade journal ... View Full Bio