Golden Age: Are These Wall Street’s Good Old Days?

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Jan. 16 (Bloomberg) -- Bloomberg Contributing Editor Bill Cohan and Stephanie Ruhle debate what constitutes the golden age of Wall Street and the impact regulation has on firms’ ability to make money on Bloomberg Television’s “Market Makers.”

Is a shell of its former self.

Morgan stanley has a side business underwriting stocks and offering merger advice.

Citigroup and bank of america sold off classic wall street businesses to comply with.

Frank -- with dodd frank." bill cohen celebrity his 10 year anniversary of breaking free from the financial industry.

Ben is very smart about politics.

Guess what?

He is wrong about this.

Wrong-o! just like you don't want me writing about washington -- you don't want him in your backyard?

He has not educated himself about this.

It is a washington perspective.

In my view, this is the golden age of wall street if you can take advantage of it.

Goldman is how to take advantage.

Once jpmorgan get out of its litigation, $22 billion and counting -- hold on.

It is incredibly well-positioned to take advantage of the economy.

After jpmorgan just paid $31 billion?

You cannot say this is not a hit.

Some level of victory for the government.


I am inclined to side with bill.

I am in between.

We had an argument this morning.

I am skeptical that it is a golden age for wall street.

I look to your point about the folks who think washington won.

I look at goldman sachs's market cap, they have a market cap of $83 million.

Stock is down a bit, at its peak, its market cap was out $100 million.

If washington won, market cap would not be down 17%, it would be down 50%. if washington really won, jpmorgan would not be up twice six percent -- up 26%. the economy is improving, they are well-positioned to take advantage of investment banking services, money management, all the things.

There cost of capital is close to zero.

What would you rather be, a goldman sachs pre-ipo partner 12 years ago or goldman sachs -- 15. or a partner today?

Either today.

-- either.

It was not bad to be a partner pre-ipo, you got $300 million for your stock.

Now, when it was pre-ipo, it had a problem with cost of capital, very expensive to get private capital.

Other firms our public had greater access to capital.

There were a lot of reasons they went public, greed being one of them.

You can still make 10 million to $20 million being a goldman sachs partner, that is pretty good, risky not of your own money.

We rather be steve schwarzman or jamie dimon?

Who has more money?

We are slicing -- we are not.

Really thin.

0.01% of the 0.01%. in terms of conversation, would you rather be working at goldman sachs where you don't have to risk any of your own capital, get paid $1 million a year or whatever.

Or a teacher in the new york city schools -- the teacher versus goldman sachs are two different things.

Neither person is risking any capital.

The golden age was 2001, not today.

If you are a high deals trader at goldman sachs today -- it will be again.

I came into wall street in september 1987, one month later, the market crash.

I saw grown men crying.

We thought it was over.

Wall street constantly reinvent itself.

There is less competition now.

The people who are smarter going to make money -- watch out.

If i am a distressed debt trader today and i have a great idea, do i went to be at blue crest capital, a hedge fund, or at goldman sachs?

I don't want to be at goldman, they are going to say give it to a customer because you cannot take risk any more.

What's your point?

It was a golden age seven years ago.

Still pretty great.

Both of you might be right.

Now is not the golden age for credit on the sell side, now the buy side.

In the equities business, goldman is hitting it out of the park.

In the m&a business, you want to be at goldman sachs.

Or lazard.

I work at lazard, they probably make more -- a senior m&a guy at goldman sachs makes more.

You know better than me.

Wall street business as and flows, what is hot one year is not hot the next.

That is why they have a portfolio business.

Goldman sachs is going to figure out how to deal with the regulatory environment, they going to start minting money.

The return on equity will improve because they're going to cut compensation -- i am not saying they're not going to figure it out.

But right now with what the department of justice has done, with how much pressure they have on them to regulate -- they have done nothing to change the basic business model.

What are you talking about?

They cannot take risk anymore.

I am not sure about that.

What does the volcker rule really mean?

You're not seeing a trading desk take risks, the equities division never takes risk.

They are no longer in -- in the fourth quarter of this last year about goldman sachs posse private equity investment, they were supposed to one point $5 billion, they did over $2 billion.

They sold off a lot of their private equity and jerry walked out.

They have a deep bench, they will figure out -- figuring it out and the golden age are two different things.

If i could be a partner at goldman sachs right now, except for the fact that i have been liberated, i would do that.

Give them a call.

This was fun.

This text has been automatically generated. It may not be 100% accurate.


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