Bank Businesses and Robot Traders

Banks.

One dumb way to think about the banking industry is that every so often a big scandal comes along and sets the tone for the entire industry, ruling everything that comes after like an astrological sign. Until the next big scandal comes along and the astrological influences change. So now we are under the Sign of the Wells Fargo Fake Accounts, and one effect of that sign is that retail banking is Bad and investment banking is Good. Wells Fargo, which used to distinguish itself from the other big banks by its retail focus and conservatism in investment banking, "disclosed on Friday that new account openings had taken a nose-dive since the scandal over illegal activity at the bank erupted." (I suppose in the past it would have made up for that drop in new accounts by opening fake ones, but that is now frowned upon.) But also on Friday, JPMorgan and Citigroup beat expectations for bond trading revenue, "a challenge to those who think fixed-income profits are mired in a steady, irreversible decline." See people thought that after the last scandal, but the stars are aligned differently now: